711.932/3–2145: Telegram

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

502. Embassy is instructed to present to the Chinese Government as a basis for negotiation, the draft treaty of friendship, commerce and navigation (Reurtel no. 470, March 21) after the following changes have been made in the draft treaty:

In Article II, paragraph 2 (page 3, line 18) delete the word “professional”. In the same paragraph (page 3, line 22) insert after the semicolon following the word “authorities” (page 3, line 22) the words “to engage in every profession not reserved exclusively to nationals of the country”, these inserted words to be followed by a semicolon.

In Article IV, paragraph 1 (page 8, line 2) for the word “within” substitute the word “throughout”.

In Article VI, paragraph 1 (page 11, line 10) for the words “enforced by”, substitute the word “of”.

In Article VI, paragraph 4 (page 13, line 8) for the word “however”, substitute the word “moreover”.

In Article VII (page 14, line 14) for “enforced by” substitute the word “of”.

In Article VIII, paragraph 4 (page 18, line 7) for the words “of his domicile”, substitute the words “where he was domiciled at the time of his death”.

In Article XII, paragraph 2 (page 24, line 20) for the word “within” substitute the word “throughout”.

In Article XVI, paragraph 1 (page 30, line 16) capitalize “G” in word “government”.

In Article XVII, paragraph 3 (page 34, line 12) after the word “imposed” insert the words “upon them”.

In Article XIX, paragraph 3 (page 39, line 23) delete comma after word “accord”, and in the following line (page 39, line 24) insert a comma after the word “Party”.

In Article XXIV, paragraph 1 (page 46, line 14) for the phrase “with respect of” substitute the phrase “with respect to”.

In Article XXV (page 48, line 21) after the words “except as” insert the words “may hereafter be”, and two lines below (page 48, line 23) delete the words “in the Convention signed . . . . . . .”. In the same Article (page 48, lines 26 and 27) delete the words “either under bond or”, and after the word “custody” delete the comma and insert the words “wehther or not under bond” followed by a semicolon before the word “but” in line 27.

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In the same Article (page 49, line 1) insert after the word “charges” the words “if such requirements for entry and retention in customs custody are complied with and”.

In Article XXIX, paragraph 1 (page 55, line 2) after the word “supersede” insert the words “provisions of”. In the same line delete the words “and other agreements”. In the same paragraph (page 55, line 4) after the word “China” and before the colon insert the words “in so far as such provisions have not previously been terminated”.

Embassy is instructed to present to the Chinese Government, at the same time with the draft treaty, the memorandum for use in negotiating the treaty, after the following changes have been made in that memorandum:

In the comment on Article II, paragraph 2 of the draft treaty, insert in the memorandum a new paragraph to follow the one ending with the word “manufacturing” (page 3, line 7) and to read as follows:

“It is intended that the provision in the present draft treaty as to engaging ‘in every profession not reserved exclusively to nationals of the country’ shall preclude discriminations against aliens as compared with nationals, short of full exclusion of the former from engaging in any particular profession. In relation to other types of activities in which it is proposed to permit aliens to engage, the part of the paragraph in which there is a reference to the ‘exercise’ of rights and privileges ‘in conformity with the applicable laws and regulations … upon the same terms as nationals’ would not give to either party a right to impose, upon the nationals of the other, restrictions which were not equally applicable to its own nationals.”

In the comment on Article XII, paragraph 2, add to the paragraph which ends on page 17, line 26, the following sentences: “Illustrative enumeration, in the final sentence of the paragraph, of means by which information might be conveyed is not intended to be limitative or exhaustive. Other means, e. g. recordings, would be included.”

In the comment on Article XVIII, paragraph 1, insert a paragraph to follow the paragraph which ends with the parenthesis on page 26, line 27, to read as follows:

“Under the Twenty-first Amendment to the Constitution of the United States, broad powers have been granted to the several states of the Union for the purpose of regulating the trade in intoxicating liquors. While the Department of State is unaware of any actual cases in which a state of the Union has enacted legislation discriminating against intoxicating liquors imported from China or any other foreign country as such, certain states have enacted legislation imposing differential taxes or other special requirements applicable to distilled spirits, the product of areas, including other states of the Union, beyond the borders of the enacting states. It is possible that such legislation would be upheld by the courts as valid under the [Page 1313] Twenty-first Amendment to the Constitution. With regard to this matter the provisions of the treaty are not intended to preclude such discriminatory treatment with respect to intoxicating liquors on the part of the states, terriories and possessions as may be permited under the Twenty-first Amendment.”

Embassy is requested to inform the Department by telegraph when the draft treaty and explanatory memorandum, as revised in accordance with the present instruction, have been presented to the Chinese.

For the Embassy’s information in case the question should arise in the negotiations, the Department intends that the words “to engage in every profession not reserved exclusively to nationals of the country” in Article II, paragraph 2, shall have, in relation to treaties of either of the parties with any third state or states, and in relation to internal laws and regulations, the same effect as a most-favored-nation provision.

Reurtel no. 366 of March 5, it may also be pointed out, in case the question should arise in the negotiations, that in a number of commercial treaties of the United States, e. g. that signed with Germany in 1923, there have been provisions which appear to give aliens national treatment with respect to professional work. Other commercial treaties of this country have given the right on a qualified basis, and still others contain no mention of professional work. In the absence of judicial decisions on the point of whether provisions of any of these treaties confer the right to engage in professional activity despite state legislation to the contrary (such as now exists in a number of states of the Union) the Department prefers not to make a commitment on the point. As to other provisions in Article II, paragraph 2 of the treaty, it is the Department’s view that the part of the paragraph in which there is a mention of the “exercise” of rights and privileges “in conformity with the applicable laws and regulations … upon the same terms as nationals” would not reserve to either party a right to impose, upon the nationals of the other, restrictions which were not equally applicable to its own nationals. On the point that the treaty provisions would override state laws in the event of a clear conflict, reference may be made in case of inquiry by the Chinese, to Article VI, paragraph 2 of the United States Constitution, to the Supreme Court’s decision in Asakura V. Seattle, 265 U. S. 332 (1924), and to Hackworth’s Digest of International Law, volume V, pages 174, 195–196.

Grew