No. 980.
Mr. Bayard to Mr. Curry.

No. 271.]

Sir: Referring to previous instructions which have been sent to you from time to time in regard to discriminations said to be still practiced against American vessels in the Spanish West Indies, I now desire to call your attention to some general considerations in regard to this subject.

From the time of the signature of the provisional commercial agreement of January 2 and February 14, 1884, until now, and notwithstanding the successive changes introduced in that modus vivendi by the agreements signed October 27, 1885, and September, 1887, and which were designed to remove discriminations that had become noticeable in the practical working of the measure, it has been repeatedly represented to this Department, on behalf of American ship-owners, that a residual discrimination exists in the treatment of American steamers plying between the United States and ports of the island of Cuba and Spanish steamers making the same trips as an incident of a round-trip voyage from a peninsular port.

By an instruction (No. 311, of October 25, 1887) the consul-general of the United States was made acquainted with the precise statements in this regard, made by Messrs. James E. Ward & Co., agents for the New York and Cuba Mail Steam-ship Company, and directed to investigate the matter thoroughly and conclusively.

The report of Consul-General Williams makes it quite clear that, while the Government of the United States is, under the existing commercial agreement, exempting Spanish vessels in the ports of the United States, when coming from the Antilles, from all discriminating duties, on the assurance that our vessels in Antillean ports are treated on the basis of perfect equality, the Spanish rule, in point of fact, gives to the steam-vessels engaged in the same traffic and flying the flag of Spain, under certain conditions, a valuable exemption.

It appears from Mr. Williams’ report, and the accompanying papers, that Spanish mail-steamers or Spanish steamers making regular trips from Spain in less than twenty days are entirely exempt from the payment of both inward and outward tonnage dues, even when entering from or clearing to other than a Spanish port; so that a Spanish steamer coming from Spain with cargo enters a Cuban port without paying tonnage, and after discharging cargo there takes on cargo for a port of the United States and clears without payment of any tonnage dues. The same thing occurs on the return trip; the steamer leaving the United States with cargo enters a port of the island of Cuba and clears therefrom for Spain without paying any tonnage dues whatever, either inward or outward. On the other hand, a regular trading steam-ship, under the flag of the United States, entering and clearing from a Cuban port in the course of its trips from and to the United States, pays 62½ cents per ton upon the net register tonnage when the inward and outward cargo jointly exceed the net register.

With the treatment by Spain of its vessels engaged in trade between Spanish ports this Government has as little concern as Spain could have in regard to the treatment of vessels of the United States, and this wholly irrespective of any incidental foreign voyage which may be made in the course of a round trip. But it is unquestionable that, to [Page 1436]insure a real equality of treatment, an American and a Spanish vessel, making the voyage side by side between a port of the United States and a port in Cuba, must be treated alike at each end of the voyage. In other words, the particular voyage, or part of a general round voyage, in which the two flags come into competition, is that which the agreement between the two countries aims to equalize, and as to this voyage no inequality or discrimination can be introduced because of any other voyage or voyages whatsoever not coming within the purview of the international agreement.

It would appear that the Spanish treatment of the steam-ships of Spain, exempting them from all tonnage dues when clearing for or arriving from a port of the United States en route from or to the Peninsula, is based upon the interpretation given to article 5 of the existing customs tariff of the island of Cuba, which reads as follows:

Art. 5. Steamers nationalized in Spain and making regular trips between this island and the ports of the Peninsula and Puerto Rico, not belonging to the subsidized lines, are exempt from tonnage dues. To enjoy this benefit the duration of the regular trips must not exceed twenty days from the port of Havana to those of the Peninsula, and vice versa, and four days from Puerto Rico, respectively; a periodic trip being understood as one performed at least once a month, from which is to he discounted the time consumed in touching at intermediate ports.

It is not apparent how this article can be applied to work the discrimination to which attention is now invited, unless in the assumption that the voyage of the Spanish steamer is made to a port of the United States as an intermediate port of call between Havana and the Spanish Peninsula (and with deduction of the time the voyage is lengthened by reason of such digression), or in the still more violent assumption that the excursion is made from Havana to the United States and back to Havana without interfering with the periodicity or computed duration of the trip between the Peninsula and Havana.

