CO129-350 - Public Offices - 1908 — Page 405

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4. That the detailed arrangements connected with the outstanding affairs of the Company will be equitably arranged between Chang Yi and General Manager Nathan.

5. That the Company will not interfere with the territorial jurisdiction of the Chinese Government respecting the land and harbour at Chingwangtao.

6. At Chingwangtao on the land obtained by the Company through purchase and on that held in trust for the Chinese Government the sovereignty of the Chinese Government and Chinese local officials in exercising their territorial powers and rights shall be fully respected and recognized by the Company.

Respecting the information of a Settlement and the establishment of a municipality, &c., these will be arranged by the Customs Taotai of Tien-tsin according to the original despatch of the Viceroy of Chihli and subject to the approval of the Viceroy. The Imperial Edict strictly ordered Chang Yi to make complete restoration and what has been presented cannot be called restoration. Restoration means that the registration in England of the Chinese Engineering and Mining Company as a Limited Company should be entirely cancelled and the Company revert to Chinese control, and that all the Company's lands and buildings, and all the steamers for shipping coal, &c., belonging to the Company should be also restored and be under Chinese control. The matter of the land and harbour at Chingwangtao to be clearly settled by a payment to the Limited Company of a certain sum of money incurred in expenses and to become Chinese Government property again, and in so doing will he act in accordance with the Imperial Edict, as it points out to strictly order Chang Yi to make complete restoration. These six Articles were agreed upon and still exist in the Limited Company, and the Company has not been cancelled yet. Respecting the sovereignty of the Chinese Government, the Limited Company cannot, of course, encroach upon that and the duties, taxes, li-kin, and royalties the Company has not forgotten to pay. The report sent to me is made up of useless language and most of it is full of ineffective thoughts.

In the sixth Article it is evidently recognized that the arrangements for the converting of Chingwangtao Harbour have not been decided on and that the Limited Company having already recognized it as a commercial port it can be arranged that the Customs Taotai of Tien-tsin will have the decision regarding the arrangements in accordance with the despatch of the former Viceroy. In this there seems a slight chance of being able to deal with the matter.

The Customs Taotai, Tang Shai Yi, reports that he has consulted with W. S. Nathan on several occasions regarding Chingwangtao, and that the understanding come to is similar to the sixth Article, but I should still be allowed to order the Customs Taotai to arrange terms for a proper settlement which may enable us to get back a portion of the land, and in this case we can consider that the portion of the land recovered has been rescued in conformity with the wishes of the Chinese Government orders which is so careful about territorial land. The outcome of this case depends purely on whether the mine and properties can be restored or not.

Chang Yi in the spring of last year received several Imperial Orders ordering him to make restoration, but one year has now elapsed and he has been still unable to restore it. According to the opinion of some of the English people here, if Chang Yi were to go to England and be present in Court during the lawsuit which has been instituted for the recovery of the property the desired result might be arrived at easier, but even then it is not certain that this would be the case. Again, I have consulted foreign lawyers on the subject four different times and their opinion is that Chang Yi in the 27th year (1901) made an Agreement to sell Government land and that he undoubtedly used the official seal. That, although this has occurred several years ago, it had been so far impossible for him to make restoration as he was ordered to do, and that even if it could be restored a sum of 6,000,000 or 7,000,000 taels would have to be paid back to the English people as an indemnity for their loss, but as China is overburdened with debt it is, of course, quite impossible to raise such a sum. Further, that Chang Yi was a poor man and only owed his success to the great favour shown him at all times by the throne, and that instead of exerting himself to repay their favours by noble deeds he seized the first opportunity to sell the mines and land of the Imperial Government to a foreigner, and this during the Boxer outbreak in 1900, and while Prince Ching and Li Hung-chang were negotiating for peace at Peking, and that the degraded Chang Yi did make the sale above mentioned on his own accord and without having first obtained the very necessary permission and that he used the official seal in connection with this sale.

A.

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He never waited for Li Hung-chang to compose the Memorial to the throne and, moreover, he caused the impression to be spread that Li Hung-chang, acting conjointly with himself, had memorialized the throne, but it is apparent that the real truth was never presented to the throne. He has been guilty of fraud. He wished to raise foreign shares and to change the Company into an Anglo-Chinese Company, and the Agreements and Memorandums entered into with the foreigners have never been copied or memorialized to the throne. I have justified my statement that he had the full intention to cheat and disregard the throne, and when his follies began to come to light he was still unwilling to take steps for a speedy restoration of the mine and lands, but kept putting it off and concealing his follies until the matter has gone on entirely too long and it seems that no remedy can be effected. Surely he is too ungrateful, and with regard to the steps that should now be taken, I earnestly beg the Imperial throne to give their decision, hence my Memorial which I lay before the throne.

Rescript received, written with the Vermillion Pen, thus

To strictly order Chang Yi to make complete restoration as quickly as possible.

18th, 2nd moon.

Annexure No. 12.

Viceroy Yuan Chi Kai to Chang Yen Mao.

I understand by your Excellency's letter that you have recently come to an understanding with Major Nathan, Agent and General Manager of the Limited Company, and the points agreed on are roughly as follows:-

1. That the Limited Company shall on no account encroach on the rights and powers of the Chinese Imperial Government as the Lord of Soil.

2. That the Limited Company agree to pay the taxes and li-kin, royalties, &c., which have been imposed on the produce of the mines.

3. That the proceedings of the Limited Company and its annual accounts shall be reported regularly to the Viceroy of Chihli. That the Regulations laid down by the Central Government shall be observed by the Limited Company.

4. That the general administration of the Company shall be only discussed and settled by you and the Agent of the Limited Company.

5. That with regard to the establishment of the Port of Chingwangtao, the rights and powers of the Chinese Imperial Government shall be in no way infringed by the Limited Company.

6. That at Chingwangtao there are lands owned by the Company and those which were put under the charge of the Company, in dealing with them the Customs Taotai of Tien-tsin shall refer to the original despatch of the late Viceroy wherein he ordered the Company to buy lands.

In reply to your letter I am obliged to intimate to you that, in full conformation with the Imperial Edict issued last December, you are ordered to effect a complete restoration of the said Company to the original Chinese ownership. By complete restoration we mean that in the first place the registration of the newly incorporated Company in London should be cancelled and nullified. And further all the properties of, and those in connection with the Company, such as lands, rails, canals, wharfs, buildings, depôts, coal-yards, manufactories and other branches of mining enterprise, ships, &c., must all be received back, and reinstituted to the management of our own people. And thirdly, as to the Port Chingwangtao, the money spent by the Limited Company should be estimated and refunded to them in order that it may become a purely Chinese port and to be managed by proper officials. This is the meaning of the term "Complete Restoration," as it is used in the said Imperial Edict.

In the agreement you presented, the said Limited Company enters therein as a party, this of course shows that the same is in full existence, and therefore the very first requirement has not been fulfilled. As on other points, the limitations laid down to the powers of the Limited Company seem all superfluous. The rights and powers of the Imperial Government cannot be, never were, nor will be encroached by the said Company. They paid their taxes, and reported their proceedings and annual accounts. To what purpose, therefore, your newly signed agreement was meant, I fail to see.

However, in the 6th Article about the Port Chingwangtao the Limited