File No. 788/26–32.
Minister Rockhill
to the Secretary of State
.
American Legation,
Peking
,
January 12,
1907
.
No. 504.]
Sir: I have the honor to inclose herewith
copies of certain dispatches which I have addressed to Mr. Straight,
consul-general at Mukden, in reference to the question of customs
regulations and taxation of foreign merchandise at the city of
Mukden.
On December 11 last the legation instructed Mr. Straight not to accept a
tax on retail trade if the goods were foreign, because after goods have
paid the 5 per cent import and transit dues they can be subject to no
impost whatever. I also expressed my opinion that there should be no
custom-houses at Mukden or other interior places in Manchuria, and that
the creation of interior custom-houses would hamper the development of
the resources of the country.
In his No. 64 of December 16, a copy of which has been sent to the
department from Mukden, Mr. Straight, in reply to the above
instructions, inclosed a copy of the proposed duty regulations as
approved by their excellencies the superintendents of trade for the
northern ports, Yuan Shih-k’ai, and the viceroy of Shengking, Chao Erh
Sun. He also called my attention to a “consumption tax “which was being
levied on all goods, native and foreign, imported by Chinese merchants,
no matter what their destination.
On December 27 I made certain comments to the consul-general on the
proposed customs regulations, at the same time approving his suggestion,
as contained in his No. 64, regarding “exemption certificates “which
should be accepted by native revenue collectors, thus securing free
transit for the goods covered by such certificates.
I addressed a note to the foreign office on December 29, objecting to a
consumption tax on foreign goods and requesting that the tartar-general
at Mukden be instructed that such tax may not be levied at any of the
open cities or ports in his jurisdiction upon foreign goods that have
already paid import duty. No reply has as yet been received to the above
note other than that my note has been forwarded to the tartar-general
for his consideration.
[Page 227]
Supplementing his dispatch No. 64 to this legation, Mr. Straight
addressed me again in his No. 66, of December 25, a copy of which he
also forwarded to the department, to which I replied on December 31,
directing him to confer freely with the Japanese consul-general on all
questions in which our respective Governments were mutually interested,
and to be guided by the general instructions given by the Department of
State to Mr. Sammons, consul-general at Newchwang, and by this
legation.
On January 3 the legation received a telegram from Mukden announcing that
the viceroy was proposing to appoint commissioners to conduct
negotiations for formulating customs regulations, and requesting
instructions as to whether he (the consul-general) should hold separate
conference or joint action with the Japanese consul-general. On the same
elate I telegraphed my reply, directing him to discuss the matter with
the whole consular body at Mukden and informing him that it was not a
subject reserved by our treaty to our exclusive or separate
determination, whereas the questions connected with the foreign
settlements were so reserved. I also instructed him to bear in mind that
as Mukden and Antung were ordinary treaty ports, with all the rights and
privileges of such, no particular customs regulations appeared
necessary.
In his No. 69, of December 31, also in the possession of the department,
Mr. Straight forwarded to the legation a copy of a note which he had
received from the viceroy, together with the draft of his reply, which
he submitted to me for my approval. Owing to the fact that the question
of a “consumption tax” was being discussed by the legation with the
Wai-wu Pu, I suggested in my dispatch of January 8 that the note to the
viceroy should omit all mention of the tax in question.
I agreed with the consul-general’s views as expressed in his No. 69, in
regard to the problematic future of a special foreign settlement at
Mukden. It would seem as if Mukden could only be virtually a
distributing point and depot for the collection of native produce
destined for transshipment to the coast, where the headquarters of the
foreign firms will remain located, and that therefore the contention of
the Tartar general that the rights of foreign trade should be restricted
to a small area, if acceded to would deprive the opened city of all
value whatsoever.
I have, etc.,
[Inclosure 1.]
Minister Rockhill to Consul-General Straight
.
American Legation,
Peking
,
December 11,
1906
.
Sir: I have to acknowledge the receipt of
your dispatches of November 15 (2) and December 4.
Regarding the leasing of land for the erection of a
consulate-general, which you are informed by the Taot’ai might be
arranged for a less rate than $50 a mow per annum, you are
instructed that under no circumstances can this be agreed to, since
it would curtail the right guaranteed to us by treaty to purchase
land.
You should not accept the tax on retail trade if goods are foreign.
After the goods have paid the 5 per cent import and transit dues
they can be subjected to no impost whatever, and you should inform
Chinese merchants of this and report any case you may hear of where
a tax is levied on foreign goods in retail trade.
