CO885-(7-8)-2 — Page 274

Eastern, No 91, Confidential.

Printed for the use of the Colonial Office.

ل مرغ

PUBLIC RECORD OFFICE

Inference

TTIC.O. 882

8 PUBLIC RECORD OFFICE, LONDON

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

CANTON-KOWLOON RAILWAY.

On 28th March, 1899, a preliminary agree- ment was entered into between Sheng, Director- General of the Imperial Chinese Railway Admi- nistration, and the Agents of the British and Chinese Corporation," Limited. It provided inter alia :—

(1) That the terms of the preliminary agreement of 13th May, 1898 [i.e., for the Shanghai-Nanking Railway] are adopted as a preliminary agree- ment for the construction and working of railways between Canton and British Kowloon ; (2) That this is subject, as far as practic

able, to the terms and conditions of the final contract for the Shanghai- Nanking Railway when signed and ratified;

(3) That both parties agree to make reci- procal and satisfactory working arrangements in conjunction with the Canton-Hankow Railway; (4) That the Corporation will take prompt steps for the survey of the Canton- Kowloon line.

2. The Final Agreement for the Shanghai- Nanking Railway, referred to above, was signed by the same parties on the 9th July, 1903. The provisions which chiefly concern us are the following

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(1) The Corporation to issue on behalf of the Chinese Railway Administra- tion a sterling loan of £3,250,000 in Chinese Government 5 per cent. bonds of £100, with the railway as first mortgage security. Price of bonds 90 per cent.; any profit or loss in selling the bonds to the public to accrue to the Corporation; duration of loan 50 years.

(2) Proceeds of loan to be used in the construction and equipment of the railway and in paying interest on loan during construction. Corpora- tion to build and equip the line; Chinese Administration to secure the land for a double line of railway. (3) Loan to be secured by first mortgage, in favour of the Corporation (as trustees for the bondholders), on the said railway and upon the already completed Voosung Shanghai Railway.

(4) Agreement to be null and void if con- struction not begun within twelve months of ratification. Proceeds of bonds to be either kept in England for payment of materials and con- tracts, or transferred to banks in

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