No. 291.
Mr. Bayard to Mr. Maury.

No. 114.]

Sir: I desire to bring to your notice the complaint of the Boston Ice Company, an American corporation, against the Government of Colombia, which has received the renewed attention of this Department and a fuller examination than it was heretofore possible to make.

As you are well aware, this company has for a number of years supplied ice to the Isthmus of Panama. Its business has been very large, and has been conducted so satisfactorily that there has been and is now no complaint made against it, nor against the character or price of the commodity it sells; nor has there been any rival system of ice-selling introduced on the Isthmus to share with it public favor, though there has been the freest opportunity for such competition. Encouraged by this heavy business, developed both from the necessities of trade and by its own good conduct, the Boston Ice Company has invested large sums of money in its works and buildings on the Isthmus, and has established [Page 430] a business the plant and good-will of which may be estimated at $1,000,000.

By the decree of the Colombian Government, as to which you have already been instructed, a monopoly in the sale of ice in the Isthmus, and in Colombia generally, is to be granted to the highest bidder, it being a condition of the sale that those obtaining the proposed monopoly shall renounce their right, if they be citizens of a foreign country, to call on the sovereign of that country to procure redress in case wrong be done them.

I have now to instruct you that the decree is, in the opinion of this Department, in contravention not merely of treaty stipulations, but of the fundamental sanctions of international law. The condition of renunciation of political rights which it imposes on the purchaser of the proposed monopoly is one to which the members of the Boston Ice Company, all of them respectable and responsible citizens of Massachusetts, must refuse their assent, not merely from loyalty but from policy. No citizen of the United States doing business in a foreign land can, with due self respect, or with due respect to his own country, make such a renunciation.

In Article II of the treaty of 1846, which is still in force, between the United States and Colombia, the respective parties thereto engage mutually not to grant any particular favor to other nations, in respect of commerce and navigation, which shall not immediately become common to the other party, who shall enjoy the same freely, if the concession was freely made.”

The “favored nation” clause takes us to the third article of the treaties between the Republic of Colombia and Sardinia and France, respectively, and to the second article of the treaties between the Republics of Colombia and Peru, Portugal and Great Britain, respectively, in which there is granted to the citizens of the respective countries an unlimited liberty of trade to the cities of the contracting parties.

Article III of the treaty of 1846, as aforesaid, provides that—

The two high contracting parties, being likewise desirous of placing the commerce and navigation of their respective countries on the liberal basis of perfect equality and reciprocity, mutually agree that the citizens of each may frequent all the coasts and countries of the other, and reside and trade there in all kinds of produce, manufactures, and merchandise.

It is further provided that such citizens “shall enjoy all the rights, privileges, and exemptions in navigation and commerce which native citizens do or shall enjoy, submitting themselves to the laws, decrees, and usages there established, to which native citizens are subjected.”

Article VII of the same treaty provides:

It is likewise agreed that it shall be wholly free for all merchants, commanders of ships, and other citizens of both countries, to manage by themselves or agents their own business in all the ports and places subject to the jurisdiction of each other, as well with respect to the consignments and sale of their goods and merchandise by wholesale or retail, * * * they being in all these cases to be treated as citizens of the country in which they reside, or at least to be placed on an equality with the subjects or citizens of the most favored nation.

These stipulations are re-affirmed in the first division of Article XXXV, with particular reference to the Isthmus.

In Article XVII, certain articles are specified as comprehended under “contraband,” among which ice is not included.

