893.156CH/260: Telegram

The Chargé in China (Peck) to the Secretary of State

185. Department’s 286, November 5, noon,58 regarding Chefoo Harbor Improvement Commission. Note was sent November 9. Note from the Foreign Office, dated March 10, received March 13, first acknowledges receipt of the Embassy’s communications of November 2 and 9 and then quotes the Ministry of Finance as follows:

(Embassy’s translation) “A further communication on this subject has been received from the Inspector General of Customs transmitting a petition from the Commissioner of Customs at Chefoo reporting the circumstances of the taking over.

At the very beginning, that is on September 10, the bogus Chefoo Municipal Office sent a letter demanding the dissolution of the Chefoo Harbor Improvement Commission and the handing over completely to the custody of that office of its functions and properties. The Commission thereupon convened an emergency meeting. Mr. H. Nagaoka, Japanese Consul at Chefoo, attended the meeting on behalf of the consular body in his capacity as Senior Consul, and proposed the immediate dissolution of the Commission and the handing over all activities and properties to the bogus Municipal Office. He also stated that the matter had received the support of the Japanese Navy. The Commandant was thus compelled to take over the property and on the same day the transfer was approved. All deposits in the Bank of Communications were on that day transferred to the bogus Chefoo Municipal Office against a receipt which was placed on file. The money was delivered the next day by the bogus Municipal Office to the Japanese authorities. All other properties are under investigation and an inventory it [is?] being compiled.

As regards the functions of the Commission, they were originally transferred by the bogus Municipal Office through the Japanese naval [Page 821]authorities to the ‘Federated Shipping Bureau’ for handling. They were then taken over by the ‘Chefoo Harbor Office’ which was established on November 10 under the guidance of the Japanese naval authorities.

The harbor taxes formerly levied by the Customs on behalf of the Commission have been collected since the dissolution of the Commission, first, by the ‘Federated Shipping Bureau’, and later by the ‘Chefoo Harbor Office’ through employment of the original persons of the Commission and at the original rates.”

The Foreign Office communication is as follows:

“The Ministry in inditing this third person note has the honor to state that the Chinese Government decidedly can not recognize this illegal change brought about in the organization of the Chefoo Harbor Improvement Commission by Japan and the bogus organ. The American Embassy in China is requested to pay serious attention to the matter and to refuse cooperation. A reply is also requested.”

Unless otherwise instructed I will acknowledge saying the matter has been referred to the Department.

Repeated to Peiping, latter repeat by mail to Tokyo.