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3. I am not aware of the reason for this addition, which is open to the construction that Newfoundland must give to all imports from the United States the same tariff treatment as goods from this country or other parts of the Empire.

se,

If this provision had been in the draft which was before His Majesty's Government when the Ambassador at Washington was authorised to sign the Convention, they would have felt great difficulty in accepting it. Your Ministers are aware that it is the declared policy of His Majesty's Government that the fiscal relations of the different parts of the Empire, inter should not be hampered by any agreements with foreign countries requiring that such countries should receive the same treatment in tariff matters as may be accorded to other parts of the Empire. This principle was unanimously adopted by the Colonial Conference in 1897, and in pursuance of it His Majesty's Government denounced the important Commercial Treaties with Belgium and Germany, which were at variance with it.

4. The principle of preferential trade within the Empire was further endorsed by the Conference last year, and though your Prime Minister, who was a member of that Conference, stated that the circumstances of Newfound- land were not such as to allow it to take any steps towards granting tariff preference to British goods, it was not understood that he objected to the principle, or had any intention of committing the Colony to engagements at variance with it.

I have, &c.

8820/S.

(For the Secretary of State),

No. 2.

M. F. OMMANNEY.

The ADMINISTRATOR OF NEWFOUNDLAND to the SECRETARY

(Confidential.)

SIR,

OF STATE.

(Received March 6, 1903.)

Government House, St. John's,

February 18, 1903.

I HAVE the honour, at the request of my Ministers, to transmit herewith a copy of a Minute of the Executive Council dealing with the point raised in your confidential despatch of the 9th January, with regard to the addition to the Commercial Convention recently negotiated with the United States of America, of a clause stipulating that no heavier duty shall be imposed on articles entering Newfoundland from the United States than is imposed on such articles coming from elsewhere.

I have, &c.,

Enclosure in No. 2.

W. H. HORWOOD,

Certified Copy of Minute of the Honourable Executive Council approved by His Honour the Administrator on the 13th February 1903. Ministers have had under consideration the confidential despatch received by His Honour the Administrator from the Permanent Under Secretary of State for the Colonies, bearing date the 9th January 1903, in which the following paragraphs occur, namely:-

"2. I observe that in its final form the Convention differs from the draft in one point of importance the addition to Article 5 of the words 'and that no heavier duty shall be imposed on articles coming from the United States, than is imposed on such articles coming from elsewhere.'

"3. If this provision had been in the draft which was before His Majesty's Government when the Ambassador at Washington was authorised to sign the

• No. 1.

47

Your

Convention, they would have felt great difficulty in accepting it. Ministers are aware that it is the declared policy of His Majesty's Government that the fiscal relations of the different parts of the Empire, inter se, should not be hampered by any agreements with foreign countries, requiring that such countries should receive the same treatment in tariff matters as rnay be accorded to other parts of the Empire. This principle was unanimously adopted by the Colonial Conference in 1897, and in pursuance of it is Majesty's Government denounced the important commercial Treaties with Belgium and Germany, which were at variance with it. The principle of preferential trade within the Empire was further endorsed by the Conference last year, and though your Prime Minister, who was a member of that Conference, stated that the circumstances of Newfoundland were not such as to allow it to take any steps towards granting tariff preference to British goods, it was not understood that he objected to the principle, or had any intention of committing the Colony to engagements at variance with it."

My Ministers desire to say, in reply 1. That the " one point of importance" where the Convention in its final form differs from the draft, was communicated to the Foreign Office by the British Ambassador at Washington, and must have been duly considered by His Majesty's Government before they accepted it, as the following facts will indicate :-

On October 13th, 1902, the Secretary of State for the United States of America handed in a draft of Treaty, with the amendment referred to, and on the afternoon of that day, Sir Robert Bond discussed the contents of the document with the British Minister, who noted the alteration from the original draft, and stated that he would cable it immediately to Lord Lansdowne.

On the 18th October, the British Minister received the following cable despatch from Lord Lansdowne, a copy of which was obtained from him by Sir Robert Bond, viz. :-

"Mr. Raikes's despatch, No. 256, and your telegram, No. 36. You may sign draft Convention as amended, and inform Sir R. Bond that His Majesty's Government, relying on the assurance conveyed in his letter of April 25th, 1901, that Great Britain and all British Colonies, and all countries entitled by treaty to most favoured nation treatment in Newfoundland, will receive the same treatment both as regards bait and import duties as the United States, have much pleasure in authorising the completion of the Convention."

