Prince Kung to S. Wells Williams , United States Charge d’affaires ad interim, January 7, 1868

Prince Kung to Mr. Williams.

Prince Kung, chief secretary for foreign affairs, herewith makes a communication respecting the mode of action in cases of confiscation by the customs, according to the rules already jointly agreed upon (August 12, 1864) and now in operation at each port:

It appears by these that whenever the intendant, or collector of the port, and the consul differ in their depision, rule IV provides that the merchant shall give a bond for a certain sum to pay the duty, and that when the goods on board ship shall be delivered to him, when the superior officers have examined into the case and decided whether the goods are to released or the penalty forfeited, the case is then to be referred back and acted on. In this way it was expected that neither the duties would be lessened nor the facilities of trade be impeded.

But in the collection of duties by the customs, there have arisen many doubtful points growing out of the discrepancies existing between the meaning of the Chinese and foreign texts of the regulations, and also of the great variety of articles of commerce, some coarse and others fine, which are continually brought into the country, and which cannot be easily compared with those previously brought and reduced to a uniform standard. In these cases it is constantly happening that while the collector thinks the article ought to pay a duty, the consul thinks it ought to come in free, and it is almost impossible to prevent their arguing and disagreeing thereon. The collector at a port, being only a subordinate official himself, cannot presume to violate the regulations which are given him, and therefore feels himself obliged to levy the duty, at least until both of them have referred the matter to their superiors and received a decision to be followed by each. But when this reference has been made, if the superior officers decide that duty need not be levied on the article, then the merchant every time asks for compensation, and to be reimbursed for both cost and profit on the articles. Thus it happens that the collector, in his endeavors to act right according to the rules, involves himself in loss and injury, and nobody is benefited.

Seeing, therefore, that difficulties occur on both hands, the Foreign Office have, after much careful deliberation, come to the following decision:

Whenever, in the collection of duties, it happens that the collector and consul cannot agree as to whether an article is dutiable or free, they shall act in accordance with the provisions of rule IV of the confiscation rules; but meanwhile they shall require a bond from the merchant for the estimated cost of the goods, pledging himself to comply with the decision and clear his bond, to which the consul shall affix his seal and then deposit the bond in the hands of the collector, who shall meanwhile release the goods to their owners without receiving any duty, and the case has immediately to be fully reported by both parties to their superiors for decision. If it be decided by them that the article is not dutiable, then the collector shall transmit the bond in his hands to the consul to be nullified, without any further discussion or excuse. But if the decision be that it ought to pay duty, then the consul shall require the merchant who owns the goods to pay the duty and clear them at the customs. By this course of procedure, though the duty would be collected a little later in case it was decided that the article was dutiable, still the incomes of the customs would not suffer any loss; while, if it was decided otherwise, the merchant would not have been kept out of the use of his money; and thus the interests of trade would on both hands be materially benefited and accommodated.

This proposal is therefore now made known to your excellency, with the request that you will inform the United States consuls at the various ports that this mode of procedure in cases of dispute about duty has in future the force of law at each port, and enjoins upon them its observance, making known to me, however, your action upon the matter.