No. 33.
Mr. Hall to Mr. Frelinghuysen .

No. 23.]

Sir: The cable of the Central and South American Telegraph Company was laid in August last, and was opened to public service on the 1st instant. Its connection with this capital is through the neighboring Republic of Salvador; although it was at first, comtemplated, and a contract to the effect between the Government of Guatemala and the company was entered into for the establisment of a station at the port of San José

As a matter which possibly may interest you, and for future reference, I inclose herewith a copy of the contract referred to, and a copy of the letter of the agent of the company, Mr. Stanley McNider, in which he communicates to the government the reasons which constrain the company not to land their cable at San José, and only at the port of La Libertad in the Republic of Salvador, which is in telegraphic communication with Guatemala; as also the arrangements she has made with that government in regard to the transmission of cable messages.

* * * * * * *

I have, &c.,

[Inclosure 1 in No. 23,—Contract.]

The Government of the Republic of Guatemala, represented by its consul-general in New York, the Hon. Jacob Baiz, duly authorized to that effect, and the Central and South American Cable Company, represented by James A.Serymser, its president, have entered into the following contract, subject to the ratification of the Government of Guatemala:

The Republic of Guatemala authorizes the Central and South American Cable Company to establish in the waters of the republic, one or more electro-magnetic submarine cables, to connect the coasts of Guatemala with those of the Republic of Mexico [Page 52] on the North, and those of the Republic of Central America and Colombia, on the South at such points as may be judged most advisable by the said company, the latter having entered into an agreement with the Mexican Cable Company for the transmission over their lines of all messages to the United States.

The Central and South American Cable Company shall have also the right of building a land line of telegraph to connect the end of their cable to the telegraphic station nearest to its landing, said complementary land line to be used exclusively for the service of the company and the transmission of cable messages, and to enjoy all the rights, immunities, privileges, and exemptions conceded by this contract to the Central and South American Cable Company.

  • Second. Said company is authorized to at once make the necessary surveys for the laying of the submarine cable, and to place the same, with its accessories and dependencies, such as stations, wires, instruments, &c., &c., within the dominion and jurisdiction of the Guatemalan Republic, and to adopt the plan of operation which the company may decide upon. With this object, said company may employ the engineers, agents, workmen, ships and means of transportation, which, for whatever purpose, it may have in its employ. The route may be changed, but the necessary notification must be given the office of the secretary of public works of the Guatemalan Republic.
  • Third. The government of the republic cedes gratuitously to the company the lands which belong to the nation, and which it may need for the establishment of the termini of the cable, stations, offices, stores, and warehouses. It also cedes to the company the use of the waters of the ocean within the jurisdiction of the republic which may be necessary for the establishment of the cable. As regards the lands and water belonging to private individuals which may become indispensable for the completion of the work, the cable company is hereby authorized to have them expropriated on grounds of public utility, in accordnace with the laws of the republic.
  • Fourth. The company is at liberty to select its employés, engineers, and mechanics, and the administration and management of the undertaking shall at all times belong completely to it. The government of the republic is nevertheless free to establish at its own expense agents who will have the right to inspect the books and accounts of the company, and who will inform the government of the state of the company’s transactions.
  • Fifth. The employés and workmen of said company, no matter what their nationality may be, not excepting citizens of the Republic of Guatemala, shall be exempt from all military and public duties whilst in the employ of the company.
  • Sixth. During the term of fifty years the Government of the Republic of Guatemala will deliver, and cause to be delivered, to the Central and South American Cable Company, when the lines of said company are available for transmitting the same, all telegrams originating or proceeding from within the jurisdiction of the Republic of Guatemala destined for foreign countries, whenever such telegrams can be transmitted to their destination by the Central and South American Cable Company and its connections, as speedily and as cheaply as by any other company or route. During the term of fifty years the Central and South American Cable Company shall enjoy all the telegraphic and other privileges that may be granted to the most favored party or parties, company or companies, by the Government of Guatemala for telegraphic purposes.
  • Seventh. In its turn, the Central and South American Cable Company is hereby bound to deliver to the telegraph offices of the government of the republic, or at the points of connection, all the telegraphic dispatches that It may receive over its cable for any point in the Republic of Guatemala.
  • Eighth. The maximum of the tariff which the company may charge for each word sent over the cable shall not exceed seventy-five cents in United States gold coin, between the terminus of the cable in Guatemala and any point in the United States of America, including the charges on all the intermediate telegraph lines; subject to the foregoing conditions, the arrangement of the tariffs shall be left exclusively with the Central and South American Cable Company, which, together with the secretary of public works, shall fix the rules relative to the form and transmission of messages.
  • Ninth. Besides the agent or representative which the company must have in the city of Guatemala, to transact business with the government of the republic, it may establish in the cities which it may think proper, and where there are government or other telegraph offices, subagencies to receive and collect the telegrams destined for transmission by the cable to points outside of the republic, adding thereto in the collection the rates of transmission of telegrams over the wires of the general government, which stipulates with the cable company that they shall not exceed the lowest rates from time to time charged for any like telegrams, whether through or local, over the national wires.
  • Tenth. All messages relative to the service and management of the cable company shall be transmitted free of charge over all the lines of the government of the republic. Also all official messages sent over the cable of this company by the President and the minister of foreign affairs of the Republic of Guatemala to its functionaries abroad, [Page 53] or those sent them by such functionaries, shall be transmitted at one-half the rates charged over the said cable.
  • Eleventh. All payments for telegrams shall be made in United States gold coin, or its equivalent in silver, at the current rate of exchange in the principal city of the republic. At the end of each month a balance shall be struck of what each party is to pay the other for messages which have been delivered to it for transmission, said balance to be paid at the end of each month following the liquidation. In this must also be considered the amounts that the company may have collected in the places where agencies of the company may have been established in accordance with the ninth clause of this contract.
  • Twelfth. The establishment of the submarine cable having been declared by the Government of Guatemala a work of public utility, the exportation of the coin (moneys) which the company may have collected for the transmission of messages shall be free of all duties. The telegraph materials, whether national or foreign, which may be necessary for the construction of the company’s work and equipments of offices and warehouses, and also the apparatus for the establishment of the submarine cable, and the connecting land lines, referred to in article first, shall be free of all kinds of import or custom-house dues, of excise duties, contributions, or taxes, decreed up to the present, or that may hereafter be decreed by any authority of the republic, no matter what the nature, denomination and object of said taxes, may be, for the term fixed in the sixth clause of this contract.
  • The cable employed in the construction and establishment of the line, as also the shares which may represent it, shall be exempt from the payment of all established contribution or taxes, or from such as may hereafter be established, during the term fixed in the above sixth clause.
  • Thirteenth. The company will be empowered to associate itself with any other company, and to transfer or alienate all its rights, privileges, property, and obligations fixed in this contract. In this case the company, of which the present may form part, or association which may he substituted to it, shall enjoy all the rights and privileges herein granted, and for the same reasons will be bound to all the obligations and agreements contracted by the Central and South American Cable Company.
  • Fourteenth. Any and all doubts or difficulties which may arise in reference to the meaning or execution of this contract, between the Government of the Republic of Guatemala and the Central and South American Cable Company, or the person or association that may be substituted to it, shall be decided by arbitration, each of the parties naming an arbitrator, who together shall have, power to appoint a third as umpire, and in the event of this failing to arrive at a decision, then by the tribunals of the republic, in accordance with its laws.
  • Fifteenth. This concession shall become void for the following causes:
    In case that within one year from the date of the ratification of this contract by the Government of Guatemala the company shall not have notified it that the necessary surveys have been made for the establishment of the cable determining its position.
    For not beginning within eighteen months from such date of ratification to lay the cable, and for not having it finished and open for public service within nine months thereafter. These terms may be extended by proving that causes beyond control have delayed the execution of the work, in which case the time that the impediment has lasted shall be credited.
    On account of any interruption of over one year’s duration in the use of the cable between Guatemala and the nearest landing north or south outside the republic.
  • Sixteenth. The government of the republic stipulates and agrees that the validity of this contract shall not be affected by any law, or laws, which may exist in contradiction to the concessions made in the present agreement.
  • Seventeenth. At the expiration of the fifty years referred to in the sixth clause of this contract, the company, or its assigns, will continue in possession of its cable, and the privilege of transmitting telegrams on the same terms as enjoyed by others.

