The Chargé in China ( MacMurray ) to the Secretary of State

No. 2184

Sir: I have the honor to refer to a communication, under date of July 16th last, with which Mr. Charles Denby, special assistant to the Department of State, enclosed a memorandum embodying a suggestion that the foreign courts of all nationalities conducted under the system of extraterritoriality in China be abolished, and that China be urged to establish courts of her own with jurisdiction over cases in which foreigners are parties.

I venture to comment that this suggestion, although perhaps not realizable in the immediate future, would nevertheless seem to indicate a stage of development towards which Chinese and foreign residents alike should find it advantageous to strive. While it is true that the present administration of justice in China is not such as would warrant the inclusion of foreigners under its jurisdiction; and while it is further unfortunately true that the Chinese are in general apathetic and unresponsive to any suggestion of improvement, it may nevertheless be urged that this apathy is itself the result of the hopelessness with which they regard any possibility of obtaining the right to be entrusted with any responsible share in the administration of their laws where foreigners are concerned; I believe it is the fact that, in the case of this and of certain of the other limitations upon their sovereignty, imposed by the older treaties, the feeling of even the more ambitious Chinese is that the attitude of foreign nations, and particularly of Japan, has been such [Page 675] as to warrant no hope that a betterment of conditions through the efforts of China would receive the sympathy and cooperation of the powers.

If this belief be correct, there is at least an explanation, if not a justification, of the rather short-sighted view which the Chinese are too generally inclined to take towards the international obligations thus imposed upon them—the view that such restrictions upon their freedom of action should not only be jealously guarded with a view to preventing any undue enlargement of the privileges already conceded, but should whenever possible and by all available means be contested, evaded, and rendered nugatory. It is at least to be hoped that the proposal by our Government of a plan devised to allow them a fuller share of responsibility in dealing with foreign interests would encourage in the Chinese the broader and more far-sighted view, that only by deserving it can they entitle themselves to the enjoyment of fuller rights than have hitherto been allowed them. It was, of course, by a patient devotion to this ideal that Japan rid itself of extraterritoriality.

More recently, and under circumstances that, though less conspicuous, are perhaps even more remarkable by reason of the comparative smallness of the state concerned, Siam has in its more important international relations (i. e., with Great Britain and France) almost completely done away with the restrictions of extraterritoriality. As the Department is aware, this result has been accomplished largely through the influence of two American advisers, the late Mr. Edward Strobel, and Mr. Jens I. Westengard, who, under conditions which in many respects were analogous to those now prevailing in China, were able to bring the Siamese Government to the realization that by scrupulous observance of all the obligations imposed upon them, and by sedulous improvement of their legislation and judicial administration, they would eventually put themselves in a position to claim the sympathy and assistance of the powers with which their relations had hitherto been continually irritated by the attempt of Siam to minimize those obligations. The result was that save for certain safeguards, which are scarcely onerous to the Siamese, the jurisdiction over subjects of Great Britain and of France has been almost wholly rendered over to Siam, under a system not fundamentally different from that which Mr. Denby suggests as eventually possible in the case of China.

Although fully realizing the preoccupation of the Department, and feeling some hesitancy in urging consideration of a matter which may for the present be deemed somewhat academic, I venture to urge that the matter is one which is at least worthy of consideration; and I venture further to suggest that if this view is in any degree shared [Page 676] by the Department, it would be advisable to consult Mr. Westengard (whose address is understood to be the Harvard Law School, Cambridge, Mass.) with a view to ascertaining his judgment upon a proposal which so closely resembles the plan which he brought to a successful realization in Siam.

I have [etc.]

J. V. A. MacMurray

The Special Assistant to the Department of State ( Denby ) to the Secretary of State

Dear Mr. Secretary: I enclose herewith a memorandum making a suggestion of a somewhat radical character in regard to the exercise of extraterritorial jurisdiction in this country. I beg you to give this matter your sympathetic attention as it is of vital interest to us here, and one of the great steps we can take to complete the post war program for the United States. This idea is my own, if [is?] entirely original in its present form and I want the American Government to have the benefit of it, and to this end I urgently recommend that you take it up at once with the Chinese Minister at Washington in a tentative way in order that to America may attach the credit and advantage of having first approached the Chinese Government in this sense.

Faithfully yours,

Charles Denby

Memorandum of the Special Assistant to the Department of State ( Denby )

The time has not yet arrived to abolish extraterritoriality in China. Extraterritoriality as applied to citizens of the United States was established by the Treaty of Wang-Hea, signed in 1844,5 Article[s] XXI and XXV of which read as follows:

Article XXI

“Subjects of China who may be guilty of any criminal act towards citizens of the United States shall be arrested and punished by the Chinese authorities according to the laws of China, and citizens of the United States who may commit any crime in China shall [Page 677] be subject to be tried and punished only by the Consul or other public functionary of the United States thereto authorized according to the laws of the United States; and in order to the prevention of all controversy and disaffection, justice shall be equitably and impartially administered on both sides.”

Article XXV

“All questions in regard to rights, whether of property or person, arising between citizens of the United States in China shall be subject to the jurisdiction of, and regulated by the authorities of their own Government; and all controversies occurring in China between the citizens of the United States and the subjects of any other Government shall be regulated by the Treaties existing between the United States and such Government[s] respectively, without interference on the part of China”.

By the American Commercial Treaty signed at Shanghai in 19036 provision was made to abolish extraterritoriality at some proper time. Article XV of this Treaty reads as follows:

“The Government of China having expressed a strong desire to reform its judicial system and to bring it into accord with that of Western nations, the United States agrees to give every assistance to such reform and will also be prepared to relinquish extraterritorial rights when satisfied that the state of the Chinese laws, the arrangements for their administration, and other considerations warrant it in so doing.”