The fallacy of the latter assumption needs no argument for its demonstration, since any such to-and-fro excursion to a foreign port from Havana can never be to a point intermediate on the journey between Havana and the Peninsula. Such an excursion must be regarded as wholly complete by itself, and without the slightest regard to any prior or subsequent condition growing out of the engagement of the vessel in the domestic carrying trade between Spanish ports. The total exemption of a vessel making such an excursion from payment of dues, which must be paid by a vessel of the United States making a similar voyage side by side with its Spanish competitor, is so palpable a contravention of the condition of “perfect equality” stipulated by the agreement, that it is not believed possible to explain or justify it.

The first assumption, however, merits more extended notice. It would even cover the case of a somewhat numerous class of steam-vessels which has grown up within the last decade or two, and to which the name of “ocean tramps” has been applied. A steam-ship of this class, under the assumption that intermediate foreign calls are to be deducted from the time allowed, might, after leaving a peninsular port, rove about at will from one foreign port to another, and yet, if at any time touching at Havana before returning to Spain, would have the privilege of free entry and free clearance at Havana. That this is incompatible with the stipulated “perfect equality” of treatment with a vessel of the United States is self-apparent, for the Spanish steamer receives, for that particular section of her general voyage lying between Havana and any port of the United States, a favor which is withheld from an American steamer, and which is never at any time before or [Page 1437]after equalized by any dues levied under Spanish law or any favor accruing under Spanish regulation to the American steamer.

Besides the question thus stated, which relates to Spanish steamers, not regularly subsidized, but making so-called periodical monthly trips between Havana and the Peninsula, the report of the consul-general at Havana shows conclusively that two other discriminations exist in respect of United States vessels engaged in the Antillean trade.

A Spanish sailing vessel arriving in Cuba from another Spanish port pays per ton on inward cargo 37½ cents, and on outward cargo on clearing for the United States 25 cents per ton. A vessel of the United States pays on the combined inward and outward cargo $1.35 per ton, or at the rate of 67½ cents each way.

Here again is an illustration of the illogical policy of favoring a Spanish vessel setting out on a foreign voyage because of a prior voyage in the reserved domestic trade; for it is clear that if the American and Spanish ships set out side by side from an Antillean port towards an American port, the 25 cents per ton paid by the Spanish ship is considerably less than the share of the total tonnage dues paid by the American corresponding to the outward part of her voyage, viz: 67½ cents. This is not balanced by any differential treatment on the return voyage from the United States to the Antilles, for the total outward and inward dues of such a Spanish vessel in respect of her excursion to and from a port of the United States does not amount to the $1.35 paid by an American vessel for inward and outward tonnage dues on a similar round voyage.

Again, a Spanish vessel arriving in Cuba in ballast from Puerto Rico, pays, on clearing with cargo for a port of the United States, dues to the amount of only 25 cents per ton; whereas an American vessel entering a port of Cuba in ballast and clearing to make the same voyage as the Spanish vessel must pay 62½ cents per ton.

There may be other instances of discrimination than those mentioned in Mr. Williams’s report, and, from the circumstance that they all arise in the case of vessels coming to Cuba from another Spanish port, it is probable that in other instances also an analogous favor, springing from the prior domestic voyage of a vessel, follows her in her outward voyage to a foreign port, which is not subsequently made up by any differential Spanish impost, and which operates as an actual discrimination for that outward foreign voyage against a vessel of the United States making the same voyage side by side with its Spanish rival.

The matter is one of considerable importance, inasmuch as the continuance of the President’s proclamation suspending all differential duties on Spanish vessels and their cargoes in the ports of the United States is in terms dependent upon the continuance of equal treatment of American and Spanish vessels in the ports to which the proclamation relates.

Copies of the instruction of this Department to Consul-General Williams, and of his report, with their respective annexes, are herewith inclosed for your use in preparing such a full and clear presentation of this matter to the Government of Her Majesty the Queen Regent as will demonstrate the need of an actual reciprocity of equal treatment of Spanish and American vessels in the ports of the Antilles and give satisfactory proof that it does exist, in default of which proof the statutory obligation of rescinding his proclamation would rest upon the President. The form and details of such presentation are confidently left to your good judgment.

Previous instructions of the Department in relation to the general [Page 1438]subject of equality of treatment may be drawn upon to aid you in your task. You will observe that Mr. Williams’ report refers particularly to his previous dispatches, No. 340, of January 28, 1886; No. 350, of February 23, 1886; and No. 624, of April 26, 1887. Of these No. 340 was copied to you with my instruction No. 40, of February 24, 1886, and No. 350, was sent as an inclosure with my No. 614, of May 26, 1886. Copy of Mr. Williams’s No. 624 is hereto appended for your fuller information.

