Papers relating to the foreign relations of the United States, 1931, The Far East, Volume III

793.003/5578/9

The Department of State to the Chinese Legation²²

undated

(Tentative and without commitment)

Article I: Transfer of Jurisdiction

Except as modified by the provisions of this Treaty, nationals of the United States of America shall in China be entitled to the protection, and shall be subject to the jurisdiction, of the Chinese courts, but they shall, under all circumstances, be amenable only to the jurisdiction of the Chinese Modern Courts of Justice (Fa Yuan) and to the duly promulgated laws, ordinances and regulations of the Central, Provincial and Municipal Governments of China.

In all legal and administrative proceedings from their inception through final appeal and execution and in all matters relating to the administration of justice by the courts, nationals of the United States of America shall enjoy treatment not less favorable than that accorded to nationals of China, and reciprocally, nationals of China shall enjoy in the United States of America similar treatment.

In cases of offenses under the Police Offenses Code or under Municipal Regulations, nationals of the United States of America shall in China be subject to the jurisdiction of the Police Courts, but in such cases the penalty imposed by the court shall not exceed a fine of fifteen dollars, or, in the event of such fine not being paid, detention at the rate of one day’s detention for each dollar of the fine imposed up to a maximum of fifteen days.

Article II: Special Chambers

A Special Chamber shall be established in each of the District Courts (Ti Fang Fa Yuan) in Harbin, Shenyang (Mukden), Tientsin, Shanghai, Hankow, Chungking, Canton, Kunming (Yunnanfu), Tsingtao and Foochow and in each of the High Courts (Kao Teng Fa Yuan) or Branch High Courts (Kao Teng Fen Fa Yuan) having appellate jurisdiction respectively over such courts.

All cases involving nationals of the United Staes of America as defendants or accused shall be tried in China only before the Special Chambers most accessible to the court within whose jurisdiction the cases originate, except, (1) those which may be taken to the Supreme Court of China on final appeal; (2) those in which nationals of the United States of America concerned may elect in writing to submit themselves to the jurisdiction of the nearest Modern Court of Justice (Fa Yuan) to which no Special Chamber is attached; and (3) those which fall within the jurisdiction of the Police Courts of China as provided in Article I of the present Treaty. Similarly, all cases which arise in places where Special Chambers are established involving nationals of the United States of America as plaintiffs or complainants shall be tried before the Special Chambers.

Article III: Legal Counselors

The Government of China agrees to take into its service for such period as it may consider necessary, not less than the duration of the present Treaty, a number of Legal Counselors, who shall be selected and appointed as officials of China from among foreign legal experts of high moral character who possess the training, qualifications and practical experience necessary for appointment to judicial office, and who shall be attached to the Special Chambers. Amongst these Legal Counselors, there shall be included one Legal Counselor of Chinese nationality to be similarly selected and appointed from among Chinese legal experts possessing similar training, qualifications and experience.

The names and the amount and conditions of payment of the salaries of the Legal Counselors will be communicated by the Government of China to the Government of the United States. Their terms of service will be governed by contracts and they shall remain in office for specified terms unless dismissed for cause duly shown, and shall otherwise receive the consideration and respect due to the dignity of their office.

A Legal Counselor need not permanently reside at the place in which the Special Chamber of the court to which he is assigned is established and there shall be a flexible and practicable system of administration of assignments in order to ensure efficiency in the use of the services of the Legal Counselors.

The Legal Counselors shall serve under the Minister of Justice and shall be deputed by the Ministry of Justice for service during the hearing of cases involving nationals of the United States of America as defendants or accused in the Special Chambers. It shall be the duty of the Legal Counselors in these cases to observe the workings of the Special Chambers. They shall be given access to the files of the proceedings and may present their views in writing to the judges who shall give due consideration to the views thus expressed by the Legal Counselors. Adequate arrangements shall be made for interpreting in order to enable the Legal Counselors to follow and observe the proceedings in court. The Legal Counselors shall forward to the Minister of Justice such reports as they may consider necessary and copies of these reports shall upon request be immediately furnished by the Legal Counselors to the Minister of the United States of America in China.

