Isaac F. Shepard to Angell, January 14, 1881

Mr. Shepard to Mr. Angell.

Sir: I have the honor to transmit herewith to your excellency inclosures appertaining to the subject-matter of this dispatch, twelve in number, marked respectively A, B, C, D¹, and D², E, F, G, H¹, and H², I¹, and I², to be referred to in the course of this communication.

Since my response in No. 53, to your inquiries in your No. 4, of October 11, 1880, regarding “tonnage dues,” &c., circumstances of an important nature have transpired here and along the river ports, seriously and injuriously affecting foreign interests, interfering in what has for years been recognized as legitimate commercial enterprise, and as I think warranted, and intended to have been secured by the various treaties. At the expense of some prolixity I feel it incumbent on me to explain the whole matter to your excellency, that such steps as may be wise and called for in the exigency may be undertaken with full intelligence of the facts and their bearings.

In the early months of last year, 1880, Her Britannic Majesty’s consul, Alabasker, discovered what he deemed, and I presume were, irregularities in the dealings of certain of his constituents with native Chinese. The alleged irregularities consisted in selling the name of the British subject to certain natives, to be used by them in securing, under British protection, transit passes for merchandise outward and inward, charters for junks, and all similar privileges guaranteed to foreigners by the treaties. Without commenting on the method of procedure against the parties, both foreign and native, I may say that the matter created a good deal of excitement and resulted in a general suspicion against all foreigners in like business on the part of the native officials, and an interference on their part with lawful and honorable transactions. Formulated complaints were made to me by the Taotai against the American traders here, Messrs. M. A. Jenkins and Wadleigh & Emory. I gave them such candid examination as I could without books or witnesses to substantiate the charges, and found no sufficient, evidence that either honorable principles of trade or treaty privileges had been violated by them, and especially not by Mr. Jenkins, who has been in business here for many years. I refer to the affair, not only to give you an idea of the probable origin of the present wrong, but to introduce to your attention an extract from my No. 357 to the Taotai, of October 14, 1880, in answer to his complaint (made verbally), which will open the whole subject. (See inclosure marked A.)

In facilitating the “chartering of junks “and the shipment of cargo on the river, the method of procedure has been as follows: I required from the charterer to be deposited in the consulate the original charter-party, in Chinese and English, of every junk it was proposed to load. This I required as an equivalent for the “deposit of a ship’s papers.” I then gave a letter to the foreign customs, a form of which is inclosed, marked B. The charterer on presentation of this letter was permitted to ship his freight, and when this was completed he applied to me for a “clearance,” (see inclosure marked C.)

He then obtained from the foreign customs (1) a river pass and arms certificate, (2) a cargo certificate in English and Chinese, (3) a duty-paid receipt and a tonnage-dues receipt on one document, and (4) a bond certificate. With these papers the junk was protected on her entire voyage (usually made from Hankow to Ching-Kiang) and was free from interruption by the various lekin and customs stations passed, except for the examination of the papers. In this respect the chartered junks were on an exact footing with lorchas and steamers doing similar business, as the treaties undoubtedly intended they should be. But if a junk lacked any one of the documents above noted, she was detained at any station where the omission was discovered until she could procure it, and was liable to be turned back to the port of departure. This method has been in unquestioned operation under the “regulations for trade on the Yangtsze” continuously since January 1, 1863, when the foreign customs were first established here.

On the 29th November, 1880, Mr. Jenkins applied to one of the native junk shipping hongs through whom all charter parties are made, to charter a junk, as he had done for years. He was told they could not charter a junk, that the hongs had been summoned before the subprefect, acting under the Taotai, and made to give written assent to a notification read to them, that hereafter the junk owners would be required to pay what is known as “port dues “at the stations along the route, whenever a junk was chartered by a foreigner, and that they would be held responsible for all dues known as “lekin” at all stations passed on all cargo found on board, although it had paid duty according to the foreign tariff at the “foreign customs,” and they would further be liable to punishment for attempting to smuggle.

On the 6th of December, 1880, there was posted on the city walls a “proclamation,” which is inclosed with its translation, marked D¹ and D², and you will notice that it substantially supports the statements of the junk owners, for although the payment of “boat dues” by the owners is specifically mentioned, yet that payment to the native customs takes the vessel out from under the jurisdiction of the foreign customs, makes the vessel purely a native craft, and therefore subjects her cargo to whatever exactions the multiplied lekin stations along her route may choose to impose. Whether such exactions (never determinate) were little or much, or whether the “boat dues” were exorbitant or otherwise at the various stations, the conditions utterly preclude the chartering of a junk by a foreigner, first, because the junk owner can never know what the exactions from him may be on either boat or cargo, and, second, because he is strictly forbidden to allow the foreigner to pay them, either by advancing the price of the charter or by an agreement to refund whatever amount may be paid en route.

On the 8th December Mr. Jenkins was informed by the clerk in charge of the export and clearance desk at the foreign customs that they would not in future receive from him “tonnage dues” on chartered junks, but he must bring to them instead a “port dues “receipt from the native customs; that it would not be considered a customs document to take the place of the tonnage-dues receipt, nor be noted on the papers, as it was not paid to the customs. Mr. Jenkins replied that as a foreigner he could not recognize any but foreign customs in his shipping business, nor be required to hunt of native officials. He asked to see and to have delivered to him a copy of the order, which was refused him, as the order was not in writing nor posted, as all similar notifications have invariably been, but was only a verbal instruction from the commissioner to the clerk, but no junk clearance from the customs would be given him except the native receipt for port dues was produced first.

