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PUBLIC RECORD OFFICE

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

| PUBLIC RECORD OFFICE, LONDON

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head office; (2) that in many cases the same head office has agents in several different British West African territories, and also in French West African territory, and in the German West African Colonies now under British occupation. It seems likely that some of the branches in British territory may prove insolvent, and questions have arisen as to how the assets of each branch should be distributed. At present, acting under the advice of Sir John Simon and Lord Buckmaster, we have directed that only debts arising out of contracts with the local branch are to be met; that no distinction is to be made between British and other non-enemy creditors; and that no attempt is to be made to pool the assets of different branches in British territory of the same head office in Germany. An effort has, however, been made to secure a reversal of the Law Officers' decision, with a view to making the assets of each branch available for the payment of debts contracted with the head office, and this may result in a pooling of the assets of different branches of the same office.

The trade-mark question does not appear to be of much importance in West Africa, no applications having been received for leave to use enemy trade-marks on British manufactures. Moreover, land and buildings there are of less value than in Hong Kong, where the available land is much more restricted. Also the trade, both German and English, is in much fewer hands.

(3) In East Africa (East Africa Protectorate, Uganda, Nyasaland and Zanzi- bar) liquidation is as yet hardly begun. In Uganda there are, practically speak- ing, no German firms, and those in the East Africa Protectorate and Zanzibar are comparatively few. In Zanzibar, however, where almost all the local trade is in the hands of four or five large German traders, examination of the affairs of these firms shows in almost all cases large credit balances of assets, including large amounts of debts from native traders. A peculiar feature is also the close proximity of German East Africa, in which one at least of these firms has its head office. It may also be observed that some of the most important firms have offices both in Zanzibar and the East Africa Protectorate and in Portuguese East Africa, while Hansing & Company are established in Uganda also. The trade-mark question appears to have some importance in East Africa, the circumstances being similar to those in Hong Kong, but neither here nor in West Africa is this question of anything like the same importance as in the Eastern Colonies.

9348

No. 3.

CROWN AGENTS to COLONIAL OFFICE. (Received 26th February, 1916.)

[Copy to Board of Trade, Foreign Office, and Public Trustee, 20th March, 1916

SIR,

"L.F.] [Answered by No. 4.]

Whitehall Gardens, London, S.W.,

25th February, 1916.

I HAVE the honour to report that since the issue of the Four-and-a-half per cent. War Loan, 1925-45, was made all money remitted to us for investment on account of surplus assets of enemy businesses in various Colonies and Protectorates, has been devoted to the purchase of Five per cent. Exchequer Bonds, redeemable on the 1st of December, 1920.

2. These bonds have been issued subject to the conditions imposed by section 47 of the Finance (No. 2) Act, 1915, whereby exemption from British income tax may be obtained in respect of dividends on bonds which are in the beneficial owner- ship of persons who are neither domiciled nor ordinarily resident in the United Kingdom, and we are therefore claiming exemption from income tax on all invest- ments in Exchequer Bonds which we are making on behalf of Colonial Govern- We are also claiming this exemption from income tax in respect of all bonds purchased on account of the liquidators of enemy businesses, but we should be glad to be informed if the Secretary of State considers that we are justified in adopting this course in the case of these assets of enemy businesses.

I have, &c.,

P. EZECHIEL,

ments.

for Crown Agents.

9348

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No. 4.

COLONIAL OFFICE to CROWN AGENTS.

[Copy to Foreign Office, Board of Trade, and Public Trustee, 20th March, 1916. L.F.]

GENTLEMEN,

Downing Street, 20th March, 1916.

I AM directed by Mr. Secretary Bonar Law to acknowledge the receipt of your letter of the 25th ultimo,* raising the question of claiming exemption from income tax in respect of dividends upon Exchequer Bonds in which surplus assets of enemy businesses in the Colonies have been invested.

2. I am to state, in reply, that exemption in these cases should not be claimed, since the Colonial Governments concerned are not beneficially entitled to these funds, and it is not possible, pending a decision by His Majesty's Government on the subject, to say who will be recognized as the beneficial owner.

3. The question of claiming exemption should, therefore, be left to the person to whom the funds may ultimately be paid.

9348

SIR,

No. 5,

I am, &c.,

G. GRINDLE.

COLONIAL OFFICE to TREASURY.

[Copy to Foreign Office, Board of Trade, and Public Trustee, 20th March, 1916. L.F.] [Answered by No. 6.]

Downing Street, 20th March, 1916.

I AM directed by Mr. Secretary Bonar Law to transmit to you, to be laid before the Lorda Commissioners of the Treasury, the accompanying copy of correspon- dence with the Crown Agents for the Coloniest respecting the question of claiming exemption from income tax in respect of dividends upon Exchequer Bonds in which surplus assets of enemy businesses in the Colonies have been invested.

2. I am to inquire whether their lordships think it desirable that steps should

be taken to prevent the enemy owner from recovering income tax in this and similar

cases.

3. A copy of this correspondence is being forwarded to the Foreign Office, the Board of Trade, and the Public Trustee.

19740

No. 6.

I am, &c.,

G. GRINDLE

TREASURY to COLONIAL OFFICE. (Received 27th April, 1916.)

[Copy to Crown Agents, Foreign Office, Board of Trade, and the Public Trustes,

5th May, 1916. L.F.]

Treasury Chambers, 27th April, 1916.

SIR,

I HAVE laid before the Lords Commissioners of His Majesty's Treasury Mr. Grindle's letter of the 20th ultimo, and the enclosed copy of correspondence with the Crown Agents for the Colonies, respecting the question of claiming exemption from income tax in respect of dividends upon Exchequer Bonds in which surplus assets of enemy businesses in the Colonies have been invested.

In reply, I am directed to say that they assume that no certificate of ownership

of such dividends will be issued by the Crown Agents to enemy traders.

If so, no effective claim for repayment of income tax can be made so long as the bonds are held by the Crown Agents, and it would therefore seem that there is no necessity to take any further steps with a view to preventing an enemy owner from recovering tax in such cases.

I am, &c.,

M. G. RAMSAY.

* No. 9.

Nos. 3 and 4.

* No. 5.

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