In addition, the Legal Counselors shall be authorized to receive directly, from any of the interested parties to an action involving nationals of the United States of America, or from their counsel, observations in regard to the administration of justice, the execution of judgments, or the manner of the application of laws, and, at their discretion, shall bring such observations to the notice of the Minister of Justice with a view to ensuring the observance of Chinese laws. Copies of such observations shall likewise be furnished by the Legal Counselors to the Minister of the United States of America in China upon request.

Similarly the Legal Counselors shall be authorized to receive any other observations or complaints including such as may be caused by domiciliary visits, expropriations, requisitions, arrests, bail, detention, imprisonment, and personal status matters, which observations shall be dealt with in like manner. Immediately following any domiciliary visit, search or arrest directly affecting nationals of the United States of America in any judicial district, the local authorities shall notify the Legal Counselor most accessible in point of time.

When nationals of the United States of America, involved as defendants or accused, are tried before the Special Chambers, a foreign Legal Counselor shall be present at the hearings of the cases in both the High and District Courts, and judgment shall be reserved until he has made, within three days after the conclusion of the trial, such observations as he may desire to the judge or judges in chambers. In the event the judge or judges fail to give these observations due consideration, execution of the judgment will be suspended until the observations of the Legal Counselor shall have been considered by the Ministry of Justice which shall take such action as it deems necessary in the interest of justice.

The Chinese Courts referred to in Article II shall not begin to exercise jurisdiction over nationals of the United States of America until the Special Chambers therein provided for have been organized and the Legal Counselors have been appointed and installed in office as provided in this Article.

Article IV: Lawyers and Interpreters

Nationals of the United States of America appearing before Chinese courts shall be entitled to employ duly qualified counsel of Chinese or American or any other foreign nationality, registered as such with the Chinese Government, and such counsel, if of American or other foreign nationality, shall have the same rights and privileges as Chinese lawyers appearing before the court, and shall be subject, in all respects, to the same laws and regulations which govern Chinese lawyers. Such nationals shall also be entitled to employ duly qualified interpreters of whatever nationality.

Hearings shall be in the Chinese language but the court shall take measures to ensure an understanding of the proceedings by all parties and have the assistance of competent interpreters if necessary.

Nationals of the United States of America, parties to a suit or persons authorized by them may, upon payment of the usual official fees, obtain certified copies of the evidence and judgment in such suit, and arrangements will, if necessary and where possible, be made for supplying, on application, and on payment of the appropriate fees, translations of such documents.

In all judicial proceedings in which nationals of the United States of America are summoned to appear as parties or witnesses, and in all court processes directly concerning such nationals, their names will, in order to avoid mistake and misunderstanding, be added in English to the Chinese texts of the summonses, orders, or other court processes.

Article V: Arrests, Imprisonment, Detention and Bail

Except in cases of the actual commission of crimes or offenses, nationals of the United States of America shall not be arrested, detained or imprisoned except upon an order formally issued by a Modern Court of Justice specifically stating the legal grounds on which and the offense for which the action is authorized. In all cases of arrest, nationals of the United States of America shall, within twenty-four hours after arrest exclusive of legal holidays, be brought for preliminary hearing and trial before the nearest Modern Court of Justice to which a Special Chamber is attached. If there is no such Modern Court of Justice which can be reached in that space of time, nationals of the United States of America thus arrested shall be brought, with the least possible delay, before the nearest Modern Court of Justice where they shall be allowed to choose, in accordance with the provisions of Article II of the present Treaty, which court shall take jurisdiction.

Nationals of the United States of America under detention or under sentence of imprisonment for a period of one year or less shall only be detained or imprisoned in modern detention houses or modern prisons or in other premises suitable for their detention or imprisonment, while those under sentence of imprisonment for a term of more than one year shall be imprisoned only in the modern prisons situated at places where Special Chambers are established.

