The British Ambassador ( Howard ) to the Secretary of State

No. 279

Sir: With reference to Mr. Chilton’s note No. 851 of October 2nd last36 regarding the administration of certain islands off the east coast of Borneo, I have the honour to reply as follows to the points raised in your note of April 21st, 1925, and previous correspondence in regard to this matter:

His Majesty’s Government agree with the United States Government that it would be preferable to arrange for the assumption by the latter of administration over islands hitherto administered by the British North Borneo Company by a modification rather than by a denunciation of the existing agreement. Before proceeding to such modification, however, they desire to put forward the following considerations.

Of the seven islands mentioned in your note of April 21st, 1925 as those over which the United States now desire to assume administration, His Majesty’s Government consider that the British North Borneo Company have a good claim to Great Bakkungan and Little Bakkungan. A portion, if not the whole, of Great Bakkungan falls within the limit of nine miles from the mainland of British North Borneo, fixed by treaty as the limit of the company’s territory, if this distance be measured from low watermark. As regards Little Bakkungan this lies within nine marine miles of the mainland even at high water.

Nevertheless, His Majesty’s Government would agree to waive any claim on behalf of the company to these two islands, provided the United States Government on their part undertake (a) to give for [Page 778] the maintenance of the light-house which the company have erected on the island of Taganac the following full facilities:

A lease, free of premium, rent, or other restrictions, of an area of two acres of land, to include the site of the present lighthouse. The boundaries of this area to be agreed on the spot by an Officer of this Government and an Officer authorised by the United States authorities. This lease should be a perpetual lease, forfeitable if the light is discontinued for a period of more than twelve months.
The right to import, free of all restrictions, fuel, accessories, materials and spare parts for the light and lighthouse buildings and foodstuffs and personal effects of the attendants in the event of an attended light being installed.
A grant, covering each individual inspector for the period of his appointment, of a general authority to land and visit the lighthouse at any time; i. e. each individual inspecting officer would carry a free pass, drawn up in whatever form the United States Government consider most appropriate.
Freedom from dues or other imposts for launches or other vessels visiting Taganac in connection with the light.
The right to cut down jungle or to do anything to ensure the maintenance of a clear beam of light throughout three hundred and sixty degrees.

(b) to give assurances that an effective police post will be established by them on one of the islands. His Majesty’s Government regard the establishment of such a post as necessary, in view of the fear of the company regarding the difficulties which might arise in the matter of suppressing piracy and arresting criminals escaping from or avoiding the jurisdiction of the North Borneo Government. His Majesty’s Government are informed in this connection that there have been numerous instances in which gangs of pirates have used these islands as a base from which to attack Chinese junks passing between Sandakan and other North Borneo ports, and that on these occasions police patrols from Sandakan have had to visit and search each island in turn in order to break up the gangs. Moreover, as regards the possibility of the escape of criminals from Sandakan town and district, it is to be remembered that the group of islands can be reached by a native canoe with a favouring wind in the course of two or three hours from Sandakan Harbour. In order, therefore, that persons required by the North Borneo Government for extraditable offences may be promptly arrested and held on provisional warrants pending the completion of extradition proceedings and the receipt of the formal warrants of surrender, it is necessary that an effective police post with facilities for patrolling the group should be established on one of the islands.

Further, it will of course be clear to you that these islands, if they should be subsequently transferred to a third state, will remain subject to the restrictive provisions respecting fortification attaching to them [Page 779] under Article 19 of the Washington Naval Treaty.37 His Majesty’s Government would be glad to receive a definite statement from the United States Government undertaking that any such future transfer would be subject to the observance of those provisions.

I have [etc.]

Esme Howard