No. 164.
Mr. Denby to Mr. Bayard.

No. 545.]

Sir: I have the honor to report that the Shanghai general chamber of commerce lately addressed a communication to the dean of the diplomatic corps requesting the intervention of the ministers in the matter of bonded warehouses at Shanghai.

The chamber resolved that any scheme for the establishment of bonded warehouses which did not permit the bonding of all wharves and warehouses, or such as were prepared to accept and comply with the regulations, was against public policy and constituted an interference with trade and vested interests.

The ministers were requested to use their influence to induce the Chinese Government to rescind its edict, which designates the warehouses of the China Merchants’ Navigation Company as the sole bonded warehouses and secures to that company the monopoly of the storage of goods.

The ministers are much inclined to favor the private bonded warehouse system as now in force in western countries; but they recognize that the establishment of bonded warehouses at all is a step forward which has only been reached after years of endeavor.

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They take it for granted that after the present system has been put in operation and its benefit to commerce realized, it may and will, probably, be extended.

Recognizing that China has the abstract right to designate any warehouse it may select as a public bonded warehouse, they have, therefore, through the dean, advised the chamber that they decline at this time to press on the Chinese Government the propriety of permitting all warehouses to be bonded, but should results show that the general commerce requires an extension of the system, the ministers will use their influence to secure such extension.

I have, etc.,

Charles Denby.