No. 316.
Mr. Wallace to Mr. Frelinghuysen.

[Extract.]
No. 98.]

Sir: Consul-General Heap has referred to me three communications which I inclose, one from Mr. Alexander Sidi, another from Messrs. Iasigi & Co., by their agents Jacob Balladur & Co., and another from Messrs. Reggio & Belhomme, described as agents of MM. Laforme & Frothingham. Iasigi & Co. and Laforme & Frothingham are of Boston, Mass. Sidi, Reggio & Belhomme, and Balladur & Co. are merchants resident and doing a good business in Smyrna.

The communications, as you will perceive, all have relation to the same subject—a scheme to impose an additional charge of 8 per cent, upon petroleum. If carried into operation the result will be to burden the article with 16 per cent., exactly double the rate authorized by the treaty between Turkey and the United States.

In protesting against the proposed measure, I availed myself of the opportunity to group with it the other infringements of American rights now in question between the governments, viz, the extra charges upon alcohol and the prohibition of salted meats, and to submit to the new minister a summary of the privileges, in my opinion, clearly deducible from article 5 of the treaty of 1862.

* * * * * * *

I have, &c.,

LEW. WALLACE.
[Page 510]
[Inclosure 1 in No. 98.—Translation.]

Mr. Sidi to Mr. Griffith.

Sir: The undersigned, Alexander Sidi, a citizen of the United States of America, has the honor to state as follows:

In the month of July, of the year 1873, the local authorities being justly preoccupied of the danger existing in the storage of a large quantity of petroleum in the store-houses of the city, desired to remedy this practice by submitting this sort of business to a special regulation. His excellency Vely Pasha, then governor-general of the vilayet of Aidin, has assembled at the Corak to that effect MM. all the consuls of the foreign powers, and the regulation, which you must have seen, has been published with the approval of the Idaré Medjiliss of this vilayet.

It results from this regulation:

1st.
That the merchants dealing in petroleum must have a store-house for this article at two kilometers distance from the town of their choice.
2d.
That the local authorities reserve for itself the right of controlling the daily importation of petroleum into the town, that this quantity should not exceed the daily want of consumption.

The undersigned, who is engaged in the petroleum business in this town, has been obliged, therefore, in order to comply with the regulations in force, to hire store-houses in Holka Bonner.

The said regulation on the commerce of petroleum exists since 1873. It is therefore in force in Smyrna since nine years, and from the fact that during all this time it has not given rise to any complaint it is evident that the formalities resolved upon gave satisfaction to all interests concerned in the question.

I am informed, however, that the regulation now existing, so just and so equitable, is on the point of being modified so as to injure the interests of commerce and commit the security of the town.

The Idaré Medjiliss of Smyrna is disposed to grant to a firm from Constantinople the privilege of establishing a single and unique store-house, for petroleum in Smyrna, forcing thus the merchants to abandon their own store-rooms, established in conformity with the provisions of the regulations of 1873.

The grantee of the new store-house for petroleum would collect a tax of about 8 percent., making a return of 1 per cent, to the municipality of Smyrna, and the merchants would be obliged to pay this tax of about 8 per cent. when these same expenses at present in the stores of the undersigned amount scarcely to 2 per cent.

Should the above-mentioned decision of the Idaré Medjiliss be put into execution the undersigned is convinced that not only it will be contrary to equity and to the treaties of commerce now in force between the Sublime Porte and the foreign powers, but that it will also constitute a danger for public security. It is contrary to equity, as the undersigned being forced to take the measures in accordance with the regulation of 1873, he cannot abandon them and make use of foreign store-houses, incurring tax four times superior to his present expenses.

It is contrary to the treaties of commerce, which reject all other tax except that of the custom-house duty of 8 per cent. on the merchandise imported.

It is contrary to commerce, which will not be able to insure its petroleum against the risks of fire, the good insurance companies refusing unlimited risks on petroleum which would be concentrated in a single store-house.

Besides, the commerce of petroleum in our city, burdened with new taxes, will see its customers from the islands and towns of the sea-coast supply themselves from the places of Syra and Piraeus, where they will be able to procure this article in transit with better conditions than in Smyrna, and commerce would be thus deprived of his important outlet to the advantage of the places in Greece.

It is contrary to public security, because the fire of a unique store-house would constitute a much greater danger than the fire of private store-houses, dispersed at different points, and always at two kilometers from the town.

