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from Chinese civil warfare, and that all the best Chinese public opinion was solidly against the import of arms from foreign sources.
In the autumn of 1925 the Foreign Office, as the result of their study of the question, forwarded to His Majesty's Minister for his observations and recommendations two papers-the one a letter from Mr. Teichman then on leave in England, and the other a memorandum by Mr. Ashton-Gwatkin, on the subject of the arms embargo (see Foreign Office despatch No. 831 of the 23rd September, 1925). In the former Mr. Teichman recommended that some of the objections to the armis embargo could be met by the removal, so far as British subjects were concerned, of aeroplanes from its scope, and the consequent abolition of all restrictions on the export of aeroplanes from the United Kingdom to China, and by the further step of repealing our China King's Regulations and carrying out our arms embargo policy in future by means of prohibition of export from Great Britain (instead of prohibition of import into China); and he further suggested, with reference to the general question of policy involved in the embargo, that Germany, Russia and any other Power concerned, not party to the arms embargo understanding, should be invited to adhere to its principles, and also that, failing their acceptance, or perhaps in any case, we might even reverse our policy to the extent of attempting to apply the embargo in future in co-operation with the Chinese Government; and that the time had come to accord to the Kuo Min-tang administration in Kuangtung in this and other matters the same measure of de facto recognition as was given to the Peking Government; this suggestion, postulating the existence of two Governments in China, amounted, in effect, to a reversion to pre-embargo conditions to the extent that export of arms would be permitted on production of Mr. Ashton- huchao issued by either Northern or Southern Governments. Gwatkin, in his memorandum, emphasised the point that by their existing policy His Majesty's Government were permitting our enemies in China to themselves freely from Russian sources while keeping our friends unarmed; and he recommended that His Majesty's Chargé d'Affaires at Peking should be instructed to inform the Diplomatic Body that, in view of the complete change in conditions since the embargo was initiated. His Majesty's Government proposed to withdraw from it altogether, and to allow British subjects to deal freely in arms in China, subject always to such restrictions as might be imposed by the Chinese Government.
arm
5. His Majesty's Minister submitted his views in reply in his despatch No. 47 of the 19th January, 1926. In this despatch Sir R. Macleay pointed out that the situation had changed once more during the past few months, that there had been a further general political disintegration, and that the Kuo Min-chun group in the North, which had the previous year identified itself with the anti-British movement. and which had in the meanwhile come to control the Peking Government, was professing to hold out the hand of friendship; the considerations existing the previous summer in favour of a departure from a policy of strict neutrality on the part of His Majesty's Government had lost some of their force; Chinese public opinion continued to be strongly against the import of arms from foreign sources, and the Chinese Government themselves had issued a mandate announcing their intention of ceasing the importation of arms from abroad. This mandate was, of course, a mere paper gesture in existing political conditions, but Sir R. Macleay considered that in all the circumstances the moment was inopportune for anything like a public withdrawal from the embargo, and he recommended that the situation would best be met by amending our King's Regulations and definitely excluding aeroplanes from their scope.
6. In the meantime, appeals for assistance in the form of munitions of war continued to be made to His Majesty's Government by the anti-Kuo Min-tang leaders, more particularly by Wu Pei-fu. As a result of the above examination of the question, the Foreign Office (in despatch No. 267 of the 13th April, 1926) declared in favour of a relaxation of the embargo in a manner calculated to enable British firms to compete with foreigners in supplying arms to a future stable and friendly Chinese Government for legitimate requirements of defence; and they proposed, when a fairly stable Government had been established in power, to replace our arms embargo restrictions by a policy of applying to British subjects the Chinese law prohibiting the import of arms. They further proposed that, in the meanwhile, the hardships from which British merchants were suffering should be mitigated by a less rigid application of the King's Regulations, and the definite exclusion of aeroplanes from the scope of our interpretation of the embargo understanding.
This was done.
