Left at the Ministry of Foreign Affairs

On May 20th, 1940.

38

His Majesty's Consul-General at Canton reports

that although the Japanese Authorities have stated that the

Pearl River is being reopened, they are making it dependent

upon certain demands. Among other things they demand

agreement to the stationing of a detachment of gendarmerie in the compound above Messrs. Butterfield and Swire's wharf,

the reason given being to prevent smuggling into unoccupied

China. Until this proposal is accepted the memorandum of

April 12th regarding permission for British ships to carry

cargo will not be put into force. It also appears that

lighter and stevedore monopoly has been established which

claims the sole right to transport goods from ship to

Messrs. Butterfield and Swire's own godown and will not

allow the firm's own coolies to handle them. Mr. Toller

has protested orally to his Japanese colleague against this

attempt to extend Japanese control over British shipping under the guise of a step towards opening the river and has

refused to entertain the demand, stating that the immunity

of British property is a matter of principle.

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