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PUBLIC RECORD OFFICE

Reference :-

C.O. 885

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

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cottons from the United Kingdom and British Possessions is to be 5 per cent. ad valorem, instead of 8 per cent., as in the old Treaty. Other articles of British produce, therefore, may be subject to any rate of duty in Tunis, provided the same duty is levied on the similar produce of all other countries except France, which will, of course, give French goods what preference she chooses in Tunis.

The French Government do not desire to extend to the British Colonies the provision for most-favoured-nation treatment in Tunis, and the question is whether the Colonies desire Her Majesty's Government to press for their inclusion. The provision is, of course, reciprocal; any Colony wishing to receive most-favoured-nation treatment for its produce in Tunis must be prepared to extend the same treatment to Tunisian produce.

July 2, 1897.

(Confidential.)

APPENDIX VII.

New Hebrides Islands.

No. 1.

MEMORANDUM by MB. VILLIERS.

J. A.

LORD Dunmore called here yesterday. He is going out this week to the New Hebrides as Special Financial Commissioner for the International Corporation (capital 1,000,000l.).

The Corporation, as explained in the annexed letter, have acquired a large propor tion of the rights hitherto possessed in the New Hebrides and New Caledonia by a French company, which has been subsidized and apparently supported by the French Government.

There is mention in this letter of a fresh International Agreement with the French Government. But of this we have heard nothing, and I could not ascertain that the Corporation have been in communication with the French Government, or know the view they may take of the transfer of interests from French to British hands.

Lord Dunmore was unaware of what agreements we have with the French Government, and asked for information to guide him. He believed the French flag was flying on the islands and a French force in occupation. I told him this was not

the case.

In reply to my inquiry, he declared that the objects of the corporation were absolutely and entirely commercial.

I then read to him the assurances exchanged between Her Majesty's Government and the French Government, both verbally and in writing, in 1878 and 1883, that neither Power intended to annex the New Hebrides. I also gave him a copy of the agreements concluded in 1887 and 1888, and showed him the letter from a missionary, recently sent to us by the Colonial Office, so that he might see that British subjects are not permitted to trade in arms and spirits.

After he had looked at the papers, I said that the French were exceedingly sensitive with regard to those parts of the world, and suspicious of any proceedings which had the least appearance of an encroachment on our part. It was absolutely necessary, to prevent difficulties arising, and in the interest of the corporation, which he made clear are also his own, to avoid any proceedings or language which could be construed as contrary to the various agreements.

He assured me emphatically, and several times over, that he would be most careful. We might inform Šir E. Monson and Colonial Office.

Foreign Office, February 24, 1897.

F. H. V.

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Annex to No. 1.

Mr. M. E. WILLIAMS to LORD DUNMORE.

Winchester House, Old Broad Street, London,

February 23, 1897.

DEAR LORD Dunmore,

As requested, I give you the following general outline re the interests of the International Corporation (Limited) in the New Hebrides, which will probably suffice for your guidance in estimating the nature of these interests :-

..

In the year 1878 a French convention was concluded, which recognised the neutrality and declared the independence of the New Hebrides. Subsequently Mr. John Higginson, who, although by birth an Englishman, has very strong French sentiments (and indeed, has been created a French citizen, which, I suppose, practically makes him a French subject to all intents and purposes), in order to checkmate English coloniza- tion in the New Hebrides, formed a société anonyme at Noumea, under the title of La Compagnie des Nouvelles-Hébrides," with a nominal capital of 500,000 fr., equal to 20,000l., în 1,000 shares of 500 fr. each, having as objects the acquisition and develop. ment of properties. In this way he, by means of the Société, acquired some 700,000 hectares of land and the principal ports, and apparently succeeded in displacing the English element. This original capital of 20,000l. was subsequently augmented by loans to about 150,000, to which Mr. Higginson was a large contributor: The French Government also lent its aid by guaranteeing loans from the Comptoir d'Escompte to a total of about 60,0007., and the general proceeds were applied in the purchase of lands, and the construction and general development of harbours, buildings, cultivation of coffee, cocoanuts, &c. Mr. Higginson, from his long residence in New Caledonia, and the large expenditure which he and his partners made in the development of its mineral and other resources, gained a very prominent position in the islands, and consequently established very cordial relations with the French Government, with the result of his obtaining the French citizenship. The French Government undertook to delimit and to guarantee the title of the Société to the properties it had acquired, or might acquire, on condition of a new company being formed in Paris to acquire all its assets, and having statutes bearing its approval. It also granted Mr. Higginson individually, a large quantity of convict labour for use in his mines in New Caledonia at nominal rates. These conditions were accepted, and in accordance with the arrangement which was concluded, Mr. Higginson deposited 510, or a majority of the 1,000 shares of the Société with the Comptoir d'Escompte as a guarantee for the formation of the new Company. Differences arose between Mr. Higginson and the Government in connexion with these arrangements, but ultimately, upon a change of Ministry taking place in 1893, a new arrangement was concluded, viz., on the 30th March 1894, whereby in lieu of delimitation of land (which was abandoned presumably owing to anticipated compli- cations with England in consequence of any such action) and in consideration of the recision of the labour contract, it was agreed that the Government should definitely guarantee the Société's titles, and grant à subvention of 360,000 fr. annually for fifteen years. A new Company was thereupon registered in Paris, and provision has since been made by the French budgets for the subvention. Accordingly, Mr. Higginson was appointed liquidator of the local Société, whose assets were to be transferred, and its shares extinguished by exchange for those of the Paris Company. The shares deposited with the Comptoir d'Escompte were also released. The object of the new Company was to acquire all the assets of the old Company, with the obligation to discharge its liabilities, including the guaranteed loan made by the Comptoir d'Escompte, and it was founded upon the principle of securing absolute neutrality of interests as between the French Government on the hand, and the shareholders on the other, so far as concerned voting power and administration, until some definite International Treaty had been established for the delimitation of Anglo-French interests in the locality, when rights were to be so re-adjusted as to give the old shareholders the prepondering interest. Thus, the nominal capital of the Paris Company was fixed at 4,200,000 fr., equal to about 168,000l., consisting of 400 ordinary shares, and 8.000 founders' shares of 500 fr. each. Mr. Higginson held in his own right no less than 680 of the 1,000 orignal shares of the old Company, representing nearly seven-tenths of the capital. Those shares are now vested in the International Corporation. The 400 shares of the Paris Company were divisible equally between the old shareholders, and the French Government, 4,0001. representing the cash capital of the new Company, being for administrative purposes. The 8,000 vendors' shares were allotted to Mr. Higginson as liquidator of the old Company, but although entitled to a participation in profits, they

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