Papers Relating to the Foreign Relations of the United States, With the Annual Message of the President Transmitted to Congress December 2, 1902
Mr. Conger to Mr. Hay.
Peking, August 11, 1902.
Sir: In reference to the monopoly of the camphor trade in the province of Fukien, concerningwhich Consul Fesler has already given you the detailed facts, I have the honor to inclose herewith copies of all the correspondence had with the legation in relation thereto.
The regulations appear nominally to provide for a Chinese board only, yet the details as set forth therein practically grant a monopoly to the Japanese expert and the Japanese company which furnishes the money.
On the 22d ultimo, I telegraphed Mr. Fesler to tile a protest, referring to Article XIV of the French treaty of 1858, which provides:
Henceforth no specially privileged commercial association shall be allowed to establish itself in China, and this applies also to all combinations organized for the purpose of exercising a commercial monopoly. In case of contravention of this article, the Chinese authorities will, at the instance of the consul or consular agent, devise means to dissolve combinations of this nature, whose formation moreover they shall try to prevent by previous prohibitions, in order to avoid everything which might be prejudicial to free competition.
To-day I am in receipt of his dispatch saying he has done so. I shall forward, as soon as received, a copy of his protest and reply, and await your instructions.
I have, etc.,
Mr. Fesler to Mr. Conger.
Amoy, China, June 14, 1902.
Sir: Referring to your No. 1453, of the 13th ultimo, regarding the granting to a Japanese of a monopoly of the camphor trade in the Fukien Province, I have the honor to inclose herewith copies of the regulations of the Fukien camphor board and the expert agreement recently signed by the taotai and Japanese consul at Amoy.
Since the agreement was signed the expert has returned to Japan presumably to secure the amount of money he has to pay to the viceroy under the agreement. The regulations, therefore, will not be enacted until his return.
Taotai Yen, of Amoy, has been appointed controller of this newly established board.
Trusting that I shall have the benefit of your instructions in the premises, I have, etc.,
Regulations of the Fukien camphor board.
- 1.
- The Fukien camphor board, now being established, shall have control of the camphor trade within the three prefectures of Chang Chew, Yung Chung, and Lung Ngan, and any and all other camphor producing districts in the province, and a controller shall be appointed by his excellency, the viceroy, to reside thereat. Mr. Ikuchechichai, a Japanese expert in the camphor business, shall be employed by the board, who shall superintend the manufacture and sale of camphor, a separate agreement to be made for the said purpose.
- 2.
- Rules pertaining to the duties of the board, to the manufacture and sale of camphor as well as any other rules or by-laws pertaining to the camphor business, shall be made by the controller, such rules or by-laws to be approved by the viceroy before they are enacted.
- 3.
- Details as to purchasing camphor trees, making payments therefor, and employing workmen to collect camphor by the process of steaming, shall be fully discussed and agreed upon between the controller and the expert, and shall be subject to the approval by his excellency, the viceroy.
- 4.
- The expert shall report in detail from time to time in regard to the manufacture and prices to be realized for the “government camphor” to the controller, who is fully clothed with the supervisory power over him.
- 5.
- As soon as these regulations shall have been published no person or persons shall be permitted to own furnaces and boil camphor. Should any person or persons furnishing their own capital wish to engage in the collection of camphor they shall report to the board and obtain a written permit, and shall duly comply with such rules as the board shall have made as to the process, etc. Those who borrow money from the board for the purpose shall also comply with the requirements of the foregoing clauses. All camphor manufactured, as well as the residuum, shall be brought to the board, who will buy them at a reasonable price, and then submit them to the expert for examination. No person shall be permitted to sell camphor but to the board, this being necessary in order that no inferior goods will be sold, which is likely to injure the trade.
- 6.
- Whenever it becomes necessary for the board to buy camphor trees in the interior the controller shall send qualified agents to visit the place, examine the trees, settle their prices, and close the deal. Such agents shall report to the local authorities for assistance, in order to prevent unscrupulous persons selling trees which do not belong to them, and to prevent lawsuits in connection therewith. The expert, unless authorized by the controller, shall send no men to the interior to purchase any trees. In case the people owning the trees should be unwilling to sell them and oppose every effort of the board to get possession of same, the local authorities shall use their good offices to persuade the owners to sell; but, should the removal of such trees interfere with the fungshui or peace of the locality, the board shall not force the owners to sell.
- 7.
- As the places where the trees are produced and camphor is collected are all in the interior, the persons applying for a permit in pursuance of Article V for the purpose of engaging in the collection of camphor must necessarily be the subjects of China. No representative or subject of any foreign government or natives of Formosa who no longer own allegiance to China shall be permitted to avail themselves of the privilege.