Nationals of the United States of America arrested, detained or imprisoned shall be permitted to communicate with the nearest consular officer of the United States of America or to submit observations to the nearest Legal Counselor, and they shall be afforded all possible facilities to that end. Consular officers of the United States of America or their representatives shall be permitted to visit nationals of the United States of America under arrest, detention or imprisonment at all reasonable times.

If any national of the United States of America charged with and found guilty of an offense, the maximum penalty for which does not exceed imprisonment for six months, makes application before sentence is pronounced for the imposition of a fine instead of imprisonment, the court shall grant such application. In such cases the fine imposed shall not exceed a maximum of one thousand dollars. In like manner if any national of the United States of America charged with and found guilty of any offense, the maximum penalty for which does not exceed imprisonment for one year or a fine, makes application before sentence is pronounced for the imposition of a fine instead of imprisonment, the court shall grant such application. In such cases the fine imposed shall not exceed a maximum of three thousand dollars.

Except in cases of crimes punishable by death or imprisonment for life, immediate release on bail shall, on application, be granted to nationals of the United States of America arrested or detained, unless the court has good reason to believe that the accused may flee from justice after release. The amount of bail shall be reasonably proportionate to the offense alleged. Such facilities for release on bail shall be granted to appellants until the sentence of the final Appellate Court is given.

Nationals of the United States of America shall not be subject to imprisonment for debt. If, however, it is shown that a debtor is taking action which will render execution on his goods in China impossible, or if execution cannot be safeguarded by any other means, he may be detained in the manner provided for such cases by Chinese law, in which case the provisions of the third and fourth paragraphs of this Article shall apply.

Except in such cases as must in accordance with Chinese law be heard in camera, all hearings of cases involving nationals of the United States of America shall be open to the public and all persons interested in the hearings may be present as public spectators.

Article VI: Taxation

Nationals of the United States of America shall be liable for the payment of such non-discriminatory Chinese taxation as may be actually paid by all nationals of China who are liable therefor and as may be authorized under legally enacted and duly promulgated laws, ordinances and regulations of the Central, Provincial and Municipal Governments of China.

Nationals of the United States of America shall be protected against all taxation without legal sanction and against irregular or discriminatory methods of assessing or levying taxation, and such legal taxation as is properly payable by nationals of the United States of America shall be enforced against them by no other process than that of action in the competent Chinese Modern Courts of Justice.

Municipal taxation shall be imposed upon nationals of the United States of America only in accordance with duly authorized municipal regulations sanctioned by the Central or Provincial Governments of China. The proceeds of such municipal taxation shall in general only be expended on relevant purposes within the municipal area in question.

No methods of assessing liability to taxation shall be employed except those prescribed by duly promulgated laws, ordinances and regulations of China. In case of disputed assessment, the party concerned shall be entitled to have the amount of his liability determined by the competent Modern Courts of Justice in accordance with Chinese law.

Tax agreements entered into with nationals of the United States of America in their several capacities as companies, firms, partnerships, or corporations will be duly respected.

Article VII: Arbitration

The Chinese Courts of Justice will recognize and, if necessary, secure the performance of agreements wherever entered into by nationals of the United States of America between one another, or with other foreign nationals, or with nationals of China, for the settlement of civil or commercial controversies by arbitration. The arbitrators selected by the parties in accordance with such agreements may be of any nationality.

The arbitration shall be conducted in accordance with the procedure established in the jurisdiction where the arbitrators meet.

The Chinese Courts of Justice will not entertain any application or claim, the subject matter of which falls within the scope of such an agreement for arbitration, but will enforce awards made in pursuance thereof, unless the award is contrary to public order or good morals or its vitiated on other grounds recognized by the general principles of law as understood in modern jurisprudence.

The above provisions shall apply reciprocally to agreements for arbitration entered into by nationals of China and the enforcement of awards made in pursuance thereof by the United States Courts.

Article VIII: Rights in Immovable Property

All rights in immovable property acquired by nationals of the United States of America shall, subject to the exercise of the right of eminent domain by the Chinese Government, be recognized as valid and remain undisturbed.

The property in China of nationals of the United States of America shall not be expropriated except for reasons of public interest recognized by law as such and only after adequate compensation has been paid.