In witness whereof, the party of the first part has hereunto subscribed his official name, and affixed his official seal, and the party of the second part has caused the name of its president to be hereunto subscribed, and its corporate seal to be attached, this twenty-ninth day of November, in the year one thousand eight hundred and seventy-nine.

Signed and sealed in presence of—

[seal of consul-general of guatemala new york.]
Consul General of the Republic of Guatemala.

The Central and South American Cable Company,
[seal of central and south American cable company, new York.] By

In the presence of—
Theo. I. de Sabla.

[Page 54]
[lnclosure 2 in No. 23.—Translation.]

Central and South American Telegraph Company to the Minister of Public Works.

Sir: I have the honor to inform you that the president of the Central and South American Telegraph Company has instructed me to communicate to you his determination to locate the cable of the company at the port of La Libertad, Republic of Salvador, instead of the port of San Jose’, of the republic, as it first contemplated.

The obstacles to an efficient working of the cable in the said port (San José) are of such a serious nature that after a careful study of the causes, made with the object of overcoming them, if possible, it has been found, as the result of all the measures suggested, that there is too much uncertainty of success to warrant the company in risking the landing of the cable in that port. While the president of the company deplores the unavoidable circumstances which prevent the establishment of a station at San José, it is satisfactory to him to be able to designate the advantages which are offered to the telegraphic line of Guatemala by the contract made by the company with the Government of Salvador, in article No. 12, a copy of which I have had the honor to send you. The president of the company is equally pleased to state that notwithstanding the extra work on the cable caused by the station of La Libertad, he has determined not to vary the tariff of the company from the stipulated prices for San José, it being understood that the improved form of the contract with Salvador is approved of by this government, and that it will be of full force in this republic, and especially the substance of the said article 12.

As it appears impossible to notify all the stations of foreign countries that the official dispatches of the Government of Guatemala enjoy a reduction of 50 per cent, on passing over the company’s lines, I am instructed to say that if the government will be kind enough to order a monthly detailed statement to be taken of the official dispatches received by it from its representatives in foreign countries, the company, after verifying the account, will cancel and reimburse it for the said sum of 50 per cent, on all such dispatches.

It is hoped that the cable of the company will be open for public service by the end of the present month, at which time it will offer special facilities to the government of this republic to enjoy the utilities offered by the use of the service.

I am, &c.,