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PUBLIC RECORD OFFICE

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C.O-885

17 PUBLIC RECORD OFFICE, LONDON

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The CHAIRMAN: Those matters, if I may say so, are details on which we are The real not competent here as a Conference to express a definite opinion. question as it appears to me that has been propounded by Sir William Mulock resolves itself into this; are we going to throw away the advantages of a negotiation which is to bind no one which is to take place between the Pacific Cable Board and the Company! Are we going to say we will not authorise any such negotiation to take place, or are we going to say such negotiations shall take place with the authority of this Conference, but its conclusions must be submitted to the respective Governments? Now, it seems to me that we should have wasted our time here altogether unless now, having admirable negotiators on our part to deal with Sir Wolfe Barry, we cannot at any rate arrive at what the proposals which Sir Wolfe Barry on the part of the Companies and Sir Spencer Walpole on behalf of the Pacific Board are willing to entertain. For my part, I should say that the more freedom under which that negotiation can take place the better, because the Govern- ments are absolutely secure from their own point of view by having the final voice in the matter when the results of the negotiation are submitted for their considera- tion. Now, is it the pleasure of the Conference that that negotiation should proceed? That is your view, Sir William?

Sir WILLIAM MULOCK: Yes.

The CHAIRMAN: And yours, Lord Jersey?

The EARL OF JERSEY: Yes.

The CHAIRMAN: And yours, Sir Sandford?

Sir SANDFORD FLEMING: Not mine; I must be in the minority.

The CHAIRMAN: You are willing that it should proceed upon some basis; the question is, upon what basis?

Sir SANDFORD FLEMING: On a division the traffic only.

The CHAIRMAN: I gather that Sir William Mulock and Lord Jersey would both like the negotiations to proceed upon a wider basis.

Sir SANDFORD FLEMING: Much as I should have liked to be with them, I am afraid I cannot.

The CHAIRMAN: That, I understand, you do not feel your way to assent to. The EARL OF JERSEY: I feel there is always a safeguard, viz., the consent to be given by the different partner Governments when the conclusion of the negotiations is offered to them.

The CHAIRMAN: Sir William, I understand that you would be willing, provided your Government could scrutinise these proposals when they are formulated in detail as the result of the negotiation; that negotiation should proceed, and the full facts be elicited with regard to them.

Sir WILLIAM MULOCK: I would prefer it if the Pacific Cable Board, in the light of the discussions at this table, now took up the question untrammelled by any resolutions that we have passed and proceeded, through Sir Spencer Walpole or otherwise as they think fit, to open and continue negotiations with the Eastern Exten- sion Telegraph Company with a view to securing what in their judgment is the best possible arrangement; and, in the event of no satisfactory arrangement being reached at an early date that then it be war. Meantime, before declaration of war, I prefer leaving it to the Pacific Cable Board to see whether they can arrange terms of a satisfactory and lasting peace.

The CHAIRMAN: Yes, I think that is a most reasonable view

The EARL OF JERSEY: Yes, I agree.

The CHAIRMAN: I think it is embodied to some extent in paragraph 8 of the draft report which I have prepared. Before we go into any of the details of this report I would suggest that we embody the conclusion that at any rate Lord Jersey

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and yourself and I are prepared to agree to, namely, that authority be given to the Pacific Cable Board to negotiate with a view to an amicable arrangement with the Eastern Extension Telegraph Company, provided that no arrangement is finally concluded by the Board without the consent of the different Governments.

Mr. PEMBER REEVES: I listened very carefully to Sir Spencer Walpole's state- ment, but I should like to say that I think the advantages of a pooling arrangement as against a division of traffic were unintentionally overstated considerably. The difficulty, of course, with regard to the routed and unrouted messages is apparent, but while as things stand at present in Australia we should undoubtedly be, as Sir Spencer indicated, under great disadvantages in competing with the Eastern Exten- sion Telegraph Company for routed traffic, any arrangement with them pre-supposes that their offices should be closed and, in that case, the whole position would be altered. We are under no disadvantage in competing with them in Queensland and New Zealand, for example, where we hold our own extremely well as regards routed traffic, and the only reason why we do not hold our own in New South Wales and Victoria, arises from the agreements by which the Eastern Extension Telegraph Company prevents clients there from making use of the Pacific Cable. the Eastern offices in Victoria and New South Wales were closed, I have no doubt whatever that we should be easily able to hold our own after a time there in com- petition for routed traffic.

If

Sir SPENCER WALPOLE: I do not think you appreciated the whole of my point; even if we succeeded in competing for the routed traffic my point was you will only then be able to divide the unrouted traffic. And that will not secure that transfer of words which you would secure if you were dividing the whole traffic; we should have to secure one portion by our own exertions and not by an arrangement.

Mr. L'EMBER REEVES: Yes, but provided that the competition through open offices were prevented, our exertions would have fair play and judging from the example of Queensland and New Zealand I should think we would hold our own fairly well.

Whether that is so or not it does not seem to me in any case to militate against the Pacific Board entering upon these negotiations. That seems to be the opinion of all of us that these negotiations should be entered upon without trammel, at any rate we should have the advantage then of the result of the negotiations which could then be finally considered by each Government concerned.

The CHAIRMAN: We cannot really, I think, decide upon that.

Sir SANDFORD FLEMING: I might say, Sir, that I can join with the other three in the resolution which was passed on the 21st July.

The CHAIRMAN: This is the resolution that commands the assent, I hope. of all the delegates:-

"Difficulties having arisen as to the construction and working of the 3rd and 4th paragraphs of the resolution of the 17th July, and of the third resolution of the 21st July, the Conference rescinds said portions of the resolution of the 17th July and the said resolution of the 21st July, and resolves that it should be left to the discretion of the Pacific Cable Board to negotiate an amicable arrangement with the Eastern Extension Telegraph Company, provided that no arrangement be finally concluded without the approval of the Governments concerned, nor unless the Commonwealth Agreement with the Company is amended in the manner suggested by the Conference in paragraph 1 of the resolution of the 17th July."

Sir SANDFORD FLEMING: I do not see much to object to in that.

Sir WILLIAM MULOCK: If you are satisfied with it, I am.

The CHAIRMAN: Very well, we can consider this as agreed.

Sir WILLIAM MULOCK: Well, another proposition: these negotiations, Mr. Chair- man, will continue over a considerable period of time? I understand from Mr.

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