893.6363 Manchuria/20: Telegram
The Ambassador in Japan (Grew) to the Secretary of State
Tokyo, July 3, 1934—6
p.m.
[Received July 3—3:35 p.m.]
[Received July 3—3:35 p.m.]
142. Reference Peiping’s 2863 and previous regarding oil monopoly in Manchuria.
- 1.
- The British Ambassador called on the Minister for Foreign Affairs
on July 2 and left with him an informal aide-mémoire of which the following is a summary:
- (a)
- The British Government has been informed that the Manchurian authorities contemplate the establishment of a petroleum producing, refining, and selling monopoly.
- (b)
- Legislation has been enacted establishing the Manchuria Petroleum Company and it is reported that further legislation will be enacted giving that company a monopoly of petroleum refining as [Page 714] well as withdrawing the business of selling petroleum products from the sphere of free competition.
- (c)
- According to reports, shares of the Manchuria Petroleum Company will be held exclusively by the Monopoly Bureau and Japanese companies, including the South Manchuria Railway, and the company’s refinery will be in the Kwantung leased territory.
- (d)
- The aide-mémoire then proceeds to inquire whether the Japanese Government can confirm the above and states the position of the British Government as outlined in the second sentence of section 1 of Peiping’s 286, invoking article III of the Nine-Power Treaty.
- (e)
- Furthermore, the British Consul General at Mukden has been instructed to state to the Manchurian authorities that a monopoly would be contrary to provisions of the United States-China treaty of 18444 and the Franco-China treaty of 1858,5 thereby disregarding international obligations which the Manchurian authorities have undertaken to respect.
- (f)
- The British Government trusts that the Japanese Government will discourage Japan[ese] capital from participation in monopolistic projects in Manchuria and that it will be able to dissuade the Manchurian authorities from proceeding with measures likely to result in violation of the open door principle. (End of summary of aide-mémoire).
- 2.
- The British Embassy in Tokyo considers this to be an important test case of the open door principle in Manchuria. I concur.
- 3.
- It is to be noted that the British appear to have modified their opinion as to the applicability of the United States-China treaty of 1844 and the Franco-China treaty of 1858 and have therefore specifically invoked them through the Consul General at Mukden.
- 4.
- While it is true, and to my British colleague advisable, to avoid the appearance of an identic démarche in this matter I believe it desirable that our own representations here should be made before the Japanese Government shall have formulated its reply to the British aide-mémoire. Urgent instructions are therefore requested.
Repeated to Peiping.
Grew