very important element in the present inquiry. These fisheries are situated at distances varying from 35 to 200 miles from the coast of Newfoundland, and are productive in the highest degree. Although they are open to vessels of all nations, their successful prosecution depends almost entirely in securing a commodious and proximate basis of operations. Bait, which can be most conveniently obtained in the inshore waters of Newfoundland, is indispensable, and the supply of capelin, squid, and herring is there inexhaustible for this purpose.

With reference to the importance which has from earliest times been attached to the value of the fisheries of Newfoundland, it is to be ob served that a great portion of the articles in the treaties of 1783 and 1818 between Great Britain and the United States is devoted to careful stipulations respecting their enjoyment; and it will not escape the observation of the Commissioners that the privileges granted to United States fishermen in those treaties were always limited in extent, and did not confer the entire freedom for fishing operations which is now accorded by the Treaty of Washington, even on those portions of the coast which were then thrown open to them. Thus, whilst according the privilege of fishing on certain portions of the coast, the treaty of 1783 denied the right of landing to dry and cure on the shore, and the result was that, so far as concerned dried codfish, the concession to the United States was of little or no advantage to them. It was indispensable to the production of a superior article of dried codfish that there should be a speedy landing and curing in a suitable climate. The climate of the United States is not adapted for this purpose, whilst that of Newfoundland is peculiarly suitable. This fact is evidenced by the United States having never competed with Newfoundland in foreign markets in the article of dried codfish, whilst they were debarred from landing on Newfoundland shores. Again, it is necessary for the prosecution of the fisheries, with reasonable prospects of lucrative results, that the fishermen should be in proximity to their curing and drying establishments.

The treaty of 1783 was annulled by the war of 1812, and the stipulations of Article I of the Convention of 1818, quoted in extenso on page 4* of this case, made important modifications in the privileges heretofore enjoyed by United States fishermen. Although they had, under this convention, the liberty of drying and curing fish upon the southern coast of Newfoundland from the Rameau Island to Cape Ray, it was confined to the unsettled bays, harbors, and creeks within these limits, and, it being provided that so soon as any portion thereof should be settled, the liberty should cease, the fishermen of the United States have been prevented, by the coast becoming generally settled, from availing themselves of the liberty so conceded. Previously, therefore, to the Treaty of Washington, United States fishermen did not interfere with the Newfoundland fishermen as regards the article of dried codfish, although they prosecuted the herring-fishery at Bonne Bay and Bay of Islands on the western coast.

The question of the privileges of fishing on certain portions of the Newfoundland shores enjoyed by French fishermen does not come within the scope of this Commission, yet a passing allusion may be made to it. These privileges consist in the freedom of the inshore fisheries from Cape Ray northwardly to Quirpon Islands, and from thence to Cape John, on parallel 50° of north latitude; and the value attached to this right by the French Government is attested by their solicitude in main* Page 80 of this edition.

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taining it, and by the amount of French capital embarked in the prosecution of these fisheries. This affords another proof of the productiveness of the waters of the island.

CHAPTER II.-Advantages derived by United States citizens.

It will not be a matter of surprise that there should be an absence of exact statistical information when the facts are taken into consideration that, until the Washington Treaty, this vast extent of fishery was exclusively used by the people of Newfoundland-sparsely scattered over a long range of coast, for the most part in small settlements, between the majority of which the only means of communication is by water, and where, up to the present time, there was no special object in collecting statistical details. It is proposed, however, to show, by such evidence as will, it is believed, satisfy the Commissioners, the nature and value of the privileges accorded to the citizens of the United States under the Treaty of Washington. These may be conveniently divided into three heads, as follows:

I. The entire freedom of the inshore fisheries.

II. The privilege of procuring bait, refitting, drying, transshipping, and procuring supplies.

III. The advantage of a free market in Newfoundland for fish and fish-oil.

The privileges granted in return to British subjects will be treated subsequently, and consist of—

1. The liberty of prosecuting fishing operations in United States waters north of the 39th parallel of north latitude; and,

2. The advantages of a free market in the United States for fish and fish-oil.

I. The entire freedom of the inshore fisheries.

Newfoundland, from that part of its coast now thrown open to United States fishermen, yearly extracts, at the lowest estimate, $5,000,000 worth of fish and fish-oil, and when the value of fish used for bait and local consumption for food and agricultural purposes, of which there are no returns, is taken into account, the total may be fairly stated at $6,000,000 annually.

