893.841 Surtax/24: Telegram

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

801. Your 304, August 2, 1 p.m. Following from American consul at Shanghai:

“August 9, 5 p.m. Referring to the Legation’s telegram July 11, 5 p.m.1 authorizing upon request the clearance of American vessels with consular clearance only. I regret to find that it is not quite clear that this instruction continues in force to date, therefore I desire to advise the Legation that the Dollar Steamship Company has made formal application for the clearance of their deep seagoing vessels with consular clearance only, the first the President Taft, August 12th. Kindly instruct so that no delay may be occasioned.

[Page 448]

As previously advised the Messageries Maritimes is clearing with consular clearance only and no obstacles have been placed in their way.

At meeting yesterday of British Steamship Company they were advised by the British consul general that he was prepared to issue their vessels consular clearance and I am now informed that the Blue Funnel Line, the Peninsular and Oriental, and the Glen Line have received instructions from their head offices to clear consular clearances only. The Canadian Pacific Mail Steamship Company, the Prince Line, Ellerman and Bank Lines have applied for permit to their home offices and are awaiting advices.

It is well known that I cannot offer naval protection to American vessels even if clearance is granted; however, I am reliably informed that in the authority to the British consul general to clear vessels the Legation has further stipulated that if necessary naval protection will be afforded. This can probably be verified definitely by the Legation.

An immediate instruction is requested.”

I am replying as follows:

“August 10, 4 p.m. Your 127 August 9, 5 p.m.

1.
The Legation’s 123, August 1, 7 p.m., repeating to you the Department’s 302, July 30, 7 p.m., to the Legation amplified the Legation’s 84, July 11, 5 p.m., which repeated to you the Department’s 280, July 9, 2 p.m., to the Legation. These two telegrams set forth fully the position’ of the Department with regard to consular clearances of American vessels when faced with a demand for the payment of illegal tonnage dues. The Legation has received no instructions in modification thereof and is aware of no reason why they should not be regarded as continuing in force to date. These instructions construe[d] as meaning that it is optional with American shipping companies whether they pay tonnage surtax (with or without protest) or tender legal dues and receive consular clearances but that if these companies by availing themselves of consular clearance are thereafter denied customs privileges the American Government does not purpose to set up its own machinery for the collection from American citizens of tonnage and customs dues. That contingency must therefore be regarded as one of the risks attendant upon a decision to ask for consular clearance.
2.
Therefore you should make wholly clear to Dollar Company the limit upon your ability to extend them assistance in this matter and that they cannot hope to receive, either directly or in the last analysis, the protection of American military or naval forces in resisting payment of tonnage dues even if such protection is forthcoming for vessels of other nationalities and that responsibility for any untoward results of their decision must rest wholly upon the company. I do not mean to convey the impression that the Legation desires you to influence company against the action contemplated by them, but simply that company should not make their decision without a full knowledge of various factors involved, and, in particular, of the attitude of our Government toward this question.
3.
At a meeting of the interested Ministers this morning the question of tonnage surtax was discussed and all agreed to instruct their [Page 449] consuls at Shanghai that payment of tonnage surtax should be optional with shipping companies and that consular clearance would be granted on request in the event of a refusal of the Chinese authorities to accept treaty dues. Japanese Chargé d’Affaires, however, stated that his action would have to be addressed to the Tokyo Foreign Office which thus far considers it premature to take drastic measures without full preliminary discussions with the Nanking regime. The British counselor stated that he had no knowledge of any understanding with his consul general at Shanghai for the use of naval force to protect British vessels in resisting payment of the tonnage surtax.
4.
Your telegram above mentioned and this reply are being repeated to the Department.”

Should the Department not approve of the foregoing, I request to be informed at the earliest moment.

MacMurray
  1. Not printed; it repeated the Department’s instructions as given in telegram No. 280, July 9, to the Minister in China, p. 435.