$
Enclisine within
Commencal
Herly Bulleti
*
S22 11 JUL 11
MANILA, P. J., MONDAY, MAY 29, 1911.
TRANSHIPMENT AT HONGKONG
NOT VIOLATION OF PAYNE BILL
Lo 284.
6 JUL 1911
the islands any transfer of it from one vessel to another is violative of! the statutory condition and precludes its admission without payment of the usual duties. On the other hand, the Importers claim that goods the pro ducts. growth, and manufacture of the Philippines are exempt from duty If their shipment is made on a through bill of lading and if as a matter of fact they come to the United States" without entering into the commerce of any other country.
The language of the statutory pro vision is fairly susceptible of either
Decision of Court of Customs Appeals in United Stores interpretation, and it is therefore
Case Holds That It Was Made Necessary by Trade
Requirement and Goods Entitled to Free Entry-Full Text of the Decision
not only permissible but necessary to consider the history of the legisla tion and to inquire into the condi- tions and the circumstances inducing its enactment in order to arrive at a satisfactory conclusion touching its true purpose and intention.
The United States acquired the Philippines by cession from the King..
was in a measure one of the unavoid- able results of the Spanish-American | War. The treaty between the high- contracting parties did not vest the
The complete text of the decision tum and valorem, and paper cigars of the U. S. Court of Court of Cus and eigarettes, including wrappers,dom of Spain, and their acquisition toms Appeals in the case of the United shall be subject to the same duties States • United Stores Co. having as are herein imposed upon cigars," reference to the transipment of Phil- The importers protested against the ippine Cigars from the Yuensang reliquidation and the duties imposed to the Korea in transit to the United and claimed that the cigars were en- peoples of the islands with the rights States has been received. As an-titled to free entry under the pro-and privileges of American citizen- nounced by cable the decision was visions of section 5 of the act, the ship, and that of course left their in favor of the defendants conclud- relevant parts of which are as fol-future well-being largely depended. ing that by reason of a trade require- |lows:
on whether they should be considered
ment the shipment referred to was "Sec. 5. That there shall be levied,
ss utter strangers to the American deemed a direct shipment from Manils collected, and paid upon all articles bousehold or as wards of the Nation to San Francisco and was therefore coming into the United States from for whose happiness and prosperity within the requirements of the Payne the Philippines Islands the rates of the Government was at least morally. Bill making the goods free of duty. The duty which are required to be levied, responsible. The original instructions decision was written by Judge Smith collected, and paid upon like articles of the President to the Philippine and concurred in by all the members of imported from foreign countries; Pro-Commlasion and the organic act for the court,
vided, all articles the growth or she Government of the islands argue It reads:
product of or manufactured in the Phil. strongly that the political welfare. A verified consular invoice dated ippine Islands from materials the and material progress of the Filipino Manila, P. I., June 25, 1909, shows growth or product of the Philippine people were matters of real and ser- that the United Cigar Stores Co., Island or of the United States or of ious concern to the American Gov- a corporation organized under the both, coming into the United States ernment. Indeed, both set and instruc- laws of New Jersey, purchased at from the Philippine Islands sbali here- tiona indicate that from the outset Manila from the Philippine Co. (Ltd) after be admitted free of duty, ex- the United States regarded the in- at a cost #3,387, inclusive of pack.cept cigars in excess of one hundred habitants of its newly acquired ter- ing and other charges, 225 000 cigars, and fifty million cigars, which quan ritory as something more that mere manufactured from tobacco the growth titles shall be ascertained by the aliens, and that in dealing with them and product of the Philippine Is-Secretary of the Treasury under such it elected to pursue a policy which lands. It appears from the bill of rules and regulations as be shall was highly altruistic and benevolent. lading in evidence that the aigars prescribe. And provided further, The establishment of civil govern- so purchased were delivered at Man- That the free admission,herein prov. ment in the islands, the concession is on June 25, 1909, to the Pacificided, of such articles, the growht of a large measure of political Mail Steamship Co. for carriage from product, or manufacture of the United | autonowy to the peoples thereof, that place to New York, shipment States, into the Philippine Islands, and the beneficient intent of legis thereof to be by the steamship KOREA or of the growth, product, or manu-lation affecting their business Inter, to San Francisco and thence to des- facture, as herein before defined, ofesia, are all convincing evidences tination by transshipment. As the
the Philippine Islands into the United that a kindly purpose rather than KOREA had left Manila on June States, shall be conditioned upon the selfish one was to distinguish our: 19, 1909, and was lying at Hong. direct shipment thereof from the sovereign relations with the Phil- kong at the time the bill of lading country of origin to the country of ippines. In this spirit was passed was executed, the Pacific Mail Steam-
destination: Provided, That direct the act of March 8. 1902, admit ship Co. placed the cigars on board shipment shall include shipments inted to the United States articles the YUENSANG and caused them bond through foreingn territory con- the growth and product of to be transported by that vessel to
tigious to the United States.
Philippine Islands. at 75 per cent of Hongkong where by lighters they
The board of General Appraisers the duty imposed on foreign imports were immediately transfered with-
sustained the protest and the Govern- of the
character and which out landing to the Korea. The
ment appealed,
directed that all, the duties collected Kores carried the goods to San Fran- *elsco, whence, under entry for imme- diate transportation in bond they were forwarded by rail to New York At New York the cigars were ex- tered for immediate consumption and the collector, after liquidating the entry as "free" delivered tbe goods to the conporter who sold P9.500. Subsequent to the sale by the importer, the collector of customs, believing that the trans- boarding of the cigars at Hongkong interrupted their "direct shipment" from Manila to the United States and that they
were therefore not entitled to free entry, ordered reliquidation, and imposed on the merchandise duties amounting in the aggregate to some #19,000, under the provisions of paragraph 224 of the tariff act of August 5, 1909, which reads as follows.
them for
**224 Cigars, cigarettes, cheroots of all kinds four dollars and fifty cents per pound and twenty-five per cep
*
same
the
for
It seems to be conceded that the thereon be covered into the Philip- cigars were manufactured from pine treasury. That act was intend-i tobacco the growth and product ofed to stimulate the business of the the Philippine Islands within the islands and to provide revenue meaning of the statute; that the their government. Unfortunately time limit of 150,000 000 cigars entitled to
and experience proved that it was not affective for either purpose, and i exemption from duty in any one fiscal year was not exceeded by the that fact as shown by public docu importation; and that shipment from ments having been officially call- origin to destination was accomplished to the attention of Congres
ed
as hereinbefore recited. There brought about the enactment of being no dispute as to the facts of section 5 of the tariff act of August the case, the question to be deter-15, 1909, the construction of which mined on appeal is purely one of constitutes the present subject of dis- law, namely, what construction absii pute. That section was designed to be put upon the, provision "direct establish a large measure of free trade shipment," which is expressly made between the United States and its or a condition for the admission free lental dependencies, and one of its of goods coming from the Philippines principal objects, if not ita control. to the United States?
ling motive, was to provide a free mar
The Government insists that no du-ket in the United States for all pro- tiable merchandise imported from the ducts the growth and manufacture of Philippines is entitled to free entry the Philippine Islands except rice and unless transported there from to the sugar and tobacco in excess of the United States in a single bottom and maximum quantities specified.
For effective customs administra- beyond the maritime jurisdiction of that once such merchandise bas passed
tion it was of course necessary to
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