Ambassador Storer to the Secretary of State.

No. 274.]

Sir: I have the honor to report that, following the Department’s instructions numbered 165 and 170, bearing date, respectively, 23d and 28th of June, 1905, I conveyed formally to the ministry of foreign affairs the views therein expressed in regard to the action of the Hungarian Government as to the traffic in emigration and the treatment by it given to the International Mercantile Marine Company, otherwise known as the American Line, in connection with the Société Anonyme de Navigation Beige-Américaine, both in unjustifiably and arbitrarily interfering by its official agents in the traffic of these steamship lines and in unjustly discriminating against them by refusing a reply to the demands for a license formally made by these companies under the terms of law.

For a better understanding of the matter I venture to inclose a copy of my official letter of complaint, addressed to Mr. de Mérey, undersecretary of foreign affairs, who was acting minister at the time.

I have the honor to inclose a copy and a translation of the full and formal answer of the minister of foreign affairs, which, covering as it does the whole principle involved, gives evidence that the matter has been carefully considered and fully weighed by the Hungarian Government. It will be seen that the broad ground is taken that no traffic monopoly can be said to be created by the arrangement with the Cunard Company, because the Hungarian Government has the right to issue a license to do similar business to any other line than the [Page 59] Cunard whenever it may see fit to do so. Further, that as an inherent government right it is for the Hungarian Government to issue such license or withhold it, as it sees fit. Further, that the complaints contained in the letters of the counsel of the International Mercantile Marine Company, which I was instructed to transmit to the foreign office, that no answer had been given by the Hungarian Government to the applications for a license, is specifically denied; and the dates are given of the answers of the Hungarian Government to the communications of that company.

* * * * * * *

I have, etc.,

Bellamy Storer.
[Inclosure 1.—Translation.]

Ambassador Storer to the Minister of Foreign Affairs.

Your Excellency: I have the honor to bring to your excellency’s attention and to that of the Royal Hungarian Government the complaint of the International Mercantile Marine Company that unjust discriminations and privileges are accorded by the Royal Hungarian Government to other foreign and competing corporations engaged in the same business, and are refused to the company in question. The International Mercantile Marine Company is an American corporation, and is the owner of two large transatlantic steamers, the Finland and the Kronland, now engaged in the transportation of passengers from Europe to the United States, acting in connection with a Belgian corporation La Société Anonyme de Navigation Belge-Américaine, and performing a common service therewith in the transportation of passengers.

I have had the honor to address to His Excellency Count Goluchowski on several previous occasions complaints on behalf of this common service generally known as the “American Line” (and under that name incorporated as an American corporation) of the treatment their agents have received on the part of the officials of the Royal Hungarian Government, and in particular have called his excellency’s attention to numerous cases where travelers intending to make the voyage to America by one or other of the vessels of this line, having already purchased tickets, have been prevented from leaving Hungary by the route they had selected and paid for.

In many instances such tickets have been forcibly taken from these travelers by the Hungarian authorities, and on some occasions, it is alleged, that all the money in their possession has also been confiscated, and their journey either absolutely prevented or very much delayed under circumstances of great expense and hardship to individuals.

In all such cases, so far as any reason is given or can be discovered, it is on account of the desire and intention of the Hungarian Government to force all passenger travel from the Royal dominions to pass by Fiume, and to give an entire monoply of such international passenger traffic to the Cunard Company, a British corporation, to the exclusion of all other competing companies of any and all nations. Applications for a license or permission to carry on business at Fiume on behalf of these two American corporations have received no attention or reply whatever from the Royal Hungarian Government.

I beg to allude on this general subject to my previous letters to His Excellency Count Goluchowski, Nos. 117, 123, 124, 125, 128, 131, and 149, all of which relate to instances of this course of conduct on the part of the Royal Hungarian officials.

Renewed complaints having been made to my government, I have received instructions to submit to your excellency copies of the letters of the International Mercantile Marine Company and the American Line giving in detail the grounds of complaint and instances of this arbitrary and unjust action on the part of the Royal Hungarian officials, and such copies I have the honor to inclose herewith.

I am instructed to make urgent representation to your excellency to the end that the wrongs and discriminations practiced against this highly considered and respected American corporation, the International Mercantile Marine Company and its steamers, apparently in favor of a competing British company may be discontinued by the officials of the Royal Hungarian Government.

While it is not the usage of my Government to lend its assistance to American citizens in procuring licenses or concessions from foreign Governments the present case appears to be an [Page 60] exceptional one and an entire departure from the spirit of just and fair dealing and friendly feeling which has for so many years marked commercial intercourse between the United States and the Imperial and Royal Dominions, and I am therefore instructed to invoke your excellency’s intervention with the Royal Hungarian Government in order that the same privileges and opportunities may be accorded by that Government to steamers of the American Line in the matter of licenses and opportunity of service as are accorded to the vesesls of any other line of steamers of any other country.

I take, etc.,

Bellamy Storer.
[Inclosure 2—Translation.]

