Office of the Historian

No. 163.
Mr. Denby to Mr. Bayard.

Legation of the United States,
Peking, April 1, 1887. (Received May 7.)
No. 345.]

Sir: I have the honor to inclose herewith the basis of the agreement, relating to the opium traffic, arrived at by the commission which met [Page 206] in Hong-Kong in June last, in pursuance of Article 7, section 3, of the agreement between Great Britain and China, signed at Chefoo on the 13th September, 1876, and of section 9 of the additional article of the said agreement signed at London on the 18th July, 1885.

There were three plans proposed for the collection of the opium revenue for China.

  • First. The opium revenue should be collected for China by England in India. The Chinese commissioners favored this plan, because by a system of deferred payments of duties in India interference with capital would be avoided, and by freeing opium from taxation in China smuggling would be avoided.
  • Second. That China should do her own work, that is, collect her own revenue on Chinese territory, and take her own preventive steps all along the Chinese sea-board.
  • Third. The hulk plan, which was between the other two. Opium hulks were to be anchored at Hong-Kong. Every vessel carrying opium was, on entering the harbor, to go alongside of one of these hulks. The opium was to be discharged into a hulk. Opium leaving a hulk to go to Macao was to pay duty and lekin before it left port.

Opium to be taken to Hong-Kong, and not to customs godown, to pay duty and lekin in like manner.

Opium leaving a hulk to be taken to a Chinese treaty port by vessels under the flag of a treaty power, or belonging to a China merchants’ company, to pay duty and lekin at the treaty port. Certificates to be issued by the hulk officials describing the nature and quality of the opium.

Under the inclosed agreement, which was finally arrived at, China collects the duties at her own ports and the rights of Hong-Kong are protected.

I have, etc.,

Charles Denby.
[Inclosure in No. 345.]

Memorandum of the basis of agreement arrived at after discussion between Mr. James Russell, puisne judge of Hong-Kong; Sir Robert Hart, K. C. M. G., inspector-general of customs; and Shao, taotai, joint commissioners for China, and Mr. Byron Brenan, Her Majesty’s consul at Tientsin, in pursuance of Article 7, section III, of the agreement between Great Britain and China signed at Chefoo on the 13th September, 1876, and of section 9 of the additional article to the said agreement signed at London on the 18th July, 1885.

Mr. Russell undertakes that the government of Hong-Kong shall submit to the legislative council an ordinance for the regulation of the trade of the colony in raw opium, subject to conditions hereinafter set forth, and providing—

(1)
For the prohibition of the import and export of opium in quantities less than one chest.
(2)
For rendering illegal the possession of raw opium, its custody, or control in quantities less than one chest, except by the opium farmer.
(3)
That all opium arriving in the colony to be reported to the harbor-master, and that no opium shall be transhipped, landed, stored, or moved from one store to another, or reported without a permit from the harbor-master and notice to the opium farmer.
(4)
For the keeping by importers, exporters, and godown owners, in such form as the governor may require, books showing the movement of opium.
(5)
For taking stock of quantities in the stores, and search for deficiencies by the opium farmer, and for furnishing to the harbor-master returns of stocks.
(6)
For amendment of harbor regulations as to the night clearances of junks. The conditions on which it is agreed to submit the ordinance are:
(1)
That China arranges with Macao for the adoption of equivalent measures.
(2)
That the Hong-Kong government shall he entitled to repeal the ordinance if it be found to be injurious to the revenue or the legitimate trade of the colony.
(3)
That au office under the foreign inspectorate shall be established on Chinese territory, at a convenient spot on the Kowloon side, for sale of Chinese opium duty certificates, which shall be freely sold to all comers, and for such quantities of opium as they may require.
(4)
That opium, accompanied by such certificates at the rate of not more than 110 taels per picul, shall be free from all further imposts of every sort, and have all the benefits stipulated for by the additional article on behalf of opium on which duty has been paid at one of the ports of China, and that it may be made up in sealed parcels at the option of the purchaser.
(5)
That junks trading between Chinese ports and Hong-Kong and their cargoes shall not be subject to any dues or duties in excess of those leviable on junks and their cargoes trading between Chinese ports and Macao, and that no dues whatsoever shall be demanded from junks coming to Hong-Kong from ports in China, or proceeding from Hong-Kong to ports in China, over and above the dues paid or payable at the ports of clearance or destination.
(6)
That the officer of the foreign inspectorate, who will be responsible for the management of the Kowloon office, shall investigate and settle any complaints made by junks trading with Hong-Kong against the native customs revenue stations or cruisers in the neighborhood, and that the governor of Hong-Kong, if he deems it advisable, shall be entitled to send a Hong-Kong officer to be present at and assist in the investigation and decision.

If, however, they do not agree, a reference may be made to the authorities at Peking for a joint decision.

Sir Robert Hart, undertakes on behalf of himself and Shao, taotai (who was compelled by unavoidable circumstances to leave before the sittings of the commission were terminated) that the Chinese Government shall agree to the above conditions.

The undersigned are of opinion that if these arrangements are fully carried out, a fairly satisfactory solution of the questions connected with the so-called “Hong-Kong blockade,” will have been arrived at. Signed in triplicate at Hong-Kong, this 11th day of September, 1886.

  • J. Russell,
    Puisne Judge of Hong-Kong.
  • Robert Hart,
    Inspector-General of Customs, China.
  • Byron Brenan,
    H. B. M.’s Consul at Tientsin.