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10. This question of the registration of ships in Chinese waters under the Red Ensign has recently come before me from sources outside the Colony and I am making further enquiries, but I am inclined to suspect that the wearing of the British Flag may
have been abused owing to:-
(a) Slack observance of the Merchant Shipping Act Regulations
and
(b) because vessels privilegd to fly, the red ensign enjoy
much immunity from interference by pirates owing to our prestige.
11.
The reason for the above remarks is because it is possible that the Hongkong Government through the Colonial Office may suggest that the Admiralty should augment the Canton Delta
Flotilla.
S. N. 12. At present the Admiralty is fortunate in having as S. N.C. West River Commander Maxwell-Scott. His ability and personality has undoubtedly contributed largely towards the diminution of piracy since he assumed command there. His task is most diffical since there exists no stable Government in Canton and the various. Chinese Generals and other authorities in the Delta belong to antagonistic local factions; in spite of this, however, by his tact, resource and savoir faire he has achieved excellent results
with limited forces.
(Signed)
VICE ADMIRAL.
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