It may possibly be contended on the part of the United States that their fishermen have not in the past availed themselves of the Newfoundland inshore fisheries, with but few exceptions, and that they would and do resort to the coasts of that island only for the purpose of procuring bait for the Bank fishery. This may up to the present time, to some extent, be true as regards codfish, but not as regards herring, turbot, and halibut. It is not at all probable that, possessing as they now do the right to take herring and capelin for themselves on all parts of the Newfoundland coasts, they will continue to purchase as heretofore, and they will thus prevent the local fishermen, especially those of Fortune Bay, from engaging in a very lucrative employment which formerly occupied them during a portion of the winter season for the supply of the United States market.

The words of the Treaty of Washington, in dealing with the question of compensation, make no allusion to what use the United States may or do make of the privileges granted them, but simply state that, inasmuch as it is asserted by Her Majesty's Government that the privileges accorded to the citizens of the United States under Article XVIII are of greater value than those accorded by Articles XIX and XXI to the

subjects of Her Britannic Majesty, and this is not admitted by the United States, it is further agreed that a Commission shall be appointed, having regard to the privileges accorded by the United States to Her Britannic Majesty's subjects in Articles Nos. XIX and XXI, the amount of any compensation to be paid by the Government of the United States to that of Her Majesty in return for the privileges accorded to the United States under Article XVIII.

It is asserted, on the part of Her Majesty's Government, that the actual use which may be made of this privilege at the present moment is not so much in question as the actual value of it to those who may, if they will, use it. It is possible, and even probable, that United States fishermen may at any moment avail themselves of the privilege of fishing in Newfoundland inshore waters to a much larger extent than they do at present; but even if they should not do so, it would not relieve them from the obligation of making the just payment for a right which they have acquired subject to the condition of making that payment. The case may be not inaptly illustrated by the somewhat analogous one of a tenancy of shooting or fishing privileges; it is not because the tenant fails to exercise the rights which he has acquired by virtue of his lease that the proprietor should be debarred from the recovery of his rent.

There is a marked contrast, to the advantage of the United States citizens, between the privilege of access to fisheries the most valuable and productive in the world, and the barren right accorded to the inhabitants of Newfoundland of fishing in the exhausted and preoccupied waters of the United States north of the thirty-ninth parallel of north latitude, in which there is no field for lucrative operations even if British subjects desired to resort to them; and there are strong grounds for believing that year by year, as United States fishermen resort in greater numbers to the coasts of Newfoundland for the purpose of procuring bait and supplies, they will become more intimately acquainted with the resources of the inshore fisheries and their unlimited capacity for extension and development. As a matter of fact, United States vessels have, since the Washington Treaty came into operation, been successfully engaged in these fisheries; and it is but reasonable to anticipate that, as the advantages to be derived from them become more widely kuown, larger numbers of United States fishermen will engage in them. A participation by fishermen of the United States in the freedom of these waters must, notwithstanding their wonderfully reproductive capacity, tell materially on the local catch, and, while affording to the United States fishermen a profitable employment, must seriously interfere with local success. The extra amount of bait also which is required for the supply of the United States demand for the bank fishery must have the effect of diminishing the supply of cod for the inshores, as it is well known that the presence of that fish is caused by the attraction offered by a large quantity of bait fishes, and as this quantity diminishes the cod will resort in fewer number to the coast. The effect of this diminution may not in all probability be apparent for some years to come, and whilst United States fishermen will have the liberty of enjoying the fisheries for several years in their present teeming and remunerative state, the effects of overfishing may, after their right to participate in them has lapsed, become seriously prejudicial to the interests of the local fishermen.

II.—The privilege of procuring bait and supplies, refitting, drying, transshipping, &c.

Apart from the immense value to United States fishermen of partici pation in the Newfoundland inshore fisheries, must be estimated the important privilege of procuring bait for the prosecution of the bank and deep-sea fisheries, which are capable of unlimited expansion. With Newfoundland as a basis of operations, the right of procuring bait, refitting their vessels, drying and curing fish, procuring ice in abundance for the preservation of bait, liberty of transshipping their cargoes, &c., an almost continuous prosecution of the bank fishery is secured to them. By means of these advantages United States fishermen have acquired, by the Treaty of Washington, all the requisite facilities for increasing their fishing operations to such an extent as to enable them to supply the demand for fish food in the United States markets, and largely to furnish the other fish-markets of the world, and thereby exercise a competition which must inevitably prejudice Newfoundland exporters. It must be remembered, in contrast with the foregoing, that United States fishing craft, before the conclusion of the Treaty of Washington, could only avail themselves of the coast of Newfoundland for obtaining a supply of wood and water, for shelter, and for necessary repairs in case of accident, and for no other purpose whatever; they therefore prosecuted the bank fishery under great disadvantages, notwithstanding which, owing to the failure of the United States local fisheries, and the consequent necessity of providing new fishing grounds, the bank fisheries have developed into a lucrative source of employment to the fishermen of the United States. That this position is ap. preciated by those actively engaged in the bank fisheries is attested by the statements of competent witnesses, whose evidence will be laid before the Commission.

