His Imperial Highness, the Prince of Kung to Von Brandt, September 29, 1881

Foreign office to Mr. von Brandt

On the 19th of September we had the honor to receive your excellency’s dispatch of September 18, by which you informed us that you had submitted our dispatch (of the 19th July) and our proposals (of the 10th July) regarding the treatment of native produce, which for some time past had formed the subject of deliberation between your excellency and our office, to your colleagues, the representatives of the other treaty powers.

What your excellency says in this dispatch, viz, that according to all the treaties foreign merchants have the right to engage in any kind of trade at the open ports, is, however, only a one-sided hypothetical argument. The tenor and meaning of the treaties and special regulations is quite clear and distinct, and it does not therefore seem to be allowable that by problematical assertions of this kind the danger of manifold misunderstandings should be created.

You further state that the freedom of trade is subject to such conditions and restrictions only as are explicitly contained in the treaties or in some special regulations. If, then, restrictions of trade, in order to be binding, must be explicitly stipulated, how, then, in the reversed case, could it be lawful to claim liberties of trade summarily and as a matter of course even without their having been explicitly stipulated? The matter lies rather thus: That neither liberties nor restrictions of trade, inasmuch as they have not been explicitly stated in the treaties, can be simply and positively claimed by way of inference, by the one or the other party, on the ground of one-sided opinions. Far from this. It is rather necessary that an agreement should be arrived at on the ground of mutual deliberations before it is permitted to act accordingly.

If, as your excellency holds, the simple non-existence of a stipulation in the treaties and special regulations, by which some branch of trade is forbidden, were sufficient in order to infer therefrom that merchants are at liberty to engage in it—in this case anything not mentioned in the treaties and special regulations (and there are a great many such things) would just on this account be permitted; yet what would the foreign powers say were China to take up such a position in her relations with them?

If in Section III, Article IV, of the Chefoo convention it is said that if foreign merchants pay the half duty and take out a transit certificate for this purpose they may then transport the goods to the port, but that this privilege cannot be claimed if the native produce in question is not the property of a British merchant, or if it is not really intended for conveyance to a port, this means only that none but native produce purchased by foreign merchants for exportation to foreign countries enjoys the privilege of the transit certificate and of the payment of the half duty; whereas when this is not the case such produce is subject to the regulations existing for the interior of China; but it follows by no means therefrom that native produce purchased at the port for which no transit certificate has been taken out need not be exported.

The third section and the third paragraph of the first section of the (in Chinese so-called) “General Regulations” (of October 30,1861) further relate to the treatment at the custom-house of merchandise which has arrived from another port, of a manufacturing process, and of a sale of goods which have not been exported at the port of purchase the “General Regulations” do not say anything expressly at all, and it is therefore not admissible to ascribe such a meaning to them.

Your excellency further appeals to Art. VII of the French, Art. VI of the German, Art. XI of the Belgian, and Art. VIII of the Austrian and Hungarian treaties in order to prove that subjects of the above-named countries are “at liberty to engage in industrial enterprises at the open ports;” but this expression relates merely to the execution of sundry labors in general, and means that Chinese and foreigners are permitted to engage themselves as laborers and workmen, and work; but with the manufacturing of goods it has nothing to do, nor does it signify that goods so manufactured may be sold as a matter of course. Each treaty stipulation, in fact, has its own individual meaning, and the different meanings must not be intermixed with each other.

The treaty stipulations convened with different countries must, of course, on both sides, be conscientiously adhered to, and if, in the proposals under consideration, it is said with regard to native produce bought at the port that they shall be put into force provisionally the reason thereof simply is because the treaties say nothing with regard to this point; that, on the other hand, the local authorities have the right in certain cases to adopt measures according to their own judgment. This is expressly stipulated in the treaties concluded with different countries, and is a point which ought always to be adhered to. So, for instance, with regard to the regulations now in course of deliberation in reference to duty-free goods and to the manufacturing of native produce, it must, of necessity, be stipulated that, if the one party should wish it so, the new agreement shall again be cancelled; for the authority of convening treaty regulations rests in the hands of our Yamên and of the representatives of the treaty powers; but whether something is advantageous or injurious can only be determined after the local authorities have put it during some time into practice.

As regards the treatment of native produce, we do desire as soon as possible to come to an understanding with your excellency and to put the new rules into force, but only under the condition that both parties should profit thereby, in order that what once has been stipulated should also remain in force for a long time.