Papers Relating to Foreign Affairs, Accompanying the Annual Message of the President to the Second Session of the Fortieth Congress
General Salgar to Mr. Seward
Sir: The executive authority of Colombia took into consideration the project of a convention for the exploration of the isthmus of Darien, which I had the honor to propose to your excellency last year, but there having been proposed about that time various projects for the immediate excavation of the interoceanic canal, the Colombian congress, to which the affair was referred, judged it more convenient to issue the decree inserted in the Diario Oficial, which I send to you herewith, and which fixes the basis for the concession of a privilege for the opening of a canal.
Messrs Thomas Page, Sir Henry Kepply, Robert Marshall, and E. B. Webb, of London, have addressed a petition accepting the concession of the privilege [Page 824] in the terms of the law, by my government, desiring that the American nation may be associated in that undertaking, has charged me to make report thereof to your excellency, as I do in the law referred to, in order to see whether the government of the United States will make an offer similar or better for Colombian interests.
I have the honor to repeat to you, sir, the assurance of my most distinguished consideration and respect.
Hon. William H. Seward, &c., &c., &c.
[Translation.]
LAW disapproving the contract made by executive authority on the 25th January last with the attorney duly empowered of Mr. Henry Duesbury, and giving bases for the concession of a privilege for opening an interoceanic canal.
The Congress of the United States of Colombia decrees:
Article 1. The contract made by executive authority on the 25th January last with Mr. Eustatis de la Torre Narvaez, attorney of Mr. Henry Duesbury, for the excavation of an interoceanic canal in Colombian territory, is disapproved in all its parts.
Art. 2. The executive authority is empowered to make a contract for the grant of an exclusive privilege for the opening of an interoceanic canal through any part of the Colombian territory on the following basis:
1st. The duration of the privilege shall be for 99 years, which shall begin to be reckoned from the day on which the canal may he opened to public service in whole or in part, and the grantee or his representative may begin to collect dues for the transit or navigation.
2d. During the continuance of the privilege the government of the republic will not itself make, nor grant to any company or individual, by whatever title, the privilege of constructing another canal which may bring into communication the two oceans through the territory mentioned in the first part of this article. If the grantee should construct a railroad as ancillary to the canal across the said territory, the government will not itself do, nor grant to any company or individual the right to construct another interoceanic railroad over the same territory during the time granted for making and profiting by the canal.
3d. The canal shall be completed and delivered over for public use within ten years, reckoned from the date of this present concession; but if through fortuitous circumstances, independent of the will of the grantee, after more than a third part of the canal shall have been constructed, he shall give notice that he could not complete it throughout the whole extent in said ten years, the executive authority shall have power to allow further time of four years more.
4th. The canal shall have the breadth and depth, and all the conditions necessary for its navigation by steam or sailing vessels of highest tonnage now used by those vessels, with exception of the Great Eastern.
5th. The vacant lands necessary for the excavation of the canal, establishment of seaports, roadsteads, wharves, tramways, warehouses, and in general all things needful to the construction and service of the canal, as well as those which may also be needed for the establishment of the railroad, if thought advisable to build one. These lands shall devolve to the domain of the republic, with the canal and railroad, when the period for the privilege shall be at an end.
6th. There is also granted for the uses of the canal a strip of land along its outer bounds, not exceeding 30 metres wide on each side of it, but along the whole line the neighboring land owners shall have perfect right of easy access to the canal and its ports, as well as to the use of the road which the grantees may construct there, without paying anything to the company for this right.
7th. If the territory through which the canal must be excavated, or the railroad be built, should be wholly or in part private property, the grantee shall have the right to expropriate to this use, previously having recourse to all legal formalities, the indemnity to the owner being at the cost of the grantee.
8. The grantee is authorized through all the time he may remain in possession of the canal in the privilege or right to the use of the ports situated at the two extremities of the canal for the anchorage of ships; for the landing of merchandise, which is to be left at such ports, or transship to other vessels, to continue the voyage through the canal in case the ship which brings them is not intended to pass through the canal; to use the intermediate ports necessary to and especially intended for the storage and free deposit of all articles and merchandise, which may be intended for transit or may be previously disembarked at such intermediate [Page 825] ports, at which the government of the republic may place such officials as it may deem necessary, and take the measures it may hold indispensable to prevent smuggling.
The buildings which may be erected by the grantee for storage warehouses at the ports and landings shall be so arranged that a single person may suffice to guard against smuggling.
9. The ports at each end of the canal shall be free and open to the commerce of all nations, and thereat no duties on imports shall be collected, except on merchandise intended to be introduced for consumption in the republic. Said ports shall in consequence be privileged for the import of goods from the time the canal is open, and such custom-houses and outports as the government may judge proper shall be established thereat for collection of import duties on effects intended for other parts of the Union, and for preventing any smuggling.
