No. 151.
Mr. Angell to Mr. Evarts .

No. 120.]

Sir: I desire to call your attention to a change which the Chinese Government has recently made, and made in an objectionable manner, to the regulations for the chartering by foreigners of junks on the Yangtze River.

I inclose a dispatch from Mr. Consul Shepard, of Hankow, which gave me my first information on the subject, and which states very clearly what has happened at Hankow.

It appears that ever since the revised regulations “of trade on the Yangtze Kiang” (for which see Mayer’s Treaties, pp. 209–211), which went into effect in January, 1863, the regular course of business in chartering and dispatching junks has been substantially as follows: The original charter-party, in Chinese and in English, was deposited in the consulate. The consul then made an application to the foreign customs [Page 235] for a “special junk pass” for the charterer. On the presentation of this paper to the customs the charterer was allowed to ship his cargo. He then received from our consul a clearance on which it was expressly stated: “The United States flag is not to be raised on the junk.” He was then furnished by the foreign custom, 1st, a river pass and arms certificate; 2d, a cargo certificate in English and Chinese; 3d, a duty-paid receipt and a tonnage-dues receipt in one document; and, 4th, a bond certificate. Provided with these documents the junk proceeded on her voyage down to Chinkiang with no further detention at customs stations and lekin barriers than was necessary to examine her papers. But if she lacked anyone of the above named papers, she was liable to be detained or even turned back. This procedure has been followed for about eighteen years.

On the 29th of November last, Mr. Jenkins, an American citizen, who has been engaged in chartering junks at Hankow, found, to his surprise, on applying to one of the shipping hongs, that the native owners had been notified, as they said, that hereafter they would be required to pay port dues along the route on a junk chartered by a foreigner, and that they would be held responsible for lekin dues on the cargo at every barrier, even though it had paid duty at the foreign customs.

Bear in mind that no notice of any contemplated change in the regulations had been given by the provincial authorities to our consul, or by the Tsung-li Yamên to the foreign ministers.

On the 6th of December a proclamation, a copy of which is inclosed, from the Wu Chang prefect was posted on the walls of Hankow, notifying boat hongs and boat owners that the owners of junks must pay the port dues to the native customs even when the junks are chartered by foreigners.

On the 8th of December Mr. Jenkins learned on inquiry at the foreign customs that they would not receive tonnage dues on chartered junks, nor would they note on the papers they should issue the payment of such dues to the native customs. Some correspondence ensued between the consul and the commissioner of foreign customs, which it is not necessary to dwell upon here further than to say that, in answer to an inquiry by the consul, the commissioner informed him in a brief note that no change had been made except the adoption of the procedure described in article VI of the Yangtze regulations, namely, the levying of port dues instead of tonnage dues, and when the consul rejoined, giving the substance of the reports which the junk owners had brought of the intended detention of chartered junks, and assessment of lekin on the cargoes at every barrier, the commissioner, very improperly, as I think, omitted to make any reply.

December 24, Hoo, Taotai of Hankow, sent the consul a dispatch which, substantially in the language of the prefect’s proclamation above referred to, gave him notice of the change in the regulations, and on December 27 the consul received a similar dispatch from the Ichang taotai. Accompanying the latter were extracts from correspondence had in 1877 between the foreign office and Mr. Fraser, then Her Britannic Majesty’s chargé d’affaires at Peking, concerning the levying of port clues on a native boat, in which an Englishman and his family reached Wuhu. The conclusion of the correspondence is not given, but the British minister has promised to obtain it for me. In its present form it is of no value, and therefore I do not transmit it to you.

You will observe in reading the prefect’s proclamation that the orders of the Tsung-li Yamên reached him on the 6th of November, and [Page 236] yet it was not until the 24th of December that the taotai of Hankow wrote to our consul on the matter.

