893.5211/29
The Secretary of State to the Minister in China (Johnson)
Sir: The Department has received your despatch No. 729 of January 14, 1931, and its enclosures,4 on the subject of consular procedure in China in regard to the issuance of title deeds in that country. The Department notes the statement contained in your despatch that the issuance of consular title deeds in the name of American citizens where the property is actually owned by Chinese is a practice almost entirely confined to Shanghai.
Your despatch No. 729 also referred to a demand recently made by the Land Bureau of the Municipality of Greater Shanghai that foreign renters of land situated outside the Settlement areas furnish a statement through the consular office concerned with regard to the actual ownership of the land and with regard to the owner’s intentions in respect to its development. In that connection you enclosed a copy of your communication of December 20, 1930, to the Consul General at Shanghai, in which you instructed that he satisfy himself in each instance of the existence of a bona fide American interest. You further instructed the Consul General that the demand of the Chinese Land Bureau for a statement from foreign lessees of land situated outside the Settlement areas, in respect to the purpose for which the land had been acquired and the developments to be made thereon, could not be objected to when the land is located in the interior, since by treaty the ownership of such land is limited to American missionary societies to be used by them for missionary purposes. With regard to land situated in the port of Shanghai, whether within or without the Settlement areas, you instructed the Consul General that you did not feel that the Chinese authorities could properly insist upon a statement being given other than a general assurance that the land is being acquired for purposes specified in the treaties. In your communication to the Consul General you also referred to the possibility that the Chinese authorities might soon extend the requirement of proof of foreign ownership to land located inside the Settlement areas. You observed that the present system, whereby title [Page 1030] deeds are issued to non-beneficial owners, is both unsound and unsatisfactory and one which eventually should be abolished. You therefore suggested to the Consul General that he consult his interested colleagues with a view to the discontinuance of that practice of land holding in the Settlement areas, at least with regard to new purchases of land. You added that this question was being referred to the Department for instructions.
The Department has carefully considered your despatch and its enclosures and perceives no reason why a general instruction on this subject, as foreshadowed in its instruction No. 1350 of September 16, 1929,6 should not now be issued. You are accordingly requested to instruct the American consular officers in China, except the Consul General at Shanghai, to take no further steps looking toward the issuance of a title deed to property in China in the name of an American citizen unless satisfied that there is a substantial American interest in the property.
With regard to the procedure at Shanghai, you are informed that the Department approves your communication of December 20, 1930, to the Consul General at that port. With respect to the extension of the principle stated in the preceding paragraph to land situated in the International Settlement and the French Concession at Shanghai, the Department considers that it would be desirable for a uniform practice to be established by all the powers concerned. Before issuing any further instructions on this point, the Department will therefore await a report from the Legation setting forth the result of the Consul General’s negotiations with his interested colleagues on this subject and the Legation’s recommendations in the premises.
Very truly yours,