No. 320.
Mr. Davis to Mr. Wallace.

No. 11.]

Sir: Your dispatch of the 9th of June last, No. 98, in relation to a proposed additional charge of 8 per centum on petroleum, has been received and read with interest.

Your views on the general subject are in entire accord with those of the Department, and your foresight and vigilante in giving the matter prompt attention meet with its unqualified approval.

The subject, so far as it could in its present inchoate condition, has received attentive consideration.

The proposed measure, or scheme, as you not inappropriately denominate it, cannot be viewed otherwise by this government than as an act unfriendly to American commerce, and in contravention alike of the spirit of the treaty of 1862 between the United States and Turkey and of the acknowledged principles of international law and comity.

You will take proper occasion, and in your own way, to make known to the Ottoman Government the disappointment with which this government learns that such a proposition should be held in contemplation for a moment by the Porte, and you will urge upon the minister for foreign relations the impolicy of such a measure at a time when the friendly relations of the two nations rest upon so harmonious a basis. You will also advise the parties who have sought interference to protest against the payment, should the scheme be persisted in. You will also promptly inform the Department of the proceedings in any and every actual case, should any occur, in which the payment may be sought to be enforced. Should the proposed measure not be abandoned, further consideration will be given to the matter, of the results of which you will be promptly advised.

I transmit herewith, as a part of the record in the matter under consideration, copies of two letters addressed to the Department by Messrs. Iasigi & Co. and by Messrs. Laforme & Frothingham, of Boston, complaining of the proposed exaction of the authorities at Smyrna, touching the storage of petroleum, and whose agents in Turkey, as appears from your dispatch, have furnished you with similar information.

I am, &c.,

JOHN DAVIS,
Acting Secretary.
[Page 521]
[Inclosure 1 in No. 11.]

Messrs. Laforme & Frothingham to Mr. Frelinghuysen.

Sir: We beg to call the attention of your Department to the following statement:

In October, 1873, the municipality of Smyrna, Turkey, enacted regulations for the safe storage of petroleum, under which importers were required to store this article in warehouses to be located at least two kilometers from the city. Incompliance therewith, we instructed our correspondents in Smyrna, Messrs. Reggio & Belhomme, to erect a ware-house for the storage of our petroleum in Cordelio, a suburb of the city of Smyrna, at a cost of about 100,000 francs. Our warehouse has given entire satisfaction to the authorities and no complaint of irregularity has ever been made. The expense of storage in our warehouse has never exceeded l½ per cent. of the value of the merchandise.

We are now informed that there is a proposition seriously pending before the authorities of Smyrna to grant a concession to parties in the city of Constantinople to erect in Smyrna a warehouse to be used exclusively for the storage of petroleum, compelling all importers to store this petroleum in this warehouse, and granting, in fact, a monopoly of the storage of this article in Smyrna to said parties. We are further informed that the monopoly in question proposes to impose a charge of 8 per cent, of the value upon the petroleum stored in said warehouse, refunding to the municipality 1 per cent, for the concession granted!

Not only would such a concession be entirely contrary to existing treaties, under which only 8 per cent, ad valorem can be assessed upon imports into Turkey, but it would involve a loss to us of the sum expended for the erection of our warehouse in Cordelio, which would then become useless to us.

We therefore appeal to your Department to instruct the United States minister in Constantinople and the United States consul in Smyrna to protect by their intervention our interests, as American citizens, which are so seriously threatened.

Yours, respectfully,

LAFORME & FROTHINGHAM.
[Inclosure 2 in No. 11.]

Messrs. Iasigi & Co. to Mr. Frelinghuysen.

Dear Sir: We beg to call your attention to the inclosed translated copy of a letter addressed by our representatives in Smyrna to the acting United States vice-consul at that port, in relation to an extra duty of 8 per cent, which the authorities there wish to impose, under guise of warehousing charges, on imports of petroleum. This duty we feel to be in direct violation of the commercial treaty between Turkey and the United States, and any such action would be prejudicial in the highest degree to our business relations with that country, as the result would be the cessation of all shipments of petroleum to Smyrna.

Begging that you will give this matter your early attention, we remain, &c.,

IASIGI & CO.
[Appendix to inclosure 2 in No. 11.]

Messrs. Jacob Balladur & Co. to Mr. Griffith.

Mr. Acting Consul: We, the undersigned, Jacob Balladur & Co., merchants, established and resident in Smyrna, have the honor, as representatives in this city, by virtue of legal power of attorney, of Messrs. Iasigi & Co., American merchants, established and resident in Boston, No. 30 Kilby street, very respectfully to bring to your notice that the Ottoman Government proposes, we are informed, to burden the importation of petroleum at Smyrna with a supplementary duty of 8 per cent., disguised under the title of warehousing charges, and independent, be it understood, of the customs duty, also of 8 per cent.; in fact, that the authorities at Constantinople, on the recommendation of the Idaré Medjiliss of our city, are on the point of according to one individual the privilege or monopoly of maintaining a warehouse, where all the merchants of our city shall be compelled to store their petroleum and to pay a duty of 8 per cent., under the title of warehousing. Now, in conformity with the limitations of article 3, cited below, of the regulation of October 13 (25), 1873, elaborated by the [Page 522]local authorities, with the concurrence and adoption of the consular corps of this city, we have constructed, since the date given, large warehouses of stone, where we store the petroleum which the above-mentioned principals send us. During this long preriod of nine years there has been no disaster or even the slightest accident which could authorize or excuse the change in the regulation then in force. On the contrary, the arrangements, as practical and sensible as they were, in conformity with the spirit of the general police regulations of December, 1874, concerning the petroleum trade, have also the merit of reconciling both the public and private interests, and particularly of violating neither the spirit nor the letter of the capitulations and international commercial treaties, according to the terms of which no one in Turkey has a right to collect a duty under any title or on any pretext whatsoever, save the sole customs duty of 8 per cent.

To oblige us, in spite of ourselves, to deliver our petroleum to the care of any one individual or his representatives, whoever they may be, to exact from the merchants a new and supplementary duty compelling us to pay, under the specious title or pretext of warehousing charges, a duty of 8 per cent, when our storage expenses amount at the most to scarcely 1½ per cent., is, in our opinion, to violate the spirit and the letter of the capitulations and commercial treaties existing between foreign powers and the Sublime Porte. It is for the protection of the rights and interests of our above-named principals that we take, as representatives, the respectful liberty of addressing the present to you, and beg you to submit it with urgency to his excellency the minister of the United States of America at Constantinople. Trusting in his constant solicitude for the defense and protection of the lawful rights and interests of his countrymen, we feel sure that it will promptly determine him upon such measures as this grave and prejudicial state of affairs may suggest to arrest its realization, protesting officially in the most formal and most energetic manner against any collection of a supplementary duty under any pretext or title whatsoever, and holding the Ottoman Government responsible for all damages, foreseen or unforeseen, which may result.

Begging you to kindly deliver us an authenticated copy of the present, we have, &c.,

  • IASIGI & CO.
  • JACOB BALLADUR & CO.

Article 3 of the regulation of 13th (25th) October, 1873, published in L’Impartial of 27th October, 1873.

Art. 3. All the petroleum contained in the vessel shall be discharged in a special warehouse, at the choice of the importer, provided that this warehouse be removed at least 2 kilometers from the city and at least 1 kilometer from the villages.