It is probable that the Chinese have been prompted to their action by their desire to correct certain abuses which have sprung up on the Yangtze. It is also highly probable that the government has been defrauded by foreigners selling their names to Chinese in chartering junks and securing transit passes which prevented the levying of port dues and lekin. Of course we do not object to their seeking a remedy for this trouble. We are bound to do what we can to prevent our citizens from becoming parties to any such fraud. But the remedies must be sought in consonance with the treaties. Mr. Consul Shepard in his No. 357, to the taotai, referred to in his dispatch, quoted the stipulations concerning the hiring of boats, which are found in the several treaties, and made substantially the summary of principles which is found in his dispatch.

After learning from my colleagues of the diplomatic corps that none of them had received from the Tsung-li Yamên any announcement of the new regulation, I sought an interview with the foreign office, and on the 13th instant had a long conference with them on the matter under consideration. I began by inquiring whether any new regulation had been made by them concerning the chartering of junks by foreigners. They said, “No;” but an old one had been enforced. I asked if it had been enforced during the last seventeen years. They admitted that it had not been. I asked if the provincial authorities were not derelict in not informing our consul of so important a change until seven weeks after they had received their information. They said, “Yes.” I then asked if they did not think that it would have been better for the Tsung-li Yamên to inform the foreign ministers at the outset, so that the ministers could notify their consuls, or make objections, if they had any to make. They were less willing to condemn themselves than they had been to condemn the provincial authorities. They argued that the regulation concerned natives alone, not the foreigners. Of course I reminded them that it very deeply concerned foreigners who chartered junks, and that to make so important a change in a procedure which had been recognized for seventeen years without giving the ministers and consuls timely notice was a step well calculated to cause trouble. I then sought to ascertain what their order really was. They referred to frauds which had been practiced, and said that the requirement is simply that the native owners must pay port dues according to Chinese law. This requires, you will remember, that a native boat pays port dues at every port she enters, while by the treaties foreign vessels engaged in the coastwise trade pay only once in four months, no matter how many ports they enter. They assured me, however, contrary to Mr. Shepard’s apprehensions, that the regulation does not in any way change the status of a cargo on which the foreigner has paid duties, that such a cargo is not to be subjected to lekin anywhere on the voyage if the shipper, has all the proper papers as before except the certificate for the payment of tonnage dues. The boats, they said, might be stopped at Kinkiang and Wuhu for port dues, to be paid by the owners.

They argued that their action was sustained by article VI of the Yangtze Regulations, a part of which I copy:

Article VI. Native craft, owned or chartered by British merchants, will pay duty ont their cargo at the rates leviable on such cargo under the treaty tariff. All such craft will further have to be secured by bond in the manner laid down in the provisional rules published on the 5th December, 1861; and on entry into any port will pay por dues according to Chinese tariff. * * *

[Page 237]

I asked them how they could reconcile their new regulation with the following clause in the (amended) twenty-second article of the French treaty of Tientsin, which amended article was adopted in 1865, two years after the adoption of the Yangtze regulations: “Native craft, chartered by French merchants, shall in like manner (i. e. to French vessels) pay tonnage dues once in every four months.”

It would seem that they had forgotten or overlooked this provision. For at first they denied that there was any such provision. But when the treaty was brought they could of course deny no longer. They admitted that the matter deserved consideration. After some reflection and consultation they intimated that this might not apply to the Yangtze ports, but only to the seaports. On my requesting them to show me the authority for any such exemption they were unable to do so. I told them in conclusion that I would not press the point any further at that time, but I begged them to give the matter their careful attention. I chose to drop it there for the time, because the other foreign ministers have evinced much interest in the subject, and it is not improbable that some joint action may be taken which would be more likely to secure a result than my unaided prosecution of the matter.

In reviewing the subject it is clear, I think, that, even if the action of the government in changing the usage of eighteen years is justifiable at all, the neglect of the Tsung-li Yamên to inform the foreign ministers of their decision and the neglect of the provincial authorities promptly to inform the consuls of the orders received from Peking are deserving of grave censure.