It is evident that China has not yet established her right under our Shanghai Treaties to call upon us to abolish extraterritoriality, but there are growing evidences that extraterritoriality, as at present administered, is a barrier to our relations with China, and is a handicap to the Chinese themselves in their attempt to establish autonomous government free from foreign control. The extraterritorial provisions in the treaties which the foreign powers have imposed upon China were intended to protect the foreigner from the entire conflict between their ideas of legal administration and our own; above all to protect the foreigner from the possible animus of Chinese authorities against a litigant because of his nationality. Undoubtedly this purpose has been served and without this system foreign residence in China would have been impossible. The advantages of the system are manifest; the disadvantages were not foreseen at the time that treaties were put into effect. In the early days of the commercial intercourse of foreigners with the Chinese the foreign merchant’s life was his own, he was quite content with his own little world, with his race course and his club. He conducted his business in a commercial house to which the Chinese [Page 678] customers in general had a limited access, and he conducted his business through his compradore, which person was his link with the Chinese world. He felt no necessity to learn the Chinese language, nor, in fact, to familiarize himself with the market with which he was dealing. To compensate himself for this deficiency, however, he had the protection of his own laws and the sanctity of his own national concession in some treaty port. The requirements, however, of modern business in China have changed all this. The young men of the great foreign firms, such as the British-American Tobacco Company, the Standard Oil Company and others find it necessary to go widely throughout the country. They are, in fact, breaking down the barriers which were heretofore highly prized by the foreign merchants and we now find these barriers which protected us from Chinese ill treatment in fact obstacles in the way of our intercourse with them. We do not get at the market nor do we get at the people. The missionaries have long outgrown this and in their intercourse with the Chinese the treaty port concession has lost its value. They have learned the Chinese language, they have mixed freely with the people; they have secured through treaty the right to secure land elsewhere than at treaty ports, and have, in fact, occupied the anomalous position of Foreigners resident throughout the Republic remote from any court that could bring them to trial for their misdeeds or for the settlement of their civil controversies. This is a lesson to the foreign interests in general that extraterritoriality while a protection is at the same time a distinct limitation on the activities of foreigners in this country. The Japanese have not been slow in finding this out. They reason with justice that if they can keep the foreign world chained to the principle of extraterritoriality, Chinese tariff and economic subjection they thus limit the foreign activity and leave it free to the Japanese to place themselves outside these restrictions. By reason of racial and linguistic similarity the Japanese have, in fact, readier access to the Chinese people than the foreigner can ever hope to have. They are profiting thereby to enter the markets of China freely and as it goes on there will be less and less doubt that they are gainers by what we have considered our own protective measures.

It is not probable that conditions in China at the present time would justify the abolition of extraterritoriality and the committing of foreigners and their rights to Chinese courts; something, however, can be done towards this end. It might be indicated to the Chinese Government that the United States contemplated with some concern the time when extraterritoriality could be abolished; that the United States Government recognized that the Chinese could never learn to administer justice in cases where foreigners were [Page 679] involved without some experience in that administration, and that the United States Government proposed to lay before China some plan by which a gradual abolition of extraterritoriality could be accomplished.

We have in China at this date large interests such as the Foreign Maritime Customs, the Salt Gabelle, with its collection of enormous revenue, the railways with their semiforeign administration, all of which are conducted upon the (principle that the Chinese is to be used as far as possible but that his activities are to be controlled by supervising foreign administration.

It is, therefore, proposed by the undersigned that the United States Government approach the Chinese Government with the proposition that a Ministry of Justice shall be established with a prominent jurist at the head of the same; that this Ministry should be charged with the duty of establishing local courts throughout the Chinese Republic; that the appointees of these courts should be in some cases foreigners with Chinese, and in some cases Chinese alone; that in all cases during the operation of this plan an appeal should lie from the Courts of first instance to a superior court which foreign officials would control. In this way all the Consular Courts with their natural bias in favor of their own nationalities could be abolished. We would inspire in the Chinese some sentiment of self-respect, and above all we could train them in their relations with foreigners so that eventually they would be able to conduct not only their own legal procedure but other functions of their government in their relations with foreigners.

The machinery of such an organization would not be complicated as compared with the Customs Service, the railways and the Salt Administration. It would not be necessary in the first instance to establish a great number of courts; the system could be allowed to grow, the sites of the Courts, the methods of procedure, etc. could be modified by experience and there is much reason to believe that in the course of a few years such a reliable machinery of justice could be built up as to justify us in turning the whole system over to the Chinese themselves.

In view of the fact that the Power which first offered to China some such plan as above outlined will receive its warm gratitude, it is recommended that the Minister of China at Washington be at once approached along these lines; that the above project be more carefully elaborated and that in time a convention be made with China to put it into effect. The advantages of the system are so manifest that no determined opposition need be feared from other Treaty Powers. The United States, England and France are all recognizing the restrictions they are under in their relations with [Page 680] the Chinese by reason of their extraterritoriality. Commerce would profit by the innovation. China would be more widely thrown open to foreign intercourse, educational and missionary establishments would gather a new impetus and our political influence over the Chinese would be greatly widened. This seems the proper time to introduce this reformation. There will be much adjustment after the war, and this project might well be one feature thereof, free from any taint of selfishness or commercial gain. This idea is submitted now so as to gain for it a place in the affairs of China which will become subjects of post war negotiation. Now is the time to lay it before the Chinese and to secure their provisional acceptance of it.

Charles Denby

  1. For text of treaty, see Malloy, Treaties, vol. i, pp. 196 ff.
  2. Ibid., pp. 201 ff.