- 8.
- As the places where the trees are grown and camphor collected are all in the interior, foreign merchants, when they should need the “government camphor,” shall only buy it from the board at its prevailing price, but shall not go to the interior, own furnaces, and manufacture same, which is against the existing treaties.
- 9.
- Should any foreign merchant establish factories in the treaty ports and there collect camphor out of the trees they shall have bought, he is permitted by the treaties to do so, and shall not be interfered with.
- 10.
- The board shall issue passes to cover all its camphor to be brought from the interior to a treaty port. The cargo shall be subject to examination at the barriers en route, but shall pay no likin; but, if exported, shall pay the customs export duties and charges in accordance with the existing regulations.
- 11.
- Chinese, as well as foreign merchants, purchasing the “government camphor” in the interior, shall bring it for export duty at a treaty port, but should they export it at points other than a treaty port, the cargo shall be confiscated.
- 12.
- The object of manufacturing camphor being to secure revenue for the Government and at the same time to give employment to the people, all persons employed in connection therewith shall not take advantage of their positions to infringe the existing laws of China, or in any way interfere with the fungshui of the locality, or [Page 257] disobey any order or decree issued by the local officials and shall be subject at all times to the supervision and discipline by the board.
- 13.
- Chinese subjects who shall have obtained permits from the board for the manufacture of camphor, and would sell their camphor to the board, shall not be required to pay to the board any sum or sums of money in the form of tax, likin, or any other charge.
Agreement with Japanese Camphor expert.
- 1.
- In order to develop a new source of revenue,’ the Fukien Province has established a camphor board. The viceroy shall appoint a controller to reside thereat, who is fully empowered to deal with all questions pertaining to camphor business within the entire province.
- 2.
- For the purpose of improving the camphor trade, the camphor board doth employ Mr. Ikuchechichai, a Japanese expert, to superintend the collecting, heating, steaming, classifying, etc., of the camphor. He shall in all cases report to the controller. As regards details pertaining to the sale of camphor, he shall confer with the controller, who will then report to the viceroy for approval.
- 3.
- It having been deemed necessary for the board to possess a sum of $200,000 as running capital, the said expert shall undertake to guarantee the said amount from some Japanese company without interest on the loan. At the expiration of the within agreement, all factories, other buildings, machines, furnaces, etc., belonging to the board, shall be turned over to the company at the price they have cost the board, provided that this provision be in no wise construed to include such properties as shall be found in the interior; and further provided that the company shall only dispose of them by sale, but shall not own them, and whatever balance there is of the running capital shall be returned. Should there be none, all the sum or sums of money the board has expended shall be borne by the company as losses, the board being in no wise responsible. A separate agreement shall be made for the loan and shall be duly observed by the said expert.
- 4.
- On all camphor manufactured by the board, when sold, the expert shall pay a sum of $7 to the Chinese Government as a tax, per picul (100 catties Chinese weight, or 133 1/33). (It is to be understood that should the price be $80 per picul, the tax shall be $8; $90 per picul, the tax shall be $9, and so on, or the tax shall be $1 more for every $10 additional price.) This tax shall be paid to the controller from time to time, and shall be applied toward the Government expenses in the Fukien Province.
- 5.
- All salaries, wages, allowances, etc., of the controller, expert, duly appointed officers, clerks, and other employees of the board shall be paid out of the running capital; the amount of each shall be determined by the controller.
- 6.
- The accounts of this camphor board shall be rendered annually. After defraying all customs taxes, salaries, allowances, and other expenses and saving a certain per cent to repay the capital the net profit of the board shall be divided between the board and the expert, as the controller, alter consulting the expert and considering the comparative expansion of the trade for the current year, shall decide, such decision to be approved by his excellency the viceroy.
- 7.
- All receipts and expenses in connection with the camphor business shall be reported by the expert to the controller either monthly or annually, with carefully made out-statements to be forwarded to his excellency the viceroy for audit.
- 8.
- All provisions agreed to and contained in the within instrument, as well as those which shall hereafter be made, shall be duly observed and duly complied with on the part of the expert.
- 9.