Further, it is my opinion that the adoption in 1865 of the amended twenty-second article of the French treaty supersedes the sixth article of the Yangtze regulations so far as this sixth article is irreconcilable with it. I have reason to believe that most, if not all, of the foreign ministers here will agree with me on that point. We shall probably soon have a consultation on the subject. Until we have conferred I shall defer action.

Meantime I am informing Mr. Consul Shepard of the details of my interview with the foreign office, and am authorizing him to inform our citizens of the assurance which the foreign office has given me that the cargoes of foreigners, when shipped in junks, are not to be subjected to lekin if the duties have been duly paid. Of course such a levy would be the most flagrant violation of the treaties.

I have, however, called the consul’s attention to the need of exercising the utmost vigilance to prevent any of our citizens from becoming parties to such frauds as may have stimulated the Chinese Government to take the action complained of.

I have, &c.,

JAMES B. ANGELL.
[Inclosure 1 in No. 120.]

Mr. Shepard to Mr. Angell .

No. 55.]

Sir: I have the honor to transmit herewith to your excellency inclosures appertaining to the subject-matter of this dispatch, twelve in number, marked respectively A, B, C, D1, and D2, E, F, G, H1, and H2, I1, and I2, to be referred to in the course of this communication.*

[Page 238]

Since my response in No. 53, to your inquiries in your No. 4, of October 11, 1880, regarding “tonnage dues,” &c., circumstances of an important nature have transpired here and along the river ports, seriously and injuriously affecting foreign interests, interfering in what has for years been recognized as legitimate commercial enterprise, and as I think warranted, and intended to have been secured by the various treaties. At the expense of some prolixity I feel it incumbent on me to explain the whole matter to your excellency, that such steps as may be wise and called for in the exigency may be undertaken with full intelligence of the facts and their bearings.

In the early months of last year, 1880, Her Britannic Majesty’s consul, Alabasker, discovered what he deemed, and I presume were, irregularities in the dealings of certain of his constituents with native Chinese. The alleged irregularities consisted in selling the name of the British subject to certain natives, to be used by them in securing, under British protection, transit passes for merchandise outward and inward, charters for junks, and all similar privileges guaranteed to foreigners by the treaties. Without commenting on the method of procedure against the parties, both foreign and native, I may say that the matter created a good deal of excitement and resulted in a general suspicion against all foreigners in like business on the part of the native officials, and an interference on their part with lawful and honorable transactions. Formulated complaints were made to me by the Taotai against the American traders here, Messrs. M. A. Jenkins and Wadleigh & Emory. I gave them such candid examination as I could without books or witnesses to substantiate the charges, and found no sufficient, evidence that either honorable principles of trade or treaty privileges had been violated by them, and especially not by Mr. Jenkins, who has been in business here for many years. I refer to the affair, not only to give you an idea of the probable origin of the present wrong, but to introduce to your attention an extract from my No. 357 to the Taotai, of October 14, 1880, in answer to his complaint (made verbally), which will open the whole subject. (See inclosure marked A.)

In facilitating the “chartering of junks “and the shipment of cargo on the river, the method of procedure has been as follows: I required from the charterer to be deposited in the consulate the original charter-party, in Chinese and English, of every junk it was proposed to load. This I required as an equivalent for the “deposit of a ship’s papers.” I then gave a letter to the foreign customs, a form of which is inclosed, marked B. The charterer on presentation of this letter was permitted to ship his freight, and when this was completed he applied to me for a “clearance,” (see inclosure marked C.)

He then obtained from the foreign customs (1) a river pass and arms certificate, (2) a cargo certificate in English and Chinese, (3) a duty-paid receipt and a tonnage-dues receipt on one document, and (4) a bond certificate. With these papers the junk was protected on her entire voyage (usually made from Hankow to Ching-Kiang) and was free from interruption by the various lekin and customs stations passed, except for the examination of the papers. In this respect the chartered junks were on an exact footing with lorchas and steamers doing similar business, as the treaties undoubtedly intended they should be. But if a junk lacked any one of the documents above noted, she was detained at any station where the omission was discovered until she could procure it, and was liable to be turned back to the port of departure. This method has been in unquestioned operation under the “regulations for trade on the Yangtsze” continuously since January 1, 1863, when the foreign customs were first established here.