It is, therefore, as much in the interest of the town of Smyrna, in general, as in that of the merchants who obey the regulations prescribed with a view to public security that the undersigned protests against the decision taken by the Idaré Medjiliss of this vilayet to establish a single and unique store-house for petroleum at Smyrna, to the prejudice of the merchants dealing in the commerce of this article.

They beg you, Mr. Consul, to be so kind as to take their just demands into consideration, and to grant them the support of your efficient intervention.

1st.
Near his excellency Ali Pasha, governor-general of the vilayet of Aidin, for the maintenance of the regulation established in 1873, on the commerce of petroleum, and the rejection of the decision of the Idaré Medjiliss.
2d.
Near the minister of the United States at Constantinople, that the government of His Imperial Majesty the Sultan should refuse such a concession to a private individual to the detriment of commerce and of the public security of the town.
[Page 511]

Being confident in your enlightened solicitude for all that concerns the protection of the legitimate rights of American interests, the undersigned begs you, Mr. Consul, to be so kind as to accept the acknowledgment of his profound respect, with which he has the honor to be, &c.,

ALEXANDER SIDI.
[Inclosure 2 in No. 98.—Translation.]

Messrs. Balladur & Co. to Mr. Griffith.

Sir: We, the undersigned, Jacob Balladur & Co., merchants, established and residing in Smyrna, have the honor in our quality of representatives in this city of MM. Iasigi & Co., American merchants, established and residing in Boston, No. 30 Kilby street, by virtue of a regular procuration to bring to your notice, very respectfully, that the Ottoman Government intends to burden the importation of petroleum into Smyrna with a supplementary tax of 8 per cent. which is disguised under the name of warehouse duty, independently, of course, of the custom-house duty equally of 8 per cent.

In fact the authorities of Constantinople, on the recommendation of Idaré Medjiliss of our city, would be on the point of granting to a private individual the privilege or monoply to hold a unique store-house, where all the merchants of our city would be forced to deposit petroleum and to pay a tax of 8 per cent.

Conforming ourselves, therefore, with the provisions of the III article reproduce below, of the regulation of 13th (25th) October, 1873, made by the local authorities with the assistance and adoption of the consular body of this city, we have constructed since that time large stone built warehouses ad hoc, where we deposited the petroleum which our above-mentioned principals send us.

During the long period of nine years no misfortune has taken place, even the least accident, to authorize or excuse the modification of the regulation now in force. On the contrary, the dispositions being practical and wise and in conformity with the spirit of the general regulation of the month of December, 1874, concerning the commerce of petroleum, have, besides, the advantage of conciliating at the same time the public and private interests, and specially not to injure the spirit or the letter of the capitulations and of the international treaties of commerce, according to the terms of which nobody in Turkey has the right to collect under any title or any pretext whatever another duty, except the unique custom-house duty of 8 per cent.

To oblige us to part against our will with our petroleum in order to intrust it to the guard of an individual or his employés, whoever they may be, to force the merchants to any and supplementary tax by obliging us to pay, under a special title or the pretext of warehousing, a tax of 8 per cent., when our expenses in relation thereto scarcely amount at the most to 1½ per cent., this is according to us a violation of the spirit and the letter of the capitulations and treaties of commerce existing between the foreign powers and the Sublime Porte.

It is for the safeguard of the rights and interests of our above-mentioned employers that we take respectfully the liberty, in this quality, to address to you these presents in order to beg you to be so kind as to submit them urgently to his excellency the minister of the United States of America at Constantinople.

Being confident in his constant solicitude for the defense and the protection of the rights and legitimate interests of his fellow-citizens, we are sure that he will kindly think promptly of such measures as this grave and prejudicial state of things will suggest to him in order to stop the realization thereof, protesting especially, in the most formal and energetic manner, against any payment of a supplementary tax under any pretext and any title whatever, it maybe, and rendering the Ottoman Government responsible for all damages foreseen or not, and which would result therefrom.

Begging you, sir, to kindly furnish us with a legalized copy of these presents, we have the honor, &c., &c.,

  • IASIGI & CO, of Boston.
  • JACOB BALLADUR & CO.

Article third of the regulation of 13th (25th) October, 1873, published in the Impartial of 27th October, 1873:

Article 3.—All petroleum contained in the vessel shall be deposited in a special store-house to the choice of the importer, provided that this store-house should be two kilometers distant at least from the town and one kilometer at least from the villages.