For some inexplicable reason no notice whatever was communicated to the consul of so important a change either from the foreign customs or from native authorities. I knew of the “proclamation,” and sent my scribe into the street to copy it, whence my transcript of it. After waiting more than two weeks thereafter for official information and receiving none, I wrote my No. 364, of December 19, to the commissioner. (See inclosure E.) The same day I received his reply (marked F) and answered it (inclosure G). To my No. 365 the commissioner made no response, leaving me to the unavoidable inference that no real interference with established custom was contemplated; but I must be allowed to say Mr. White’s response is not the full and candid information I asked for, and the conclusions I drew from it are utterly misleading. While they are warranted by the letter itself, the facts deny them all. Whether it was intended to be sophistical and to evade the facts I wished to have from authority I will not judge, but I wrote my No. 365 expressly to show him the legitimate conclusions from his communication, and to give him the opportunity to correct any erroneous inference. He has never replied, even to acknowledge receipt of my last dispatch, although I know he received it. I will not comment on his silence farther than to observe that in six years’ experience in China it is the first instance in which full information has been withheld from me on any official topic where information was asked for from officials of any nationality.

I regret, if Mr. White has done so, that any foreigner in Chinese service should at all imitate the native character for official prevarication. He certainly knew what the actual as well as the nominal effect was, and what was intended to be compassed by it. The secrecy and silence of the whole movement is suggestive, to say the least. I doubt it Mr. Inspector-General Hart gave it his sanction or co-operation. Soon after the correspondence with the commissioner, the Taotai condescended to give me information of the abrupt change that had been in operation nearly a month. On December 25, 1880, I received his dispatch marked H¹. I do not pretend to explain the long delay. But you will observe that both this communication and the proclamation carefully exclude or suppress the correspondence referred to with the acting British minister in 1877, which does not support their action. Two days later, on the 27th December, I received the Ichang Taotai’s communication, marked I¹, which covers the portion of the correspondence above noted.

If all the treaties do not specify both the rate and the duration of dues for the tonnage of all vessels, the French treaty certainly does, and the twenty-third article of the Prussian treaty most especially so. These have heretofore been inviolate, and I am at a loss to understand why the treaties should define rates and the Yangtsze rules prescribe different ones for a certain class of vessels. May it not be that the phraseology of the sixth rule, viz,” Will pay port dues according to Chinese tariff,” refers to the different method of measuring employed for the native junks? At all events the language does not require payment to be made at native customs, but only at a native rate. The real object of the violent change, however, is to give license to the native officials to make exactions from both vessel and cargo at all stations on the route of traffic.

I respectfully submit the following topics for consideration as entering into the decision of the matter at issue, and ask your excellency’s attention to the whole subject, with a view or securing justice and a proper interpretation of the treaties by which a reversal may be effected of the wrongful and injurious change.

• The treaties give the full right to traffic on the Chinese waters and rivers and between the open ports.
• They guarantee protection to foreigners through the foreign customs for trade in vessels, whether under steam or sail, large or small.
• They make no discrimination to the prejudice of small vessels, whether owned or chartered by foreigners.
• They affix the rates of tonnage dues, and they should be uniform in system.
• A foreigner cannot be compelled to have business with native customs where foreign customs are established.
• Monopolies are strictly prohibited in trade or in vessels.
• Any onerous or peculiar exaction on small or native owned craft under charter to foreigners, acts as a monopoly, as it prohibits competition, and diverts and forces all freights towards steamers, the principal lines being in native hands.
• The assent to the principle that merchandise shipped by foreigners through foreign customs having paid prescribed tariffs may thereafter be subject to lekin in process of a voyage, would be an entering wedge to end in subjecting goods on all kinds of craft to the same exactions.
• The direct result of the last-suggested claim would be to drive all foreign shipping from Chinese waters, and establish such exactions upon merchandise as to render trade in foreign commodities impossible.
• If the “Yangtsze regulations “afford any warrant for the interpretation and action now developed by the “proclamation” they should be at once modified, and made to conform to the treaties in letter and in spirit also.

I have no doubt you will give the matter such earnest and immediate attention as its importance demands. I presume co-operation with other nationalities will be desirable. Shipping goods in chartered junks has long been an important branch of business in American hands at this port, and has been conducted in an honorable and justified way. If others have abused the privileges granted to foreigners it affords no sufficient reason for illegitimate ways of curbing the evil. The treaties provide remedies for such abuses. Probably one-third of the fees received at this consulate are derived from the entrances and clearances of such junks, aggregating about $500 per annum. The action taken totally suppresses revenue from this source, besides being a severe and decisive blow at a legitimate business of American citizens. This is a small matter, however, as compared with the ultimate effect upon general commerce, upon trade privileges, and upon treaty rights. I trust you may be able to obtain a speedy revocation of the obnoxious proceedings, apparently by sanction of the foreign board, but, I cannot doubt, without the knowledge or consent of our own or other legations at Peking.

I am, &c.,