No. 390.
Mr. Curry to Mr. Bayard.

No. 119.]

Sir: Your cablegram produced in the legation surprise. At once I sought an interview with the minister of state to ask an explanation of what, if unexplained, would place the Spanish Government in the attitude of a nullification of its solemn and clearly understood agreement. The minister being engaged in a council, I left a note asking an early interview. This was granted for the next day, and I availed myself of it to present the matter of your cablegram in the strongest light I could. I submitted a memorandum at the same time, a copy of which is inclosed. The minister said my statement was strictly accurate, and he was sure there was some misunderstanding, as the object of the order of the minister of ultramar was to equalize the flags of the two nations. On my request to put in writing such a statement as might be used as a basis for a cablegram, he said he would consult with his colleague of ultramar and send the paper in twenty-four hours.

* * * I waited two days and received a note asking me “to excuse these unavoidable delays,” as “the colonial secretary has cabled for some information wanted to give the answer I (he) promised.” To this note I responded immediately.

Thus the matter stands. The Madrid papers, about two weeks ago, discovered that the order of June had been issued and began a series of attacks on the minister of state and the Government. What effect these criticisms had can only be conjectured.

Of the sincerity of the minister of state and his purpose, so far as lies in his power, to carry out, in good faith, the agreement, I have not a doubt.

The matter shall have constant and earnest attention, and the Department shall be advised by cablegram whenever anything definite occurs.

* * * * * * *

I have, &c.,

[Inclosure 1 in No. 119.]


Article I of the commercial agreement of February 13, 1884, expressly provided for the suppression of differential flag duties, and that the American flag in the Antilles should be treated upon precisely the same terms as the Spanish flag. The fact, however, that goods transshipped in American ports in Spanish vessels were admitted under the third column of the tariff, while the same class of goods in American vessels was compelled to pay the fourth column duties, was an overwhelming discrimination in favor of Spanish and against American shipping, and the United States has, from the moment that the commercial agreement was construed in this manner by the Spanish Government, protested against the construction and instructed its representatives at this court to use every effort to induce the Government to place the flags of the two countries upon the same basis, as was expressly provided for by the agreement.

Mr. Curry, in continuation of the negotiations of his predecessors to this end, sent to his Excellency the minister of state on the 10th of April, 1886, a memorandum, section 3 of which was devoted to this question. In that memorandum Mr. Curry said:

“It appears, however, that Spanish vessels are permitted to carry foreign goods transshipped in American ports to Cuba and Porto Rico, and have them admitted under the third column of the tariffs of those islands, while similar goods carried in American vessels are required to pay the higher duties of the fourth column. This, as it [Page 804] must be apparent to your Excellency, is a manifest discrimination against the American flag, the imposition of a different duty, and consequently a violation of Article I of the agreement. The President of the United States is authorized to continue the suspension of the discriminating duty so long as the reciprocal exemption of vessels of the United States and their cargoes shall continue, and no longer.”

* * * * * * *

On May 20, in order to remove any possible misunderstanding, Mr. Curry, in another note, again reviewed the whole question, and in view of the agitation in the United States in favor of retaliatory discrimination, urged that immediate measures be taken for the removal of the cause of complaint. He continued, in conversation and letters, to press it upon the attention of the minister of state, until, on June 4, Señor Moret wrote:

My Dear Sir: I have just had an interview with my colleague, the colonial secretary, and I have the pleasure to inform you that, in spite of his bad health, we have discussed thoroughly the question of the equalization of the Spanish arid American flags, and have agreed to have it put into practice at once in accordance with the principles of the modus vivendi of 1884.

“My colleague shall issue the necessary orders to remove any difference existing at present between Spanish and American ships in the ports of the Antilles, and you may therefore inform your Government that any discriminating duties or taxes, such as those you mention, shall be corrected without further delay.

“Moreover, if after the orders, which will be immediately enforced, any grievance still arises, you may rely upon the loyalty and fairness of the Spanish Government, and be sure it will be removed as soon as it is brought to my knowledge.”

On June 30 an official communication was received containing the order, which was as follows:*

It will be observed that to avoid ambiguity or misconstruction in the words “productos y procedencias” the order begins by stating the complaint of the minister of the United States that “the minister of the United States objects * * * that in that island the differential duty is maintained in respect to foreign merchandise transshipped in American ports.”

In view of the presumed successful close of long and tedious negotiations and the satisfaction felt and expressed by the Government of the United States at the final determination of the Spanish Government to enforce the agreement of February 13, 1884, in accordance with the terms of Article I, which expressly provides for the suppression of differential flag duties, the minister of the United States has learned with regret, through a telegram just received from his Government, that the consul-general of the United States at Havana has reported that the minister of ultramar has telegraphed to the “administration, central de aduanas” of Havana that the order of June 22 permits only products of the United States shipped from ports of the United States in vessels of the United States to the Antilles to be admitted under the third column of the tariff. As it is clearly stated in the preamble of that order, as has been shown above, that the reason for its promulgation was the complaint made of the maintenance in the Antilles of the differential flag duty in respect to foreign goods transshipped in American ports, such instractions to the customs authorities amount not to a construction of the order, but to a declaration that the order is null and void. The minister of the United States hopes and believes that there has been some misunderstanding on the part of the consul-general of the United States or the local authorities of Cuba. He cannot believe that the Spanish Government, after long negotiations and explicit promises, could decide to render its own order utterly abortive by prohibiting the fulfillment of the very objects for which it was issued.