[Page 512]
[Inclosure 3 in No. 98.—Translation.]

Messrs. Reggio & Belhomme to Mr. Griffith.

Sir: The undersigned, Reggio & Belhomme, agents of MM. Laforme & Frothingham, of Boston, Mass., citizens of the United States of America, have the honor to state as follows:

In the month of July, of the year 1870, the local authorities considering justly the danger existing in the storage of a large quantity of petroleum in the warehouses of the town, desired to remedy this practice by submitting this sort of business to a special regulation. His excellency Vely Pasha, then governor-general of the vilayet of Aidin, has assembled at his corak, to that effect MM, the consuls of foreign powers and the regulation, copy of which is inclosed, has been published with the approval of Idaré Medjiliss of this vilayet.

It results from this regulation:

  • First. That the merchants engaged in the petroleum business must have a storeroom of their choice, for this merchandise, at two kilometers distance from the town.
  • Second. That the local authority reserves for itself the right of controlling the daily importation of petroleum into the town, that this quantity should not exceed the daily want of consumption.

The undersigned, who are engaged in the petroleum business in this town, have been obliged therefore, in order to comply with the regulation in force, to have stores constructed immediately on the coast of Cordelio for their account and for that of MM. Laforme & Frothingham, of Boston, the cost of which amounts to 100,000 francs.

The said regulation on the commerce of petroleum exists since 1873. It has, therefore, been in force in Smyrna during nine years, and by the fact that it has not given rise to any complaint during all this time, it is evident that the formalities resolved upon gave satisfaction to all interests concerned in this question.

We are, however, informed the regulation now existing, so just and so equitable, is on the point of being modified in such a manner as to injure the interests of commerce and commit the security of the town. The Idaré Medjiliss of Smyrna is disposed to grant to a firm of Constantinople, the privilege of establishing a sole and unique store-house of petroleum in Smyrna, and oblige in this way the merchants to abandon their own store-rooms which were established in conformity with the requirements of the regulation of 1873. The grantee of the new store house would collect a tax of about 8 per cent, making a return of 1 per cent, to the municipality of Smyrna, and the merchants should be obliged to pay this tax of about 8 per cent. when actually these same expenses amount only to 1 or 1½ per cent.

Should the above-mentioned decision of the Idaré Medjiliss be put in force, the undersigned are convinced that not only it will be contrary to equity and to the existing treaties of commerce between the Sublime Porte and the foreign powers, but that it will also constitute a danger for public security.

It is contrary to equity, because the undersigned being obliged by the regulation of 1873 to construct store-houses for petroleum for their own usage, costing them 100,000 francs, cannot abandon them and make use of foreign store-houses incurring a tax eight times superior to their present expenses.

It is contrary to the treaties of commerce, which reject all other tax except that of the customs duty of 8 per cent, on goods imported. It is contrary to commerce, which will be unable to insure always its petroleum against the risks of fire, the good insurance companies refusing unlimited risks on petroleum which would be concentrated in a single store-house.

Besides, the petroleum business of our time burdened with new taxes, will see its customers from the islands and the towns of the sea-coast to supply themselves from the places of Syra and Piraeus, where it will be able to procure this article in transit with better conditions than in Smyrna, and business would be thus deprived of this important outlet to the advantage of the places of Greece.

It is contrary to public security, as the fire of a unique store-house would constitute a much greater danger than the fire of private store-rooms dispersed at different points and at two kilometers’ distance from the town.

It is, therefore, as much in the interest of the town of Smyrna in general, as in that of the honest merchants who obey the regulations resolved upon with a view to public security, that the undersigned protest against the decision arrived at by the Idaré Medjiliss of this vilayet, to establish a single and sole store-house of petroleum in Smyrna to the detriment of the merchants dealing in this article.

They beg you, Mr. Consul, to be so kind as to take their just complaint into consideration, and to grant them the support of your efficient intervention.

  • First. Near his excellency Ali Pasha, governor-general of the vilayet of Aidin, for the maintenance of the regulation promulgated in 1873 on the commerce of petroleum, and the rejection of the decision of the Idaré Medjiliss.
  • Second. Near the minister of the United States at Constantinople, in order that the government of His Imperial Majesty the Sultan should refuse such a concession to a private individual to the detriment of commerce and of the public security of this city.

