ENG-1948 — Page 118

recent years, to the restrictions on imports imposed by China the incentive to smuggle goods from abroad into China has greatly increased.

The Hong Kong Government has always looked with disfavour on this illegal traffic. At the end of the last century negotiations were opened with the Chinese Government with a view to creating machinery whereby smuggling, at least as affecting Hong Kong, could be reduced to a minimum, if not wholly eliminated. These negotiations were not successful nor were later attempts made in 1911 and 1929 to reach an agreement between the two Governments on this very difficult question. Shortly after the defeat of Japan negotiations were again re-opened and a Customs Agreement was finally concluded in January, 1948. The Ordinance is designed to limit in three ways the possibilities of smuggling from Hong Kong into China:-

It limits the loading of vessels under 200 tons net to two designated points within the harbour, except that vessels under 200 tons may also load at another designated point, but there they will be cleared only to a Chinese port at which a Chinese Maritime Customs Station is in operation. At the same time the Chinese Maritime Customs are permitted to set up stations in close proximity to the first two designated points in the harbour and there persons exporting goods into China may, if they so choose, pay customs duty. At these harbour stations the Chinese Maritime Customs are permitted to maintain officers who tally on to ships. under 200 tons any cargo which has paid Chinese duty in Hong Kong. Exporters shipping on ships over 200 tons are also permitted to pay Chinese duty in Hong Kong and the Chinese Maritime Customs are permitted to keep a number of officers on board ocean going ships for the purpose of tallying this cargo.

(2) The Chinese Maritime Customs are given permission to patrol certain waters in Hong Kong in Mirs Bay and Deep Bay. In these areas known as prohibited areas any vessel which has no proper clearance papers issued in Hong Kong may be detained by the Chinese Maritime Customs and handed over to the Hong Kong authorities for prosecution in the Courts of Hong Kong.

(3) The transportation of commodities from Hong Kong to China across the land frontier is limited to 4 points

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