CO129-565-1 Indo-China Steam Navigation Company- acquisition of Chinese merchant steamers 30-9-1937 - 6-4-1938 — Page 30

CO129 Colonial Office Hong Kong Records 理藩院香港檔案 All

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Kwel tol

Hong Kong No. 254 of the 26th October; on the other hand,

he considers that it would be prudent for the company to

avail themselves of any unofficial contacts which they may

have with the Japanese Consulate-General for the purpose of

bringing the transaction to the notice of the latter.

3. In their letter to the Colonial Secretary of the

27th September last, Messrs. Jardine, Matheson and Company

raise the question of the Declaration of London in relation

to the proposed transfer. In the absence of a formal state

of war this question does not arise. It nevertheless falls

to be considered whether, if a state of war were to be

recognised before (or even shortly after) the completion of

the contemplated transfer, the Japanese Government would be

bound to regard the transfer as operating to divest the vessels

concerned of their previous enemy character.

Mr. Eden is

advised that the provisions of the Declaration of London, which

was never ratified, have no real force except in so far as they

are declaratory of pre-existing practice. In this case the

relevant provisions in fact represent a certain departure from

previous British and American practice, which was that a vessel

was divested of enemy character provided that the transfer was

bona fide, that the previous enemy owners retained no interest

in the vessel and had not the right of eventual repurchase, and

that the transfer was not made with the object of avoiding a

capture. The British post-war Naval Prize Manual provides in

paragraph 16 for a reversion to this practice.

It is not

known what Japanese practice would be if a state of war were

to come into existence; during the Russo-Japanese war, however,

Japanese prize regulations followed the old English rule. In

the event of the present transaction not having been completed

before the assumption by Japan of belligerent rights, it would

not/

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