CO129-562-26 China- extra-territoriality 16-6-1937 - 9-7-1937 — Page 18

S.!S Colonies

THIS DOCUMENT IS THE PROPERTY OF HIS BRITANNIC MAJESTY'S GOVERNMENT

18

SECRET.

C.P. 153 (37).

Printed for the Cabinet. June 1937.

CABINET.

EXTRA TERRITORIALITY IN CHINA.

Copy No

40

Memorandum by the Secretary of State for Foreign Affairs.

THE United States Government have approached the Foreign Office with a request for the views and observations of His Majesty's Government with regard to the question of the resumption of negotiations for the abolition of extra- territoriality in China. A copy of the State Department Aide-Mémoire of the 30th March and of the interim reply sent to the United States Embassy on the 14th May are annexed hereto (Annexes I and II). As the question of extra- territoriality in China has been in abeyance since 1931, and has never therefore been considered by the present Government, a decision of the Cabinet on the question of policy involved is necessary before the further communication promised in the Foreign Office letter of the 14th May is made to the United States Embassy. In order to facilitate consideration of the question I submit the following observations:

2. The extra-territorial system in China has its origin in the treaties of 1842 and 1858, the effect of which is that British subjects are not subject to Chinese laws or the jurisdiction of Chinese Courts, but only to British law, and British Courts. No Chinese law or regulation is binding on a British subject unless it has been expressly accepted and made binding by His Majesty's Government. A British subject must, however, have recourse to the Chinese Courts when seeking redress against a Chinese. Since about 1900, when the Chinese began in earnest to modernise their laws and political institutions generally, the existence of foreign privileges has, on the one hand, made it progressively more difficult for the Chinese Government to regulate in a satis- factory manner a whole range of activities connected with modern commerce, such as companies, insurance, banking, shipping, &c., and, on the other hand, British merchants have found that it was impolitic and, indeed, impracticable to insist on the complete immunity from Chinese regulations secured to them in theory by Treaty. Compliance on a voluntary basis is, to an increasing extent, becoming the normal practice, with the result that much of the old extra-territorial system has crumbled away.

3. Political conditions in China for long made it impossible to make a serious effort to grapple with the problem. Chinese impatience brought nationalism to a head in the bitter anti-British boycott organized by the Kuomintang (Nationalist Party) in 1925-26. This was the prelude to the Chamberlain Memorandum of December 1926, in which His Majesty's Govern- ment recognised the reasonableness of Chinese aspirations and undertook to take definite steps to meet them without delay. When the Kuomintang established the present National Government of China at Nanking in 1928 more rapid. progress was made. Amongst other concessions tariff autonomy was granted, Weihaiwei and some of the smaller British concessions were given back and control of Customs revenue was relinquished. In 1929 negotiations on the subject of extra-territoriality were begun. After some fencing at long range the details of an actual treaty on the subject were hammered out, and on the 6th June, 1931, a draft treaty was exchanged between Sir Miles Lampson and

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