CO882-6 — Page 523

PUBLIC RECORD OFFICE

Reference :--

TTIC.O. 882

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PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

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nationality, will be recognised as entitled to exclusive control of the construction work, it is, I presume, workable, and in accordance with the agreement. Kindly advise me whích method you will adopt, so that I may know how to answer Mr.

Yours sincerely,

Parsons.

12582

(Confidential.)

No. 12.

Sir CHENTUNG LIANG.

ACTING GOVERNOR MAY to MR. LYTTELTON. (Received April 9, 1904.)

SIR,

Government House, Hong Kong, March 12, 1904. REFERRING to the question of the construction of a railway from Canton to Hong Kong, I have the honour to report that information has reached me that an English- man is at the present time negotiating at Shanghai with the Director of Chinese Railways for a concession to construct a railway from Chin Kiang, on the Yangtze, to the frontier of this Colony, when it is proposed the line should join the Canton- Hong Kong line. Such a railway could transport goods and passengers within twenty-four hours from Chin Kiang to Hong Kong, that now travel round by sea occupying five days in transit.

I have not been able to gather any details of this project. It is one well worthy of the support of His Majesty's Government, and if such a line were constructed it would very much increase the earnings of the section of the Canton-Hong Kong line lying within the territory of this Colony.

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I have, &c.,

F. H. MAY,

Officer Administering the Government.

No. 13.

(Received in Colonial Office April 13, 1904.)

THE BRITISH AND CHINESE CORPORATION, LIMITED. Kowloon to Canton Railway Scheme. Draft Proposal.

Parties to the Scheme:-

The Colonial Government of Hong Kong.

The Chinese Government.

The British and Chinese Corporation, Limited.

The Intended British Railway Company.

The British and Chinese Corporation to surrender to the Chinese Government

the Loan Agreement which they hold from the Chinese Government, and which com- mits the Chinese Government to:--

(1) Accept 90 per cent. for the Loan.

(2) Guarantee unconditionally the full nominal amount of the Loan both

principal and 5 per cent. interest.

(3) Divide with the British and Chinese Corporation the profits of working

the Railway.

(4) Pay the British and Chinese Corporation a commission on all materials

required for constructing and working the Railway.

The Chinese Government in consideration for such surrender to grant to the Colonial Government of Hong Kong the exclusive right to construct and work by means of a British Company, a Railway from the frontier of Kowloon to Canton, the necessary land to be provided by the Chinese Government free of cost and the use of it permitted for the purposes of the Railway, rent, tax, and likin free both as

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regards land, traffic, and materials for construction and maintenance. The Chinese Government to give all necessary protection and facilities and to covenant that during the currency of this concession no other concession of land, or right to con- struct, own, or work any railway or line shall be granted to any other Corporation, firm, or person, or to any foreign Government or State, nor shall the Chinese Govern- ment directly or indirectly construct, or be interested in the construction of any railway within a radius of

miles on either side of the Railway line adopted from Kowloon to Canton, or which would in any way connect Kowloon with Canton, or with any intermediate places within such radius.

The Colonial Government of Hong Kong (hereinafter called "the Government") to provide free the land required in Colonial Territory and grant a concession to a British Railway Company, to be promoted by the British and Chinese Corporation, to construct and work a Railway from Kowloon to Canton on the following terms: — 1. The Corporation agrees within months from the date hereof to register a British Company (hereinafter called "the Railway Company") under the English Law, having a capital divided into shares and including in its objects the acquiring of this present concession, and of carrying out, owning and working the same, and having all necessary powers of issuing shares of any class, stock, mortgage and other debentures, debenture stock and other securities, for the purpose of raising the neces- sary funds to carry out its objects, including the constructing, equipping, and work- ing the Railway, and generally of developing this concession and of paying expenses of preliminary and other surveys and reports in connection with the Railway, the formation of the Railway Company, the issuing of the Railway Company's prospectus, and the procuring and underwriting of its capital and debentures, and the remunera- tion of any company, firm, or person, for services rendered in and about the obtaining of the said concession, or in the carrying out of the undertaking or otherwise.

2. The Articles of Association of the Railway Company shall provide for its having a head office and a Board of Directors in London with a subsidiary and local office and local Board of Directors in Hong Kong, on which last-mentioned Board the Government shall always have the right of nominating one Director.

3. The concession for the Railway on the terms contained in the subsequent clauses is granted in the first instance to the Corporation, but it is intended that the same shall be the property of and belong to the Railway Company when formed to the intent that the Railway Company shall have and enjoy all the rights and benefits thereof and be subject to all the liabilities thereof and the Corporation shall stand entirely released therefrom. Such transfer to the Railway Company is to be on the terms that the Railway Company shall issue to the Corporation free of cost and without payment or liability and as fully paid per cent. of all the shares,

stock, debentures, and other securities of all kinds which shall form that part of the capital issue of the Railway Company appropriated to the Railway, it being hereby declared that of all the capital issued by the Railway Company to promote its under- taking in connection with the whole railway from the Port of Kowloon to Canton, including all preliminary and formation expenses.

4. Immediately after the formation and registration of the Railway Company the Corporation shall procure the Railway Company to apply to the Government for its recognition as the Railway Company intended under this contract, and the Govern- ment shall give its official recognition thereto.

5. The Railway Company shall be entitled to construct, build, equip and work the Railway by and in such sections and at such times and in such manner as they may deem advisable, and from time to time to open for traffic such sections as they may think fit, provided always that the Railway, which, under the provisions of this Agreement, is to be constructed, built, equipped and opened for traffic, is to be a first-class single line Railway on the standard gauge of 4 ft. 8 in. with all the neces- sary stations, sidings, workshops and machinery and with a sufficient supply of rolling

stock.

6. The time for completion of the Railway shall be the date of this Agreement. Provided always that all engagements on the part of years from the Railway Company under this concession are and shall be at all times subject to the due fulfilment of all engagements on the part of the Government herein con- tained, and of the engagements to the Government of the Chinese Government, and to a sufficient allowance being made in all cases of force majeure, war, rebellion, native or other disturbances, tempests, floods, fire and pestilence.

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