File No. 893.773/39.
Ambassador Guthrie to the Secretary of State.
Tokyo, March 29, 1915.
Sir: My despatch No. 234 of the 8th instant transmitted as enclosure a copy of a representation made by the Embassy to the Foreign Office on the subject of apparent discrimination in freight rates on the South Manchuria Railway against shipments from Shanghai. [Page 616] I have the honor herewith to transmit a copy of a note from the Foreign Office received in reply.
In a recent conversation with the Minister for Foreign Affairs he told me that the above-named company had desired to promote the commerce of Dairen and to favor it even at the expense of Newchwang, for the reason that at the latter place part of the trade to Mukden and beyond went by the Chinese railway, whereas by Dairen the whole went by the South Manchuria road. He said that as the matter had been explained to him the regulations did not discriminate between the trades of different countries at all, American trade being able to take advantage of the regulations just as Japanese trade had. I pointed out that while this was theoretically true, practically it was not correct; that American trade all went by way of Newchwang, where it was very much discriminated against by this regulation; that while theoretically goods going from Shanghai by way of Newchwang could get the benefit of the discount on through rates provided they were billed through, the only steamship line which could issue the through bills was composed of the South Manchuria Company’s own ships. Baron Kata admitted that this point should be corrected and arrangements made to permit other lines to send goods through.
As to the regulation providing that only through goods could be entitled to the discount, he seemed convinced that American trade had no just cause of complaint thereat. He said that as a matter of fact Japanese merchants at Dairen had complained bitterly of the same thing, alleging that insistence upon this point must drive them out of the trade. In spite of this, however, the company had adhered positively to the regulation.
It will be noted by the communication from the Foreign Office that the railway company expresses its willingness to form a connection for joint transportation with any foreign steamship company so desiring, and to allow to such foreign company the same reduced rates on through goods which are now given to through goods carried by the railway company’s own steamers, and that this regulation applies both at Newchwang and Dairen.
I have [etc.]