Being confident in your enlightened solicitude for all that concerns the protection of the legitimate rights of American interests, the undersigned beg you, Mr. Consul, to be so kind as to accept the acknowledgment of their profoundest respect, with which they have the honor to be, &c., &c.,

REGGIO & BELHOMME.
[Appendix to inclosure 3 in No. 98.—Translation.]

Vilayet of Aidin.

regulation concerning the importation of petroleum in smyrna.

Considering the proceedings of deliberation taken by his excellency Vely Pasha, governor-general of the vilayet of Aidin and MM. the foreign consuls residing at Smyrna the 29th June–11th July, 1870, from which it results that the store-house of a large quantity of petroleum in the town of Smyrna constitutes an imminent danger for the city, and that it is urgent to think about the means for making this danger disappear:

That it was necessary to remove immediately from the town the petroleum existing therein, and forbid the direct introduction of any other petroleum which may arrive in future;

That it was necessary, in order to obviate the above-mentioned inconveniences, to store all petroleum arriving in future at Smyrna in a remote place from the town:

A commission has been charged then to find a convenient place for the storage of petroleum; but this mission having, unfortunately, remained without execution on account of the difficulties that the choice of such a locality presented conciliating the interests of the different importers, and his excellency Sureya Pasha, being justly preoccupied of this state of things which was prolonged until now, and considering the urgency, after having consulted with the council of the administration of the vilayet, has resolved and resolves the following:

Article First.

Every vessel arriving in the harbor of Smyrna loaded with petroleum must anchor outside of the other vessels which are anchored about the harbor, and stop at the place which will be indicated to it by the harbor-master.

Article Second.

As soon as the vessel shall be at anchor in this way it will receive on board an officer of the municipality, who will remain on board until the complete discharge of the petroleum. The salary of the said guard, fixed at nine piastres (two francs) a day, is to the charge of the captain of the vessel.

Article Third.

All the petroleum found in the vessel shall be landed in a special store-house at the choice of the importer, provided that this store-house should be distant two kilometers at least from the town and one kilometer at the minimum from the village.

It is allowed, however, to transship all or a portion of the cargo of petroleum on board another vessel for exportation. The vessel in which the petroleum would be transshipped shall be subject to the precautionary measures established in Article 1, as long as it shall remain in the harbor of Smyrna.

Article Fourth.

The vessel loaded with petroleum shall not be allowed to change the anchorage which was assigned to it by the harbor-master until the full discharge of the petroleum.

Article Fifth.

The sale of petroleum shall not be made in the city, but in stone-vaulted stores.

The approximate consumption of petroleum in the town of Smyrna being about a thousand cases (25,000 okes) per week, it is not allowed to keep a greater quantity at a time in town. And until a distribution of this quantity be made by the municipality [Page 514]among the different stores authorized to sell, it shall not be permitted to each seller to have more than twenty-five cases of petroleum in his store. It is prohibited to have many retail shops in the same khan, or in one same street. It shall be permitted, however, to the bocols (grocers) and actors (chandlers) of the quarters which are distant from the retail shops to have one or two cases of petroleum in their shop, for the facility of the indigent families, in order to sell them at retail.

Article Sixth.

Every retail dealer in petroleum authorized by law shall be furnished with a permit from the municipality, indicating his name as well as the quarter and the number of his shop. In case of a change of place, he must exchange his permit with another, which shall be delivered to him for his newly-situated shop.

Article Seventh.

Every surplus of cases of petroleum indicated in Article 5 which would be found in the stores or retail shops; all petroleum which would be stopped in transit either by land or by sea, for being introduced into the town without permit, shall be immediately seized and confiscated.

Article Eighth.

The present regulation shall be put into execution in all the vilayet of Aidin.

Article Ninth.

The municipality and the local police are charged with the strict execution of all the provisions contained in the present regulation.

[Inclosure 4 in No. 98.]

Mr. Wallace to Said Pasha.

Excellency: For the purposes of the communication which I think it well to make to the end that a better understanding may be had of the commercial rights asserted for citizens of the United States of America, I respectfully invite your attention to the following quotations taken from Article V of the treaty of commerce between our respective governments of 1862:

“His Imperial Majesty further engages that, save as hereinafter excepted, he will not prohibit the importation into his dominions and possessions of any article the produce and manufacture of the United States of America, from whatever place arriving, and that the duties to be imposed on every article the produce or manufacture of the United States of America imported into the empire and possessions of His Imperial Majesty the Sultan shall in no case exceed one fixed rate of 8 per cent. ad valorem, or a specific duty, fixed by common consent, equivalent thereto. * * * *. If these articles, after having paid the import duty of 8 per cent., are sold either at the place of their arrival or in the interior of the country, neither the buyer nor the seller shall be charged with any further duty in respect to them,” &c.

