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This Ordinance shall remain in force for a period of one year from the date of its coming into operation and for such further period or periods as may from time to time be determined by resolution of the Legislative Council.

Passed the Legislative Council of Hong Kong this 18th day of April, 1899.

J. G. T. BUCKLE,

Clerk of Councils. Assented to by His Excellency the Governor, the 18th day of April, 1899. J. H. STEWART LOCKHART,

Enclosure 2 in No. 181.

REPORT ON Ordinance No. 12 of 1899.

Colonial Secretary.

Attorney-General's Office, Hong Kong, May 2, 1899.

I have examined the accompanying Ordinance, entitled "An Ordinance to provide for the Better Regulation of the New Territories," and I am of opinion that the Ordin- ance is one which is not contrary to the Governor's Instructions.

Objects and Reasons.

The object of this Ordinance is to confer temporarily power upon the Executive Council of this Colony of making rules for the collection of revenue from the new terri- tories which have recently been added to this Colony.

This measure is introduced as a temporary expedient in order to remove the diffi- culties which must necessarily be experienced in dealing with certain sources of revenue which are new to this Colony, and in order to obviate the necessity for, and the delays which would be occasioned by, passing numerous Ordinances and amending Ordinances through the Legislative Council.

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5. Mr. Chamberlain considers that the most important point to secure is the withdrawal of all Chinese authority and jurisdiction from the City of Kowloon. This point has been insisted on in Lord Salisbury's letter to the Chinese Ambassador of the 30th ultimo,* and therefore it is unnecessary to make further reference to it.

6. The northern boundary should, in Mr. Chamberlain's opinion, be the boundary which has already been delimited by Mr. Lockhart, acting for the Hong Kong Govern- ment, and the Commissioner deputed by the Viceroy of Canton, and which is shown on the enclosed map (to be returned). In the Governor's interview with the Viceroy of Canton, he intimated that the boundary had been thus delimited, and except for such difficulties as may be involved withdrawing from the occupation of Sam Chun, Mr. Chamberlain is of opinion that it would be better to adhere to the line, and not to press for a further extension of territory. This view, he gathers from your letter of the 27th ultimo,† will probably be shared by Lord Salisbury.

7. Through the failure of the Viceroy of Canton to ensure the peaceable transfer of the leased territory, considerable expense has been incurred either by the Imperial or by the Colonial Government, and Mr. Chamberlain considers that this expense should be made good by the Chinese authorities. The demand for moderate com- pensation will also justify the presence of the troops outside the frontier, and its satisfaction will justify their withdrawal. I am therefore to suggest that a reasonable claim for money compensation should be preferred against the Chinese Government, and that the Governor of Hong Kong should be consulted as to what sum should be demanded.

8. If the views expressed in this letter commend themselves to Lord Salisbury, I am to ask for his Lordship's approval of the enclosed draft of a telegram to Sir H. Blake, and to suggest that a communication in the sense of this letter should be made to the Chinese Government.

I am, &c.,

C. P. LUCAS.

13692 8.

HENRY E. POLLOCK,

Acting Attorney-General.

No. 182,

14680 S.

No. 183.

FOREIGN OFFICE to COLONIAL OFFICE.

(Received June 9, 1899.)

(Secret.)

SIR,

COLONIAL OFFICE to FOREIGN OFFICE.

[Answered by No. 183.].

Downing Street, June 5, 1899. I AM directed by Mr. Secretary Chamberlain to acknowledge the receipt of your letter of the 1st instant, intimating the views of Lord Salisbury with regard to the telegram received on the 31st ultimo † from the Governor of Hong Kong relating to the possibility of an attack on the Basle Mission Station at Li Long and I am to enclose a copy of a telegramț which was sent to Sir H. Blake on the 2nd instant in accordance with Lord Salisbury's wishes.

2. I am also to acknowledge the receipt of your letter of the 27th ultimo,§ on the subject of the northern boundary of the leased territory, and your letter of the 1st instant, enclosing a copy of His Lordship's reply to the protest received from the Chinese Government against the removal of the Chinese troops and officials from Kowloon City, and the occupation of Sam Chun.

3. I am to enclose copies of telegrams received from the Governor on the 26th and the 30th ultimo, and (in original for perusal and return) three despatches dated the 27th and 28th of April, and received on the 29th ultimo.¶

4. His Lordship will probably agree with Mr. Chamberlain that it is desirable that the difficulties which have arisen should be settled as soon as possible, and that final instructions should be sent to Sir H. Blake, and be communicated to the Chinese Government with the least possible delay.

• No. 178.

| No. 177.

↑ No. 175,

‡ No. 179.

▼ Nos. 168, 174, 170, 171, and 172.

§ No. 173.

(Confidential.)

[Answered by No. 184.]

Foreign Office, June 8, 1899.

SIR,

I AM directed by the Marquess of Salisbury to acknowledge the receipt of your letter of the 5th instant§ inclosing the draft of a telegram which Mr. Secretary, Chamberlain proposes to send to the Governor of Hong Kong with regard to the Kowloon extension.

His Lordship concurs in Mr. Chamberlain's opinion that the boundary should be that delimitated by Mr. Lockhart and the Chinese Commissioner, and that Shan Chun should eventually be restored to China.

Lord Salisbury would, however, propose as regards the demand for compensation on account of the expense incurred owing to the Chinese resistance to the transfer of the leased territory, that a large indemnity should be asked for on the understanding that Her Majesty's Government will forego payment of it in whole or in part, provided that satisfaction be given by the Chinese Government in other matters. Lord Salisbury would suggest that the draft telegram to Hong Kong should be amended accordingly.

I am, &c.,

FRANCIS BERTIE.

Enclosure in No. 177.

No. 173.

+ See No. 187.

§ No. 182.

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PUBLIC RECORD OFFICE

Reference :---

C.O. 882

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PUBLIC RECORD OFFICE, LONDON

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