I am, etc.,

T. F. Bayard.
[Inclosure 1 in No. 271.]

Mr. Adee to Mr. Williams.

No. 311.]

Sir: I transmit herewith for your perusal a copy of a letter, dated the 19th instant, from Messrs. James E. Ward & Co., agents for the New York and Cuba Mail Steamship Company. You will gather from this letter that the above-named company claims that its steamers clearing from the port of Havana for New York have been subjected to heavier tonnage tax than Spanish steamers clearing from Havana for New York immediately after a voyage to Havana from a Spanish port; and that this discrimination is in violation of the arrangement for equalization of tonnage dues.

It seems that there are two dissimilar and non-comparable methods of assessing tonnage dues in existence in Cuban ports; by one of which Spanish, and by treaty American, steam-ships, making regular trips between Cuban and non-Spanish ports, pay on each visit to a Cuban port 62½ cents per ton registered capacity; by the other, registered Spanish steam-ships making regular trips between Cuban and Spanish ports under certain conditions, enter Cuban ports free of tonnage tax, and pay on clearing for any port 25 cents per ton on each ton of cargo carried out.

The complainants state that registered Spanish steam-ships, having entered a Cuban port free of tonnage tax under the domestic trade regulations, take on a cargo for the United States, on which they pay a clearance due of 25 cents per ton; whereas American steam-ships, thus brought into competition with the favored Spanish vessels, are required to pay 62½ cents per ton registry; the result being, say Messrs. Ward & Co., a discrimination of 37½ cents per ton in favor of the Spanish vessel for that voyage, which is not made up on the return voyage, and which is therefore contrary to agreement.

It is clear that if there is a substantial discrimination against the American steamship at the beginning of the voyage outward from Cuba, it is never made up, and is a permanent loss. But the Department is unable, without further information, to make an intelligent comparison of the two systems of tonnage taxation in their practical working.

It is conceived that there will, except in accidental cases, be some inequality in a tax of 62½ cents per ton registered capacity and a tax of 25 cents per ton of cargo carried out; but it is impossible, in the present state of the Department’s information, to determine in what direction the inequality operates, and which class of vessels is thereby put at a disadvantage.

You are therefore instructed to report fully upon this point: First, as to the correctness of the Department’s conception of the law; and, secondly, as to its practical operation upon the interests of American steam-ships engaged in the carrying trade between Cuban and United States ports.

I am, etc.,

Alvey A. Adee,
Second Assistant Secretary.
[Inclosure 2 in No. 271.]

Messrs. Ward & Co. to Mr. Bayard.

Sir: Referring to the memorandum of agreement between your good self and the Spanish minister, dated September 21, we respectfully submit for your consideration the following facts:

According to the laws in force in the Island of Cuba any steamer coming to Cuba [Page 1439]from Spain that makes the voyage in less than twenty days pays no tonnage due at all if she loads again for Spain, but if she loads for a foreign port, she only pays tonnage dues on her outward cargo at the rate of 25 cents per ton.

The steamers that run from Spain to Cuba, owing to the scarcity of cargo in Cuba for Spain, frequently load in Cuba for ports in the United States, and thus come into direct competition with American steamers, having the advantage over American steamers that they pay only 25 cents per ton on the cargo they bring to the United States, while an American steam-ship loading sugar or other cargo in Cuba for the United States pays 62½ cents per ton; thus the Spanish steamers loading in Cuba for the United States have an advantage under “similar circumstances” over the American steamers of 37½ cents per ton.

To illustrate the facts stated we will cite a case in point. The Spanish steamer M. M. Pinillos, which arrived in Cuba from Spain in August last made the passage in less than twenty days, and was therefore entitled to the reduction in tonnage dues above recited. She came into the market in direct competition with the regular American lines owned by Messrs. F. Alexander & Sons and ourselves, and secured a cargo of 25,000 bags of sugar for New York. This lot of sugar would weigh 4,000 tons, on which the Spanish steamer paid $1,000 tonnage dues, and on which, had we taken it, we would have had to pay $2,500, thus having an advantage over an American steam-ship in a few days’ passage of $1,500, and which, at the present rate of freight, say 8 cents per 100 pounds, is about one-quarter of the total freight money earned for carrying the 25,000 bags.

We respectfully submit that the Spanish Government are therefore discriminating in favor of their own steamers as against American steamers, and would request that you take the necessary steps to place us on an equal footing with Spanish steamers coming into direct competition with us, which we claim we are entitled to by virtue of the agreement of September 21, 1887, previously referred to.