The officers the government may deem necessary for the discharge of this duty shall be paid by the company exclusively, and their wages be designated by the government.
10. The government of the republic declares neutral for all time the ports at the one and the other extremities of the canal, and the waters of the canal from sea to sea, and in consequence, in case of war between other nations, or between some or any of those and Colombia, the transit by canal shall not be interrupted on such account; and merchant vessels and individuals of all nations may enter said ports and pass through the canal without being molested or delayed. Foreign troops are expected which shall not pass except through permission given by congress.
11. Entry to the canal shall be vigorously forbidden to vessels of war of nations which may be at war with another or others, and whose manifest purpose may be to take part in hostilities.
12. The grantee shall have right freely to import, free of any duty on importation, or of any kind soever, all instruments, machinery, tools, building materials, provisions and clothing for workmen, that he may require during the term granted to him for construction of the canal.
13. No contributions, national, municipal, or of any other class, shall be imposed on the canal, the vessels that may pass through it, the towing vessels of the grantee, his warehouses, wharves, machinery and other works or effects of whatever kind that may belong to him, and which in the judgment of the executive authority may be necessary for the service of the canal, and its dependencies, during the time given to the grantee for its construction and use.
14. The passengers, money, merchandise, objects and effects of all classes which may be transported by the canal from one ocean to the other, shall be exempt from any national, munincipal, or any other kind of duty of whatever class.
The like exemptions extend to all effects and merchandise which remain in the character of deposit at the ports, warehouses, or landing places of the grantee intended for the interior, or for foreign ports; but articles intended for the domestic consumption of the republic shall pay the duties or national imposts established, or that may be be established, payment of which shall be made on taking said effects out of the warehouses of the grantee; for which purpose it shall be done with the knowledge of the persons employed by the government, and in conformity with the rules and regulations which the executive authority may dictate.
15. Passengers who may pass through the canal shall not have need of passports except in case of war or internal commotion, if the executive should think proper to require it; but vessels passing through said canal shall be under obligation to present, at the port at the end of the canal at which they may arrive, their respective sea letter and other seafaring papers that may be necessary accordingly to the laws and public treaties, in order that a vessel may navigate freely. Vessels which lack said papers, or may refuse to present them, shall be detained and proceeded against according to law.
16. When national duties or imports on importation of effects introduced into territory adjacent to the canal may exist and be in force, vessels shall pass through it with their hatches closed, and sealed up by the custom-house of the port at which they may arrive at one of the ends of the canal, and shall receive on board one or more officers of the government, who may during the transit watch that nothing of the lading of such vessels be landed. If after having passed through the canal the owner of the vessel should desire to land or sell the cargo at the port at the extreme end at which he may come to this resolution, the unlading shall be permitted upon going through all lawful formalities.
17. Vessels which carry effects intended for the work on the canal, according to section 12 may be entered freely at any of the points comprehended in the territory designated in the first part of this article (although there may not be any custom-house established) from the day on which the grantee may have needed them, in order to make a beginning with the work; and for preventing any fraud he must enter into bond to give previous notice at the proper custom-house in relation to what port the said vessels are bound.
18. The grantee has, during the term of his privilege, the right, exclusively, to establish the tariff of rates which shall be collected for the passage through the canal, the use of its landings, warehouses, and wharves, with the like, so as not to exceed the maximum which is settled hereby, to wit: 75 cents the ton in ballast; $2 on each ton of cargo; $10 for each person; one-half per cent, on gold, silver, or platinum, coined as money or in bars, and on precious stones. The prices shall always be equal on individuals, vessels, merchandise, and property of all nations; and no vessel can pass through the canal without having satisfied [Page 826] such charges. Nevertheless, all ships and government vessels of the United States of Colombia, and all ships and vessels which, without belonging to it, are in the exclusive service of said government, shall pass through the canal and shall enter all its ports completely free from payment of any duty to the company.
19. The undertaking of the canal is reputed a public benefit.
20. The Colombian government will dictate the regulations which must spring out of the grant of this privilege as necessary and suitable for preventing smuggling.
21. The grantee is authorized to submit to the executive authority the regulations he may think needful for the police, use, and security of the canal, havens, works, and establishments of all kinds; but such regulations shall not take effect without the express approval of the national government; which, after having approved them, may modify or abrogate them as may be deemed proper, always proceeding in conformity with the laws of the republic.
22. In consideration of the receipt of duties and values fixed by the tariff, the grantees contract the obligation to carry out constantly, with care, punctuality, and without exception of nationality, the carrying of travellers, animals, merchandise, goods, and material of every kind which may be intrusted to it. The carrying shall be done without other special rebate of the rate of the tariffs than what may be agreed in favor of nations which may have committed themselves, or in future may commit themselves, by public treaties concluded by the United States of Colombia, to guarantee positively and effectively to this republic its rights of sovereignty and ownership over the Isthmus of Darien and Panama and the adjacent coasts, and the perfect neutrality of the said isthmus and its coasts, in order that there may not be at any time an interruption or embarrassment to the free transit on the isthmus or by this canal; but it shall continue to be expressly understood that the United States of Colombia, the Colombians and their property, shall enjoy all the benefits and advantages of every kind which any other nation may obtain by virtue of anything contained in the provisions of this article.
