CO129-461 - Governor Sir Stubbs - 1920 [5-7] — Page 309

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DRAFT.

Sir,

305

Shanghai,

.March, 1920.

China (Companies) Amendment Order in Council, 1919.

and

The British American Tobacco Company (China) Ltd.

I have the honour to acknowledge, with thanks, your letter of the 12th instant written on behalf of the above Company informing me of Sir Arthur Churchman's arrival in China, of the visit of Viscount Acheson and your-self to Peking, and of the suggestions then made to Mr. Lampson that, by a further Companies Order in Council, H. M. Minister might be given power to grant licences to 'China Companies' to employ non-British Managers

under special circumstances, and under certain conditions.

While recognizing the difficulties which the British

American Tobacco Co. have, in view of the nature of their busi-

ness in China, in complying with the provisions of the Order in Council of 1919, it is my duty to point out to you that, in my opinion, any alteration permitting non-compliance with its provi- sions even in the case of one China Company, would inevitably tend to render nugatory the safeguards which have been embodied in the new Order in Council, drawn after years of careful con- sideration, whereby provision has been made that Companies regis- tered in Chine enjoying British recognition and protection shall in fact be there under British management.

The Crown Advocate agrees with me in thinking that the

suggested appointment of Sir Arthur Churchman as Chairman of the

Board of your Company in China, even if he cannot take up his

permanent residence there, would be a wise step to take, as an

immediate compliance with Article 4 of the new Order in Council.

I repeat my verbal assurance that in view of the steps

which the management of the British-American Tobacco Co. (China)

Ltd. are taking to conform with the provisions of the China

. B. Kennett, Esq.,

British-American Tobacco Co. (China) Ltd.