Angell to By the President: Wm. M. Evarts, November 16, 1880

No. 131. Mr. Angell to Mr. Evarts.

Sir: In my No. 41 to you, dated November 1, 1880, I furnished such information as I had then been able to gain, in answer to the inquiry whether the Chinese Government discriminates against us in tonnage dues and duties on imports. I was able to report that there was no discrimination against us in the dues and duties collected by the so-called foreign customs, unless possibly there was an exception in the case of Chinese steamers bringing government rice from the Yangtsze ports to Tientsin, but that full and exact information concerning the treatment of junks, was not then at hand. A circular to our consuls and a note to Prince Kung, designed to bring out the facts in respect to junks, were transmitted to you as inclosures in No. 41.

I have now the pleasure of inclosing Prince Kung’s reply to my inquiry, and also the replies which the consul-general, and the consuls at Foochow, Chinkiang, Hankow, and Newchwang have sent to the circular.

The prince replies in substance that foreigners and Chinese transporting goods in Chinese craft are treated alike and that the duties they pay are just what is paid on goods of a foreign merchant unprotected by a customs certificate; that is, on goods imported and then sent inland without a transit pass; and further that the tonnage dues paid by Chinese craft are the same as those paid by foreign vessels, that they are paid at every customs station by the Chinese vessels, and that the rate is the same whether the vessels are under foreign or Chinese charter.

So far as this is a declaration of the law, it may be taken as satisfactory. But the testimony of some of our consuls and of intelligent persons, with whom I have conversed on the subject, compels the belief that the law is not taken as the strict guide of the officials of the so-called Chinese customs, who collect the dues and duties from Chinese junks.

The answers of Consul-General Denny, Consul Wingate, and Consul Shepard are clear on this point. There can be no doubt that in many cases the Chinese customs officers, without regard to the law, collect by “squeezes” what they can in payment of dues and duties. Whether this mode of collection results in an advantage or a disadvantage to the native vessels as compared with foreign, is a point on which men equally well qualified to judge differ. Probably in some cases it works one way and in others in a different way. When the official can safely “squeeze” the native trader or vessel into the payment of higher charges than are exacted from the foreigner by the foreign customs, he does not neglect the opportunity; but when the competition of foreign vessels with the native is close, he may accept something less than the foreigner pays, in order to prevent commerce from turning too largely to the vessels which report to the foreign customs. Consul Shepard, of Hankow, while acknowledging the difficulty of obtaining exact information, is of opinion that the native vessels in his district have an advantage over foreign vessels. Consul Wingate, of Foochow, believes that at that port the native vessels pay heavier dues than the foreign, pay heavier duties on the exportation of poles (a large traffic at Foochow), and are forbidden to export certain articles to foreign countries. The only advantage which he concedes to them is that of visiting the non-treaty ports. It will be remembered too that the junks are required by law to pay tonnage dues at every port which they enter, and do probably pay whatever is “squeezed” from them at every port, while the foreign vessels engaged in coastwise trade pay only once in four months, though they may enter several ports in that time. I suppose that Consul-General Denny’s remark is substantially correct that at the present time the trade carried on by the junks “is of a purely native character between coast and inland ports and does not materially affect the interest of foreigners.” Still, the time has been when our vessels did a good deal of the inland and coastwise transportation and that time may come again.

I have received from Mr. Robert Hart, inspector-general of the foreign customs, a reply to my verbal inquiry, whether exemption from duty on the part of the, cargo of the Chinese merchants’ steamers, which bring government rice from the Yangtsze ports to Tientsin, is still continued. I inclose a copy. He answers in the affirmative and argues to show that the exemption practically works no discrimination against foreign vessels. Probably it is intended as a sort of subsidy, and if it were abolished, the subsidy would be continued in some form. A direct subsidy we could not regard as a discrimination against us, but I must regard a subsidy in this form as a discrimination in respect to coastwise duties. But it is the only discrimination recognized in the foreign customs, and does not in fact prevent competing lines of foreign steamers from plying between Shanghai and Tientsin.

I conceive that any remedy for the irregularities in the methods of administering the Chinese customs must be found in measures tending to place them under the direct charge of the Imperial Government. If such measures were adopted, the foreign powers might then under proper treaty stipulations hold them responsible for any maladministration which should work injury to foreign interests.

The bearing of the facts above recited and of the conclusion drawn, upon the negotiations of the commissioners plenipotentiary concerning commercial intercourse will readily be perceived.

Trusting that the information I have been able to gather, though necessarily less exact in relation to Chinese junks than could be desired, may suffice for the present purposes of the Department.

I have, &c.,

Prince Kung to Mr. Angell.

Referring to the arrival of the China Merchants’ Steam Navigation Company’s steamship Hochung at San Francisco, your excellency, some time since, addressed certain inquiries to this office to ascertain whether the duties and tonnage dues levied on American goods and vessels differed in any way from those levied on Chinese goods and vessels or those of any other nation, and, it will be remembered, that this office explained in reply that no discrimination whatever was made by the foreign customs in levying duties and tonnage dues on the goods and vessels of all nationalities alike.

Later another dispatch was received from your excellency, inquiring further, whether the duties and tonnage dues levied by the Chinese customs on vessels, or on foreign goods imported, native produce exported, or foreign and native goods carried coastwise, differed in any respect from the duties and tonnage dues levied by the foreign customs.

In reply, I have the honor to state that foreign goods imported, native produce exported, or foreign and native goods carried coastwise, when transported in Chinese craft sailing under foreign flag pay duties at the foreign customs; when transported in Chinese craft proper they pay duties at every customs station, and lekin barrier just like the goods of a foreign merchant when unprotected by customs certificate.

As regards tonnage dues, the ch’uan liao (tonnage dues) levied on Chinese craft is the ch’uan ch’ao (tonnage dues) paid by foreign vessels, and this is paid by the former at every customs station (Chinese) according to the regulation of the station, and the rate paid is the same whether the craft be under foreign or native charter.