PUBLIC RECORD OFFICE
| | || | || || | || ||||||||
Reference :--
C.O. 882
9
PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-
COPYRIGHT PHOTOGRAPH-NOT TO
502
commence from the date of issue of this loan, and to terminate upon its complete redemption.
ARTICLE 13.
All materials of any kind that are required for the construction and working of the railway or of any branch lines whether imported from abroad or from the provinces to the scene of the work shall be exempted from lekin so long as such exemption remains in force in respect of other Chinese railways. The bonds of this loan, together with their coupons and the income of the railway, shall be free from imposts of any kind by the Government of China.
ARTICLE 14.
It is agreed that during the time of the construction of the railway the interest on the bonds and on any advances made by the Corporation is to be paid from the proceeds of the loan. The accruing interest from any proceeds of the loan not used during the period of construction, and the earnings derived by the Chinese Govern- ment from the working of any sections of the railway as they are built are to be used to make up the amount required for the payment of the said interest, and if any deficiency remains, it is to be met from the proceeds of the loan.
When the construction of the railway is wholly completed, the interest on the bonds is to be paid from the income or earnings of the railway received by the Chinese Government every half-year on the first day of June and the first day of December. It is hereby agreed that the amount required for the payment of interest and the repayment of principal, together with a sum of one-quarter of one per cent. on such accounts to cover commission to the Hong Kong and Shanghai Banking Corpora- tion, who are hereby appointed agents for the entire service of repaying the loan shall be paid to them in Hong Kong fourteen days before the due dates in sycee sufficient to meet such payments in sterling in London, exchange for which shall be settled with the Hong Kong and Shanghai Banking Corporation at the most favourable rates.
The Chinese Government unconditionally undertakes and hereby promises to pay the principal of the loan and the interest on the loan on the due dates fixed therefor. If, at any time, the earnings of the railway, together with funds available from the proceeds of the loan, are not sufficient to meet the interest on the bonds and the repayment of capital in accordance with the amortisation schedule hereto attached, the Viceroy shall devise means for supplying the deficiency, and should his inability to do so appear probable, he shall memorialise the Government to take measures to make up the deficiency from other sources, and thus be ready to pay off the indebtedness, so that the required amount may be placed in each case at least fourteen days previous to the due date of such payments in the hands of the Hong Kong and Shanghai Banking Corporation in Hong Kong.
ARTICLE 15.
The Corporation may, subject to all its obligations, transfer or delegate all or any of its rights, powers, and discretions to its successors or assigns, but the Corporation, which is a Corporation formed under English Law, shall not transfer its rights under this agreement to any other nation, or people of any other nationality, except British or Chinese. Similarly the Chinese Government's rights and authority under this agreement shall not be transferred to persons of other nationality.
It is further agreed that without the express consent in writing of the Viceroy and of the Corporation no other rival railway detrimental to the business of the railway shall be constructed, and no line parallel to the railway is to be allowed to the injury of the latter's interests within the area served by the railway.
ARTICLE 16.
The term of the loan, as stated in Article 1, shall be fifty years. Repayment of principal shall commence after the expiry of 12 years from the date of the loan, and shall be completed in 37 years by payments to the Hong Kong and Shanghai Banking Corporation as agents for the service of the loan, acting for the Corporation under the terms of this agreement, in accordance with the amortisation schedule of amounts and dates hereto attached.
If, at any time after the expiry of 124 years from the date of the loan, the Imperial Chinese Government should wish to redeem the outstanding amount of the loan
503
or any portion of it, not yet due under the provisions of the amortisation schedule hereto attached, not less than six months' notice shall be given in writing by the Viceroy to the representative of the Corporation, declaring the number of additional bonds so required to be redeemed, whereupon the representative of the Corporation shall immediately proceed to make such arrangements as may be necessary and usual for the redemption of the number of bonds specified, which, when duly redeemed after payment by the Imperial Chinese Government of the proper amount due thereon, shall be cancelled, and delivered to the Viceroy.
All bonds thus redeemed in excess of the amount specified in the amortisation schedule hereto attached before the expiry of 25 years from the date of the loan shall be paid for with a premium of 24 per cent. over their face value (i.e., £102 10s. will be required to pay for £100), but after 25 years, bonds may be redeemed over and above the amounts specified in the schedule without premium upon notice being given in the manner above specified.
As soon as the loan has been completely redeemed, this agreement shall become null and void, and the mortgage shall be cancelled.
ARTICLE 17.
If, during construction, any proceeds of the sale of bonds are lying unused, and bearing interest on their deposit whilst the construction of the railway is going on, such interest is to be credited to the general account of the railway in order that the railway may enjoy the full advantage thereof.
It is also agreed that if the Corporation shall think it expedient before the sale of any of the bonds to advance any money for the work, such advances, together with the interest thereon not exceeding a charge of 6 per cent. per annum, shall be deducted from the proceeds of the sale of the bonds.
ARTICLE 18.
The junction of the sections of the railway from Canton to the boundary of the Kowloon leased territory under British control, and from the said boundary to the port of Kowloon respectively shall be arranged and the railway worked under conditions based on the agreements usual in regard to the junction and working of inter-State railways in other countries. The Viceroy and the Governor of Hong Kong shall, in due time, appoint officials to consider the subject, and to arrange regulations accordingly.
ARTICLE 19.
This agreement is signed under the authority of an Imperial Edict, dated which has been officially communicated to the British Minister in Peking by the Wai Wu Pu.
ARTICLE 20.
This agreement is executed in quintuplicate in English and Chinese, one copy to be retained by the Viceroy, one by the Wai Wu Pu, one by the Bureau of Railways and Mines at Peking, one by the British Minister, and one by the Corporation, and should any doubt arise as to the interpretation of the agreement, the English text sliall be accepted as the standard.
14801
Signed at
by the contracting parties this day of the Intercalary month of the Kwang-Hsu, being the
day of hundred and of the Western Calendar.
No. 319.
year of the Emperor
nineteen
FOREIGN OFFICE to COLONIAL OFFICE.
(Received December 5, 1906.)
The Under-Secretary of State for Foreign Affairs presents his compliments to the Under-Secretary of State for the Colonies, and, by direction of the Secretary
of State, transmits herewith copy of the under-mentioned paper.
Foreign Office,
December 5, 1906.
504
REFERENCE TO PREVIOUS LETTER: Foreign Office, November 22,*
DESCRIPTION OF ENCLOSURE.
Name and Date.
Subject.
Sir J, Jordan, Peking, No. 421, October 16
Canton-Kowloon Railway Negotiations.
Enclosure in No. 319.