No. 316.
Señor Volio to Mr. Bayard.


Sir: The newspapers of this capital publish in their numbers of yesterday and the day before the news that the Secretary of the Treasury has issued a circular to collectors of customs, in which, after stating that he has been informed by the Department of State that various lines of foreign and Costa Rican vessels plying between Costa Rica and New York, New Orleans, and other United States ports, and likewise between Costa Rica and European ports, enjoy a rebate of 5 per cent, in the payment of import duties, and also certain privileges as regards the payment of port charges, and that said rebate is not granted to United States vessels, he instructs them, in consequence, to subject cargoes of Costa Rican vessels entering United States ports to the discriminating duties established by section 2501 of the Revised Statutes, as incorporated in the act of March 3, 1883.

On the supposition that the notice published is correct, I have the honor to call your attention to the true state of the case in Costa Rica.

It is true that some navigation companies, in virtue of a special concession, enjoy a reduction of 5 per cent, in the payment of import duties on goods imported in their vessels.

By way of compensation for this, these companies agree that their vessels shall enter the ports of the Republic a certain number of times each month, that they shall carry the mails of Costa Rica to foreign [Page 470] countries, and vies versa, and allow a number of free passages each year, the same being at the disposal of the Government.

It is thus seen that the concessions are reciprocal, and that those of the nation to the companies are not granted by way of groundless preference, but in exchange for services rendered by said companies.

The law, moreover, which authorizes the executive to conclude with the navigation companies the contracts on which is based the reduction of duties enjoyed by some of them empowers him to conclude similar agreements with any company that may desire it, and that may be willing to contract the same obligations which have been required of those with which arrangements have already been made.

In my humble opinion, the United States Government would have acted with perfect justice in adopting the measure which it has, if that of Costa Rica had granted the reduction of duties in favor of all goods imported into the Republic in all vessels of other nations, except those of the United States, or even in all vessels belonging to one particular nation, and perhaps even if, the favor being restricted to one particular company, the benefit were exclusive and gratuitous; in view, however, of the circumstances mentioned, which show that the advantages obtained by some companies are fully accessible to those of this Republic, I think that the decision of your Government has been adopted on the basis of inaccurate information.

If this is true, and if the reasons which I have had the honor to state in this communication should lead to a modification of your judgment, my Government would be much pleased to see a corresponding change-made in the order of the Secretary of the Treasury to which this note has reference.

I have, etc.,

Federico Volio.