-4-
to be the case also with such European-controlled companies
as the Great Eastern Life Insurance Company Limited, and
to preclude the appointment of Chinese citizens as agents
or managers of its branches in China will certainly prove
an unjustifiable hardship upon genuine British or genuine
Straits-born Chinese Companies.
5. I am also at a loss to understand why it is
proposed that a company operating in China without the
Ambassador's Licence, or infringing the rules governing
the issue of such Licences, shall be dealt with by penal
action in the Consular Courts resulting in the imposition
of fines or in the issue of winding-up orders. It would,
in my opinion, be sufficient penalty if diplomatic and
extraterritorial privileges were withdrawn from any
offending company.
6. The object of framing rules for the grant of
licences is to differentiate between companies which are
genuinely British and those which are not. I have indi-
cated above certain ways in which the rules, as prepared
by the Ambassador, would not be acceptable under local
conditions. I venture also to suggest as a general pro-
position that, whatever rules may be finally decided upon,
they should be sufficiently wide and general in their scope
to permit the judging of individual cases on their own
intrinsic merits. I submit that the local Government
is the best judge of what is a genuinely British locally-
incorporated company, and I would therefore urge strongly
that an Ambassador's licence should in no circumstances be
refused to such a company without prior consultation with
this Government.
I have the honour to be, Sir,
Your most obedient, humble servant,
71
GOVERNOR'S DEPUTY.