We remain, etc.,

James E. Ward & Co.
[Inclosure 3 in No. 271.]

Mr. Williams to Mr. Rives.

No. 740.]

Sir: I have now the honor to reply to the Department’s instruction number 311 of the 25th of last October, wherein was inclosed a copy of the letter of Messrs. James E. Ward & Co., of the 19th of the same month, complaining of the defective execution here by the insular authorities of the memorandum of agreement concluded at Washington, on the 21st of September of the present year, between the honorable Secretary of State and the minister plenipotentiary of Spain.

Accordingly, and in fulfillment of the Department’s instructions, I annex herewith the following inclosures corroborative of this report:

Inclosure No. 1 is a certified copy of the original invoice here on file, which was presented for consular certification to this office on the 3d of last September by the shippers, Messrs. Hidalgo &, Co., of the 25,000 bags of sugar then carried to New York by the Spanish steamer Miguel M. Pinillos. The presentation herewith of this invoice confirms, by the fact itself, the statement of Messrs. James E. Ward & Co., as to the amount of cargo carried to the United States by that Spanish steam-ship on its trip to. New York from Havana last September.

Inclosure No. 2 is a copy of the original Spanish communication addressed by me to the collector of the port of Havana on the 17th instant, wherein I asked him to be pleased to inform me of the rate of tonnage dues collected here from Spanish sailing vessels arriving from Spain, and leaving here afterwards in continuation of their voyages, loaded with cargo for the United States; as also with respect to the tonnage dues paid here by Spanish steamers making periodical trips to this island in less than twenty days from Spain, and then leaving here loaded for the United States in continuation of their voyages; as likewise, to be informed if the said Spanish steamship Miguel M. Pinillos, on its voyage from Havana to New York on the 5th of last September paid tonnage dues or not; and, if it paid them, under what article of the Cuban tariff were they collected; and, if it did not pay them, by what article of the same tariff was it exempted therefrom.

Inclosure No. 3 is the English translation thereof.

Inclosure No. 4 is a copy of the original communication of the collector of the port of Havana in answer to mine of the same date, and No. 5 is the English translation thereof. As you will please observe, the collector in this communication even more than confirms all the statements of Messrs. James E. Ward & Co., viz: First, that [Page 1440]Spanish sailing vessels on leaving the ports of Cuba loaded for the United States only pay 25 cents for each gross ton of 1,000 kilos of cargo taken on board when they arrive from Spain; second, that Spanish steamers making regular trips from Spain in less than twenty days, are free from the payment of tonnage dues on leaving the ports of Cuba loaded for the United States; third, the Spanish steamer, Miguel M. Pinillos, referred to by Messrs. James E. Ward & Co., paid no tonnage dues whatever; became exempted by Article 5 of the regulation, dictated the 16th of October, 1883, in fulfillment of the royal order of the 25th of August of that same year.

As likewise pertinent and elucidative of this subject, I beg to annex extracts of my dispatches No. 340 of the 28th of January and of No. 350 of the 23d of February of last year, 1886, as well as of No. 624 of the 26th of April of the present year, 1887, in each of which I mentioned the existence of these practices, now complained of as discrimination by this American firm of ship-owners.

Dispatch No. 624, above cited, as will be noticed, was based upon the complaint of the master of the American schooner Mattie B. Russell, of Portland, Maine, who mistakenly claimed that the agreement made at Washington, October 27, 1886, between the United States and Spain, provided for an absolute equality in the ports of Cuba between American vessels arriving here from the United States and Spanish vessels arriving here from Spain. But upon inspection of that agreement it will be found, as I showed in that dispatch, that it did not include the case presented by the master of the schooner Mattie B. Russell, for that was one pertaining exclusively to the coastwise trade of Spain as much so as a voyage from New York to San Francisco, California, via Cape Horn or the Straits of Magellan pertains to the coastwise trade of the United States.

The present complaint of Messrs. James E. Ward & Co., however, is one of an entirely different nature, treating as it does exclusively of the trade between the United States and Cuba and Spain. In this case it will be perceived that Messrs. James E. Ward & Co. claim that the present agreement made at Washington on the 21st of last September between the United States and Spain in substitution of that of the 27th of October, 1886, provides for an absolute equality in the ports of Cuba, between American and Spanish vessels trading from the United States to Cuba, and conversely from Cuba to the United States or any other foreign country.

