File No. 312/62.

The Minister of Panama to the Secretary of State.

No. 24.]

Excellency: In the middle of the year 1905, the concern styled “The Central & South American Telegraph Co.,” with headquarters in the city of New York, submitted to the Government of [Page 678] Panama, through its agent, propositions for the continuance of the contract the company had made with the Government of Colombia, or for a renewal of the contract or the signing of a new contract on bases similar to those found in existing contracts between the concern and the Government of Colombia and the other South American countries.

The Government of Panama, heeding the interests of the country and the prohibition contained in the organic law of the Republic, found itself constrained to deny the petition of the cable company, and, in turn, offered to its representative the draft of a liberal contract, the only objections to which on the part of the company were the terms of duration offered by the Government and the defect that it was not granted an exclusive privilege.

From that time until now the company has been treating with your excellency’s Government about the matter, and information has reached the department of foreign relations of my country to the effect that the said Government has granted the Central & South American Telegraph Co. permission to lay its cable as far as Colon or some point in the Panama Canal Zone.

As my Government has no positive knowledge of the fact and as the cable would have to cross Panaman waters, the secretary of foreign relations of my country directs me respectfully to apply to your excellency for information on the subject, and closes his instructions by asking me to say to your excellency that under the narrowest limit recognized by international law—three marine leagues—the whole of the Bay of Limon, within which, according to the HayBunau Varilla treaty, the canal begins, is part of the territorial waters of Panama; and that this makes it appear that the cable company proposes to ignore our rights, notwithstanding Panama’s liberal offers to the said company and to the American Government itself; and, as this seems unlikely, I should address the Department of State and request an explanation of what has been or may be done in this very delicate matter and ask that until the two Governments reach a mutually satisfactory agreement that will adjust the difficulty, orders be issued to suspend all operations for the laying and landing of the telegraphic cable, as it is proposed to do.

I am asked by my Government to communicate by cable to Panama the result of this inquiry. I beg that your excellency will deign to let me know as soon as possible the circumstances of the case to enable me to comply with my Government’s wishes.

If your excellency should wish to have an interview with me respecting this matter, I shall be very glad to place myself at your excellency’s disposal.

I avail, etc.,

J. A. Arango.