15
whatsoever other than the Import Tariff of 1902 and transit due
(if any) or the Export Tariff of 1858, as the case may be, or any future revisions of those instruments. It is of course understood (and this mi ht perhaps be more clearly expressed) that any revisions of the Tariff must be concurred in by His lajesty's Government and that any lekin or otuar form of lavy are prohibited. This Colony has not asked for any corresponding facility at Canton for its officials to function and collect Juties on Liquor or on any other article upon which in the future custous duties may be imposed in the Colony. Buch facili- -tios are only asked at the frontier station, but if you anti- -cipate any difficulty in regard to this clause and schedule you may possibly consider it advisable to press for complete reciprocity in this matter with the intention of abandoning it so far as the Canton terminal is concerned provided that the Chinese will agree to the exemption of goods carried by the Railway from duties except in accordance with the Tariff as in the Schedule. I may add that in the circumstances I do not propose to proceed with the separate Customs Convention, in (in which matter China by her dilatoriness has lost her opportuni. -ty) and if it is pressed later by the Viceroy I shall probably require more favourable conditions than it at present contains.
11.
state
With regard to article 37-B (now article 39)
I have the honour to forward in original and translation an extract from the Sa Taz Yat io of the 15th. ultimo which snowS how necessary it is that a clause dealing with the policing of the Railway should find a place in the Working Agreemont. If the transit by railway is insecure there is little hope of successful competition with the river steamers and I hope that Your Excel- -lency will secure the retention of this clause in the agreement.
12.
Since signing the attached copy of the agres-
-ment Mr. Chao has received on the 9th. instant a telegram from the Director-General of Railways which reads as follows:- "He "have received instructions from the Board to reply that concern-
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