711.932/11–3045
Memorandum by the Assistant Chief of the Division of Commercial Policy (Gay) for General George C. Marshall68
It would seem appropriate at the time of mentioning to Generalissimo Chiang Kai-shek the importance which this Government attaches to early consummation of the proposed commercial treaty that his attention also be called to the importance of providing domestic legislation consistent with and in the spirit of this treaty, that is, which would be conducive to maximum flow of commerce and investments between the two countries. The pending Chinese Company Law is a principal case in point. The original draft thereof was given to the American Embassy last July and as a result of suggestions by our Embassy emanating from American business interests several changes have been made.
The proposed law has just been referred back to the Supreme National Defense Council for reconsideration before promulgation (presumably January 1, 1946) because it was not deemed by certain Chinese officials to be entirely consistent with previously-stated principles of the Council. The principal points still at issue insofar as important American business interests are concerned have been transmitted to our Embassy (1932, December 4, 1945) with the instruction to approach General Chiang Kai-shek on the matter. They feel that failure of the Chinese Government to amend the law in these specified respects, particularly that dealing with the definition of a “foreign company”, might seriously jeopardize the flow of investments into China and the position of some existing American companies in China.
It is suggested therefore that at the time of discussing with the Generalissimo our interest in the treaty reference be made to the desirability for this further modification in the Chinese Company Law.