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attacking rirato strongholds, patrolling and pursuit of ·

Firate craft that is, in action beyond the resources of private individuals. The onus of a merchant ship's internal

18.

de fenco has always been laid on the owners themselves.

In the China Seas, where labour is cheaper and trade more plentiful than elsewhere, it is not unreasonable to expect firms benefiting from these conditions, to pay for armed protection, which, it might be claimed, becomes necessary to no small degree by reason of the employment of the cheap labour, since a vessel carrying a European

cr ew could not he pirated. Further, the cost of Native guards is comparatively small expense.

19.

Naval and Military guards may come to le regarded

as a kind of Government subsidy and must be strongly deprecated as creating a precedent which will lead to endless dissension. For instance, certain firms regi stered in the United Kingdom pay full Imperial income Tax, while others only pay lo cal taxes. One firm which claims that 11 the Government has a 20% interest in our activities" may be expected to resent a firm, only paying indirectly towards the maintenance of the fighting forces, getting equal consideration.

Again, a line which has the ini tia tive

to organise its own guards would be penalized.

20.

Military guards have, so far, only been allotted

to certain coasting firms. There are however, a number of lesser firms, owned by Priti sh or Hong Kong Chinese, competing with the larger Companies and it would be difficult to refuse them should they plead for equal treatment. Again, British-owned shipping in the West River might claim military protection, and

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