[This Document is the Property of His Britannic Majesty's Government, and should be returned to the Foreign Office if not required for official use.]

FROM

CHINA.

Sir M. Lampson. (Peking).

Decypher.

May 3rd, 1929.

D.

3.40.p.m. May 3rd, 1929.

No. 398.

R. 11.35.a.m. May 3rd, 1929.

12

IMPORTANT.

Following received from Hongkong No. 8 May 1st.

Secret.

Your telegram No. 37 April 29th: Commercial Treaty.

Colonial Office has sent full text of draft en-

quiring if Hongkong can accede and, if not, what modi-

fications Hongkong considers desirable. This despatch

only reached me on April 15th and I at once coll-

sulted confidentially British members of Chamber of

Commerce and China Association. But the merchants con-

cerned are unwilling to advise without consulting their

Shanghai offices. Even on receipt of British merchants'

views I shall advise with considerable misgiving as

Chinese merchants of colony are at least as much con-

cerned. But as long as the draft remains confidential

it is impossible to allow disclosure beyond Chinese

members of Council whom I have asked to advise me. Copy

of my despatch will be sent you as soon as the draft is

settled and I trust you will not open negotiations until

you receive it.

In addition to scheme for customs bonds (Article

18) to which I return below, Chamber of Commerce desire

to explore possibility of payment of tariff duties in

Hongkong and issue of clean pass into China as is now

done...

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