(Translation.)
Sir,
Inclosure 7 in No. 1.
Consul Hughes to Taolai Chu Yen-hsi.
May 28, 1907. I HAVE the honour to acknowledge receipt of your despatch of yesterday's date.
[Despatch quoted.]
In reply, I have the honour to state that since Changsha has been opened as a Treaty port, foreign goods entering the port are by Treaty liable to no further imposts or taxes after the customs import duty has been paid.
Yuan T'ai are the agents of the British American Tobacco Company, and the latter Company has not been transporting goods for other parties.
I cannot order the Tobacco Company to do as you request, as such an order would be contrary to the Treaties.
(Translation.)
Sir,
Inclosure 8 in No. 1.
I have, &c.
(Signed)
M. HUGHES.
Tuotai Chu Yen-hsi to Consul Hughes.
May 31, 1907. I HAVE the honour to acknowledge receipt of your despatch of the 28th instant.
[Despatch quoted.]
By the Xth Article of the China-Japan Commercial Treaty of 1903, Changsha was opened to foreign trade on the same footing as the other ports already opened to trade. The Treaty ports are generally called after the prefecture or district, but the ports are all outside the chief towns of the prefectures and districts. The port of Changsha has been fixed outside the city; it is exactly on the same footing as the other Treaty ports. Since the practice here is in accordance with the earlier Treaties, the city is outside the limits of the port, and the Li-kin Office has the right to levy li-kin. Outside the port all are native merchants. The firm of Yuan T'ai has not been established by foreign merchants. When they sell the cigarettes of the British-American Tobacco Company it is a case of foreign goods in the hands of native merchants, and foreign merchants are not concerned in the matter. The reference of the Li-kin Office to this affair as being a case of interference by the Tobacco Company is certainly correct. An arrangement to meet the case has now been devised, viz., the Li-kin Office is to collect the li-kin from Yuan Tai. I have written in this sense to the Li-kin Office, and I have the honour to inform you of the arrangement.
(Translation.) Sir,
I have, &c.
(Seal of Superintendent of Customs.)
Inclosure 9 in No. 1.
Consul Hughes to Taotai Chu Yen-hsi.
June 3, 1907.
I HAVE the honour to acknowledge receipt of your despatch of the 31st May.
[Despatch quoted.]
By Treaty foreign goods are not liable to any li-kin or tax whatsoever within the limits of a Treaty port, This does not apply solely to foreign merchants. Foreign goods imported by native merchants are equally exempt from all taxation. This is an elementary fact which no one with any experience in international questions can be ignorant of. The arrangement mentioned in your despatch is clearly an evasion of the Treaties, and I am surprised that it should have been proposed to a foreign official with experience of foreign trade at the Treaty ports.
5
I trust that his Excellency the Governor will at an early date issue a Proclamation notifying all subordinate officials that the city of Changsha being a Treaty port, foreign merchants may open places of business there, and that foreign goods are not liable to li-kin, so that by the issue of the Proclamation troubles of the present sort may be avoided. In the meantime, I have the honour to request you to instruct the Li-kin Office not to repeat the previous irregularity, obstructing the trade of the Company in question.
I have, &c.
Inclosure 10 in No. 1.
(Signed)
Taotai Chu Yen-hsi to Consul Hughes.
M. HUGHES.
(Translation.) Sir,
June 6, 1907. I HAVE the honour to acknowledge receipt of your despatch of the 3rd instant, on the subject of the cigarettes of the British-American Tobacco Company, brought into the city by the firm of Yuan T'ai for sale on behalf of the Tobacco Company.
Foreign goods are free from li-kin and every other sort of impost within the settlements of the Treaty ports. You are correct in stating this. The city of Changsha, however, is outside the Settlement, and foreign merchants cannot be permitted to establish business premises therein, nor can foreign goods sent into the city for sale be exempted from the "lo ti tax. This point has been already explained by me in correspondence with the late Acting Consul. According to the Treaties and general Regulations, Yuan T'ai, when selling the cigarettes of the Tabacco Company, within the city, are on several grounds bound to pay li-kin. Firstly, the locality is not within the Settlement; secondly, the goods have come into the hands of foreign merchants; thirdly, a transit pass has not been taken out. On these three grounds, an official experienced in trade questions at Treaty ports must admit that the collection of the li-kin from Yuan Tai by the Li-kin Office is a proper arrangement. 1 am unable, therefore, to order the Li-kin Office not to levy the tax,
(Translation.)
13
I have, &c. (Seal of Superintendent of Customs.)
Inclosure 11 in No. 1.
Consul Hughes to Taolai Chu Yen-hsi.
Sir,
June 14, 1907. I HAVE the honour to acknowledge receipt of your despatch of the 6th instant, in which you state that foreign goods are free from li-kin and every other sort of impost within the Settlements of the Treaty ports, but that Changsha city is outside the Settlement, and foreign merchants cannot be permitted to establish business premises within it, nor can foreign goods sent into the city for sale be exempted from the "lo ti" tax.
The instructions of His Britannic Majesty's Minister at Peking, received long since, are that Changsha city is open to foreign trade, and that the Wai-wu Pu had admitted the right of British merchants to open business premises therein. Further His Majesty's Minister instructed my predecessor to send back to his Excellency the Governor, a despatch in which his Excellency stated that when Changsha was opened to foreign trade, a foreign Settlement had been marked out outside the North Gate, and the wharves were to be outside the West Gate, and that His Excellency could not permit British merchants to establish business premises inside Changsha city.
With reference therefore to your statement that Changsha city is outside the Settlement, and that foreign merchants cannot be permitted to establish premises therein, and that foreign goods sent into the city for sale cannot be exempted from li-king this view has now received the assent of His Britannic Majesty's Minister, and it is therefore needless for me to discuss the question.
I have, &c. (Signed) M. HUGHES.
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