Mr. Olney to Mr. Dun.

No. 370.]

Sir: I have received your No. 410, of September 14, 1896, in regard to the treaty of trade and commerce concluded April 4, 1896, between the Governments of Japan and Germany, relative to trade-marks and patents. In view of the provisions of that convention you add:

It appears to me that under the most-favored-nation clause of our treaty with Japan, American citizens are, subject to the same terms and conditions, entitled to the same privileges and protection in regard to trade-marks, patents, etc., that the new German treaty secures in Japan to German subjects.

The disturbed state of affairs in Japan since the resignation of Marquis Ito has prevented you from bringing the subject to the attention of the minister for foreign affairs, with a view to ascertaining the disposition of the Japanese Government to extend to American citizens, under the same terms and conditions, the same rights and privileges in regard to patents, trade-marks, etc., as are secured to German subjects under the new Japanese-German treaty. You say you have reason to believe that there will be no unwillingness on the part of Japan to accord these rights and privileges to our citizens who, in your judgment, “are clearly entitled to them under the most-favored-nation clause of our existing treaty with Japan.” Hence you inquire, in expectation of Japan’s willingness to concede the rights and privileges of which you speak, upon the same terms and conditions as they have been granted to German subjects, “can reciprocal rights and privileges be granted, under the laws of the United States, to Japanese?”

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Your dispatch has received careful consideration, and I shall now endeavor to make the subject clear as the Department understands it.

So far as concerns “copyright,” and the statement that the Japanese Government proposes to join the international Convention at Berne bearing upon that subject, I may observe that the act of March 3, 1891, authorizes the President, when he is satisfied that any foreign state permits to citizens of the United States the benefit of copyright on substantially the same basis as its own citizens, to issue a proclamation declaring the benefits of our copyright laws are extended to the citizens or subjects of such foreign state.

This question has been formally presented to you in a circular instruction of May 7, 1891, which you have no doubt communicated to the Japanese Government, and in case Japan is in a position to give the necessary assurance, under her laws that our citizens enjoy within Japanese jurisdiction equal benefits with her own subjects, in the matter of copyright, I shall be glad to receive it and to recommend that the President issue his proclamation pursuant to our statute.

But we have no such law so far as concerns trade-marks and patents, and must look elsewhere for our authority. In connection with this subject, I direct your attention to the volume of Foreign Relations, 1895 (pp. 759765), in regard to reciprocity in trade-marks with Greece. The position of the Department is there clearly stated. It will be seen that it was unable to accept the declaration signed by your colleague at Athens, and the minister for foreign affairs, on July 9, 1894, in order to determine in a more explicit manner the text of the treaty of commerce and navigation concluded at London, between the United States and Greece of December 10–22, 1837, in all that relates to trade-marks, industrial designs, and patterns. The Department’s examination of that treaty failed to satisfy it that it was susceptible of the construction the declaration placed upon it. It was accordingly thought that it amended and enlarged the treaty, and in that event necessarily required the President’s ratification by and with the advice and consent of the Senate. Mr. Alexander was therefore instructed to conclude a formal convention. That proposition is still under consideration at Athens.

Article IX of our treaty with Japan of March 31, 1854, contains, it is presumed, the most-favored-nation clause to which you refer. It reads as follows:

It is agreed that if at any future day the Government of Japan shall grant to any other nation or nations privileges and advantages which are not herein granted to the United States and to the citizens thereof, that these same privileges and advantages shall he granted likewise to the United States and to citizens thereof, without any consultation or delay.

By the treaty of July 29, 1858, such of the provisions of the treaty of 1854 as conflict with those of the former are revoked by Article XII thereof. (See treaty vol., 1776–1887, p. 1256, Art. VI.) The quoted provision would not seem to be of that class, however. But without discussing that feature of the case, I may remark that, in the Department’s judgment, the provision of the treaty of 1854, to which you refer, does not mean if Japan shall grant privileges to Germany in consideration of similar privileges granted by the latter to the former, the same privileges shall be granted gratuitously to the United States. The clause “that these same privileges and advantages shall be granted likewise to the United States and to the citizens thereof, without any consultation or delay,” only refers, in my opinion, to privileges granted gratuitously to a third power and not to privileges granted in consideration of concessions made by another government.

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A covenant to give privileges granted to the “most favored nation” only refers to gratuitous privileges, and does not cover privileges granted on the condition of a reciprocal advantage. (Mr. Livingston, Secretary of State, to President Jackson, January 6, 1832. Wharton’s International Law Digest, sec. 134, p. 39, Vol. II.)

You will find this subject of the “most-favored-nation” treatment discussed in Mr. Frelinghuysen’s instruction to Mr. Bingham, No. 827, of June 11, 1881, touching treaty revision in Japan. (See Wharton’s Digest, sec. 68, p. 507, Vol. I.) It states, among other things, that the English contention has hitherto been under the most-favored-nation clause of the treaties, that it is absolute, and that even when Japan may bargain with any power to give it a favor for an equivalent the like favor must be granted to England.

The Japanese contention is the reverse of this, being that if a favor for a specific condition be stipulated with anyone nation, no other may enjoy the favor except upon identical or equivalent conditions.

“The theory on which this Government views the question is akin to that of Japan,” observes Mr. Frelinghuysen, who then proceeds to cite a pertinent example and to fully discuss the whole subject.

This theory was further exemplified and given practical application under the commercial arrangements concluded with foreign powers pursuant to section 3 of the tariff act of 1890.

It may possibly be, as you conjectured, that American citizens are “subject to the same terms and conditions,” entitled to the same privileges and protection in regard to trade marks and patents that the new Japanese German treaty secures to German subjects in Japan, but the Department is compelled to think it at least doubtful. But even supposing your view to be correct, it is not perceived how it could be declared that the conditions exist except by a treaty, convention, or law pursuant to the act of Congress of March 3, 1881 (Stat. L., vol. 21, p. 502). That law protects trade-marks owned by persons “located in any foreign country * * * which by treaty, convention, or law affords similar privileges to citizens of the United States.”

In the absence of either one of the expressed conditions, Japanese subjects can not register their trade-marks in this country, and consequently we can not claim corresponding privileges in Japan.

Now Article XVI of the treaty of commerce and navigation concluded with that Empire November 22, 1894, says:

The citizens or subjects of each of the high contracting parties shall enjoy in the territories of the other the same protection as native citizens or subjects in regard to patents, trade-marks, and designs upon the fulfillment of the formalities prescribed by law.

When this treaty goes into effect on July 17, 1899, the matter can be simply and effectively adjusted. One of the conditions imposed by our statute will then have been fulfilled and due cognizance can be taken thereof.

It is possible that a formal declaration, reciting the provisions of the above treaty, after submission to the Senate and proclamation by the President, by and with the advice and consent of that body, might meet the case. But as this declaration could not become operative in advance of the treaty’s taking effect, it is perceived that such an arrangement would serve no practical purpose. Hence, the only safe way is to conclude a formal convention to that end or wait until July 17, 1899, when the treaty of November 22, 1894, will come into existence.

I am, etc.,

Richard Olney.