PUBLIC RECORD OFFICE
Reference :-
TEC.O. 882
376
as is the case in France and Germany, and other countries with adjoining frontiers. His Excellency, however, could not well understand why Hong Kong was suggested as the place for the head office; why not Canton ?
Mr. Ross.-Hong Kong was regarded as the most convenient centre, and as the final terminus of the line.
Mr. Wen.-Canton would be quite as suitable.
Mr. Ross. Possibly if His Excellency had drafted this working agreement he would have inserted Canton as the most suitable place for the head office. The point was one which would have to be very carefully considered, and if the advan- tages, after close examination, were found to be equal in every way, perhaps, as in the case of the Federal Capitals of America and Australia, it might be found necessary to select some neutral spot, say on the Kowloon frontier, where general meetings could be held.
The Deputies then said they would like to discuss all the foregoing points with the Viceroy, and take his instructions thereon. A meeting was arranged for the following day at the same place and hour.
NOTE. Read over to Deputies at meeting on 29th March, they agreed the foregoing accurately described what passed at meeting of 28th idem.
{
R. TEBBITT.
C. H. Ross.
MINUTES of 4th Meeting with Viceroy's Deputies, held at the British Consulate- General on Thursday, 29th March, 1906, at 3 p.m.
Present:-
Taotais Wei, Wen and Kung, representing the Viceroy of Canton. Mr. R. T. Tebbitt, His British Majesty's Vice-Consul, and Mr. C. H. Ross,
representing the British and Chinese Corporation, Limited. Mr. Ross read the minutes of the meeting held the previous day, a copy being given to each Deputy.
Mr. Wen said these minutes accurately represented what had taken place, but they had since seen the Viceroy, who instructed them to say that they had not correctly stated his intended proposals.
His Excellency had now placed in writing the terms on which he was prepared to negotiate, and if the Corporation's representative was not authorised to discuss such terms, he begged him to submit them to London for consideration of his principals.
Mr. Wen then handed to Mr. Ross a copy of these proposals in English and Chinese, pointing out that in the hurry of translation the numbering of the para- graphs in the two translations did not correspond.
Mr. Ross, having read the proposals, said he had no authority to discuss them. If the Deputies were not prepared to negotiate on the basis of the draft Agreement he yesterday handed theni, he must return to Hong Kong and inform the Corpora- tion that such was the case.
Mr. Wen suggested that the terms should be submitted to the Corporation, who might, he thought, with certain modifications possibly see their way to accept them as a basis for further negotiations.
The Deputies said they would be pleased to meet the Corporation's representa- tive again, and, if he would inform the Consul-General by wire of the date of his return to Canton, they would arrange to meet him at the Consulate-General.
C. H. Ross.
377
4. The post of engineer-in-chief for the construction of the railway is to be filled by an Englishman. The posts of assistant engineers are to be taken up by English, Chinese and Japanese, who are completely qualified for the work.
5. Before the entire principal of the loan has been paid off, an Englishman is to be employed to supervise the accounts.
6. Both the engineer-in-chief and the English supervisor of accounts are to be recommended for employment by the creditors, and are appointed only with the consent and approval of the Director-General.
7. After defraying the expenses for operation, all the receipts from the railway are to be deposited in the Hong Kong and Shanghai Bank, which deposits will be used to repay the principal and interest of the loan.
8. In addition to those railway materials procurable in China, similar materials may also be purchased from England, provided that such materials are of the same quality and at the same price as similar materials from other foreign countries.
If the materials from other foreign countries are cheaper in price and better in quality than the English, they may also be purchased from such other foreign
countries.
Enclosure 4 in No. 246.
Note of an interview with Mr. J. O. P. Bland, 9.30 a.m., April 2, 1906.
He professed ignorance of any cause of difference between himself and Mr. Scott, and desired, should such difference exist, that it should not prejudice negotiations. I told him that he had better see Scott as soon as possible and talk matters over with him, and that I did not think personal matters would interfere with his actions with Mr. Scott in the matter of the railway,
He explained to me the different interests in the British and Chinese Corpora- tion, and said he was instructed to work with the representatives of both interests, i.c., of the Hong Kong and Shanghai Bank and of Messrs. J. M. and Co.-the interests of the shareholders of the Corporation being always paramount.
He was of opinion that if it were possible to avoid a deadlock in the Canton- Kowloon negotiations by concessions, this might assist the Corporations affairs in other directions.
I told him that the clause of the draft Agreement giving the Corporation one- fifth net profits-redeemable by paying one-fifth of amount of loan, i.e., £300,000—.. seemed to me to press unduly on the Chinese.
He answered that it was only by giving the net profit certificates to the public that it had been possible to float the Shanghai-Nanking Loan, and that the Corpora- tion in that case had made nothing out of them.
cent.
He appeared to think that the Corporation would sooner yield the 5 per commission on materials in return for an agreement for share of construction under new conditions than the 20 per cent. net profits.
I showed him the Viceroy's last proposals.
I then suggested that he should proceed to Canton, see the Viceroy's Deputies, point out that the draft Agreement was to be the basis of negotiation, and ask them
to go over each clause of it, and indicate any objections they had to it. He would then, after discussing the matter with the Bank and with J. M. and Co., here make proposals for modifications, which I should back up to the Colonial Office, if the Corporation at home would not accept them.
I added that I should make the acceptance of the joint Working Agreement a condition of concessions in the Loan Agreement.
A
M. N.
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
6PUBLIC RECORD OFFICE, LONDON
8 B
CANTON-KOWLOON RAILWAY.
Viceroy of Canton's proposals, as made on 29th March, 1906.
1. To borrow a loan of one million pounds sterling, which is to be delivered in three instalments.
2. Before the construction of the railway is completed, the Salt Gabelle of Kwangtung is to be hypothecated for the loan."
3. Repayments of the principal on the loan will begin as soon as five years have elapsed after the completion of construction of the railway.
Enclosure 5 in No. 246.
Mr. BLAND to Sir MATTHEW Nathan.
DEAR SIR MATTHEW NATHAN,
Hong Kong, April 3, 1906. WITH reference to our conversation of this morning, and in compliance with your request, I append copy of the instructions communicated to me to-day by the Directors of the British and Chinese Corporation.
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