CO129-512-5 Boxer Indemnity Settlement 21-5-1929 - 21-5-1929 — Page 71

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11.

Faokow-Chinghua Railway •

Article 19 of the loan agreement of July 3, 1905, between

the Director General of Railways and the Peking Syndicate pro-

vides as follows:-

All plant and materials necessary for the repair and working of the line will be purchased by the (Peking) Syndicate as agents, but in placing such orders the Syndi- oate will do their best to get the most favourable terms .

It is understood that articles which China herself can manufacture, if quality and price are the same are not to be ordered from abroad

By price is meant the cost in the foreign country plus freight and insurance.

The working agreement concluded on the same day provides,

in Article 2 (ad finem) as follows:-

12.

As regards orders for the supply of materials necessary for maintaining and repairing the line means should be de- vised to place the same at Chinese workshops.

Chinghua-Menghsien extension of Txokow-Chinghua Railway.

The agreement for the construction of this extension, be-

tween the Government of the Republic of China and the Peking

Syndicate, provides as follows:-

In the preamble. It is hereby declared that the terms of the

loan agreement and/or the working agreement of the Tao-Ching Railway shall not apply to this agreement.

Article 19.

All plant, tools, materials and supplies necessary for the construction of the branch railway which require to be purchased during the period of construction shall be purchased by the Peking Syndicate (Limited), as purchasing agents, by calling for tenders in the open market. In placing orders therefor articles of Chinese manufacture shall be preferred, providing always that in quality and price the same compare favourably with articles of foreign manufacture

The Peking Syndicate (Limited) shall be entitled to 3 per cent commission upon the net eost, (excluding freight and insurance) of the materials purchased only through their agency from foreign countries.