On the 29th November, 1880, Mr. Jenkins applied to one of the native junk shipping hongs through whom all charter parties are made, to charter a junk, as he had done for years. He was told they could not charter a junk, that the hongs had been summoned before the subprefect, acting under the Taotai, and made to give written assent to a notification read to them, that hereafter the junk owners would be required to pay what is known as “port dues “at the stations along the route, whenever a junk was chartered by a foreigner, and that they would be held responsible for all dues known as “lekin” at all stations passed on all cargo found on board, although it had paid duty according to the foreign tariff at the “foreign customs,” and they would further be liable to punishment for attempting to smuggle.

On the 6th of December, 1880, there was posted on the city walls a “proclamation,” which is inclosed with its translation, marked D1 and D2, and you will notice that it substantially supports the statements of the junk owners, for although the payment of “boat dues” by the owners is specifically mentioned, yet that payment to the native customs takes the vessel out from under the jurisdiction of the foreign customs, makes the vessel purely a native craft, and therefore subjects her cargo to whatever exactions the multiplied lekin stations along her route may choose to impose. Whether such exactions (never determinate) were little or much, or whether the “boat dues” were exorbitant or otherwise at the various stations, the conditions utterly preclude the chartering of a junk by a foreigner, first, because the junk owner can never know what the exactions from him may be on either boat or cargo, and, second, because he is strictly forbidden to allow the foreigner to pay them, either by advancing the price of the charter or by an agreement to refund whatever amount may be paid en route.

[Page 239]

On the 8th December Mr. Jenkins was informed by the clerk in charge of the export and clearance desk at the foreign customs that they would not in future receive from him “tonnage dues” on chartered junks, but he must bring to them instead a “port dues “receipt from the native customs; that it would not be considered a customs document to take the place of the tonnage-dues receipt, nor be noted on the papers, as it was not paid to the customs. Mr. Jenkins replied that as a foreigner he could not recognize any but foreign customs in his shipping business, nor be required to hunt of native officials. He asked to see and to have delivered to him a copy of the order, which was refused him, as the order was not in writing nor posted, as all similar notifications have invariably been, but was only a verbal instruction from the commissioner to the clerk, but no junk clearance from the customs would be given him except the native receipt for port dues was produced first.

For some inexplicable reason no notice whatever was communicated to the consul of so important a change either from the foreign customs or from native authorities. I knew of the “proclamation,” and sent my scribe into the street to copy it, whence my transcript of it. After waiting more than two weeks thereafter for official information and receiving none, I wrote my No. 364, of December 19, to the commissioner. (See inclosure E.) The same day I received his reply (marked F) and answered it (inclosure G). To my No. 365 the commissioner made no response, leaving me to the unavoidable inference that no real interference with established custom was contemplated; but I must be allowed to say Mr. White’s response is not the full and candid information I asked for, and the conclusions I drew from it are utterly misleading. While they are warranted by the letter itself, the facts deny them all. Whether it was intended to be sophistical and to evade the facts I wished to have from authority I will not judge, but I wrote my No. 365 expressly to show him the legitimate conclusions from his communication, and to give him the opportunity to correct any erroneous inference. He has never replied, even to acknowledge receipt of my last dispatch, although I know he received it. I will not comment on his silence farther than to observe that in six years’ experience in China it is the first instance in which full information has been withheld from me on any official topic where information was asked for from officials of any nationality.

I regret, if Mr. White has done so, that any foreigner in Chinese service should at all imitate the native character for official prevarication. He certainly knew what the actual as well as the nominal effect was, and what was intended to be compassed by it. The secrecy and silence of the whole movement is suggestive, to say the least. I doubt it Mr. Inspector-General Hart gave it his sanction or co-operation. Soon after the correspondence with the commissioner, the Taotai condescended to give me information of the abrupt change that had been in operation nearly a month. On December 25, 1880, I received his dispatch marked H1. I do not pretend to explain the long delay. But you will observe that both this communication and the proclamation carefully exclude or suppress the correspondence referred to with the acting British minister in 1877, which does not support their action. Two days later, on the 27th December, I received the Ichang Taotai’s communication, marked I1, which covers the portion of the correspondence above noted.

