CO129-338 - Public Offices & Others - 1906 — Page 116

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of Peking, to which the Company shall render periodical accounts of the management in its charge. The Chinese Government may appoint a Chinese civil functionary, who will reside there as the Imperial Agent at the said custom-house.

Passengers' luggage, as well as the merchandize, conveyed in transit by this branch line from one of the Russian frontier stations to the region of Liaotung Peninsula ceded in usufruct to Russia, or vice versa, shall not be subject to customs duties; and they shall All goods imported by the also be exempt from all the internal imposts or taxes. railway from the territory ceded in usufruct to Russia into the interior of China, and those exported by the railway from the interior of China to the said territory shall be subject, respectively, to the import or export duties, as the case may be, of the Imperial Maritime Customs without any reduction or augmentation,

Art. 6. The Eastern China Railway Company has the right to own, at its own risk, merchant steamers under the flag of the Company, conforming to the regulations of navigation applicable to foreign commerce in Chinese waters. The Chinese Govern- ment shall not be in any way responsible for any losses which may be caused to the Company in connection with the undertaking or management of this enterprise. Fares and freight for transportation of passengers and merchandize on these steamers of the Company shall be fixed by the Company. This enterprise being entirely separate from the railway, the duration of its term shall not be fixed, nor shall it be governed by the stipulations of Article 12 of the Agreement concluded on the 27th August, 1896, between the Chinese Government and the Russo-Chinese Bank relative to the terms of redemption and free passage for the Chinese Government.

Art. 7. The tracks and the points where the South Manchurian branch line shall pass, shall be determined by the President of the Eastern China Railway Company, or his agent at Peking, in common accord with the Chinese Railway Bureau, after the Chief Superintendent shall have made necessary investigations in Manchuria, and reported the result thereof.

The 18th (28th ?) day of the 5th moon of the 24th year of Kuang-Hsü (St. Peters- burgh, June 24, 1898).

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I have the honour to state in reply that this Board are just now engaged in negotiations with Japan and Russia for the establishment of custom-houses, for Southern Manchuria, at Dalny, and for Northern Manchuria at Manchuria* and the Sui Fen River.*

We cannot see our way to make Newchwang a free port under the circumstances, and moreover, in view of the fact that the customs revenue of Newchwang is involved in the indemnity due to foreign Powers, the grounds adduced for making it a free port can still less be entertained.

While requesting that this reply may be communicated to His Majesty's Principal Secretary of State for Foreign Affairs, I avail, &c.

Your Highness,

Inclosure 3 in No. 1.

Mr. Carnegie to Wai-wu Pu.

Peking, August 25, 1906. WITH reference to my note of the 15th August on the subject of the establish- ment of custom-houses in Manchuria, I have the honour to observe that the levy of Tariff duties ou imports and exports at Newchwang, while similar goods are allowed to enter Manchuria at other ports or by railway free of impost, is an unfair discrimination against a long-established Treaty port, and I am instructed by His Majesty's Principal Secretary of State for Foreign Affairs to point out that so long as there are no customs at other ports in Manchuria, Newchwang should also be a free port.

Again requesting the favour of an early reply, I avail, &c.

(Signed)

LANCELOT D. CARNEGIE.

0

(Translation.) Sir,

Inclosure 4 in No. 1.

Wai-wu Pu to Mr. Carnegie.

Peking, 32nd year, 7th month, 11th day (August 30, 1906).

I HAVE the honour to acknowledge receipt of your note of the 25th August complaining of the differential treatment to which merchandize is subjected when passing through Newchwang into or from Manchuria, and urging under instructions from His Majesty's Government that, until custom-houses are established at other points of entry, Newehwang should be made a duty-free port.

* These are the points on the railway at which the line enters Manchurian territory on the west and east respectively, "Manchuria" being the name of a railway station.-TRANSLATOR,