He is certain, therefore, that the difficulty must result from some misunderstanding which the Government of Her Majesty will hasten to rectify.

[Inclosure 2 in No. 119.]

Mr. Curry to Mr. Moret.

Dear Sir: I have the honor to acknowledge your kindness in sending me a note of yesterday suggesting “unavoidable delay” as growing out of a cablegram of the colonial secretary, in giving me a response to the subject-matter of our interview and of my memorandum or the 25th. May I venture to express very strongly the hope [Page 805] that the order of the colonial secretary of June last will be reaffirmed promptly, and in such language that the Cuban authorities cannot misconstrue it? It seems that the colonial officers have nullified a positive and clearly expressed order of the colonial secretary to effectuate Article I of the commercial agreement of February 13, 1884, and “to remove any difference existing between Spanish and American ships in the ports of the Antilles.”

The just and honorable determination of the Government of Spain toenforce the language and principles of the agreement of February, 1884, and suppress the differential flag duties excited the liveliest satisfaction in the United States, as drawing the two nations into closer and mutually profitable commercial intercourse, and as giving still another proof of the fidelity with which Spain observes her obligations. The surprise and astonishment were proportionately great when information was conveyed to Washington that inequalities, vigorously protested against, were still enforced in the Antilles. I inclose slips from London Times and Imparoial, confirming the information which led my Government to appeal to your Excellency for an explanation.

The order of the colonial secretary and Article I of the commercial agreement on which it was based were not, as some ill-informed journals suppose, a gratuitous concession to the United States on the part of Spain. On the contrary, the equalization of the flags of the two countries was a solemn stipulation in return for a full and most advantageous quid pro quo. For fifty years Spain had sought release from a retaliatory duty reluctantly imposed by the United States, and the promise to put flags of the two countries on the same footing secured what she had so long desired.

The urgency of my Government and the excitement among shippers will excuse me in the eyes of your Excellency for asking such early action, in the most efficacious way, as will remove all possible misunderstanding and preserve in fullest harmony the cordial relations for which the two Governments have so earnestly and successfully striven.

In all these negotiations my Government is happy in dealing with such enlightened statesmen, and its representative is honored in being permitted to renew the assurances, &c.,

[Inclosure 3 in No. 119.—Extract from El Resumen.—Translation.]

a conflict.

We have received information this evening referring to a question of great importance, hitherto unknown by the, press and public opinion. Thanks to information, the exactitude of which cannot be doubted, we propose to bring it to light with all the details that have reached us. While this question does not belong to the domain of politics, it is so nearly related to it that it may be the origin of a ministerial conflict and of difficulties in our international relations.

The fact of the matter is that the representative of the United States in Spain began a short time ago to take steps to the end that the great North American Republic, and. above all, the marine, might obtain greater advantages than those offered by the existing commercial treaty, not by any means of a new agreement, but by virtue of a new interpretation of the present one.

In accordance with the terms of the existing agreement, the products of the United States enter the Spanish Antilles, paying duty under the third column of the tariff as foreign products carried under the national flag.

The North American minister, understanding well, on addressing himself to our Government, the consequences of what he proposed, and counting perhaps on our usual accessibility on the subject of foreign pretensions, formulated the request that the benefit of the third column be extended to whatever proceeds from the United States, or what is the same thing, that everything arriving in Cuba and Porto Rico under the flag of the Republic, whether North American products or not, should enjoy the avantages of the third column.

It appears that the minister of state, without taking into account what this meant, welcomed the proposals of the representative of the United States, agreed to do what was requested, and dictated a royal order which placed the desired construction upon the clauses of the treaty.

The subject passed to the ministry of ultramar for the dictation of the royal rrder, and having been received there as a matter in the ordinary run of business, this question which appeared so insignificant, but which was in reality nothing less than the total ruin of our poor merchant marine, followed the usual course.

[Page 806]

We do not know how or when or where the difficulty fortunately arose, the matter was paralyzed and began to attract the attention of the representatives of the decayed interests of our navigation, as well as of those who watch here over the mercantile interests of other countries.

The concession granted in principle to the United States would be soon saddled with the extension of this favor to other nations, who by their conventions with us have the right to the treatment of the most favored nation.

And from the moment in which not only the products, but what proceeds from, enter the Antilles with the shelter of the third column, what would remain of our merchant marine can be imagined.

The very productions of Spain would be snatched from our ports by a competition which it would be impossible to sustain, and all the commerce of the Antilles, no matter whence it came or with whom carried on, would finally fall into the hands of the United States, whose rates of freight are always more advantageous.

There was not wanting some one to see this in time, and the subject is paralyzed, as we have said.

But the question is not settled, and is far from being so. The efforts continue, the engagement exists, and they do not know how to escape from it.

Perhaps the circumstance that the minister of ultramar has hastened his return to Madrid may have some relation with what we refer to.

We could almost venture to say that it has.

Will the ministerial press now tell me what is going to be done; because it is evident to us that the conflict is begun, and we believe that we are rendering a service to the interests of the country in revealing the very grave peril that threatens our decayed naval industries.

  1. See translation of royal order of June 22, inclosed in Mr. Curry’s No. 69, page 799.