Article XVIII provides that—

All other merchandise, and things not comprehended in the articles of contraband, explicitly enumerated and classified as above, shall beheld and considered as free, and subjects of free and lawful commerce, so that they may be carried and transported in the freest manner by the citizens of both the contracting parties, even to placet belonging to an enemy. * * *

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Article XXXV provides that—

The citizens, vessels and merchandise of the United States shall enjoy in the ports of New Granada, including those of the part of Granadian territory generally denominated Isthmus of Manama from its southernmost extremity until the boundary of Costa Rica, ail the exemptions, privileges and immunities’ concerning commerce and navigation, which are now or may hereafter be enjoyed by Granadian citizens, their vessels and merchandise, and that ibis equality of favors shall be made to extend to the passengers, correspondence and merchandise of the United States, in their transit across the said territory, from one sea to the other. The Government of New Granada guaranties to the Government of the United States that the right of way or transit across the Isthmus of Panama * * * shall be open and free to the Government and citizens of the United States, and for the transportation of any articles of produce, manufactures or merchandise * * * belonging to the citizens of the United States; that no other tolls or charges shall be levied or collected upon the citizens of the United States, or their said merchandise thus passing over any road or canal that may be made by the Government of New Granada, or by the authority of the same, than is, under like circumstances, levied upon and collected from the Granadian citizens; that any lawful produce, manufactures or merchandise belonging to citizens of the United States, thus passing from one sea to the other, in either direction, for the purpose of exportation to any other foreign country, shall not be liable to any import duties whatever; * * * nor shall the citizens of the United States be liable to any duties, tolls, or charges of any kind to which native citizens are not subjected for thus passing the Isthmus.

It was to secure these guaranties—to protect investments in Colombia by American citizens from exactions such as that now complained of—that this Government, as is stated by President Polk in his message of February 10, 1847, transmitting this treaty to the Senate, consented to the insertion therein of the guaranty by the United States of the perfect neutrality of the before-mentioned Isthmus.”

The condition now sought to be imposed upon the Boston Ice Company would be in derogation of the spirit of the treaty, and it should require the citation of no especial stipulation to induce the Government of Colombia to abstain from any measures the practical effect of which is manifestly the destruction of American property—property bought and established by American enterprise and capital, and productive of so much profitable business in Panama.

The prompt relief given by the United States in pursuance of its treaty guaranties to the Colombian Government, when in such great difficulties in 1885, should never be forgotten; and our citizens in Panama should feel the benefit of it in the justly favorable treatment of that Government.

The imposition of such a condition as that here adverted to is wholly useless as a means to the attainment of any beneficial results. And this Department can not suppose that the Government of Colombia intends to employ it, or to permit it, to work injury to foreigners who may be subject to its laws, or desires to impute to the United States or other powers the design of obtaining for their citizens or subjects, by the protection they afford, anything more than can injustice be demanded.

The creation of such a monopoly as that set up by the decree would be in conflict with that unlimited liberty of trade which is secured to the United States by the treaty of 1846. It will be a serious blow to the friendly relations of the people and Government of the United States with Colombia, and to their desire for closer commercial intercourse, if, under color of laws granting exclusive and monopolistic privileges, such disastrous interference with the natural course of trade in Colombia is attempted, and the effect of such action will be most severely felt along the route of the transit across the Isthmus of Panama, the unembarrassed use of which it was the main object of the United States in the treaty of 1846 to secure.

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The effect of excluding American citizens from the free and equal opportunity to carry on “unlimited trade” would not be merely to nullify the most favored nation clause of the treaty. It would be a most unfriendly and destructive act against the citizens of a friendly power, the beneficial effect of whose prompt action on so recent an occasion Colombia has attested by her expressions of thanks.

It is the duty of Colombia to protect against extortion or unequal treatment American citizens who have carried their capital and property to Panama and invested them permanently under the guardianship of her laws. The United States look for a generous and friendly construction of treaty obligations and of the duties of international comity towards their citizens in Colombia, and have a tight to expect it.

It is believed that these representations being frankly and distinctly made, will suffice to prevent disfavor being shown to the Boston Ice Company, which has been so especially useful to citizens and travelers in Panama, audit is hoped that you will receive assurances which will relieve this Government of all further apprehensions of such injurious results.

In this way it is believed that the necessity of a formal protest will be obviated. The United States should not be compelled to proceed further in vindication of the rights of its citizens to just and friendly treatment, and the Department entertains no doubt that when the attention, of the Government of Colombia is called to the true nature of the case, it will afford prompt relief.

I am, etc.,

T. F. Bayard.