A reading of the text quoted discloses four points which would seem to be impossible of contradiction or evasion:

1.
His Imperial Majesty is solemnly engaged not to prohibit the importation into his dominions and possessions of any article the produce and manufacture of the United States of America, from whatever place arriving, except tobacco and salt, they being the exceptions reserved in Article XIV of the treaty.
2.
His Imperial Majesty is also solemnly engaged not to impose on any article the produce or manufacture of the United States of America, imported into his empire, a duty in any case exceeding one fixed rate of 8 per cent, ad valorem, or a specific duty, fixed by common consent, equivalent thereto.
3.
His Imperial Majesty is further solemnly engaged that, if such articles (the produce or manufacture of the United States of America), having once paid the import duty of 8 per cent., are sold, either at the place of their arrival or in the interior of the country, neither the buyer nor the seller shall be charged with any further duty in respect of them.
4.
The engagements so defined, in the nature of guarantys by His Imperial Majesty, have relation to the articles imported, not the citizenship or nationality of the person importing them. Enough always that the articles are the produce or manufacture of the United States of America.

These deductions, I beg to say, are not presented to your excellency because it is thought they are unknown to you, but to bring more clearly to your view the matters of complaint subjoined.

The note verbal from the Sublime Porte, No. 25, dated June 3, 1882, contains an interdiction absolute, and without pretense of justification, against the importation of salted meats of American manufacture. How, excellency, does that interdiction comport with the engagement of His Majesty first above given?

Then there are the new regulations under which your customs officers in Smyrna are collecting upon American alcohol, not 16 paras the oke, that being the amount specifically agreed upon as the equivalent of 8 per cent., but forty-eight paras the oke, the conditions being such that it is possible to carry the levy to ——, and even —— paras.

How, permit me to ask, do such regulations agree with the provision of the treaty second above given?

This, it must be added, has been going on against protest, and with the knowledge of the Sublime Porte, for quite —— months; your predecessor once declared the exaction a mistake on the part of the customs officers; yet, though repeatedly be sought to correct it, he did nothing. The unlawful collection is still going on. And now I am called upon to present you another measure proposed of the same character relating to petroleum, an item, as your excellency knows, of vast consumption in Turkey, and almost exclusively an American product. In 1870 the practice of petrolem dealears in Smyrna was to store their stocks on hand in the city. His excellency, the then governor-general of the vilayet of Aidin, discerning the danger from fire incident to the usage, required the merchants to provide themselves with houses for safer keeping outside the city limits at least two kilometers. This was done with consent of dealers, foreign consuls, and the Idaré Medjiliss, and upon compliance by the dealers became a contract, they on one part, the government on the other. Since 1873 the regulation has subsisted satisfactorily to all concerned. It would appear, however, that the present Idaré Medjiliss has other views. That body had decided to grant to a person or firm the privilege of establishing a general storehouse for petroleum in the city, and require merchants and dealers in the article to give up storage in the houses prepared by them under the regulation of 1873, and resort to the new one. No option is to be allowed. In a tax or charge for storage of 8 per cent, the enterprising grantees of the privilege are to find a profit of 7 per cent. and the Idaré Medjiliss 1 per cent. The same scheme, I am informed, is to be set at work in Constantinople, and probably in the empire generally. The effect will be to exactly double the rate of charge permitted by the treaty. With His Majesty’s engagements in view, how, excellency, can the Sublime Porte permit a thing so plainly unlawful to go into execution?

In protesting against the three measures referred to, it may serve well to remark that I have grouped them together that your excellency may the better perceive the unpleasant suspicions to which their further continuance will certainly lead. A very singular-coincidence indeed, that interdictions and oppressive duties should be the order of the day against articles so necessary, some to His Majesty’s subjects, others to foreigners resident in His Majesty’s dominions, and at the same time of chief supply from America! Whether the hostility proceeds from the Sublime Porte or at the instance of competitors in trade, the effects upon American industries and rights are the same. My government is bound to notice them.

I avail myself, &c.,

LEW. WALLACE.