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7. Since that time the main issue has become somewhat obscured by a discussion between the Foreign Office and the Legation about the application to British subjects of the Chinese law prohibiting the import of arms (see Legation despatch No. 522 of the 12th July, 1926; Foreign Office letter of the 28th January, 1927; and Legation reply of the 7th April last). It seems to me unnecessary to complicate this already difficult question by considering the question of the applicability of the Chinese code at all, seeing that the import of arms, except to the order of the Chinese Government, is, and always has been, prohibited by Customs regulations based on a treaty provision, and, therefore, operative against British subjects; while with regard to the technical point as to the meaning of article 74 (3) of the Order in Council, making punishable in a British court anyone importing into China goods the importation of which is forbidden "by law," and the ruling of His Majesty's Supreme Court that the word "law means the law of China concurred in by His Majesty's Government in some public document, I should have thought that such concurrence was, in fact, adequately expressed in rule 3 of the Rules of Trade, and that a British subject smuggling arms through the Customs could be punished under the Order in Council by a British court, as he would presumably be for any other form of smuggling in violation of treaty tariff provisions.
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8. The last paper from this Legation on the question is represented by my despatch above referred to (No. 318 of the 4th April), which again raises the point that the hostile South is being supplied without let or hindrance with arms from Russian sources, while, in pursuance of our arms embargo policy, we not only prevent British interests from supplying arms to the friendly North, but use the machinery of our Eastern ports of call to prevent the latter securing arms from any source. In the meanwhile, the situation in regard to the embargo has momentarily taken yet another turn, in that the Extremist Nationalist clique established since last autumn at Hankow, which has hitherto been so freely supplied with arms from Russian sources, now finds itself for the time being cut off from the coast by a rival Nationalist faction, which professes to have turned against the Russian domination of the Kuo Min-tang, and which has even appealed to us for assistance in the supply of arms (see Canton telegram to Foreign Office No. 32 of the 6th May, 1927).
9. As I understand the position, the present policy of His Majesty's Govern- ment is that we should withdraw from the arms embargo as soon as a friendly Chinese Government has been established, and replace it by the enforcement on British subjects of the Chinese law prohibiting the import of arms (or, rather, in my view by the ordinary Customs prohibition based on the treaty prohibition). There is, however, obviously little prospect at the present time of the establishment of such a Government; and the question arises as to whether we should continue our present policy while we wait for its emergence. His Excellency the Governor of Hong Kong has long been pressing for our withdrawal from the embargo, and he has recently again raised the matter in connection with the supply of arms to General Li Chai-sum at Canton, and it will be noted from the enclosed copy of a minute by the commercial counsellor to His Majesty's Legation that Mr. Fox supports the view that the time has come for us to withdraw from the embargo. From the point of view of immediate political expediency there can be no question but that the embargo is, from our point of view, objectionable and prejudicial to our interests. Taking, however, a broader and longer view. it may very well be questioned whether, if we freed ourselves from it, we should not in fact land ourselves in even greater difficulties. In the first place we should have to give formal notification to the other Powers concerned of our withdrawal, which would be broadcast by our enemies as an indication that we intended to afford material support to one military faction against another. Any public withdrawal from the embargo at the present time is bound to be misrepresented to, and to invite severe criticism in many quarters. There is little doubt that we might find a certain class of British subjects mixed up in all kinds of shady transactions in arms, involving complications and conflict with the various Chinese military factions. Apart from its moral aspect and from a political point of view the question of the arms embargo turned largely on the point as to whether or not we are going to continue our policy of strict neutrality in Chinese In this civil wars and whether we wish to intervene on one side or the other. connection the views attributed to Sir J. Jamieson in Foreign Office letter to the Colonial Office of the 5th January last (see Foreign Office despatch No. 16 of the however 10th January) are undoubtedly very much to the point, namely, that disadvantageous the agreement may be to British interests at present, it does definitely prevent Great Britain from becoming identified in Chinese eyes with any one of the
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