Now, in Order to show that the discriminations complained of by Messrs. James E. Ward & Co., and upon which the Department instructs me to report, are practiced here in accordance with the said article 5 of a customs law of Cuba, and admitted by the collector of the port of Havana in his communication of the 17th instant already referred to and herewith annexed, I beg to wait upon you with the following comparison of the tonnage dues paid here by American sailing vessels trading between Cuba and the United States, with Spanish vessels trading between the same two countries, when the latter vessels arrive with cargo inward from Spain.

comparison.

An American vessel of 500 tons pro forma net register, pays tonnage on inward and outward cargo in the ports of Cuba at the rate of $1.35 per ton on 500 tons net register, or say $675. But a Spanish vessel of 500 tons pro forma net register coming loaded from Spain pays on inward cargo at 37½ cents ($187.50) and on leaving Cuba for the United States pays on the 500 tons net register at the rate of 25 cents, or say $125; or a total of $312.50.

Consequently, instead of the observance hereby the customs authorities of an absolute equality of tonnage dues between Spanish and American vessels trading between Cuba and the United States as stipulated for by the honorable Secretary of State with the minister plenipotentiary of Spain in the memorandum of agreement done at Washington the 27th of September last, an inequality of upwards of 100 per cent, is wrought by the operation of the 5th article of the customs law cited by the collector of the port as the source of authority in this case, in favor of Spanish sailing vessels and against American sailing vessels of $362.50.

Further, in the case of Spanish regular trading steam-ships coming loaded from Spain to Cuba in less than twenty days, and then loading here for the United States, the inequality against American steam-ships is immensely greater; for in this case Spanish steam-ships are free of the payment of all tonnage dues, whilst the regular trading American steam-ships pay 62½ cents per ton upon the net register tonnage when the inward and outward cargo jointly exceed the net register. In illustration of this point, as you will please notice, I cited in my dispatch number 340 the instance of the regular Spanish steam-ship Hernan Cortes, which brought 1,460 tons of cargo from Spain, and then, in the continuation of its voyage, took in 2,100 tons of cargo for the United States without paying any tonnage dues whatever; whereas a regular American steam-ship in this case, had the joint inward and outward cargo not exceeded its register tonnage, would have had to suffer an inequality of $2,225.

Also, in the case of the regular trading Spanish steam-ship M. M. Pinillos, mentioned [Page 1441]by Messrs. James E. Ward & Co., it will be perceived that the inequality is even much greater than stated by them; for instead of paying $1,000, as they supposed, it really came loaded and left loaded, scot free, having paid no tonnage dues whatever, as will be seen from the perusal of the said communication, dated the 17th instant, of the collector of the port of Havana, hereto annexed.

In. conclusion, and reducing the inequalities of the case down to their prime terms, I beg most respectfully to express the opinion that they arise from the irreconcilable difference of meaning existing between section 4228 of the Revised Statutes of the United States, and article 5 of the Spanish Law of Commercial Relations, herewith accompanied as inclosure number 6, and form, therefore, separately a subject to be considered in connection with the “satisfactory proof” required to be given under the above-mentioned section of the Revised Statutes of the United States, by every foreign government upon the solicitation of the suspension of the retaliatory duties of the United States in accordance with the said statute.

I am, etc.,

Ramon O. Williams.
[Inclosure 4 in 271.]

Certified copy of Invoice No. 5128.

Invoice of 25,000 sacks sugar shipped pr. S. S. Miguel M. Pinillos, Roldo’s Mr. bound to New York, for account and risk of whom it may concern, and consigned unto order.

centrif. sugar.

Z. $25,000=25,000 sacks, wg. Gross 7,694,065 lbs.
1 per cent. tare 76,942
Net 7,617,123 lbs. at 3c per lb $228,513.70
Less freight at 8c per 1,000 lbs. net. Invo. Wt 6,093,70
Net cost f. o. b. including all chs. and commis. U.S. curry 222,420.00
E. & O. E. Havana Sept. 3d, 1887, at 11¼ percent. P. Equivalent to Sph. gold 247,442.23

Hidalgo & Co.

Consulate-General of the United States,
Havana:

I, the undersigned, Consul-General of the United States of America at Havana, do hereby certify that the foregoing copy of an invoice, together with the usual consular certificate authenticated in triplicate and numbered 5128 on the 3d day of September for New York per steamer Miguel M. Pinillos and on file in this office is a true and faithful copy of said original; the said copy having been carefully compared and collated therewith and found to agree word for word and figure for figure.