Any dispute regarding the amount of compensation to be paid shall be determined by reference to the competent administrative organ or Modern Court of Justice at the option of the nationals of the United States of America concerned, in accordance with Chinese law. Where such cases are brought before the Modern Courts of Justice to which Special Chambers are attached, the provisions of the Articles of the present Treaty in regard to Special Chambers and Legal Counselors shall apply.

Article IX: Search of Premises

The public buildings and private residences in China of nationals of the United States of America and their warehouses, business premises, factories, together with accessory articles and properties, shall be respected and shall not be subjected to any requisition, search or inspection; and the books and correspondence relating to their commercial transactions shall not be examined except as specifically provided for in non-discriminatory legislation, legally enacted and duly promulgated. Except where crimes or offenses are actually in the process of being committed, premises occupied by nationals of the United States of America shall only be forcibly entered upon warrants formally issued by Modern Courts of Justice stating the legal grounds on which the action is authorized.

Article X: Military Service and Forced Loans

Nationals of the United States of America in China shall not be subject to any form of military service, or to any tax or levy imposed as substitute for military service, or to military requisitions or contributions of any kind nor shall they be liable or compelled to subscribe, directly or indirectly, to public loans or any other form of forced levy. Reciprocally, nationals of China shall enjoy in the United States of America similar exemptions in respect of all the above matters.

Article XI: Shipping

The commercial vessels of the nationals of the United States of America in Chinese ports or territorial waters or rivers shall comply with such non-discriminatory and legally enacted and duly promulgated Chinese regulations as are applicable to all similar vessels. They shall not be subject to any form of commandeering or requisition, nor shall they be compelled to carry Chinese troops or Chinese military supplies. Such vessels will not be inspected, searched, boarded, or subjected to any kind of restraint by Chinese armed military authority except in the case of special emergency and only after due notification to and by arrangement with the captain of the vessel or the officer in charge. They may not be boarded by Chinese police nor may any person be arrested on board any such vessel except upon a warrant formally issued by a Modern Court of Justice specifically stating the legal grounds on which action is authorized. In the absence of such a warrant, Chinese police may only board the vessel in case of special emergency and only after due notification to and by arrangement with the captain of the vessel or the officer in charge. In general the treatment accorded to the commercial vessels of nationals of the United States of America shall be in conformity with that accorded under recognized international practice by maritime nations to vessels of other countries in their ports or territorial waters. The present authority of the Chinese Maritime Customs with respect to the commercial vessels of nationals of the United States of America, including authority to search such vessels for the prevention of fraud or smuggling, shall remain unimpaired.

Article XII: Companies

Companies, firms, partnerships, corporations or philanthropic institutions incorporated or organized in the United States of America or its territorial possessions in accordance with applicable laws and operating in China shall, provided they comply with Chinese laws relating to registration, be entitled to all the rights and privileges enjoyed by nationals of the United States of America under the present Treaty. Such companies, firms, partnerships, corporations or philanthropic institutions and their branches, agencies or representatives shall not be subject to discriminatory treatment, and, as regards national, provincial and municipal taxation, shall only be taxed in proportion to the amount of capital actually employed respectively in China, in the province, or in the municipality, or in respect of profits and revenues which they have actually earned respectively in China, in the province, or in the municipality.

Reciprocally companies, firms, partnerships, corporations or philanthropic institutions incorporated or organized in China in accordance with applicable laws and operating in the United States of America shall enjoy as regards taxation, the right to carry on business and access to the courts, treatment not less favorable than that enjoyed by companies, firms, partnerships, corporations or philanthropic institutions of the most-favored foreign country.

Article XIII: Pending Cases

Cases which have been terminated in the courts of the United States of America in China prior to the coming into force of the present Treaty shall not be reopened and judgments or decisions rendered in such cases shall, if necessary, be executed in any part of China by the Chinese judicial authorities.

