693.002/1111: Telegram

The Consul General at Shanghai ( Lockhart ) to the Secretary of State

1074. My 843, July 12, 11 a.m.55

Inspector General of Customs has now informed me in writing that the situation vis-à-vis the expenses of the Inspectorate General has become critical inasmuch as he has no assets to meet salaries and [Page 808] liabilities for August, and that in such circumstances he does not feel that he will be able to maintain the integrity of the customs service; that the Inspectorate’s funds having now become exhausted it will necessarily cease to function in occupied China or alternatively it will be necessary to arrange a modus vivendi with the Japanese authorities on the basis of the appointment of a commissioner of Japanese nationality in Shanghai. The Inspector General points out that the interested powers have repeatedly declared their respective reasons for the maintenance of the integrity of the Chinese Maritime Customs Administration and the uninterrupted service of the Lighthouse Department and that he is of the opinion that should the protest which has been lodged at Tokyo prove ineffective it would not be in reason for the powers to expect the Inspector General to appoint a Japanese Commissioner at Shanghai without first receiving the declared approval and assurance of support of the interested powers, i. e., Great Britain and the United States. The Inspector General added that he noted that the American Government has not hitherto concerned itself with customs personnel matters, but I emphasized that the proposed appointment of a Japanese Commissioner at Shanghai is not altogether a normal service appointment and that such an appointment might be received unfavorably by the Chungking Government.
I had previously informed Sir Frederick of the fact that Ambassador Grew had made representations to the Japanese authorities at Tokyo and that no indication of the attitude of the Japanese in the matter had been received. Tokyo’s 1117, July 29, 5 p.m. to the Department is that, for the reason stated in the telegram, no mention was made of the appointment of a Japanese Commissioner and separate representations were made. I did not inform Sir Frederick of this fact.
The appointment of a Japanese Commissioner at Shanghai would unquestionably not be well received in non-Axis business circles here and would probably result in the strengthening of the Japanese position in the Maritime Customs but, inasmuch as the American Government as a principle has long maintained an attitude of noninterference in customs personnel, I doubt the advisability of interfering in the present matter or in the proposed measures which has already been taken by the Embassy in Tokyo. It is possible, however, that it would be opportune to renew representations at Tokyo with emphasis being laid upon the question of the undesirability of taking any action which would impair in any way the smooth functioning of the Maritime Customs.

Sent to the Department.

Repeated to Chungking, Peiping. Code text by air mail to Tokyo.

  1. Not printed.