If all the treaties do not specify both the rate and the duration of dues for the tonnage of all vessels, the French treaty certainly does, and the twenty-third article of the Prussian treaty most especially so. These have heretofore been inviolate, and I am at a loss to understand why the treaties should define rates and the Yangtsze rules prescribe different ones for a certain class of vessels. May it not be that the phraseology of the sixth rule, viz,” Will pay port dues according to Chinese tariff,” refers to the different method of measuring employed for the native junks? At all events the language does not require payment to be made at native customs, but only at a native rate. The real object of the violent change, however, is to give license to the native officials to make exactions from both vessel and cargo at all stations on the route of traffic.

I respectfully submit the following topics for consideration as entering into the decision of the matter at issue, and ask your excellency’s attention to the whole subject, with a view or securing justice and a proper interpretation of the treaties by which a reversal may be effected of the wrongful and injurious change.

1st.
The treaties give the full right to traffic on the Chinese waters and rivers and between the open ports.
2d.
They guarantee protection to foreigners through the foreign customs for trade in vessels, whether under steam or sail, large or small.
3d.
They make no discrimination to the prejudice of small vessels, whether owned or chartered by foreigners.
4th.
They affix the rates of tonnage dues, and they should be uniform in system.
5th.
A foreigner cannot be compelled to have business with native customs where foreign customs are established.
6th.
Monopolies are strictly prohibited in trade or in vessels.
7th.
Any onerous or peculiar exaction on small or native owned craft under charter [Page 240] to foreigners, acts as a monopoly, as it prohibits competition, and diverts and forces all freights towards steamers, the principal lines being in native hands.
8th.
The assent to the principle that merchandise shipped by foreigners through foreign customs having paid prescribed tariffs may thereafter be subject to lekin in process of a voyage, would be an entering wedge to end in subjecting goods on all kinds of craft to the same exactions.
9th.
The direct result of the last-suggested claim would be to drive all foreign shipping from Chinese waters, and establish such exactions upon merchandise as to render trade in foreign commodities impossible.
10th.
If the “Yangtsze regulations “afford any warrant for the interpretation and action now developed by the “proclamation” they should be at once modified, and made to conform to the treaties in letter and in spirit also.

I have no doubt you will give the matter such earnest and immediate attention as its importance demands. I presume co-operation with other nationalities will be desirable. Shipping goods in chartered junks has long been an important branch of business in American hands at this port, and has been conducted in an honorable and justified way. If others have abused the privileges granted to foreigners it affords no sufficient reason for illegitimate ways of curbing the evil. The treaties provide remedies for such abuses. Probably one-third of the fees received at this consulate are derived from the entrances and clearances of such junks, aggregating about $500 per annum. The action taken totally suppresses revenue from this source, besides being a severe and decisive blow at a legitimate business of American citizens. This is a small matter, however, as compared with the ultimate effect upon general commerce, upon trade privileges, and upon treaty rights. I trust you may be able to obtain a speedy revocation of the obnoxious proceedings, apparently by sanction of the foreign board, but, I cannot doubt, without the knowledge or consent of our own or other legations at Peking.

I am, &c.,

ISAAC F. SHEPARD.
[Inclosure 2 in No. 120.]

a proclamation,

Issued by the Wu Chang Prefect.

