The Chargé in China (Robertson) to the Secretary of State
[Received October 20—12:15 a.m.]
1826. On October 11 Embassy received note from Ministry of Foreign Affairs replying to Embassy’s note of May 23, 194545 and conveying Ministry’s comments on aide-mémoire submitted by International Telephone and Telegraph Corporation to Department of State on “post-war telecommunications in and with China”.
In response to expressed hope that Shanghai Telephone, Mackay Radio, Commercial Pacific Cable and China Electric Companies be allowed to continue pre-war activities, Chinese Government states that in view of changed conditions “a justifiable adjustment of prewar activities must be made”. Ministry points out that China’s [Page 1401] policies must be uniform with respect to American and other foreign companies but states it will negotiate with complete sincerity and will seek concrete and mutually advantageous measures for collaboration.
Shanghai Telephone Company: Ministry outlines developments under Japanese occupation in merging Shanghai Telephone Administration of the Ministry of Communications and Shanghai Telephone Company into the General Shanghai Telephone Administration. On September 19, the note states, after the retrocession of these properties from Japanese hands “those telephones of the General Shanghai Telephone Administration located in the former foreign settlements were handed over to the original manager, Mr. Porter, of the Shanghai Telephone Company for temporary operation”. Because the assets, equipment, personnel and accounts of the above telephone companies were mixed together during the war period, the situation in separating them is stated to be extremely complicated. It appears to the Chinese Government that a comprehensive plan for adjustment of the telephone business in Shanghai should be drawn up for which discussions will be held between the Ministry of Communications and the company.
Mackay Radio Company: Through message traffic with China hitherto maintained by this company is regarded generally as satisfactory. The original traffic agreement expired June 26, 1945 and is not binding since that date. A year ago Ministry of Communications notified the company that it proposed readjustment of method of apportioning message charges. Subsequently company has been instructed to maintain traffic for time being while negotiations on the apportionment of charges are carried on. If these negotiations [are] successfully concluded, there is no question that Mackay Radio “will continue to maintain traffic with international radio stations located in various places in China”. As regards the Manila to Chengtu route its restoration may be negotiated at any time.
Commercial Pacific Cable Company: Substance of the section of the Ministry’s note regarding this company was sent in Embtel 1778, October 12, 8 a.m.
Shanghai Electric Company: The China Electric Company’s original contract having already expired is now canceled. The Ministry of Communications is prepared to conduct separate negotiations with the company regarding the form of joint operation to be adopted and to conclude a new contract setting up a new organization in accordance with Chinese law.
Text of Ministry’s note is being forwarded immediately by air mail.46 Please inform Department of Commerce and International Telephone and Telegraph Company.