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is authorized". To do this, the Chinese contend, would be contrary to Chinese law which requires only a statement in the warrant of “the legal grounds on which action is authorized". An unwillingness of the Chinese Government to invalidate or to amend domestic law by treaty would thus appear to be indicated. I am still of opinion that we should contend for wording substantially like that written into the draft of October 28. Our position in this matter would be strengthened if I were informed that Federal practice at home provides for stipulations of this sort in a warrant for search and arrest. [End paraphrase.]

12. "Military service, forced loans, et cetera. British subjects in China shall not be subjected to any form of military service or to any tax or levy imposed as a substitute for military service or to military requisitions or contributions of any kind, nor shall they be compelled to subscribe, directly or indirectly, to any public loan or to any other form of forced levy".

13. "Treatment of companies. Subject to reciprocity of treatment for Chinese companies, et cetera, in Great Britain, companies, firms, syndicates, and corporations incorporated or organized in accordance with the laws of His Britannic Majesty and operating in China shall, provided they complied with provisions of Chinese law, be entitled (then continue as in rest of article 11 of British draft)."

[Paraphrase.] Comment: The above, I am informed, represents an agreed version in principle, with alterations of phraseology possible, as stated previously. The idea underlying it is that foreign companies in China, having no right unless registered in accordance with Chinese law, are not juristic. I am not acquainted with United States practice regarding the subject of juristic capacities of foreign firms before American courts, but I am told that practices do differ in the several States. [End paraphrase.]

2. [14] "Pending cases. Cases terminated in the British courts in China before the coming into force of this treaty shall not be reopened and all final judgments or decisions rendered in such cases shall be executed in any part of China by the Chinese judicial authorities. Cases pending before the British courts in China at the time of the coming into force of this treaty shall continue until judgment is pronounced in the said courts, the jurisdiction of which shall remain in full force for this purpose; and the Chinese authorities undertake to lend any assistance requested by the British authorities in this connection. All such pending cases shall be finally disposed of and wound up within a period of 6 months from the date of the coming into force of this treaty, upon the expiration of which period any cases still pending shall be dismissed or turned over to the Chinese courts for adjudication. It is understood that after the coming into force of the present treaty no actions against British subjects will be entertained by the competent Chinese courts in respect

of acts of [sic] which took place prior to that date for which they were not liable according to British law but for which they might be liable according to Chinese law."

[Paraphrase.] Comment: It will be noted by the Department that this text sets a time limit for the disposal of all pending cases and that there has been added a final sentence to prevent retroactive proceedings against foreigners. [End paraphrase.]

15. "Nondiscriminatory treatment. Subject to reciprocity of treatment for Chinese citizens in Great Britain, in all matters for which this treaty provides British subjects shall enjoy all exemptions from Chinese jurisdiction which may be enjoyed by the nationals of any other country and shall be subjected to no discriminatory treatment in regard to taxation, judicial, or any other matters for which this treaty provides, as compared with (nationals of China or) the nationals of any other country."

[Paraphrase.] Comment: I understand that C. T. Wang will accept the foregoing provided the bracketed words "nationals of China or" are deleted. Apparently the Chinese Government does not desire to give foreigners national treatment in these matters. [End paraphrase.]

16. "British protected persons. Article 16 of the British draft on this subject was acceptable to the Minister for Foreign Affairs".

17. [Paraphrase.] It will be noted from the above that Lampson has succeeded in making considerable progress in the matter of legal guarantees. The British Minister has informed C. T. Wang that the Chinese attitude regarding these matters will go a long way to determine the British attitude respecting the main principles. Lampson expects us to stand upon open ground if and when there is a satisfactory ironing out of these questions of legal guarantees and that the main fight will concern the reservation of jurisdiction in criminal cases and the reserved areas. Confidentially, he does not agree with his Government regarding the giving up of everything save the reservation of jurisdiction in the Shanghai International Settlement, and I think he has informed his Government to this effect. Lampson favors sticking to what we seem to be ready to stand for, and he agrees with me that if jurisdiction cannot be retained within the entire area of Shanghai (meaning greater Shanghai) there would be little value to retain part. May I have the Department's comments regarding the above-quoted texts to be used at my discretion when I discuss procedure with Lampson upon his return on March 23 to Nanking. Teichman will return here on March 18 or 19 to resume his discussions with Hsu Mo of the remaining legal guarantees. I shall try to keep the Department promptly informed. [End paraphrase.]

JOHNSON

793.003/557)

Memorandum by the Minister in China (Johnson) of a Conversation With the Chinese Minister for Foreign Affairs (C. T. Wang)1

NANKING, March 19, 1931.

I handed to Dr. C. T. Wang today a memorandum giving the text of a statement handed to Dr. C. C. Wu, the Chinese Minister at Washington, on March 11th, stating that the Government of the United States felt that at this juncture negotiations in regard to extraterritoriality might be facilitated if the American Minister to China were authorized to discuss with the Chinese Minister for Foreign Affairs outstanding issues in connection with the principles involved.

Dr. Wang stated that Dr. Wu had been instructed to inform the Department that the Chinese Government regretted that the Government of the United States was unable to accede to the desires of the Government of China in regard to the three principles of co-judges, criminal jurisdiction and reserved areas, and that the mere transfer of negotiations to Nanking at this stage would have no effect upon the firm position of the Chinese Government in this matter. Dr. Wu had also been instructed to say that it was hoped that Dr. Wu would be able to sign a treaty should one result from the discussions now going on.

