CO882-6 — Page 549

PUBLIC RECORD OFFICE

Reference :-

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سياسيا

C.O. 882

6

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH-NOT TO

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(c.) The working of both sections as one undertaking to be provided for by agreement between the two Governments.

(d.) The general terms of such agreement to be arranged between the Colonial Office, on behalf of the Colonial Government and the Corporation.

(e.) Negotiations then to be opened with the Chinese Government by the Corpora- tion, with the assistance and support of the British Government, for the final Loan Agreement for the Chinese section; such Agreement being on the lines of the Shang- hai-Nanking Final Loan Agreement, but modified so as to meet the present circum- stances, and to admit of the proposed working agreement.

(1) The Corporation to obtain the concurrence of the Colonial Government in the Loan Agreement proposals before submitting them to the Chinese Government, and before accepting any important modifications in them.

(g.) The Chinese and Colonial Governments reciprocally to undertake in their joint working agreement not to allow their respective sections to pass under the control of any third Power or subjects thereof; and not to grant any concessions in their territories which would compete with or injure either section of the line without the previous consent of the other party.

(h.) Rolling stock to be jointly provided, and owned in proportion to the mileage; commission not to be payable to the Corporation in respect of the proportion provided at the expense of Hong Kong.

(i.) Any capital necessary for working to be provided by the two Governments in proportion to mileage; the Chinese proportion for this, and for rolling stock to be provided out of their loan, and to be earmarked for the purpose.

(j.) Each Government to provide the necessary land for the railway at its own cost, and to make its own arrangements as to the funds required therefor.

(K.) The line to be worked by a joint board of six members appointed, two by the Chinese Government, two by the Colonial Government, one by the Corporation together with a General Manager to be selected by agreement between the Corpora- tion and the Colonial Government.

After the redemption of all Chinese Bonds, &c., the representatives of the Corporation would disappear from the Board.

In the absence, &c., of any of these members the party who appointed them to appoint a substitute.

Three to be a quorum; the decision of the majority to be final on all points not ultra vires or contrary to the Agreement.

(1.) Receipts and working expenses to be pooled; net profit or loss thereon to be divided between the two Governments in proportion to the actual cost of building and equipping the respective sections apart from cost of land, and any commissions of whatever kind paid by either party to the Corporation or others.

(m.) The Consulting Engineers to be the same for both sections, and to be selected by agreement between the Crown Agents as representing the Colonial Government, and the Corporation.

(n.) Work to be begun on the two sections simultaneously.

Mr. Lyttelton, on behalf of the Government of Hong Kong, is prepared to assent to these conditions, and he will be glad to receive at your earliest convenience an intimation that they are accepted by your Board.

I am to add that the Secretary of State understands the above arrangement to refer to a line of railway to be constructed on the 4-feet 84-inches gauge.

W. Keswick, Esquire, M.P.

42604

No. 45.

I am, &c.,

C. P. LUCAS.

COLONIAL OFFICE to FOREIGN OFFICE.

Downing Street, December 29, 1904.

SIR,

I AM directed by Mr. Secretary Lyttelton to express his regret that he has not hitherto been able to give a definite reply to your letter of the 15th instant* re- specting the offer of Mr. E. Davis to find the capital for the construction of a line of railway from Canton to Kowloon.

No. 12.

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2. I am now to suggest, for the consideration of the Marquess of Lansdowne, that Mr. Davis should be informed that negotiations with other persons were already in progress when his offer was first made, and they have now reached a stage which precludes His Majesty's Government from entertaining his proposal.

3. Mr. Lyttelton is not in a position to offer any observations as to Mr. Davis's suggestion with regard to the Shanghai-Ningpo-Hanchow line.

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DEAR MR. FIDDES,

No. 46.

I am, &c.,

C. P. LUCAS.

MR. W. KESWICK, M.P., to MR. G. V. FIDDES. (Received January 4, 1905.)

3, Lombard Street, London, E.C., January 4, 1905.

I Now forward to you the draft agreement* connected with the Canton- Kowloon Railway.

It has not been submitted to the Board of the Corporation, but in principle I believe it embodies what you and we consider necessary. After it has gone through

the legal and engineering expert's hands, I do not think there will be room for much or any difference of opinion.

Enclosure 2 in No. 46.

Yours, &c.,

W. KESWICK.

THE BRITISH AND CHINESE CORPORATION, Limited.

CANTON TO KOWLOON RAILWAY.

Memorandum respecting the :-

Draft dated 4th January, 1905, of an agreement between the British and Chinese Corporation and the Chinese Government for the financing and construction of a Chinese railway from Canton to the frontier of Kowloon to which is scheduled the

Draft of an agreement between the Colonial Government of Hong Kong and the Chinese Government for the working as a single undertaking the above-named Chinese railway and the Colonial Government railway which the Hong Kong Govern- ment will construct in Kowloon.

Before proceeding to examine the agreement between the British and Chinese Corporation and the Chinese, it is desirable to read the scheduled draft agreement between the Colonial Government and the Chinese Government.

The Loan and Finance Agreement with the Chinese Government is on the lines of the Shanghai-Nanking Railway Loan Agreement modified to suit the circum- stances of the present project. In cases where it has been deemed expedient to preserve provisions which are wholly or partly incompatible with the Working Agree- ment between the two Governments, it will be found that they are over-ridden by references to the Working Agreement, and are rendered nugatory thereby while that agreement is in force.

It must be distinctly understood that although the drafts have been prepared on the instructions of the British and Chinese Corporation on the footing generally of Mr. Fiddes's letter of December 16th, 1904, they must not be treated as documents which have been considered and approved by the British and Chinese Corporation, as, after they have been submitted to expert scrutiny, the Board may have to suggest various amendments.

• Not printed.