23. The grantee shall carry gratuitously in their vessels men in the service of the Union, where there may be need to transport by canal or by the ancillary railroad, for the purpose of maintaining security abroad or the preservation of public order; and if the company should not have vessels, those which may supply this transportation shall be exempt from payment of any duties.
24. The grantee engages, at his own cost and expense, and risk and hazard, to carry from one end of the canal or railroad to the other all the correspondence which may come from the territory of the republic or from abroad, receiving for such service one-third of the amount they might collect for receiving, carrying, and delivering such correspondence in conformity with the contracts the company may make for the purpose, with the approval of the government; the two-thirds remaining belonging to the United States of Colombia.
25. The grantee is under obligation to execute, at his expense, risk, and hazard, all the works necessary to the construction and establishment of the canal of communication between the two oceans on the line he may choose through any part of the Colombian territory.
26. The grantee will pay to the government of Colombia, for the first twenty-five years, six per cent., and for the seventy-four years remaining eight per cent, of the clear annual profit of the enterprise, without taking into account for the payment of this percentage any deduction for presumptive interests of capital invested in the work, nor for any sum intended for a reserved fund or for amortization; and for the collection of said so much per cent. the government will rely, as well as the shareholders in the undertaking, on the accounts liquidated according to the regulations of the company; and of which accounts, as well as of those of the costs of the undertaking, and of its books and documents, the agent of the republic who shall be indicated for the purpose shall take cognizance and make the observations and reclamations for which there may be place, like any shareholder, but without power to mix himself up with the direction of the affairs of the republic. The payment of the rate of percentage shall be made annually at the place which the executive authority may designate. The grantee shall guarantee that this percentage shall not be less than six hundred thousand dollars annually, so that six hundred thousand dollars will be the minimum of the annual sum which the government will in any case receive.
27. On the expiry of this privilege, the canal, the wharves, warehouses, depot, and all buildings and work annexed, above mentioned, which the contractor may have constructed at either extremity, and through the channel of the canal, or for other purposes connected with the service and administration of the enterprise of the canal, shall become public property, and shall be delivered over to the government, together with the ancillary railroad and things thereto annexed, in case they may have been constructed by the grantee or the representative of his rights, to the effect that after the completion of the works the grantee shall make, at his cost, with the assistance of the officers of the government, a circumstantial inventory of the canal, and buildings and works annexed to it, and of all property which ought to be turned over to the republic. The grantee shall make, besides, statements similar and descriptive of all works of like nature which he may have caused to be executed while he continued in possession of the privilege.
28. An exact and authentic duplicate of the documents spoken of in the former article shall be signed by the grantee at the department of state—which department is the branch [Page 827] for public works—in order that they may be deposited in the national archives, and serve therein their needful purpose during the course of the privilege or to the time of the expiration thereof.
29. The grantee is bound to make, one year before the expiration of the privilege, with summons to the agents of the government who may be commissioned for the purpose, a valuation of the works which, at the close of such privilege, are to be ceded to the republic; and of these valuations, and of descriptive lists of the works at the time such valuations are made, a duplicate shall be deposited in the office which may be designated by executive authority, that it may be at hand at the time of delivering to the government the canal and its dependencies.
30. The grantee shall give security for the fulfilment of the obligations to which he subjects himself in the sum of one hundred and fifty thousand dollars, which he shall place at Bogota, London, or New York, at the disposal of the Executive of the republic, in this manner: sixty thousand dollars immediately after the contract shall receive the approval of the Executive, and the remaining ninety thousand during the three following months, at the rate of thirty thousand dollars a month. This consignment shall be made in American dollars. Said sum shall be without interest, to account of the dividends which may belong to the republic from the profits of the canal.
31. The grantee shall not have power to cede this privilege by sale nor in any other manner to any foreign nation or government, nor take recourse in any case to any foreign power to intervene in the settlement of differences which may arise respecting this privilege or the Works that may be built in conformity therewith, by reason of non-fulfilment of the conditions established, because such differences shall always be decided by the judges and according to the laws of the republic; and in no case shall right, immunity, or exemption, not expressly recognized in this present privilege, be alleged.
32. In case the line of the canal should pass by some portion of territory to which may extend the privilege granted to the Panama Railroad Company under the contract of the 15th April, 1850, it shall be a charge devolving on the grantee to obtain the assent of that company to the construction of the canal.