I said that there was no thought on the part of the Department to deprive Dr. Wu of this honor, but I felt that the Department had all along been under the impression that the Chinese Government was willing to negotiate on the basis laid down in the exchange of notes of 1929 when the United States Government had indicated its readiness to negotiate on a basis of gradual relinquishment of extraterritorial privileges.75

Dr. Wang said that the Chinese Government had never accepted gradual relinquishment as a basis for negotiation, either as to type of case or as to geographic areas.

I said that to the best of my knowledge Dr. Wu had never informed us of this attitude and by his silence and his willingness to negotiate The Department had assumed that this basis was acceptable to the Chinese Government. On this Dr. Wang made no reply but said he was ready to discuss the nature of the various legal guarantees such as duties of counselors, number and location of special chambers, et cetera, but there was no ground for discussion of the main principles

"Copy transmitted to the Department by the Minister in China without covering despatch; received May 12. Substance reported by the Minister in his telegram of March 19, 1931, 7 p. m., from Nanking; received March 19, 4:12 p. m. (793.003/563)

"See telegram No. 254, August 1, 1929, 11 a. m., to the Minister in China, Foreign Relations, 1929, vol. 1, p. 596.

involved. The Chinese Government was firmly determined to stand for the immediate relinquishment of civil as well as criminal jurisdiction and the abolishment of reserved areas. All that remained was for the United States Government to indicate its position regarding those principles. I told him that I would inform my Government. NELSON TRUSLER JOHNSON

793.003/566: Telegram

The Ambassador in Great Britain (Dawes) to the Secretary of State

LONDON, March 21, 1931—11 a. m. [Received March 21-11 a. m.]

81. Contents of Department's 71, March 16, 6 p. m. conveyed to Foreign Office which by informal letter dated March 20 expresses appreciation and states:

"Telegrams received from Lampson indicate that he has made unexpectedly rapid progress in the negotiations. By concentrating on details first and leaving major issues for subsequent negotiation succeeded in inducing the Chinese Government to agree to practically all the safeguards that we want except reserved areas, as to which the Chinese Minister for Foreign Affairs is at present inflexible. As to these areas, we fully realize that the interests of other powers are closely concerned and may not be exactly the same as ours. We therefore entirely share the view of the State Department that the negotiations particularly on this point, conducted by each power should take into consideration the special interests of the other most interested powers. The reference in the instructions to Lampson to the International Settlement of Shanghai was intended to indicate what, having regard to purely British interests, was the final point beyond which no further concession would be made.

Lampson expects that the negotiations will shortly reach a stage when, all other points having been disposed of, he will be in a position to offer to surrender criminal jurisdiction in return for the exclusion of certain areas.

76

We are telegraphing to Washington in the above sense and instructing the Ambassador to explain the position as above described to the State Department. I would add that the position reached in our negotiations appears to render unnecessary the adoption of the procedure proposed by the State Department for dissolving a possible deadlock.

With regard to the above matters referred to by the State Department, the position is as follows:

Evocation and co-judges. The first concession which Lampson made was in fact not evocation but co-judges. He had contemplated giving up co-judges last, but seems to have been influenced by the wording of the latest American draft, a copy of which was communicated by Atherton" to Wellesley on January 28th."

"The British Ambassador did so orally on March 23, 1931 (793.003/578).

77

Ray Atherton, Counselor of Embassy in Great Britain.

See Department's confidential instruction 640, January 20, 1931.78

"Immovable property. We do not anticipate that there will be any serious difficulty in obtaining safeguards as regards rights in immovable property. We have never abandoned the idea of obtaining such guarantees."

DAWES

793.003/562: Telegram

The Acting Secretary of State to the Consul General at Nanking

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WASHINGTON, March 21, 1931-3 p. m. 15. For Minister Johnson: Your March 17, noon, from Nanking. (1) You may use at your discretion the following comments by the Department on the tentative texts which you quoted in your telegram.

(2) Legal counsellors. The Department believes that, in addition to the provision for legal counsellors being deputed by the Ministry of Justice to serve during hearings of cases, it is desirable to have a provision for these counsellors to be deputed by the said Ministry "either on its own initiative or upon request of the parties to such actions.”

As to the provision which empowers the Ministry of Justice to take action such as may be required as a result of recommendations made by the legal counsellors, phraseology somewhat as follows is suggested by the Department: "until these observations have been considered by the Ministry of Justice, which the Chinese Government undertakes shall be empowered to take such action as the case may require.”

Regarding the Chinese Government's desire for a Chinese legal counsellor as a liaison officer between the Chinese judiciary and the foreign counsellors, the Department does not perceive any objection to the appointment of such a counsellor for that purpose on condition his function is understood to be primarily one of liaison.

For the moment the Department offers no other comment on the text as quoted in your telegram of the provisions regarding legal counsellors. It must be remembered, however, that no understanding has been reached yet with the Chinese as to the three major issues, that is, co-judges, criminal jurisdiction, and excluded areas. As reported, the text contemplates apparently the giving up of the principle of co-judges although no agreement has been obtained from the Chinese to exclude certain areas. Therefore, the Department believes it to be highly desirable for all the provisions regarding legal counsellors to

18 Not printed; it enclosed the new draft proposals (see statement handed to the Chinese Minister, February 7, 1931, p. 726).

"Quotations not paraphrased.

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