CO129-383 - Public Offices - 1911 — Page 378

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

373

AFFAIRS OF CHINA,

CONFIDENTIAL.

са [May 1.]

17449 SECTION 1,

RECR

[16172]

No. 1.

Rraf 29 MAY 11

:

(No. 152.) Sir,

Sir J. Jordan to Sir Edward Grey.-(Received May 1.)

Peking, April 11, 1911. WITH reference to my despatch No. 97, Confidential, of the 1st of March last, I have the honour to transmit to you herewith copy of an agreement which was signed yesterday between the Board of Communications and the Eastern Extension and Great Northern Telegraph Companies for a loan of 500,000, or, as it is termed in the document itself, an "advance" to that amount on account of certain revenues administered by the two companies.

The repayment of interest and principal is guaranteed by the Chinese Government and the other conditions of the contract are practically the same as those reported in my above-mentioned despatch, the only notable exception being the elimination of article 8, relating to the retention of the services of a foreign adviser. This clause was omitted in exchange for a verbal assurance from Sheng Kung Pao that there was no intention of parting with Mr. Dresing.

The transaction was confirmed by an Imperial decree which was transmitted to me in a note from Prince Ch'ing, copy of which I have the honour to enclose here- with, and as provided by article 7, one copy of the agreement has been deposited by the Eastern Extension Company in this legation. The companies receive a preferen- tial lien on Chinese revenue from "through traffic" and "limitroph traffic" and no loan or mortgage can be charged upon this security, nor can the revenue be in any way impaired until the present advance is redeemed.

The two foreign companies which were the pioneers of telegraph enterprise in China have thus secured à further advantage against all possible competitors until the 31st December, 1930.

I have, &c.

J. N. JORDAN.

Enclosure 1 in No. 1.

Agreement,

AN agreement made this 10th day of April, 1911, corresponding with the 12th day of the 3rd moon of the 3rd year of Hsuan Tung, between the Imperial Chinese Board of Communications (hereinafter called "The Yuchuanpu ") of the one part, and the Eastern Extension Australasia and China Telegraph Company (Limited), and the Great Northern Telegraph Company (Limited), of Denmark (hereinafter called "The Companies "), of the other part.

Whereas, the Yuchuanpu for the purpose of reorganising, improving, and developing the telegraph and telephone services throughout the Chinese Empire has to provide large sums of money in the immediate future.

And, whereas, in accordance with existing agreements between the Imperial Chinese Telegraph Administration and the companies, certain revenues administered by the companies, are paid quarterly to the said administration.

And, whereas, the companies are prepared to make an advance on account of the said revenues to the Yuchuanpu for the purposes stated.

It is, therefore, mutually agreed between the parties hereto, as follows:-

Article 1. The companies agree to make an advance to the Yuchuanpu of the sum of 500,000, on the conditions hereinafter named.

Art. 2. The advance shall be made at par and shall bear interest at the rate of 5 per cent. per annum.

Art. 3. Of the said sum of 500,000l. a sum of 300,0001, shall be paid by the companies to the Yuchuanpu on the 1st May, 1911, corresponding with the 3rd day of the 4th moon of the 3rd year of Hsuan Tung and the balance of 200,0001, shall

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