[Page 228]
I am of opinion that there should be no custom-houses at Mukden or
other interior places in Manchuria, but only at ports where goods
enter the country, and think that the creation of interior
custom-houses would hamper the development of the resources of the
country. You should resist an arrangement which would in any way
increase the levying of dues of any kind on foreign goods.
It would be better to accept the view of Mr. Hagiwara and those of
the British and German consuls, and have indiscriminate residence
throughout the city, than accept a strict delimitation of territory
to form an international settlement coupled with the restrictions
the Chinese seek to impose on commercial rights.
[Inclosure 2.]
Minister Rockhill to Consul-General Straight
.
American Legation,
Peking
,
December 27,
1906
.
Sir: I have to acknowledge your dispatch
No. 64, of December 16. The draft customs regulations which you
inclose, while apparently framed for the purpose of facilitating
trade at Mukden, appears to this legation cumbersome. As regards
Articles VII and VIII, it would seem that the establishment of
bonded warehouses by the railway company under the usual supervision
that customs authorities exercise over such places would be a much
better arrangement than that laid down in these articles.
Mukden being no more in the interior than Hangchow or Soochow, since
these must be reached via Shanghai, it should not be made the
subject of a special article. I think that Article I should be
omitted altogether.
In Article II the words “exceptional treatment may be accorded”
should be struck out, for if satisfactory reasons are given why
import duty has not been paid on foreign goods at the seaboard it is
a right the owner possesses to pay them at Mukden; it is not
optional with the customs to refuse him.
In the same article the words “to their place of destination” should
be struck out, as the provisions of the treaties are that on the
payment of transit dues goods are exempted from all inland taxation
whatsoever.
Article V: This appears to be unjust. Under existing rules at the
other ports goods going from one open port to another pay (1) export
duty at the place of departure, and (2) coast-trade duty (one-half
import) at port of entry. The proposal to add inland taxation on
goods en route from Mukden to the sea practically leaves Mukden in
the same position as an unopened city. Such goods should enjoy the
same privileges as those coming to Mukden from other open ports of
China, as set forth in Article III.
Article IX: With whom do the commissioners intend to consult?
I approve of your suggestion to secure the issue by customs
authorities of “exemption certificates,” and I shall bring the
attention of the Waiwu Pu to the matter of the levy of a consumption
tax, which, as you say, is practically a transit, duty equivalent to
the former likin and which is being levied in Manchuria on all
goods, native and foreign, imported by Chinese merchants, no matter
what their destination.
[Inclosure 3.]
Minister Rockhill to the Prince of
Ch’ing
.
American Legation,
Peking
,
December 29,
1906
.
Your Imperial Highness: I have the honor to
call the attention of your imperial highness to the action of the
Tartar general at Mukden in levying a “consumption tax” on all
goods, native or foreign, imported into the province of Feng-t’ien
no matter what their destination. I am informed by the American
consul-general at Mukden that such a tax is being collected upon
American goods placed on sale at Mukden.
I need scarcely remind your imperial highness that all goods of
foreign origin which have paid the tariff duty upon such imports may
not be subjected [Page 229] to
further imposts at any open city or port of China, or while in
transit from one open port to another, no matter what the
nationality of the owner or possessor of the articles. Inasmuch as
Mukden has been declared open to international residence and trade,
foreign goods which have paid import duty must be allowed the same
treatment there as at other open ports.
I have the honor, therefore, to request your imperial highness to
instruct the Tartar general at Mukden that such tax may not be
levied at any of the open cities or ports in his jurisdiction upon
foreign goods that have already paid import duties, and that such
foreign goods, upon payment of the import duties, may be allowed the
usual exemption certificate on being shipped from the port where
such import duty was paid to any of the inland cities of Manchuria
which have been declared open to foreign trade.
Trusting that your imperial highness will favor me with an early and
satisfactory reply assuring me that American goods at the open ports
of Manchuria, whether in the hands of Chinese or foreigners, will be
exempt from the said “consumption tax,” which is in violation of the
treaties between the United States and China, I avail myself,
etc.,
[Inclosure 4.]
Minister Rockhill to Consul-General Straight
.
American Legation,
Peking
,
December 31,
1906
.
Sir: I have to acknowledge the receipt of
your dispatch No. 66 of the 25th instant, in which you inclose copy
of a note signed by the consular body at Mukden and sent to the
Tartar general in reply to the communication of the local foreign
affairs board, concerning regulations for general taxing in the
province of Feng-t’ien.
Your reply meets with the approval of the legation.
