711.933/241
Memorandum by the Chief of the Division of Far Eastern Affairs (Hornbeck) of a Conversation With the Chinese Minister (C. C. Wu)
Dr. Wu called by appointment. He had come to inquire concerning the Department’s reaction to the counter-proposals which he had made to Mr. Johnson after the proposals made by Mr. Johnson in conversation with him on December 21.
Mr. Hornbeck stated that he was instructed to say that the proposals were not considered such as could be adopted. He explained, with regard to Article II, that it would be impossible to make a commitment that arrangements would be completed by a specified date, three months hence. This, for reasons which scarcely need elaboration. Expressing his own personal view, unofficially, he felt that it was unwise in such matters to attempt to specify any date where the setting of the date was not necessary. He said that the American Government had committed itself to the principle of negotiating and that it hoped to conclude an agreement on this subject, that conversations had been going on in good faith, but that experience of the past year had shown that these matters moved slowly and that unforeseen events, as well as considerations which are ponderable, interfere with getting a particular thing done within a particular and limited period of time.
With regard to Article III, it was felt in the Department that this was what might be called a “Least-favored-nation clause” rather than a “most-favored-nation clause”.
With regard to Article I, it seemed too general: it might be construed as an authorization on the part of the American Government to the Chinese Government to go ahead and dispose of the question as it saw fit. But, although there might be differences of view upon one or all of these points, these proposals as a whole had not met with approval in the Department.
Dr. Wu said that with regard to Article III at least, he felt that there need be no great amount of trouble over the question of a most-favored-nation clause, provided that it was not made more broad than the subject matter of the agreement in question. There followed some discussion of uses and abuses of most-favored-nation clauses; and there seemed to be a community of view that there would be less difficulty with regard to that feature of an agreement than with regard to other features.
Mr. Hornbeck then said that he was authorized to submit, for consideration, a modification of the proposal which had been submitted by Mr. Johnson. He handed Dr. Wu a copy of a revised proposal, [Page 663] of which a copy is attached hereto.46 He explained that it had been understood that Dr. Wu did not like the idea of a commission to pass upon Chinese laws, and therefore it was suggested that the American court which undertook to apply these laws should itself decide what Chinese laws could be applied. He pointed out, also, that a different provision was suggested in place of or as an alternative to the most-favored-nation clause which had been proposed of Article III in the earlier project.
Upon reading over this proposal, Dr. Wu said that it seemed to him less satisfactory than the other proposal, for the reason that it left to the American courts the decision with regard to both the character and the application in effect in China of Chinese laws. Mr. Hornbeck said that if the points could be agreed upon in principle he thought that modifications with regard to the details might be worked out. There followed some discussion of this proposal as compared with the previous proposal.
Mr. Hornbeck then stated that he had a duty which he regretted to have to perform: he had been instructed to read a statement expressing the views of the American Government at this juncture in the presence of certain rumors. He referred to the good will which has prevailed between China and her people and the United States and the American people and he said that the American Government wished to be helpful to and did not wish to place obstacles in the way of the achievement by the Chinese of various objectives to which the latter aspire. He referred to the statements which have been made in the course of conversations between himself and Dr. Wu and Mr. Johnson and Dr. Wu in the course of the past year, and he said that this Government now felt it incumbent upon itself to reveal officially, though informally, its views with regard to principles of procedure which ought in its opinion at no time to be overlooked. Mr. Hornbeck then read the contents of the memorandum hereto attached47 and gave to Dr. Wu an unaddressed, undated and unsigned copy.
Thereafter, Dr. Wu inquired whether Mr. Hornbeck had read the British Government’s aide-memoire of December 21. Mr. Hornbeck stated that he had seen that aide-memoire but had not had an opportunity thoroughly to study its contents. He said that he remembered that it had in it a statement of the British Government’s views. Dr. Wu said that it contained a statement that the British Government would have no objection to the making of a declaration by the Chinese Government on January 1, 1930. Mr. Hornbeck inquired whether there was not a proviso. Dr. Wu said that there was a proviso to [Page 664] the effect that certain principles should be considered. Mr. Hornbeck said that that was his recollection and he stated that the American Government in the course of the proposal submitted by Mr. Johnson to Dr. Wu had indicated that it was not unwilling that January 1 be signalized as the date beginning from which definite steps should be taken toward effecting gradually the relinquishment of rights of extraterritoriality. Dr. Wu inquired whether the American Government would be willing to affirm, as the British Government had done, that it had no objection to the making by China of a declaration. Mr. Hornbeck said that he could not say anything on that point as the views of the American Government had been expressed in the document which, under instructions, he had read; that he considered that the statement itself was explicit and ample; and he did not feel at liberty to add to or amend or modify that statement. Dr. Wu asked whether Mr. Hornbeck would find out whether the American Government would be willing to give the assent which the British Government had given. Mr. Hornbeck said that it would be impossible to undertake to do this before Monday, December 30, but that on that day he would do the best he could with that inquiry.
There followed some conversation with regard to the situation in China.