The Minister in China (Johnson) to the Acting Secretary of State
[Received June 21—1:50 a.m.]
543. Senior Consul at Shanghai requested by [requests?] Senior Minister to obtain support of Diplomatic Body for Consular Body protest filed with Commissioner of Customs against Shanghai Customs Notification number 1294, April 24, 1933, to the effect that “invoices and contracts will be regarded as evidence of value but not necessarily as exclusive evidence and in this respect their interpretation will rest with the Customs.” Notification then proposes to list means available to customs for determining duty paying value of goods including “the inspection of firm’s books.” Notice concludes “in the case of duty paid goods already imported the customs retain the right to examine firm’s books.”
Senior Consul protesting to Commissioner of Customs [that he?] may not employ any means of determining the duty paying value of goods in case by [of?] firms enjoying extraterritorial status which conflict or are inconsistent with extraterritorial rights and in particular that the inspection of such firm’s books cannot be enforced without an order from their respective national courts issued after due process of law.
I am not certain that protest on extraterritorial basis is well founded in view of our treaty abandoning tariff. In any case customs are in a position to enforce order. Department’s instructions are requested.