The Secretary of State to the Ambassador in China (Gauss)
1203. In making the inquiry referred to in your 1513, September 6, 1 p.m., Department had in mind such matters as the financial obligations of the municipal councils at Shanghai and Amoy, municipal loans and debentures, the various contractual obligations which these councils have assumed vis-à-vis American and other foreign companies, etc. American interests concerned have been somewhat apprehensive that the Chinese Government might unduly delay assuming the financial obligations of the councils following the conclusion of hostilities and that the Chinese Government might not see fit to recognize such contractual obligations as exist, for instance, between the Shanghai Municipal Council and the Shanghai Power Company. Department feels that it would be highly desirable for the Chinese Government to make the provisions called for in Articles II and III well in advance in order that there might be no delay in transferring the Legation Quarter and the two Settlements to the Chinese when the Japanese are driven from those areas.