No. 204.
Mr. Denby to Mr. Bayard.

No. 634.]

Sir: I had the honor to report, in my dispatch No. 592 of March 19, that measures for the abolition of the camphor monopoly in Formosa were in satisfactory train. Subsequently the Tsung-li-Yamên repudiated the construction placed on its alleged agreement by the foreign ministers. The Yam to now insists that the monopoly in camphor shall remain in force as at present.

By reference to dispatch No. 39, of date June 15, 1869, of Mr. J. Ross Browne to the honorable Secretary of State, and inclosure B therein, you will see that certain rules governing the camphor trade were adopted March 17, 1869. These rules were in the nature of an agreement between the Chinese Government and the foreign powers. Under the circumstances the foreign ministers have transmitted to the Yamên a communication, of which a copy is appended to my dispatch No. 633 of April 27, 1888.

The ministers therein insist that these rules are still in force and inform the Yamên that the consuls have been instructed to claim compensation for all injuries arising from any breach thereof.

I have, etc.,

Charles Denby.