- This contract shall be good and binding for a period of six years from the day it is signed. When it expires, should the business be prospering, and should its renewal be desired by both parties, due notice thereof shall be given each other and it may be continued for such further period as shall be agreed upon. During the continuance of the contract no other expert shall be employed. Should the expert desire to resign before its expiration, he shall be permitted to do so, but shall not be given his passage home. Should it be discovered at any time by the controller that the expert has not complied with any or all of the conditions made and provided in the within contract, that he has in some way interfered with the right of the local administration, or that his management of the camphor business is not proper, he shall report him to the viceroy, and should the charges be found true he shall be given his passage home and dismissed from the service before the expiration of the [Page 258] contract. In the event of his dismissal in such a case, so far as the loan he guaranteed in pursuance of Article III of the within instrument is concerned, the factories, other buildings, machines, furnaces, etc., of the board shall be turned over to the company making the loan at the same price as they have cost the board, providing that provision be not construed to include such properties as shall be found in the interior, and further provided that the company shall only dispose of them by sale, but shall not own them; and whatever balance there is of the running capital shall be also returned, while all the sum or sums of money already expended shall be borne by the company as losses, the board being in no wise responsible. Nor shall the expert make any claim whatever.
- 10.
- There shall be two copies made of this contract, to be signed by the controller and the consul for Japan, one copy to be deposited with the board and the other with the expert.
- 11.
- Should any clause in the within instrument be deemed incomplete or unsatisfactory, the same shall be amended or corrected with the consent of both parties.
supplement.
- 1.
- The Japanese expert, in view of his employment by the board, shall voluntarily contribute the sum of $100,000 to the Chinese Government, said amount to be applied toward the expense of the Government within the Fukien province.
- 2.
- Joo Pan, a Chinese company represented by Ling Choo Kang, having obtained the monopoly of camphor trade for the three prefectures of Chang Chew, Yung Chung, and Lung Ngan, and the entire province of Fukien, now that the Government desires to control the same itself, the board shall buy from the said company all its machines and factories as well as furnaces, etc., at their estimated value, and shall reimburse the company for all moneys expended and losses sustained by it on account of the enterprise.
Mr. Conger to Mr. Fester.
Peking, June 27, 1902.
Sir: I have received your No. 35, of the 14th instant, inclosing copies of the regulations of the Fukien camphor board, which seems a substantial monopoly of the camphor trade in that province to a Japanese.
Please furnish the legation with particulars as to the camphor trade, its extent, etc., and how American interests are likely to be affected by the regulations mentioned, and at the same time refer all the facts to the Department of State for its opinion and instruction.
I am, etc.,
Mr. Fesler to Mr. Conger.
Amoy, July 10, 1902.
Sir: I have the honor to acknowledge receipt of your No. 1519, of the 27th ultimo, relating to the granting of a monopoly of the camphor trade in Fukien to a Japanese.
In compliance with your instructions I have to-day reported all the facts in the case to the Department of State.
The camphor trade in Amoy was started last year by an American firm. The firm made contracts with the natives in the interior to buy their camphor, and the goods were brought down to Amoy under transit passes. The example of the American firm was soon followed by merchants of other nationalities. On several occasions the goods were seized by the local officials and the transit pass was ignored, but were released when the consuls took the matter up with the higher officials.
The trade is yet small, but increasing. During the year 1901 the export from this port was 191 pictuls, valued at about $12,000 Mexican.
[Page 259]I am informed that the English and German consuls here have protested, calling attention to the French treaty of 1860, Articles XIV and XXVII.
I inclose herein copy of a dispatch just received to-day from the taotai, announcing the opening of the board.
I have, etc.,
Taotai Yen to Mr. Fesler.
Sir: I have the honor to inform the consuls of the fact that the viceroy has appointed me to be controller of the Fukien camphor board, and that an agreement has been signed with a Japanese expert who is to raise the necessary capital. I have since appointed one deputy controller and a treasurer, and have on this 2d day of the sixth moon opened the board to the transaction of business, and have for the first time used its official seal.
Mr. Conger to Mr. Fesler.
Peking, July 22, 1902.
Protest camphor monopoly under articles fourteenth French, and thirtieth United States treaties, 1858.
Mr. Conger to Mr. Fesler.
Peking, July 22, 1902.
Sir: I have to acknowledge the receipt of your No. 37, of July 10, giving information as to the camphor trade in Amoy, the connection of Americans therewith, and showing how it is interfered with by the monopoly recently given to a Japanese subject.
In consequence of this information I have to-day sent you the telegrama which I confirm herewith.
You will undoubtedly have made your protest before this reaches you, but I trust you have complied particularly with the directions given in Article XIV of the French treaty.
I am, etc.,
Mr. Fesler to Mr. Conger.
Amoy, July 23, 1902.
Sir: I have the honor to confirm your telegram.a
In pursuance of your instructions I have to-day entered a strong protest with the taotai of Amoy, and shall report fully upon receipt of his reply.
I am, etc.,