893.50/338: Airgram

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

A–48. Department’s telegram No. 1164, August 21, and Embassy’s telegram No. 1607, August 31.28 Dr. Kung’s proposal in question was approved by the Executive Yuan in early August and was referred to the Ministries of Finance, Communications and Economic Affairs for the drafting of appropriate regulations. An informed Chinese official states that the purpose of the proposal is to allay any fears foreign investors of capital and technical personnel may have regarding [Page 865] their status as a result of the abolition of extraterritoriality. The Legislative Yuan is reported to have appointed a special committee to study legislation to be adopted in order to carry out Kung’s proposal.

In this connection, the Ministry of Economic Affairs is said to have submitted recently to the Legislative Yuan the draft of a new patent law under which registration of patents by aliens is to be effected. According to informed opinion, such new law is not likely to be put into effect until new Sino-foreign commercial treaties are concluded. We are endeavoring to obtain a copy of the draft patent law for forwarding to the Department.

It is reliably reported that Kung will present a similar resolution to the Central Executive Committee at its scheduled meeting beginning September 6. The Chinese official mentioned in the first paragraph states that the resolution will be more detailed than the proposal submitted to the Executive Yuan and that it will probably give some indication of the types of foreign investment desired and the conditions under which such investment will be permitted.

Embassy will expect to report further when additional information is available.

  1. Latter not printed; referring to Department’s telegram No. 1164, it stated: “It is understood that matter is only in preliminary and tentative state at present and that proposal in question has been referred to competent authorities for drafting of appropriate regulations”. (893.50/330)