CO129-350 - Public Offices - 1908 — Page 488

C

[This Document is the Property of His Britannic Majesty's Government ]

AFFAIRS OF CHINA.

CONFIDENTIAL,

137395]

No. 1.

485

6160

Rec [Novemb120 FEE 08

SECTION 1.

Sir,

Board of Trade to Foreign Office.-(Received November 12.)

Board of Trade, November 11, 1907. IN reply to your letter of the 12th ultimo respecting the registration of ships owned by Companies carrying on business in China, I am directed by the Board of Trade to state, for the information of Sir E. Grey, that as regards the case of the "Canton" it seems clear that, as the vessel is the property of a Company which is established under and subject to the laws of some part of Ilis Majesty's dominions, and has its principal place of business in those dominious, namely, Hong Kong, she is entitled to be registered as a British ship under "The Merchant Shipping Act, 1804." In this connection I am to inclose a copy of an extract from the opinion given by the Law Officers and Mr. (now Mr. Justice) Sutton in 1902 with reference to the Atlantic shipping combine.

As regards the matter dealt with in the final part of your letter, viz., the question of the status of vessels owned by Companies registered at Hong Kong, and British in respect of capital and Directors, but baving their principal place of business at Treaty ports in China, I am to state that, while such vessels can probably not be registered as British if the law is to be read with strictness, the Board are disposed to agree with the suggestion contained in Inclosure No. 4 to the Shanghae Consul- General's despatch of the 6th June that, in the case of Companies which are bond fide British, and which have their principal place of business at a Treaty port, the Treaty port might for the purpose of registration be regarded as forming part of His Majesty's dominions.

If, therefore, the Registrars of Shipping, either at Hong Kong or Shanghae, upon the application of a Company registered in Hong Kong, but having its principal place of business at a Treaty port, and on being satisfied by a certificate from the Consul at the Treaty port or otherwise that the Company is bond fide a British Company, think fit to register auy vessels of the Company as British ships, the Board of Trade would not feel called upon to raise objections to such registration.

In such cases, however, it would be necessary that the composition of these Companies should be carefully examined from time to time, in order that if it were found that the majority of the Directors and shareholders had become non-British the British registry of the ships might be closed.

I am, &c.

(Signed)

WALTER J. HOWELL.

Inclosure in No. 1.

Extract from Law Officers' Opinion respecting the Atlantic Shipping Combine, dated May 27, 1902.

WE are of opinion that :-

1. The acquisition by the American Corporation, under the Agreement of the 4th February, 1902, of the whole of the shares of the Companies representing the White Star line and Dominion line respectively would not constitute an acquisition of a boneficial interest in the British ships owned by them, within the meaning of section 57 of the Act of 1894, for the whole interest in such ships is and would remain vested in those Companies respectively, and not in their shareholders.

Upon the true construction of section 1 (d) of the Act the Companies, by selling or being parties to the sale of the whole of their shares to the Corporation, would not thereby cease to be qualified to be owners of British ships, provided and so long as their principal place of business continued in the King's dominions (see Arnand's

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