CO129-405 - Public Offices - 1913 — Page 438

C

(13619/13).

Definition of China Company.

437

Sir E.Grey is of

opinion that at the present stage it would be inad-

visable to accept the proposal to add "or guarantee"

to the definition. The addition would introduce the

difficult question of enforcing contributions from

foreigners in the case of companies which are wound up.

The elaborate provisions in article 13 to ensure that all

shares issued by a China company were fully paid were

intended to obviate the difficulty concerning foreign

contributions, and if the words or guarantee" are now

added it will enable any China company to evade article

13 by working as a company limited by guarantee and not

by shares. Sir E.Grey is aware that many British con-

cerns in Shanghai will, as the definition now stands,

rank as "British companies" and not as "China companies",

but that is in his opinion a lesser evil. In a scheme

of this magnitude it is inadvisable to proceed too

rapidly at the start; when the scheme has been ob-

served in operation it can, if desirable, be extended to

Include approved companies limited by guarantee.

The second paragraph of the note on Article 2 deals

with