CO129-557-9 British protection of companies in China 26-3-1936 - 27-2-1937 — Page 71

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to be the case also with such European-controlled companies

as the Great Eastern Life Insurance Company Limited, and

to preclude the appointment of Chinese citizens as agents

or managers of its branches in China will certainly prove

an unjustifiable hardship upon genuine British or genuine

Straits-born Chinese Companies.

5. I am also at a loss to understand why it is

proposed that a company operating in China without the

Ambassador's Licence, or infringing the rules governing

the issue of such Licences, shall be dealt with by penal

action in the Consular Courts resulting in the imposition

of fines or in the issue of winding-up orders. It would,

in my opinion, be sufficient penalty if diplomatic and

extraterritorial privileges were withdrawn from any

offending company.

6. The object of framing rules for the grant of

licences is to differentiate between companies which are

genuinely British and those which are not. I have indi-

cated above certain ways in which the rules, as prepared

by the Ambassador, would not be acceptable under local

conditions. I venture also to suggest as a general pro-

position that, whatever rules may be finally decided upon,

they should be sufficiently wide and general in their scope

to permit the judging of individual cases on their own

intrinsic merits. I submit that the local Government

is the best judge of what is a genuinely British locally-

incorporated company, and I would therefore urge strongly

that an Ambassador's licence should in no circumstances be

refused to such a company without prior consultation with

this Government.

I have the honour to be, Sir,

Your most obedient, humble servant,

71

GOVERNOR'S DEPUTY.