The Acting Secretary of State to Ambassador Thompson.

No. 167.]

Sir: Referring to the department’s telegram of the 8th instant, regarding the proposed arrangement between the United States and Mexico for the regulation of the transit of merchandise from port to port of either country through the territory of the other, I inclose herewith a copy of a letter from the Acting Secretary of the Treasury expressing his views in the matter.

It may reasonably be assumed that the intention of the understanding is that each Government shall make known to the other any modifications of the transit regulations which may be made or contemplated, [Page 1112] thus affording opportunity to make appropriate representations against any change which may be found or deemed burdensome or calculated to impair the principle of reciprocal favor upon which the understanding rests.

I am, etc.,

Robert Bacon.
[Inclosure.]

The Acting Secretary of the Treasury to the Secretary of State.

Sir: I have the honor to acknowledge the receipt of your letter of the 11th instant, in which you state that your department has repeated by telegraph to the United States ambassador at Mexico this department’s telegram of the 8th instant, in regard to merchandise shipped duty free through the United States from port to port in Mexico.

I have to request the return of the draft of the regulations governing shipments from port to port in the United States through Mexico, transmitted to you with this department’s letter of May 16 last.

In your letter of the 3d instant you state that the Mexican treasury department will offer no impediment to the adoption of said regulations, provided the Government of the United States will, in its turn, accept such measures as Mexico may enact for the transit of goods which, leaving Mexican port or frontier, may pass over American territory to be reimported into Mexico by some other port or frontier.

I am of the opinion that the acceptance by this Government of such measures as Mexico may enact for the transit of goods from port to port in Mexico, through the United States, under section 3005 of the Revised Statutes, as amended, should not be made a condition precedent to the adoption by Mexico of the regulations proposed by this Government, under section 3006. As you were informed on the 8th instant, merchandise may be shipped free of duty through the United States from port to port in Mexico, under regulations made pursuant to section 3005 of the Revised Statutes, as amended by the act of May 21, 1900. Any modification of these regulations which the Mexican Government shall at any time propose will have due consideration by this department and will be adopted if compatible with the purpose of the law, but I do not feel that the Government should be committed to the acceptance of any changes without knowledge of what they are.

Respectfully,

C. H. Keep.