CO885-6 — Page 489

35987

SIR,

50

No. 61.

GOVERNOR SIR M. NATHAN to MR. LYTTELTON.

(Confidential.)

(Received October 9, 1905.)

[Answered by No. 69.]

Government House, Hong Kong, September 8, 1905. IN continuation of my despatch, No. 141, dated the 31st May, 1905,* on the subject of the penalization of raw sugar produced in the Philippine Islands, I have the honour to transmit a copy of a note which, after discussing the matter with Mr. William H. Taft, United States Secretary for War, on the 3rd instant, I handed to that gentleman at his request on the 5th.

2. Mr. Taft told me that he would take steps to get Congress to alter the duties so as to reduce the existing surtax on raw sugar and bring it within the limits allowed by the Brussels Convention, and promised me a further communica- tion on the subject from Washington.

I have, &c.,

51

by the Marquess of Lansdowne to state that no further information has been received on the subject since that referred to in your letter of the 19th ultimo,* and that it does not appear to be necessary to obtain any further details for the purposes of the Sugar Commission.

His Lordship has not considered it necessary or of any advantage to approach the United States Government with a view to the reduction of the duties on sugar imported into the islands as suggested in your letter of the 15th of July last.†

I am to state that the draft of the instructions to the British delegate for the next meeting of the Commission will be forwarded in due course for Mr. Secretary Lyttelton's concurrence.

I am,

&c.,

36712

No. 63.

E. GORST.

PUBLIC RECORD OFFICE

Reference :-

C.O. 882

6

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH-NOT TO

Enclosure in No. 61.

M. NATHAN,

Governor, &c.

Note handed to Mr. Secretary Taft. Article III of the Brussels Sugar Convention of March 5th, 1902, lays down that :---

"The High Contracting Parties undertake to limit the surtax to a maximum of G francs per 100 kilogrammes for refined sugar and assimilable sugars, and to a maximum of 5 francs 50 centimes for other sugars. The surtax is the difference between the rate of duty or taxation to which foreign sugars are subject, and that imposed on the hone product."

Countries affected by the Convention are bound to either impose an import duty not less than the excess of the surtax over the above amounts or to prohibit the entry into them of sugar from the countries that have an excess surtax.

Hong Kong is affected by the Convention. Being a free port it cannot impose import duties, and so is bound to prohibit importation.

The Permanent Commission which gives effect to the Convention has ruled that the import duty on raw sugar at the Philippines which by the Customs Tariff of the 3rd March, 1905, is $1.62 per 100 kilogrammes gross weight, is equivalent to an excess over the recognised surtax of 1 franc 31 centimes per 100 kilogrammes. At the request of the British Representative the Permanent Commission at their sitting in last April postponed till October the question of penalising Philippine sugar.

Unless the excess surtax is removed it may be necessary for Hong Kong to issue a prohibition order against the importation of raw sugar from the Philippines.

This would injuriously affect Hong Kong and cannot be of any advantage to the Philippines.

36531

SIR.

No. 62.

FOREIGN OFFICE to COLONIAL OFFICE.

(Received October 14, 1905.)

[Answered by No, 65.]

WITH reference to the second paragraph of your letter, 31605/05,† of the

Foreign Office, October 13, 1905. 3rd instant, respecting sugar legislation in the Philippine Islands, I am directed

FOREIGN OFFICE to COLONIAL OFFICE. (Received October 16, 1905.) [Answered by No. 65.]

The Under-Secretary of State for Foreign Affairs presents his compliments to the Under-Secretary of State for the Colonies, and, by direction of the Secretary of State, transmits here with copy of the under-mentioned paper, for concurrence. It is requested that an answer may be returned by the 19th instant if possible. Foreign Office.

October 16, 1905.

Same and Date.

Draft to Sir H. Bergne

SIR,

(Draft.)

DESCRIPTION OF ENCLOSURE,

Subject,

Autumn Session of Sugar Commission: Instruc-

tions.

(Also sent to Treasury and Board of Trade.)

Enclosure in No. 63.

1905.

Foreign Office, October In your despatch of May 5th last, in which you reported the result of the proceedings of the recent session of the Permanent Sugar Commission, you informed me that the Autumn Session of the Commission had been fixed to take place on October 23rd, and it is, therefore, necessary now to consider the attitude to be adopted by you with regard to the various questions which may be raised before the Commission.

You will remember that the countervailing duties imposed on sugar from Brazil at the 32nd sitting of the Commission were suspended at the 37th sitting which took place on the 8th of April last pending a fresh decision at the coming session. His Majesty's Government have not received any information that convinces them that the system of sugar legislation in Brazil gives rise to a bounty, as will be seen from the enclosed statement on the subject summarizing the information at their disposal, but should any such information be produced before the Commission you will, of course, not be in a position to resist the condemnation of Brazil, provided the Commission have, in the first instance, declared that the system does actually give rise to a bounty-a condition on which you should insist-and do not base their decision on the existence of a surtax alone. I understand that the Brazilian Government have deputed Mr. Wildman to proceed to Brussels in order that he may personally prove to the Commission that the Brazilian system does not give rise to a bounty. I request that you will strongly support any request that may he put forward by the Brazilian Government that Mr. Wildman may be accorded

* No. 49.

↑ No. 60.

138

• No. 58.

† No. 50.

G 2