Memorandum by the Chief of the Division of Far Eastern Affairs (Hamilton) of a Conversation With the Counselor of the Japanese Embassy (Suma)

Mr. Suma called at his request. He referred to the representations made by Mr. Grew at Tokyo to the Japanese Foreign Minister in regard to the Customs situation at Shanghai. He said that the Japanese Foreign Minister had explained the Japanese attitude to Mr. Grew; that the Japanese Government would be glad to take note of such views, comments and suggestions as American representatives might put forth but that the Japanese Government could not admit the right of American representatives or other foreign representatives to participate in the making of the arrangements at Shanghai, that these arrangements should be made between the Japanese and the Chinese. Mr. Suma referred to the fact that with the departure from Shanghai and Nanking of responsible Chinese the Japanese were experiencing difficulty in finding Chinese with whom they could effect an arrangement and that the working out of an arrangement might take some time. Mr. Suma indicated that the Japanese Government would be prepared in any such arrangement to safeguard the American financial interests in the Customs.

I said to Mr. Suma that our interest in the Customs Administration was twofold: (a) we were naturally interested in the service of China’s obligations to the United States and to American nationals which were secured on the Customs; and (b) we were interested also in the much broader aspects of the Customs situation. I said that the United States along with Japan and other countries had long had a definite interest in the preservation of the integrity of the Chinese Customs Administration and in its effective functioning. I said that, in view of both these types of interest, the American Government believed that it had a right to be consulted in regard to any arrangement made which would affect the functioning of the Customs, and that our Consul General at Shanghai was prepared to offer suggestions with a view to safeguarding our interest in the Customs. I said that the attitude of the Japanese Government did not appear to coincide in all respects with our attitude; that we believed that our attitude was warranted; and that we hoped that in the working out of any arrangements at Shanghai the matter would be handled in such a way, particularly through giving our Consul General an opportunity to offer suggestions and comment in regard to any arrangement under contemplation, as to meet the views of this Government.

M[axwell] M. H[amilton]