The Minister of Foreign Affairs to Ambassador Storer.

Referring to the esteemed note of July 13, 1905, the undersigned, after having had an interchange of views with the Royal Hungarian ministry of the interior, has the honor to inform his excellency the ambassador of the United States of America, Mr. Bellamy Storer, that the complaints of the International Mercantile Marine Company and the American Line seem to be based on an erroneous interpretation of the Hungarian emigration bill and of paragraph 7 of this law in particular.

According to this paragraph those companies who wish to engage in the transportation of emigrants must obtain beforehand the permission of the ministry of the interior to this end. By such a permission (which the ministry of the interior can grant to native citizens or to foreigners, but without being under obligation to do so) the business for the transportation of emigrants received the character of a licensed business. Since, as a matter of course, neither citizens of this country nor foreigners are entitled to demand as a right the conferring of a license, there can not be seen, in the granting of a license for the transportation of emigrants to the Cunard Steamship Company and in the refusal to grant such a license to the International Mercantile Marine Company and to the American Line a discrimination in favor of the first-named company and against the last-mentioned companies.

Furthermore, the two said American corporations are not entitled to make complaints with regard to the granting of a license to the Cunard Steamship Company and to infer from this granting an analogous right for themselves, as they have been placed on the same basis as the home navigation companies, which did not obtain a license for the transportation of emigrants. With this explanation of the legal side of the question the undersigned thinks to have rectified the fundamental error which has crept into the judgment of this case, and begs to pass to the discussion of the several details of the esteemed note above referred to.

First of all it is not correct that the communications of the American line have not been answered. The undersigned, to whom an opportunity was offered to take an insight into the correspondence on this subject of the Royal Hungarian ministry of the interior with the said navigation company, was able to ascertain that the letters of the American line of the 27th and 28th July and 14th October, 1904, were answered on the 15th of November, 1904. A reply to the communication of December 8, 1904, was sent on the 17th of December, 1904, and the application of January 26, 1905, was answered on February 11, 1905.

Likewise it is untrue that a monopoly for the transportation of Hungarian emigrants was given to the Cunard Steamship Company by granting the license. On the contrary, the Hungarian Government is at any time in a position to give licenses also to other transportation companies if it be thought necessary, and in case the issuance of the license in question to other companies should become necessary will consider the application of the American line with the same favor as those of other transportation companies, of course on the supposition that the American line submits to every point of the stipulations of the Hungarian Article IV of the law of 1903.

It is, however, the effort of the Hungarian Government to concentrate the emigration as far as possible at Fiume, as by this means only can an effective supervision and control of emigration be carried through, and because the policy of the transportation (verkehrspolitische) and economical interests of Hungary require it.

As to the cases of complaint enumerated in the list (being an inclosure of the above-mentioned esteemed communication) each one will be examined separately and conscientiously and the result communicated to his excellency the American ambassador.

Finally, the undersigned may be allowed to make the following remarks to the last paragraph of the repeatedly mentioned communication.

During the first five months of 1905 there emigrated from Hungary (not including Croatia and Slavonia) 97,583 persons to the trans-Atlantic countries. Of this number 18,250 traveled on steamers of the Cunard Line. The other 79,333 emigrants have taken the steamers of those companies which, as far as known to this office, are combined without exception to the [Page 61] International Mercantile Marine Company or united with it and which at the present have no license in Hungary. The undersigned believes that in good conscience he can leave it to the wise judgment of his excellency the American ambassador to decide whether under these circumstances the assertion that the officials of the Hungarian Government act unfairly and partially toward the unlicensed companies is correct.

Furthermore, the undersigned begs to call the attention of his excellency the American ambassador to the circumstance that the dimensions which the emigration from Hungary to the United States has taken produces not only great alarm in Hungary, but it is discussed also in the United States in a way which shows great annoyance. The press of the Union discusses this immigration in a tone which unfortunately is very unjust and sometimes hostile, and the American legislation has followed for some years past an undeniable tendency to increase the severity of immigration regulations.

As the granting of a license to the American line and to a corporation like the International Mercantile Marine Company, which has so many branches and which is united with a great number of other companies, would probably raise the Hungarian emigration to an immeasurable degree, it is difficult to reconcile the present demand of the American Government with the attitude followed up to the present by the American legislation and what is expected also to be followed in the future.

On the other hand, it is clear that the Hungarian Government can not be inclined to contribute to the boundless promotion of emigration by granting new licenses at a moment at which the public opinion of the United States looks with an unfavorable eye upon the emigration from Hungary and when the same might be threatened by an aggravation of American immigration regulations.

Therefore the undersigned hopes that his excellency the American ambassador will weigh considerately the motives by which the Royal Hungarian Government has been guided in its present policy of granting licenses, and will come to the conclusion after consideration of the above said that the reproach made to the Hungarian Government that in the present matter it has allowed itself not to be guided by that spirit of just and friendly feeling which has for so many years marked commercial intercourse between Austria-Hungary and the United States is in every respect unjustified.

The undersigned avails, etc.,