[seal.]
Ramon O. Williams,
Consul-General
[Inclosure 5 in No. 271.]

Mr. Williams to Mr. de la Torre.

Sir: In order to be enabled to reply directly to an instruction received from my Government, I beg you to be pleased to inform me what tonnage dues Spanish sailing vessels pay on arriving in the ports of this island from Spain, and which afterwards sail, in continuation of their voyages, loaded for the United States, also as to what tonnage dues are paid here by Spanish steamers, making periodical trips from Spain to Cuba in less than twenty days, upon leaving likewise loaded for the United States, as well also to be informed at the same time if the Spanish steamer Miguel M. Pinillos paid tonnage dues or not on its trip from Havana to New York on the 5th of September last; and if it did pay them, under what article of the Cuban tariff; and if not, then I will thank you also to inform me under what article of the said tariff it was exempted.

I am, etc.,

Ramon O. Williams.
[Page 1442]
[Inclosure 6 in No. 271.—Translation.]

Mr. de la Torre to Mr. Williams.

Sir: Replying to your attentive communication, of to-day, I have the pleasure to inform you that Spanish sailing vessels arriving in the ports of this island from Spain, and afterwards sailing loaded with cargo for the United States, pay their tonnage dues on arriving here at the rate of 37½ cents for each ton of 1,000 kilos discharged and 25 cents for each ton of 1,000 kilos of outward cargo (for the United States). Regular Spanish steamers making the trip in less than twenty days from Spain to this island enjoy an absolute exemption from tonnage dues both upon inward cargo from Spain and outward cargo for the United States.

The Spanish steamer Miguel M. Pinillos, referred to, paid no tonnage dues, because embraced in article 5 of the regulation dictated on the 16th of October, 1883, in conformity with the royal order of the 25th of August of the same year.

God guard you many years.

Alfonso de la Torre.
[Inclosure 7 in No. 271.—Translation.]

Extract from the customs tariff of the Island of Cuba.

Art. 5. Steamers nationalized in Spain and making regular trips between this island and the ports of the Peninsula and Porto Rico not belonging to the subsidized lines are exempt from tonnage dues. To enjoy this benefit the duration of the regular trips must not exceed twenty days from the Port of Havana to those of the Peninsula, and vice versa, and four days from Porto Rico, respectively; a periodic trip being understood as one performed at least once a month, from which is to be discounted the time consumed in touching at intermediate ports.

[Inclosure 8 in No. 271.—Translation.]

Mr. de la Torre to Mr. Williams.

Sir: In reply to your attentive letter of the 5th instant, I have the honor to inform you that Spanish vessels arriving here from Puerto Rico in ballast and sailing afterwards loaded with sugar for the United States, pay tonnage dues at the rate of 25 cents for each 1,000 kilos gross, excepting those Spanish steamers of periodical trips, which enjoy an exemption from their payment.

The tonnage dues collected in Puerto Rico do not serve as a basis at all in this island, because of the different manner in which they are collected.

God guard you many years.

Alfonso de la Torre.
[Inclosure 9 in No. 271.—Translation.]

Mr. de la Torre to Mr. Williams.

Sir: In reply to your attentive letter of the 15th instant, relative to the tonnage dues paid in this island on American and Spanish vessels, I have to say that this office has interpreted and continues to interpret the operations belonging to this subject by a strict literal adherence to the royal order of the 9th of July, 1868, which concedes an equality with Spanish vessels in the payment of tonnage dues to the vessels of all those nations that grant the like privileges in their respective territories, this practice having been successively extended not only to the nation you so worthily represent, but to France, Germany, England and all its colonies, Sweden and Norway, Holland and its colonies, Denmark/Belgium, Austria and Hungary, Italy, Greece, Russia, Finland, and Mexico.

[Page 1443]

The law of commercial relations between Spam and its colonies was promulgated in this island on the 20th of July, 1882, in which several distinct forms are established for the collection of tonnage dues.

Consequently, in view of the orders cited, the only ones now ruling, I proceed to answer the questions you have been pleased to address me relative to the case.

Upon the first: If the vessel is not a regular Spanish mail-carrying steamer she pays for each ton of inward cargo discharged, 37½ cents; and for each ton of outward cargo loaded, whatever may be the country or port of destination, 25 cents.

If the vessel is a regular Spanish mail-carrier, and makes the trip from the Peninsula to this port in less than twenty days, it will be entirely exempt from the payment both of inward and outward tonnage dues.