33. The grantee binds himself to organize an anonymous company to carry out the excavation of the canal, and shall reserve one-tenth part of the shares for Colombian capitalists who may choose to take part in the enterprise, not having leave to dispose thereof till six months after the organization of the company. Moreover, all that is stipulated in this contract in favor or at the charge of the grantee shall be understood as accepted by said company.
34. This privilege shall fall through in the cases following: 1st. If the grantee should not deposit to the satisfaction of the executive authority of the republic, at the times fixed in section 30, the sum which is to secure the execution of the work and the fulfilment of other obligations to which he is subject. 2d. If within 18 months the termination of the exploration should not be completed, and the determination about the line of the canal made. 3d. If within the two first years of the ten conceded for the construction of the canal the work shall not have been formally commenced. 4th. If at the time fixed in section 3 for the construction of the canal it should not be concluded. In case that the extension of time spoken of in the same section be allowed, it shall be at the close of such extension that the privilege shall fall through if the work be not completed. 5th. If the undertaking company should alien the privilege in favor of any foreign government or nation. 6th. If the company should co-operate in any act of rebellion against the government of the republic intended to take from its dominion the territory in which the canal may be. 7th. When for more than six months the service of transit by canal should be suspended, saving fortuitous cases with reference to laws of common application.
35. In the first of the cases of forfeiture of the privilege, pointed out in section 34, the act declaratory of such forfeiture shall be done by executive authority immediately after the term fixed for depositing any of the sums by which the execution of the work was to be secured may have passed by without such deposit having been made.
In cases 2 and 3 of forfeiture indicated in the same section, it pertains also to the executive authority to make the declaratory act if the exploration and determination about the line of the canal should not have been made, or if it should appear by trustworthy documents that no work has been begun upon the canal in the term fixed upon in said section. But if some work shall have been done in manner to justify a doubt whether the company has or has not come within case 3 of forfeiture of privilege, the decision thereon shall belong to the judicial authority.
36. In cases 4, 5, 6, and 7 of section 34, it shall pertain to the judicial authority of the Colombian states to decide whether or not the privilege has become forfeited.
37. In whichever case the forfeiture of privilege may be declared, the company shall lose in favor of the republic, first, the sums by which it should secure the execution of the work in conformity with section 30; secondly, all the lands which by sections 5 and 6 are granted to the company, which shall devolve to the dominion of the republic in the condition in which they may be found; third, all the works, buildings, and betterments which the company may have made, in the state in which they may be found, and the materials which may have been prepared for the execution of any works on the canal and its annexations.
The republic shall not give any indemnity for the buildings, works, betterments, and materials, which, according to this section, the company may forfeit in its favor.
[Page 828]38. The government of the United States of Colombia and the company which may have obtained the privilege, reciprocally bind themselves to make to the governments of England, Prussia, Holland, France, and the United States of America, the arrangements necessary for the absolute guarantee of neutrality of the canal by said powers, and the sovereignty of the republic over the territory through which the canal may be constructed, the Isthmus of Panama and Darien, and the coast adjacent.
39. The diplomatic or consular agent of the republic resident in the domicile of the company shall be ex officio member of the directory counsel of the enterprise, with all the prerogatives which other members may enjoy under the statutes of the company.
40. The disbursements required for keeping up the public force which may be held necessary give security to the interoceanic transit shall be at the charge of the company as part of the general expenses of the undertaking.
Art. 3. The executive authority is also equally empowered to require as a condition of the adjudication of the privilege that the grantees bind themselves to make a contract with the associate founder and inspector general of “the undertaking of the wagon roads of Buena ventura to convert it into a railroad from the port of Buenaventura to the most convenient point on the river Cauca near the City of Call, receiving the work which is being done, and the disposable funds. The company shall recognize the national government, that of the sovereign state of Cauca, andthe individual shareholders, as shareholders in the new enter prise to the extent of the amount they have invested.
Art. 4. The contract alluded to in the former article will be a contract of simple transfer of the privilege of the Buenaventura road, without mixing therewith any measure by which any burden may be imposed, of any kind, on the national treasury.
Art. 5. If the privilege should not be awarded to: Mr. Henry Duesbury or to the company of which he is or was a part, the executive authority will promptly arrange the devolution of the hundred and twenty thousand dollars received by the government of the republic in consequence of the agreement for the excavation of the canal, made the 25th January last between the attorney of said Mr. Duesbury and the President of the United States of Colombia.
Art. 6. The executive authority will make public this law and the project of contract in the most notable newspapers of Europe and of North America, and fix a reasonable time for proposals to be addressed to the commissioner who may be appointedinLondon or such place as may be deemed most proper for receiving such proposals, and accept the most advantageous, which the said executive authority will definitively approve, provided always that the stipulations accord with this present law, having in the contrary case to submit the same to the approval of Congress.
Be it published and have effect.
[l. s.]