As regards your request for instructions in reference to the draft
regulations prepared by Mr. Oliver, commissioner of maritime
customs, and forwarded to this legation in your No. 64, it has been
anticipated, and the views of the legation were sent you on the 27th
instant in my dispatch No. 1029.
In your dispatch under acknowledgment you also ask if you should,
following the precedent established by Consul-General Sammons,
conduct negotiations, presumably for carrying out the provisions of
Article XII, paragraph 3, of our treaty with China of October 8,
1903. You must be guided by the general instructions given Mr.
Sammons by the Department of State and this legation, using your
discretion in interpreting their spirit, and bearing in mind changes
which may possibly have occurred since they were sent. At all
events, you should freely confer with the Japanese consul-general
and ascertain his views on all questions in which our respective
Governments are mutually interested, using your efforts to so adjust
your different views as to best serve the policy of the United
States as regards Manchuria, which, fortunately, is in absolute
conformity with the oft-repeated declaration of the Japanese
Government on the same question. However, before finally committing
yourself to any arrangement concerning any of the questions involved
in the pending trade arrangements for Manchuria you should submit
the matter to this legation and await further instructions.
[Inclosure 5.]
Minister Rockhill to Consul-General Straight
.
American Legation,
Peking
,
January 4,
1907
.
Sir: I have to acknowledge the receipt of
your telegram of the 3d instant, and to confirm my reply thereto, as
follows:
“American Minister, Peking:
“The viceroy proposes to appoint commissioners to conduct
negotiations anticipated in the last two paragraphs my No. 66,
December 25, for formulating [Page 230] customs regulations. No expression intention propose simultaneous
negotiations settlement regulations, which will probably be reserved
subsequent discussion. Chinese desire to ascertain whether my
instructions provide for separate conference or joint action with
Japanese consul. Am informed that they prefer, in the beginning at
least, former procedure. Respectfully request instructions.
“Straight.”
“American Consul, Mukden:
“Your cipher telegram third, any discussion customs regulations
should be held jointly with whole consular body at Mukden. This
subject is not one reserved by our treaty to our exclusive or
separate determination, whereas those connected with settlements
are. You will bear in mind that Mukden and Antung being ordinary
treaty ports with all rights and privileges of such, no particular
customs regulations appear to us necessary.
“Rockhill.”
[Inclosure 6.]
Minister Rockhill to Consul-General Straight
.
American Legation,
Peking
,
January 8,
1907
.
Sir: I have to acknowledge the receipt of
your dispatch No. 69 of December 31, inclosing the reply of the
Tartar general to the identic note which you and your colleagues
sent him on the 22d of December, in reference to the observance by
foreigners of the regulations for general taxation in the Province
of Feng-t’ien, issued by his order.
This identic note was approved in my No. 1036 of December 31.
The draft reply to the Tartar general’s note of December 29, which
you inclose in your dispatch under acknowledgment for the approval
of the legation, is in accordance with the instructions heretofore
sent Mr. Salomons (see my No. 773 of June 28, 1906), which have
received the entire approval of the Secretary of State. As the
question of “consumption tax” is now being discussed by the legation
with the Waiwu Pu, as I have already informed you in my No. 1034 of
December 29 of last year, I would omit from your note to the Tartar
general all reference to it. On page 2 of your draft you should
therefore strike out from line 4 the portion of the phrase after the
words “opened in this province” to the end of the paragraph.
With this answer sent the Tartar general, I think you should let this
question rest, as it is one which can not be settled locally, but
must be discussed with the Chinese Government here. The Tartar
general’s views, as shown in his note, are of interest as his
personal interpretation of the terms of Article XVI of our treaty of
1903, concerning Mukden and Antung, but they do not necessarily
represent the views of the Imperial Government, which has not yet
replied to the note which I sent to the Prince of Ch’ing on the 26th
of April of last year, stating the interpretation by our Government
of the provisions of the treaty concerning the opening of Mukden and
Antung.
The legation agrees with your views as expressed in your dispatch
under acknowledgment as to the problematic future of a special
foreign settlement at Mukden, which, as you remark, like all the
other inland marts opened or to be opened in Manchuria, will be
virtually a distributing point and depot for the collection of
native produce destined for transshipment to the coast, where the
headquarters of the foreign firms will remain located. If this is to
be the commercial role of these places, the contention of the Tartar
general that the rights of foreign trade at them should be
restricted to a small area in proximity to each of these marts
would, if acceded to, deprive them of all value whatsoever. You will
please send the legation at once a copy of the Chinese text of the
viceroy’s note of December 26, and also of your reply when sent. All
important papers received from or sent to the Chinese authorities
should be sent to the legation in Chinese as well as in
translation.
