The Ambassador in China (Johnson) to the Secretary of State
[Received 11:50 a.m.]
139. 1. In a despatch dated February 15, the American Consulate General at Canton reported that the interested Consuls were considering whether the collection of the conservancy tax from foreign imports and native exports imposed by customs notification of February 2 was contrary to existing treaty provisions and that the Japanese Consul General was inclined to think that the tax contravened the principle of uniformity of customs duties as prescribed in article VI of the Washington Conference Treaty relating to the Chinese customs tariff.56 The Japanese Consul General felt that imposition of the tax without the prior consent of the Japanese Legation contravened article I of [Page 651] the Sino-Japanese agreement signed at Nanking May 6, 1930,57 since conservancy surtaxes are not listed in that article among matters to be regulated exclusively by Chinese law and therefore remain in the category of taxes which can be collected from Japanese only after mutual agreement. Canton telegraphed later that the Japanese Consul General on February 18 under instructions from Tokyo filed protest with the Commissioner of Customs.
2. The British Embassy takes the position that the Anglo-Chinese tariff treaty of December 20, 1928,58 granting tariff autonomy to China deprived Great Britain of any right to interfere with customs surtaxes at individual ports or with the harbor improvement and other projects which they support.
3. I am inclined to think that the tariff relations treaty of 192859 placed the United States in a similar position and that prior consultation in regard to customs surtaxes for conservancy and other purposes and conversations in regard to the conduct of such enterprises can no longer be insisted upon as a treaty right although protests can still be filed by the Embassy on ground of equity or expediency. The unrestricted right to impose surtaxes gives the Chinese authorities a powerful means of favoring one port at the expense of another. The principle of uniformity of import levies at land and maritime frontiers seems to me to have at least potentially a very important bearing on immunity of American imports from discriminatory treatment but I question whether the later tariff relations treaty of 1928 did not deprive the United States of the right to appeal to article VI or any other provision of the customs treaty of 1922. I should appreciate the Department’s instruction on the position to be taken hereafter in regard to conservancy and other customs surtaxes in the light of all these circumstances.
4. Sent to the Department; by mail to Peiping.