No. 74.
Mr. Hall to Mr. Bayard.

No. 603.]

Sir: With reference to my dispatch No. 515, of the 17th June, and to your instruction, No. 380, of the 17th August last, in relation to the proposed establishment of a line of Spanish steamers between Panama and San Francisco, under special contracts with the several governments of Central America, I have the honor to inclose a translation of a decree of the Legislative Assembly of Salvador of the 27th September last, making certain amendments to the contract with that Government [Page 93] and rejecting altogether the stipulation in regard to the rebate in duties upon merchandise imported into Salvador by that line. The decree also requires that the contractors shall deposit $20,000, or give the equivalent guaranty as a security for the fulfillment of their obligations.

In the mean time the contractors have failed to comply with that part of the contract by which they engaged to have their steamers ready at the time therein specified.

It may be proper to mention, in connection with this subject, that there is a line of German steamers making monthly trips between Hamburg and the Pacific ports of South and Central America, by way of the Strait of Magellan, during the season of coffee shipments, which is from December to June, inclusive. It is understood that the German Government subsidizes this line and takes much interest in its success; it receives in all of the Central American ports the same exemptions as regards port charges and concessions, except the subsidies for carrying the mails, that are accorded to the Pacific Mail Company’s steamers. I have been informed that the German minister to Central America, by instruction of his Government, gave notice to; the Governments of Guatemala, Salvador, and Costa Rica, with reference to the proposed line of Spanish steamers, that the German Government would expect that any rebate in import duties conceded to the vessels of any other nationality should also be extended to German vessels.

I have, etc.,

Henry C. Hall.
[Inclosure 1 in No. 603.—Translation.—From the Diario Oficial, of Salvador, September 27, 1886.]

the national constituent assembly.

The Provisional President of the Republic of Salvador to its inhabitants:

Know ye: That the National Constituent Assembly has decreed the following:

The National Constituent Congress of the Republic, considering that the contract entered into on the 6th of May of the present year, between the Supreme Provisional Government of the one part, and Don Carlos F. Irigoyen and Don José A. March of the other part, in regard to the establishment of a line of Spanish Central American steamers, is in the main acceptable, but that it contains conditions which conflict with the treaty of the 6th December, 1870, with the United States of America, and that the holders of the concession do not give sufficient security to insure the fulfillment of the stipulations of the said contract, decrees:

only article.

The contract referred to shall be approved with the following modifications:

That the steamers touch at the ports of the Republic, although there may be neither cargo nor passengers.
That the rebate of 3 per cent, in duties conceded to Irigoyen and March be rejected.
That the said Messrs. Irigoyen and March as a guaranty for the fulfillment of the contract deposit the sum of $20,000, which they shall forfeit to the treasury in the event of a non-compliance with the stipulations, or that they give some other sufficient security.
That in the event of Messrs. Irigoyen and March wishing to transfer or hypothecate the contract, it shall be with the assent of the executive.

  • Antonio Ruiz, President
  • Maximo Mancia, Secretary.
  • Jeremias Guandique, Pro. Secretary.

Therefore, let it be executed.

Francisco Menendez.

The Secretary of State in the Department of Public Works,

Baltizar Estapinian.