893.74/117: Telegram
The Secretary of State to the Minister in Denmark (Grew)
31. Your despatch 207, March 31. Please address the Foreign Office a note acknowledging theirs of March 2955 and continuing as follows:
“It would appear that the Danish Government is under some apprehension as to the view of the American Government embodied in the Legation’s note of February 23.56 It is not the intention of the American Government to contend that the contractual rights of the Danish company are to be retroactively annulled, or that they are to be held invalid by reason of anterior treaty stipulations save in so far as they are based upon concessions which were actually in excess of the power of the Chinese Government to make. Your note furthermore states that the Danish Government is not aware of the concessions upon which my Government bases its view that the utilization of any field of commercial or industrial activity in China by the citizens of another country can not be hindered by contractual rights. On this point, I would refer you to Article 15 of the American treaty of 1844 by which the Chinese Government undertakes that American citizens in China are not to be impeded in their business by monopolies or other injurious restrictions.
It is the view of my Government that by this and similar provisions of subsequent treaties the Chinese Government has effectively renounced the right to create in favor of itself or of any foreign interests such a position as would exclude American citizens from the possibility of participating in such enterprises. It was therefore not within the competence of the Chinese Government to confer upon Danish interests such a monopoly as is asserted in behalf of the Great Northern Company. Without, therefore, calling into question the validity of the particular positive grants which the Chinese Government may by contract have vested in the Danish company, my Government does insist that no contractual stipulations on the part of the Chinese Government could suffice to divest American citizens for the benefit of that company, of their existing treaty right not to be ‘impeded in their business by monopolies or other injurious restrictions.’
In this view of the matter, it is not felt to be essential that the Chinese Govern’ment has hitherto acquiesced in the monopolistic [Page 443] rights claimed by the company. Nor may this Government be deemed to have acquiesced in this position, in view of the secrecy that has enveloped the contracts upon which the company’s claim is based, and that has made it impossible until recently for this Government to ascertain the basis of that claim.
The Government of the United States has never associated itself with any arrangement which sought to establish any special rights or privileges in China which would abridge the rights of the subjects or citizens of other friendly states; and it is the purpose of this Government neither to participate nor to acquiesce in any arrangement which might purport to establish in favor of foreign interests any superiority of rights with respect to commercial or economic development in designated regions of the territories of China, or which might seek to create any such monopoly or preference as would exclude other nationals from undertaking any legitimate trade or industry or from participating with the Chinese Government in any category of public enterprise.”
You will orally indicate that the discussion of this case would now appear to have covered all relevant issues, and that in the view of this Government it seems unnecessary to pursue the question further.
The Department is taking a similar attitude with respect to the British and Japanese protests and in response to an inquiry is addressing the Chinese Legation in the sense of the final paragraph of the note quoted above.
Advise the Department immediately by telegraph upon the delivery of the note.