Upon the second: In this case, sailing vessels will pay the same tonnage dues expressed above, steamers enjoying the like exemptions. (See dispatch Mo. 632, dated May 9 1887.)

Upon the third: If the Spanish vessel is not a regular Spanish mail-carrying steamer, and comes in and goes out loaded, she then pays on her net register measurement at the rate of $1.35 per ton.

If she arrives with cargo and leaves in ballast, $1.30.

If she arrives in ballast and leaves loaded, $1.

If she arrives in ballast and leaves with a full cargo of molasses, 37½ cents.

If she arrives in ballast and loads part of a cargo of products of the island, she will then pay tonnage dues upon the number of tons of cargo loaded at the rate of $1, and upon the remaining empty space 5 cents.

If she enters and leaves in ballast, 5 cents.

If she brings coals up to or beyond her register tonnage then she pays no tonnage dues.

If she brings coals in a less quantity than her register measurement, and no other cargo, she will then pay upon her unoccupied space at the rate of 62 cents.

If she arrives partly loaded with coals, and the rest of her space with other cargo, she will pay upon the tonnage occupied by coals 73 cents per ton and upon the other cargo, up to her register tonnage, $1.35.

When the vessel is a regular Spanish mail carrier, tonnage dues will be collected on the sum of the tons of cargo imported and exported when not exceeding net register tonnage, 62½ cents, and if exceeding it, tonnage dues will be collected only on her measurement. American mail carriers pay the same tonnage dues.

Upon the fourth. In this case Spanish vessels pay the same tonnage as expressed in article 3, American vessels being entirely upon the same footing.

Upon the fifth. In this case they pay the same tonnage dues as Spanish vessels, and in the same conditions as expressed in article 3, American vessels being entirely upon the same footing.

Upon the sixth. In this case, according to a superior order lately issued, 25 cents upon the tons of cargo loaded in port, regardless of the port of destination, and free of tonnage dues if the vessel leaves port in the same condition under which it entered.

Note by Mr. Williams.—By the answers of collector of the port of Havana, as given above, it will be observed, in the cases of Spanish sailing vessels and Spanish steamers arriving in the ports of Cuba from Spain, that the first only pay at the rate of 25 cents per ton for tonnage dues when clearing loaded for the United States, and that the second, when clearing in the same condition for the United States, are entirely free from their payment if the trip has been made from Spain to Cuba in less than twenty days. I called the attention of the Department to this fact in my dispatch No. 340, of January 28, 1886. I again beg to present it, in case it should, in the judgment of the Department, constitute an exception or discrimination against American vessels under the stipulations of the agreement with Spain, dated Washington, 27th October, 1886, or of section 4228 of the Revised Statutes of the United States.

[Inclosure 9 in No. 271.]

Mr. Williams to Mr. Porter.

No. 624.]

Sir: Referring to the Department’s instruction, No. 246, dated the 24th of January last, receipt of which I acknowledged the 8th of February, and wherein were inclosed a copy of a dispatch, No. 42, of December 23, 1886, from our commercial agent at Cardenas, and another of a protest made by S. A. Larrabee, master of the American schooner Mattie B. Russell, of Portland, Maine, against the rate of $1.35 per ton, at [Page 1444]which the collector of customs at the port of Cardenas charged the tonnage dues on said vessel, and which were sent me for investigation, I beg to report now as follows:

In this contention it is to be particularly noticed that the master of the schooner Mattie B. Russell rests his protest upon the claim that the agreement between the United States and Spain, signed at Washington, October 27, 1886, distinctly states that “all discriminating rates on American vessels are done away with in Cuba, declaring absolute equality of American vessels from the United States with Spanish vessels from Spain, which latter pay 37½ cents per 1,000 kilos on their inward cargo and 25 cents per 1,000 kilos on their outward cargo in Spanish gold.”

A confrontation of the protest of the master of this schooner with the agreement itself, will show that he has not only misquoted its text, but has, also, misapprehended the scope of its meaning.

Article 1 of the agreement declares:

“It is positively understood that from this date an absolute equalization of tonnage and import duties will at once be applied to the product of and articles proceeding from the United States, or from any foreign country in vessels owned by citizens of the United States to the islands of Cuba and Porto Rico, and that no higher or other import or tonnage duties will be levied upon such vessels, and the merchandise carried in them as aforesaid, than are imposed upon Spanish vessels and their cargoes under the same circumstances.”

