CO885-(13-15) — Page 622

PUBLIC RECORD OFFICE

Iz Ti

C.O.885

Reference :-

14 PUBLIC RECORD OFFICE, LONDON

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

2

with subjects of other States," it empowered the Government Treaty as at present submitted," with instructions, however, to the Government to to proceed with the assure itself by way of protocol or otherwise that no equality between whites and coloured persons would be granted.

That the modification proposed by the Volksraad was rejected by you (C. 8423, page 63), and that you pointed out that the Volksraad had admitted the principle of quality between the white and black subjects of l'ortugal for the purpose of com- mandeering, and no further action had been taken in regard to the Treaty.

That in the early part of last year it had come to the knowledge of Her Majesty's Government that the Portuguese Government, under Article II. of their Treaty with the South African Republic of 1875 (a translation of which formed Schedule 3 (d) to Sir Frederick Young's Memorial), claimed and received for 'their subjects, whether white or coloured, exemption from being commandeered, not only for personal service, but for requisitions of war, and (on the faith of the understanding between Sir Henry Loch and President Kruger) the High Commissioner was authorised to claim similar exemption for all British subjects. That a copy was enclosed with Mr. Graham's letter of an official notice on the subject, which was issued by the British Agent in the South African Republic about the end of September last. That the Government of the South African Republic, though they had never formally admitted the contention of Her Majesty's Government, had so far not made any attempt to dispute it.

Mr. Graham was to state that you were prepared to adhere to the claim put for- ward for most favoured nation treatment, not only with regard to personal service, but also with regard to requisitions, but that you were doubtful whether the exemption from all extraordinary taxes that were not general and established by law, provided for in the Portuguese-South African Republic Treaty, could be held to extend to the War Tax, which although imposed at irregular intervals, and at the discretion of the Executive on a certain section of the community, was not exacted by the arbitrary act of the Field Cornet from particular individuals as was the case in ordinary commandeer- ing requisitions.

That we would observe that Mr. Dicey and Mr. Kotzé, in their opinions which formed Schedules 6 (5) and 6 (e) to Sir Frederick Young's Memorial, held that the exemption under sub-section (b) of the first Section of Law 24 of 1896 of companies consisting solely of burghers doing military service made the tax one which did not apply to all citizens of the Republic. and that consequently that sub-section by im- posing the tax on companies consisting of British subjects was contrary to Article XIV. of the London Convention (a copy of which formed Schedule 1 to the Memorial).

Mr. Graham finally stated that he was to ask:

1. Whether in our opinion exemption from the War Tax can be claimed on behalf of British subjects and British companies nation treatment, and in view of the provisions of the Portuguese-South African Re- pursuance of the claim for most favoured public Treaty?

2. Whether in view of the considerations set forth by Mr. Dicey and Mr. Kotzé,

we see reason to modify our opinion of 6th May, 1897*? And

3. To be favoured with our views generally on the position taken up by Her Majesty's Government.

We have taken the matter into our consideration, and in obedience to your com- mands have the honour to

1.

Report

That we understand that we are to assume for the purposes of this question that the Draft Commandeering Treaty of 1895 is to be treated as being in force between Her Majesty's Government and the South African Republic.

We think that this War Tax is a military requisition or demand within the mean- ing of that arrangement. We further think that it is an "extraordinary" tax and not "general" within the meaning of Article II. of the Treaty between the South African Republic and Portugal of 1875. We think it is not "general" on the ground stated in our answer to question II. It follows that, by virtue of their right to most favoured nation treatment, British subjects resident in the South African Republic, either as individuals or as shareholders in companies, are entitled to claim exemption from this War Tax on the ground that by the Portuguese Treaty Portuguese subject + would be exempt.

• No. 141.

3

We desire further to call attention to the fact that apparently citizens of the Orange River Free State are exempted from the operation of the law as to the War Tax, and this exemption may be invoked in favour of British subjects resident in the South African Republic under the most favoured nation clause.

The rights conferred by the Draft Treaty of 1895 are, however, confined to British subjects while residing in the South African Republic, and have no application to those who, while residing out of the South African Republic, own property there.

2. While we see no reason to modify our opinion of May 6th, 1897, as to the levy of the tax on non-resident landlords, we think that the materials now before us show that head (b) of the Law No. 24 of 1896 is an infraction of Article XIV. of the Convention of London.

It would not, in our opinion, be an infraction of that Article if a tax were imposed on alien shareholders fairly equivalent to the burthen of military service imposed on burghers. But it seems clear that this tax on companies owned by aliens is out of all proportion to the burthen to be borne by the burghers. In the case of some small war, though the burghers are liable to be called out, most of them certainly will not be called out, while these companies are made liable to this very heavy impost with- out discrimination. There is no proportion between the burthens imposed on aliens and those imposed on burghers, and it seems to us that head (b) of this Law is an infraction of Article XIV.

3. We think that Her Majesty's Government will be justified in treating this Law as an infraction of Article XIV., and also, so far as British residents in the South African Republic are concerned, as an infraction of the most favoured nation Treaty of 1495, if this is to be regarded as in force.

The Right Honourable J. Chamberlain, M.P.,

&c.,

&c.,

&c.

We have, &c.,

RICHARD E. WEBSTER. ROBERT B. FINLAY.