Cases pending before the courts of the United States of America in China at the time of the coming into force of the present Treaty shall continue until judgment is pronounced in said courts, the jurisdiction of which shall remain in full force, and the Chinese authorities shall lend any assistance requested by the authorities of the United States of America in this connection. Such cases shall be disposed of and wound up within a period of six months, upon the expiration of which period, all cases still pending shall either be dismissed or turned over for adjudication to the Chinese courts which would otherwise have jurisdiction under the provisions of the present Treaty.

It is understood that after the coming into force of the present Treaty, no action against nationals of the United States of America shall be entertained by the competent Chinese courts in respect of acts which took place prior to that date, for which they were not liable according to the laws of the United States of America, but for which they might be liable according to laws of China.

Article XIV: Rights of Residence and Trade

In those areas in which the United States of America shall have completely surrendered extraterritorial jurisdiction over its nationals in China, the nationals of the United States of America, if they do not already possess such rights under existing treaties, shall be entitled to reside, travel, trade and own property.

Article XV: Personal Status Matters

In matters of personal status the laws of the United States of America shall be applied by the Modern Courts of Justice as regards nationals of the United States of America in China unless the Chinese laws in regard to such matters are substantially the same as the laws of the United States of America or of the countries of Western Europe, in which case the Modern Courts of Justice shall apply Chinese law. In deciding whether Chinese or American laws are applicable in this connection, the Modern Courts of Justice shall consider briefs to be filed with the Courts by the lawyers for the interested parties and by the legal Counselors provided for in Article III of the present Treaty.

When nationals of the United States of America die in China, the local administrative authorities shall at once inform the nearest consular representative of the United States of America, provided, however, that if the latter receives the information of death first, he shall notify the local Chinese authorities accordingly.

In all cases where the consular officers of the United States of America deem such action necessary, they shall be entitled, upon receipt of notice of the deaths of nationals of the United States of America, to take possession of or take steps otherwise to protect and preserve the property of such deceased Americans pending the arrival of a duly authorized representative of the estate or the appointment by the competent court of an administrator. In the exercise of this duty, consular officers of the United States of America shall be given every assistance by the Chinese authorities if such assistance is requested.

The personal effects and objects of value left behind by nationals of the United States of America who die on the high seas, or when passing through China without having there any regular domicile or permanent residence, shall be handed over to or be taken possession of by the nearest consular representative of the United States of America, who shall be entitled and obligated to dispose of the same in accordance with the laws of the United States of America without any interference by the Chinese authorities.

Article XVI: Non-discriminatory Treatment

In all matters for which provision is made in the present Treaty, nationals of the United States of America shall be accorded in China treatment in no way discriminatory as compared with the treatment accorded to the nationals of any other Power or Powers in China, and any exemptions from Chinese jurisdiction which may be accorded by China to the nationals of any other Power or Powers shall likewise be accorded to nationals of the United States of America.

Article XVII: Definition of the Expressions—“Nationals of the United States of America” and “Nationals of China”

The expression “nationals of the United States of America” used in the present Treaty shall be deemed to include both citizens of the United States of America and citizens of its territorial possessions; and likewise the expression “nationals of China” shall be deemed to include both citizens of China and citizens of its territorial possessions.

Article XVIII: Excluded Areas

The provisions of the present Treaty shall not be applicable within a radius of ten miles from the present Custom Houses in the treaty ports of Shanghai, Tientsin, Hankow and Canton.

Article XIX: Provisions of Existing Treaties

Except as superseded or modified by the provisions of the present Treaty, the provisions of existing treaties between the United States of America and China shall remain in force.

Article XX: Duration and Ratification

The present Treaty shall come into force upon the date of the exchange of ratifications and shall thereupon be mutually binding over a period of ten years, at the end of which period the agreement may, in response to the demand of either party made six months prior to the expiration of the period, be revised by negotiation between the parties hereto. Should neither party demand such revision, the Treaty shall continue in force for an additional period of five years, at the expiration of which term and likewise at the expiration of each successive term of five years, the same provision for revision shall apply.

The present Treaty has been drawn up in the English and Chinese languages; but, in the event of there being any differences of interpretation, the sense as expressed in the English text shall prevail.

In faith, whereof, the above-named Plenipotentiaries have signed the present Treaty and affixed, thereto, their seals.