From this comparison, between the master’s protest and the article above cited, I can draw no deduction in support of his averment that the agreement provides for the absolute equality of American vessels from the United States to Cuba with Spanish vessels from Spain to Cuba. In fact no such expression or intention, to my view, appears in the agreement. This expressly reads, “from the United States or from any foreign country to Cuba,” but says nothing of from Spain to Cuba. Similar claims have also been made verbally at this office several times before and since the receipt of this instruction, founded, as supposed, upon the phrase in article 1 of from the United States or “ from any foreign country.” But I have always replied to them, that under the provisions of the agreement, Spain can not, any more than the United States, be considered “a foreign country,” the phrase evidently meaning all other countries to the exception of the United States and Spain. Neither is there anything in the agreement tending to show that either nation has yielded in favor of the other any of its right to the exclusive control over its own coastwise trade, as would be the case on the part of Spain were the statement of Captain Larrabee well founded. Nor can it be denied that the ports of Cuba and the ports of Spain bear quite a similar relation to the coastwise trade of Spain as those of Boston or Galveston, New York or San Francisco, Portland, Maine, or Portland, Oregon, New Orleans in Louisiana or Sitka in Alaska, bear to the coastwise trade of the United States. We have yielded no rights to Spain by this agreement over our coastwise trade, and I can not see where its provisions give us any right over that of Spain.

Then, if it be true, that under this agreement each nation retains full control over the government of its own coastwise trade, the right of Spain to fix the rate of tonnage dues on vessels trading between one port and another of the Spanish dominions remains indisputable, and we can no more oppose the manner in which she chooses to exercise this right than she can dispute that of the United States in its regulation of the tonnage dues to be paid or not to be paid by American vessels trading from one port to another of the United States. Under the Spanish system of legislation, import duties are charged on all merchandise brought from the mother country to the colonies, as well as upon that carried from the colonies to the mother country. And the agreement in question in no manner affects, nor can affect, this right of Spain to fix the rates of these import duties on this coastwise trade. And if it does not limit her right in this respect, it is difficult to perceive how it can affect that of fixing the rate of tonnage dues on the vessels employed in carrying on this traffic between the different ports of the colonies and of the mother country.

Under the fiscal system of the United States neither import duties nor tonnage dues are levied on the commerce carried on between the ports of the Federal Union. In this respect each nation merely exercises a sovereign right in pursuit of that polity which it believes best for its own interests.

In direct reply to the points presented for ascertainment by the Department in its instruction I have to say:

First. That this vessel has not paid higher tonnage dues, etc., than a Spanish vessel would have paid for making the same voyage with like cargo from Portland, Maine, to Cardenas, Cuba.

This is corroborated by an incident in regard to which application was made to this consulate a few months ago. A Spanish vessel arrived here with a cargo of lumber from Mobile, and the charterer, in opposition to the customs authorities, claimed that she should pay only 37£ cents per ton for inward tonnage dues, the same as though she had come from Spain. The collector, however, enforced the payment [Page 1445]of the same rate that an American vessel would have paid coming from a port in the United States.

But when a Spanish vessel comes to Cuba from Spain and not from the United States or from a third country, then, on leaving here for the United States, for a third country, or for Spain, she pays outward tonnage at the rate of 25 cents per ton. Should a Spanish vessel, however, arrive here from the United States or a third country and clear again for either of them, she will in this case pay $1.35 for inward and outward tonnage, the same as foreign vessels.

However, as will be noticed, a Spanish vessel that has arrived in a port of Cuba from Spain, be it either a sailing vessel or steamer, if it leaves here loaded for the United States, it will have the advantage in the payment of lesser in the one case, and of no tonnage dues in the other over an American sailing vessel or over an American steamer leaving a port of Cuba for the United States. This fact was pointed out in my dispatch No. 340, dated January 28, 1886.

But the protest under consideration does not rest its cause of complaint upon the tonnage dues that a Spanish vessel pays in comparison with those collected from an American vessel on their leaving Cuba for the United States, but upon what a Spanish vessel pays arriving in Cuba from Spain. Upon this exception I shall make a supplementary report in a subsequent dispatch.

Second. Both American and Spanish vessels are treated alike when trading between the United States and the Antilles, and between the latter and a third country; and no other or higher duties are imposed in the one case than in the other. This is the general rule observed since the date of the agreement herein referred to; the only exception I know of is the case of the American bark Sarah A. Stapples, reported in my dispatch No. 591, dated March 16 last, and still pending.

I am, etc.,

Ramon O. Williams,
Consul-General.