It is impossible to offer more convincing testimony as to the value to United States fishermen of securing the right to use the coast of Newfoundland as a basis of operations for the bank fisheries than is contained in the declaration of one who has been for six years so occupied, sailing from the ports of Salem and Gloucester, in Massachusetts, and who declares that it is of the greatest importance to United States fishermen to procure from Newfoundland the bait necessary for those fisheries, and that such benefits can hardly be overestimated; that there will be, during the season of 1876, upwards of 200 United States vessels in Fortune Bay for bait, and that there will be upwards of 300 vessels from the United States engaged in the Grand Bank fishery; that owing to the great advantage of being able to run into Newfoundland for bait of different kinds, they are enabled to make four trips during the season; that the capelin, which may be considered as a bait peculiar to Newfoundland, is the best which can be used for this fishery, and that a vessel would probably be enabled to make two trips during the capelin season, which extends over a period of about six weeks. The same experienced deponent is of opinion that the bank fisheries are capable of immense expansion and development, and that the privilege of getting bait on the coast of Newfoundland is indispensable for the accomplishment of this object.

As an instance of the demand for bait supplies derived from the New. foundland inshore fisheries, it may be useful to state that the average amount of this article consumed by the French fishermen, who only prosecute the Bank fisheries during a period of about six months of the year, is from $120,000 to $160,000 annually. The herring, capelin, and

squid amply meet these requirements and are supplied by the people of Fortune and Placentia Bays, the produce of the Islands of St. Pierre and Miquelon being insufficient to meet the demand.

It is evident from the above considerations that not only are the United States fishermen almost entirely dependent on the bait supply from Newfoundland, now open to them for the successful prosecution of the Bank fisheries, but also that they are enabled, through the privileges conceded to them by the Treaty of Washington, to largely increase the number of their trips, and thus considerably augment the profits of the enterprise. This substantial advantage is secured at the risk, as before mentioned, of hereafter depleting the bait supplies of the Newfoundland inshores, and it is but just that a substantial equivalent should be paid by those who profit thereby.

We are therefore warranted in submitting to the Commissioners that not only should the present actual advantages derived on this head by United States fishermen be taken into consideration, but also the prob. able effect of the concessions made in their favor. The inevitable cousequence of these concessions will be to attract a larger amount of United States capital and enterprise following the profits already made in this direction, and the effect will be to inflict an injury on the local fishermen, both by the increased demand on their sources of supply and by competition with them in their trade with foreign markets.

III.-The advantage of a free market for fish and fish-oil in Newfoundland.

It might at first sight appear from the return of fish exports from the United States to Newfoundland that this privilege was of little or no value; indeed, the duties when collected on this article were of insignificant amount. There is, however, an important benefit conferred by it on United States fishermen engaged in the Bank fisheries. In fishing on the banks and deep-sea, heretofore large quantities of small fish were thrown overboard as comparatively useless, when large fish, suitable for the United States market, could be obtained in abundance; this. practice was highly prejudicial to the fishing grounds.

Under the Washington Treaty, two objects are attained: first, a market for the small fish at remunerative prices in Newfoundland; and secondly, the preservation of the fishing grounds.

It is evident that, although at the present time United States fishermen have been in enjoyment of the privileges conferred by the Treaty of Washington only for a short period, and may not have availed themselves to the full extent of this privilege, the actual profits derived thereby, and which, in certain instances, will be substantiated before the Commissioners by the evidence of competent witnesses, will be more. fully appreciated during the remaining years of the existence of the right, and this item must form a part of the claim of Newfoundland against the United States.

CHAPTER III.-Advantages derived by British subjects.

Having now stated the advantages derived by United States fishermen under the operation of the Treaty of Washington, it remains to estimate the value of the privileges granted thereby in return to the people of Newfoundland.

In the first place, the value of the right of fishing on the United States coast conceded to them must be considered. This consists in