393.1164/98

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

No. 1742

Sir: I have the honor to enclose copy of Consul General Cunningham’s despatch No. 5716, of October 27, 1928, concerning the registration of American missionary educational institutions with the Nationalist authorities.

In this connection, the Department’s attention is invited to Consul Adam’s despatch to the Legation No. 568, of October 26, 1928,55 regarding the seizure by the Chinese authorities of heroin from an American company, copies of which were sent direct from Hankow to the Department.

It is believed that the two incidents reported in these despatches give a distinct forewarning of the difficulties which, from now on, will be increasingly experienced by American interests in China, both business and missionary. The Nationalist officials of today are more endowed [Page 574]with enthusiasm for asserting authority and control over foreigners than with experience and judgment. Many of them are men who have heretofore been persons of no importance, who are without any real qualifications for the positions they hold, and who, suddenly finding themselves possessed of unexpected power, are inclined to exercise it unadvisedly and with utter indifference to the rights of foreigners, and with entire disregard of economic consequences to China itself. With such a situation, and with the Central Government exercising only a most nominal control of the provinces, the affording of any real protection to American interests by the Legation and by the Consulates is certain to become exceedingly difficult, if not almost impossible.

I have [etc.]

J. V. A. MacMurray
[Enclosure]

The Consul General at Shanghai (Cunningham) to the Minister in China (MacMurray)

No. 5716

Sir: With reference to the Legation’s circular instruction No. 283 of October 2, 1928,56 I have the honor to transmit a copy of a letter dated October 16, 1928, from the President of the University of China,56 calling attention to the requirements of the Nationalist Government in regard to the registration of schools, and also a copy of this office’s reply to Dr. Rankin.

As intimated in previous correspondence, the requirements for the registration of American schools with the Chinese authorities compels the schools to renounce their American nationality to a large extent and would appear to remove them from the classification of religious institutions. In the event that the University of China desires to file a protest and requests the assistance of this office in resisting registration, a protest will be filed in accordance with the Legation’s telegram of December 23, 1:00 p.m., 1927.56 Any further precedents or instructions which the Legation considers desirable to transmit would be very much appreciated. It is difficult to know exactly what steps should be taken. The school might be closed as a protest against the requirements of the Chinese authorities but this would render useless a large American investment and it would appear that since citizens of the United States have by treaty the right to maintain schools in China under their own supervision, this would be unfair both to the mission society and to the American contributors who have a vested interest in the particular school.

I am impressed with Dr. Rankin’s reasoning as set forth in the paragraph of his letter which states: [Page 575]

“If China may thus take charge of and control the administration of missionary corporations and private institutions, she may in like manner, as it would seem, take charge of and control every private business of any and every foreigner in China. If she may thus take control of private business, she may through such control destroy the business thus controlled. And thus she may indirectly, but without question, expel every foreigner from her domain, though apparently claiming to maintain a friendly and peaceful relation with other nations.”

If American business concerns in China are required to register with the Chinese authorities under the Registration Act which was promulgated on October 29, 1927,57 the laws may be changed requiring the president or the head of the concern to be a Chinese, and thereby place American capital under the direct control of Chinese. This fear has long existed in my mind and the minds of many local business men. It is felt that such a fear is well founded and Dr. Rankin’s illustration is very apt indeed because if once these firms are registered, the laws may be changed in such a manner as to effect what will be practically a confiscation of American undertakings acquired in a legitimate manner and supported by American capital.

I have [etc.]

Edwin S. Cunningham
[Subenclosure]

The Consul General at Shanghai (Cunningham) to the President of the University of China (Rankin)

Sir: The receipt is acknowledged of your letter of October 16, 1928,57 stating some of the requirements for the registration with the Nationalist authorities of schools supported by church constituencies in western lands. You state that if registration is required, you desire to protest against each and all of the requirements as being contrary to the spirit of amity and good will that should obtain between different nations.

Your letter presents the question in a slightly different light from that in which it has previously been presented. This office desires to extend to those American institutions which seek it, all the protection guaranteed Americans in the Sino-American treaties, which they have a perfect right to demand. It would appear that the attempt of the Chinese authorities to enforce the four requirements mentioned in your letter has no authoritative basis in the treaties and therefore, whenever you request it, a protest will be filed with the Chinese authorities against such registration. It is certain that neither international law [Page 576]nor the Sino-American treaties recognize the right to confiscate legitimately acquired property of American citizens in China. If you are approached by the Chinese authorities seeking to require the registration of your institution, and do not desire to comply, this office will be very glad to take up the matter with the Chinese authorities.

It may interest you to have the following authorized statement of the American Minister in regard to the status of institutions which may elect to register with the Chinese Government:

[Here follows text of penultimate paragraph of instruction No. 871, May 23, 1928, to the Minister in China, printed on page 570.]

Very respectfully yours,

Edward S. Cunningham
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