I am in receipt from Hoo Taotai, of Hankow, as follows:

I have to inform you that I have received the following from his excellency the viceroy, on the 10th November:

I am in receipt, on the 6th November, 1880, of a dispatch from the Tsung-li Yamên, as follows:

The Yamên is in receipt of a communication from the northern and southern superintendents of trade (Nanking, viceroy, and Tientsin, viceroy), as follows:

We have a petition from the Kinkiang Taotai, as follows:

There is at present a custom among the native traders of fraudulently obtaining a permit from a foreign trader, and using it to cover a junk flying the foreigner’s flag [i e., protected by the foreigner’s name]. They thus hire a native vessel, on which they place their wood or timber, and pay only one duty at the foreign customs at Hankow, and thus pass the Kinkiang customs without further charge. Thus these junks pass all stations along the route free of boat dues. Your petitioner would request that in future all junks chartered by foreigners be required to pay their junk dues, according to the sixth article of “revised regulations of trade on the Yang-tsze kiang,” which is that junk dues are to be paid according to the native tariff, and thus crafty merchants will have no room to exercise their sharp practice, and the revenue will be greatly increased.

The foregoing being received by the superintendents of trade, they replied, “We will instruct the Hankow Taotai to furnish information.”

The board having received the above would observe:

We find Rule VI of Yangtsze rules of trade to be, that junks which are chartered by foreigners to carry goods, are on their entry at a customs to pay junk duty according to native rules (or tariff). This is the regulation for foreigners chartering junks. All the customs are to carry out this rule. During the third year, forth moon (May, 1877), an Englishman on board a native vessel belonging to the Kuang province, on passing Wuhu, paid the native junk duty at that place. We arranged with Foo, the acting, British minister, that the native vessels should pay native junk dues. We farther requested the minister to instruct the consuls to issue the needed orders to the traders, that the payment of the boat duty belongs to the native boat owners, and does not concern foreign traders; and that foreigners must not allow the boatmen to impose on [Page 241] them to pay what does not concern them. By acting thus both parties interested will be benefited. We hand to you, the viceroy, copies of the correspondence, so you can issue the proper instructions to the native and foreign customs, that junks chartered in future will pay their dues at the native customs according to native rules, and that the foreign customs are not to collect boat duty. Thus the junk owners will have no excuse nor chance to practice craftiness. The use of foreign flags by natives to run by the stations for the purpose of defrauding the revenue is a very heinous practice, and greatly detrimental to the revenue, and strict measures should be taken to suppress it. The English and French treaties contain clauses against such practices. The consuls interested on being informed would do their duty towards putting a stop to them. Should the taotai find that natives are using foreign flags, he should bring it to the notice of the consuls, so they may prevent it, and thus the fraud may be stopped, and the revenue protected. The board request you to issue the proper orders. This is an important matter. I, the viceroy, now issue to you, the taotai, this order for your action. You will inform me of your plan to carry out these instructions. I, the taotai, having received the above and having also received a communication from the northern superintendent of trade to the same effect, have issued the proposed order to the commissioner of customs, the deputy at the head custom-house, known as the foreign customs. I now have to instruct you, the Wu Chang prefect, that in future when junks are chartered by foreigners, my office will not collect the boat duty. You are therefore to order the boat owners to pay their boat dues themselves, according to the native rules. You are also to give notice to all customs stations under your control.

I, the prefect, now issue this proclamation to all of you boat hongs, boat-owners, and traders, that hereafter when junks are chartered to foreigners, you, the junk-owners, are to come and pay the boat-duty at the different boat-dues stations, according to native regulations. This order is issued in accordance with Article VI of the “Yangtsze regulations for trade.” I am instructed by the taotai that the foreign customs will not collect “boat-duty,” but the native customs will collect it. Therefore you junk-owners are, in future, to pay your boat-duty at different Wu Chang stations. You are not allowed to use foreign flags for your private use to run by customs stations, and thus evade the payment of dues. All who do not obey will be severely punished. Important notice.

Dated December 6, 1880.

Note by the consul.—The foreign flags referred to in the foregoing are simply and only the house flag, or designation of the foreign charterer of the junks. Every clearance that has been given has on it, in prominent type, the words, “The United States flag is not to be raised on the junk” and the prohibition has not been violated.

  1. Inclosures referred to omitted from this publication.