Von Brandt to Prince Kung and the ministers of the Yamên, September 18, 1881

Mr. von Brandt to Prince Kung and the ministers of the Yamên

I have the honor to acknowledge the receipt of your imperial highness and your excellency’s note of July 19, referring to transit-passes outwards and trade in native produce in general, which questious have for some time past formed the subject of my negotiations with the Tsung-li Yamên.

I have placed this note, as well as the proposals handed to me by some of the ministers at the conference held at the Yamên on July 10, before my colleagues, the representatives of the other treaty powers, and I have been authorized by them to make the following statement to your imperial highness and your excellencies.

My colleagues and myself are of opinion that the text of the treaties give to foreigners full liberty to transact every kind of commercial business at the open ports, subject only to such conditions and restrictions as contained in the treaties themselves, or in the rules and regulations agreed upon conjointly since the conclusion of the treaties.

Your imperial highness and your excellencies say in your note of July 10, that such liberty of trade does not exist, because it is nowhere stated in the treaties that goods bought at the port might be sold there or used for manufacturing purposes. But besides that, where permission to trade is granted, such permission must be considered as a general one unless special restrictions are added to it. The rule that native produce carried from the interior to a port may be exempted by payment of the half duty from all inland charges only if bona fide intended for shipment to a foreign port (Chefoo convention of 1876, section III, Art. IV) is in itself sufficient proof that no such obligation to export to a foreign port exists for native produce having paid all inland charges, i. e., having been brought from the interior under payment of them, or having been bought at the port.

The foreign merchant has further not only the right freely to dispose of native produce to foreigners and Chinese alike at the port unless the produce be brought there under transit pass; but he is also entitled to forward it for sale coastwise (see Regulations of October 30, 1861, III, [Mayers, p. 204]) or inland (same Regulations, I, 3), provided he pays in the first instance export duty and coast-trade duty, and in the second one all charges imposed on goods in transitu by the provincial governments.

With regard to native produce being used for manufacturing purposes the French treaty of 1858, Art. VII, the German treaty of 1861, Art. VI, the Belgian treaty of 1869, Art. XI, and the Austro-Hungarian treaty of 1869, Art. VIII, give to the subjects of these powers the right to exercise at the open ports any industry they like, no restriction being attached to this concession, neither with regard to the materials to be used, nor to the disposal of the goods so manufactured.

These are the views held by my colleagues and myself with regard to the trade in native produce, and which we must maintain to express the principles laid down by the treaties and acted upon until lately, when illegal attempts have been made by the Chinese authorities at some of the open ports to put them aside. Under these circumstances my colleagues and myself, while willing and anxious to unite with the Tsung-li Yamên in the discussion and execution of any measures which may be deemed necessary for the protection of the Chinese revenue, or the better and more satisfactory execution of treaty stipulations, do not feel at liberty to enter upon a discussion of those rules and regulations laid down in the treaties which are rightly considered as the basis of the relations between China and foreign powers, and which they have neither the will nor the power to alter or to apply in any other way than explained in this note.

There are, however, two points in your imperial highness and your excellencies’ note of July 19, which my colleagues and myself do not wish to pass under silence, as by doing so your imperial highness and your excellencies might suppose that we agreed with the views expressed in them by the Tsung-li Yamên. The one is the statement that if the right freely to trade in native produce at the port or to subject it to a manufacturing process was contained in the treaties, it would not be necessary to introduce it now as an experiment, or to state expressly in the arrangement under discussion that either of the contracting parties should be at liberty to denounce it; the other, the opinion put forward in the note in question, that it was the duty of the local authorities in certain cases referring to the execution of the treaties to act according to their own views and to the necessities of the case.

With regard to the first point it will be sufficient to draw your imperial highness and your excellencies’ attention to the declaration made by me in my note of November 26, 1880, as well as on other occasions, that the rules contained in sections II and III, and referring more especially to duty-free goods and goods manufactured from native produce were nothing but a reassertion of treaty rights rendered necessary by the persistent efforts of local authorities to ignore them. The denunciation of the arrangement under discussion by one of the contracting parties would therefore have rendered inefficient not those treaty rights, but only such new stipulations as had been embodied in the same arrangement.

With regard to the second point, the independent interpretation of the treaties by the local authorities, your imperial highness and your excellencies will remember that it has been at the express and urgent demand of the Chinese Government that the discussion and settlement of difficulties arising under the treaties has been transferred from the local authorities to the central government and foreign representatives at Peking. Under these circumstances my colleagues and myself have the right to expect that it shall not further be left to the local Chinese authorities to substitute their own individual views for those of the central government, and thereby provoke discussions and conflicts not unlikely seriously to endanger the good relations between China and the treaty powers. My colleagues and myself must insist that in future in all cases referring to the execution of the treaties the provincial authorities shall not any more act upon their own views and responsibility, but upon and under the instructions of the central government.

Having thus laid before your imperial highness and your excellencies the views of my colleagues and myself on the question of trade in native produce, I have the honor to add that your imperial highness and your excellencies, in your note of July 19, have expressed the desire to see the negotiations continued. I shall be most happy to resume the pour parlers on this subject with the Yamên, provided they are carried on with the view of removing the Yamên’s complaints as to the illegal use of transit passes outwards, and’ those of my colleagues and myself with regard to the illegal attempts of local authorities to ignore the stipulations of the treaties referring to the treatment of duty-free foreign imports and native produce and the use or exportation of goods bought or manufactured in the port.

I avail. &c.,