Minister Rockhill to the Secretary of State.

No. 153.]

Sir: Referring to Mr. Conger’s dispatch to the Department No. 1759 of December 8, 1904, in which he acknowledged the receipt of Department instruction No. 838, of September 2, 1904,a with the report inclosed therein of the Acting Director of the Geological Survey-embodying proposed amendments to the Chinese mining regulations, Mr. Conger said that it seemed to him impossible to accomplish anything in the line of having the regulations amended at that time.

After carefully considering the question of securing the revision of the mining regulations issued by the Chinese Government in March, 1904, and ascertaining that my British colleague, under instruction from his government, was pressing the matter, I decided, under the previous instructions of the Department given Mr. Conger, to take the matter up with the Waiwu Pu and to urge upon it a prompt consideration of the question.

I inclose herewith copy of the note which I have addressed to the foreign office on this matter.

I have, etc.,

W. W. Rockhill.

Minister Rockhill to Prince Ch’ing.

Your Highness: In a note written April 15, 1904, my predecessor, Mr. Conger, had the honor to call your highnesses earnest attention to the fact that the revised mining regulations which had received the imperial approval on the 17th of March, 1904, could not be accepted by the Government of the United States as satisfactory or as fulfilling the provisions of Article [Page 235] VII of the treaty of 1903. This article specifically states that China shall “recast its present mining regulations in such a way as, while promoting the interests of Chinese subjects and not injuring in any way the sovereign rights of China, will offer no impediment to the attraction of foreign capital nor place foreign captialists at a greater disadvantage than they would be under generally accepted foreign regulations.”

The regulations of March 17, 1904, were not in harmony with these provisions of our treaty, and Mr. Conger therefore felt constrained to make known to your highness the disappointment which our government would feel at their being put into force.

Eighteen months have now elapsed since Mr. Conger wrote to your highness on the subject in the hope that the Chinese Government would revise the regulations in question and make them practicable for industrial and commercial purposes. As, however, no amended regulations have, so far as this legation is aware, been issued since those of March, 1904, I trust that your highness will pardon me if I revert to this important subject and submit in detailed form the objections which my government finds to these regulations.

The regulations of March 17, 1904, are 38 in number. Our principal objections refer to numbers 3, 4, 16, 24, and 29.

Regulation No. 3 is objectionable in that it does not specifically provide the proceeding necessary to obtain a permit to prospest or mine upon private property in a case where it is impracticable to obtain the owner’s consent. This, in a country so densely populated as China, is a question of great importance.

Regulation No. 4, subdivision (b), in that it requires applicants for permits composed of Chinese and foreigners to disclose the exact number of shares held by the foreigners, appears to be framed with the evident intention to prevent the operative control of any mining undertaking or enterprise by foreign capitalists, such as is contemplated by the treaty, and thus tends to discourage instead of to attract foreign capital.

Regulation No. 16 prevents practically the issuance of a permit to prospect or work a mine in China in any case where a majority of the stock is owned by foreigners. It is believed by my government that the conditions insisted upon in this regulation constitute impediments such as would cause a foreign capitalist to decline to embark his means in any enterprise hampered by such unsatisfactory conditions.

This regulation again distinctly repels rather than attracts foreign capital, and is therefore not in harmony with treaty stipulations.

Regulation No. 24, wherein it is provided that the applicants must commence operations within six months from the date on which the permit shall have been granted, does not meet the conditions under which foreign capital is placed. Necessarily in the beginning the mines to be operated would be far from base, and six months would be too short a time for the commencement of operations on the ground.

Regulation No. 29 is extremely vague and objectionable in that every important contract necessary in the practical mining operations is to be delayed and impeded by the submission thereof to the board of commerce for its action thereon, and possibly its nullification.

There are many other objections which my government has noted in these regulations. I attach to this note a detailed list of them,a calling your earnest attention to the fact that, whereas the regulations of 1903 are based on those of 1898 and 1902, comparison shows that the features which most obviously contravene the treaty of 1903 are taken therefrom and the modifications made are nearly everywhere contrary to the spirit of this treaty rather than in accord with it.

This matter is one of great importance, and the Chinese Government itself has recognized “that it is advantageous for the country to develop its mining resources and that it is desirable to attract foreign as well as Chinese capital to embark in mining enterprises.” I feel therefore convinced that your highness will give the views of my government prompt and careful consideration, and, since the object of such regulations is to attract and not repel foreign capital and enterprise, take steps at an early date to have the mining regulations for the Empire made to thoroughly harmonize with the provisions of your treaty with us of 1903.

I avail myself of this opportunity, etc.,

W. W. Rockhill.