Done at . . . . . , the . . . . . day of . . . . . 1931.

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Sir: With reference to the Treaty which we have signed today in regard to the extraterritorial rights of the United States of America in China, I have the honor to request confirmation of our mutual understanding on the following points:

1. Protection of the Courts: The Chinese courts shall insure to the persons and property of the nationals of the United States of America due protection in accordance with international law and the general practice of nations.

2. Personnel of the Special Chambers: The President of the court to which a Special Chamber is attached shall be concurrently the chief judge of that Special Chamber and the other judges of the Special Chamber, as well as the procurators, shall be legal scholars with a broad knowledge of the general concepts of modern jurisprudence and with practical experience, and their names, ranks, and salaries, shall be made known to the public, and they shall not be removed from office without cause.

3. Legal Counselors: The Legal Counselors shall be engaged and employed by the Chinese Government under contracts specifying in detail the duration and the terms of their service, including in the case of each foreign Legal Counselor total emoluments of not less than (blank) dollars compensation, United States currency, to be paid in quarterly installments, the said quarterly installments to be deposited in such bank or banks as the Legal Counselor concerned may indicate six months ahead of the time when such installments fall due. Among the corps of Legal Counselors selected by the Government of China, there shall be included Legal Counselors of American nationality, and, as far as practicable, a Legal Counselor of American nationality will officiate at the trial of cases involving nationals of the United States of America.

4. Lawyers and Interpreters: Duly qualified American lawyers appearing on behalf of nationals of the United States of America in the Chinese courts shall not be required to have a knowledge of the Chinese language or possess diplomas of Chinese law schools.

5. Arbitration: The Chinese Arbitration Law of January 20, 1930, shall have no application to arbitration agreements of the kind contemplated in Article V of the Treaty.

6. Rights in Immovable Property: All legal Chinese land transfer fees leviable under regular Chinese legislation shall be paid by nationals of the United States of America on account of land transactions effected after the date of the signature of the present Treaty; but no demand will be made by the Chinese authorities for the payment of such transfer fees on the transfer of land to or from nationals of the United States of America prior to the date of the signature of the present Treaty, and rights in immovable property held by nationals of the United States of America shall not be called in question on account of non-payment of such transfer fees in the past. Rights in immovable property in China now held by nationals of the United States of America shall not be questioned unless they are invalidated on legal grounds as a result of a decision rendered by a Modern Court of Justice, but nationals of the United States of America shall comply with the laws of China in regard to such property. In reaching their decision in such cases, the Chinese courts shall take into consideration the treaty provisions, and the laws, customs, and practices in various parts of China which existed at the time when such property rights were acquired. Existing rights of nationals of the United States of America to acquire, hold, and freely dispose and transfer their rights in immovable property in accordance with Chinese laws shall remain unimpaired.

7. Publication of Codes: With a view to enabling nationals of the United States of America to familiarize themselves with Chinese laws and judicial procedure, the Chinese Government agrees to prepare, publish and place on sale, an edition or editions of all Chinese codes and other important laws of China duly promulgated and enforced, together with authorized translations thereof, copies of which shall be communicated to the Government of the United States of America, and future laws shall be similarly published and communicated.

I have the honor to be, etc.

Sir: I have the honor to acknowledge the receipt of your Note referring to the Treaty which we have signed today in regard to the extraterritorial rights of the United States of America in China, in which you request confirmation of our mutual understanding on the following points:

(Seven points to be quoted in full.)

In reply, I have the honor to confirm our mutual understanding of the points as quoted above.

I have the honor to be, etc.

22. Text of the Department’s revised draft of treaty and notes handed to the Chinese Minister by the Chief of the Division of Far Eastern Affairs on April 27, 1931. This draft, amended as oil May 4, was telegraphed in full, except for art. XV, to the Minister in China at Nanking in telegram No. 37, May 8, 1931, 8 p.m. (793.003/676); art. XV was quoted in Department’s telegram No. 33, May 4, 1931, 8 p.m., as well as a redraft of this article (see post, p. 837).