The same day Sir R. Bond wrote the British Minister as follows:- "Referring to Lord Lansdowne's cable despatch to you of this date, you will please convey to His Majesty's Government an expression of my high appreciation, and an assurance that on my return to the Colony I shall have a Minute of Council forwarded, embodying the assurance desired."

It is apparent from the foregoing that the Under Secretary of State for the Colonies was not made acquainted with the facts in relation to the amended draft, and was in error in supposing that His Majesty's Government were unaware of the amendment when the Ambassador at Washington was authorised to sign the Convention.

2. My Ministers are of opinion that the position of the Colony as regards preferential trade was very clearly defined by Sir Robert Bond on the day of the opening of the Colonial Conference. By reference to the Minutes of Proceedings, page 15, it will be observed that he stated as follows:-

The question of preferential trade is one with which we are not very largely concerned. The whole revenue of the Colony, with the exception of returns from Postal Department and Crown Lands, is derived from Customs taxation, and therefore it is a matter that involves a very great consideration indeed, as to how we can in any way deal with the question of preferential trade. Our policy is a free-trade policy, essentially so, necessarily so. The principle of our tariff taxation is, and always has been, an entirely free-trade principle, without discrimination of countries, yet, as have observed, it has been practically proved that we are customers of British products to the extent of about four-fifths of our annual imports."

And by reference to page 128 of the Minutes of Proceedings, it will be observed that when the Secretary of State said

"Before going any further, I would ask the Premier of Newfoundland whether he wishes to say anything in regard to this matter, or whether he

47

would have felt great difficulty in accepting it.

Your

that it is the declared policy of His Majesty's Government ions of the different parts of the Empire, inter se, should by any agreements with foreign countries, requiring that ld receive the same treatment in tariff matters as may be parts of the Empire. This principle was unanimously lonial Conference in 1897, and in pursuance of it His ent denounced the important commercial Treaties with any, which were at variance with it. The principle of ithin the Empire was further endorsed by the Conference ugh your Prime Minister, who was a member of that that the circumstances of Newfoundland were not such e any steps towards granting tariff preference to British iderstood that he objected to the principle, or had any ting the Colony to engagements at variance with it.” sire to say, in reply:

e point of importance" where the Convention in its final le draft, was communicated to the Foreign Office by the

r at Washington, and must have been duly considered by rnment before they accepted it, as the following facts will

h, 1902, the Secretary of State for the United States of 1 a draft of Treaty, with the amendment referred to, and

that day, Sir Robert Bond discussed the contents of the › British Minister, who noted the alteration from the I stated that he would cable it immediately to Lord

ctober, the British Minister received the following cable Lansdowne, a copy of which was obtained from him by

12. —

despatch, No. 256, and your telegram, No. 36. You may on as amended, and inform Sir R. Bond that His Majesty's g on the assurance conveyed in his letter of April 25th, ritain and all British Colonies, and all countries entitled avoured nation treatment in Newfoundland, will receive both as regards bait and import duties as the United pleasure in authorising the completion of the Convention." ir R. Bond wrote the British Minister as follows:-

Lord Lansdowne's cable despatch to you of this date, you to His Majesty's Government an expression of my high n assurance that on my return to the Colony I shall have a orwarded, embodying the assurance desired."

om the foregoing that the Under Secretary of State for the ade acquainted with the facts in relation to the amended error in supposing that His Majesty's Government were mendment when the Ambassador at Washington was he Convention.

are of opinion that the position of the Colony as regards vas very clearly defined by Sir Robert Bond on the day of e Colonial Conference. By reference to the Minutes of 15, it will be observed that he stated as follows:

of preferential trade is one with which we are not very The whole revenue of the Colony, with the exception of Department and Crown Lands, is derived from Customs fore it is a matter that involves a very great consideration we can in any way deal with the question of preferential is a free-trade policy, essentially so, necessarily so. iff taxation is, and always has been, an entirely free-trade liscrimination of countries, yet, as I have observed, it has roved that we are customers of British products to the r-fifths of our annual imports."

The

ce to page 128 of the Minutes of Proceedings, it will be

the Secretary of State said :-

any further, I would ask the Premier of Newfoundland to say anything in regard to this matter, or whether he

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