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No. 193.]

Mr. Seward to Mr. Burlingame.

DEPARTMENT OF STATE,

Washington, March 25, 1867.

SIR: This department has received a despatch dated the 11th of December last, from the consul general of the United States at Shanghai, enclosing a copy of a despatch of the 10th ultimo of that month which he addressed to yourself upon the subject of the expulsion of American merchants from the north bank of the Yangtsi at Chinkiang, together with copies of the correspondence between the consul general and the Tantai upon the subject referred to.

You will be pleased to report specially and fully thereupon to this depart

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SIR: Referring to my despatch No. 188, I have now the honor to forward to you a copy of a despatch which I have just addressed to the minister, in the same matter, viz: the expulsion of American merchants from the north bank of the Yangtsi at Chinkiang, together with copies of a despatch from the Tantai at that port, dated October 8, and my response of the 13th of the same month, which deal with various points involved.

I have the honor, &c., &c., &c.,

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SIR: On the 10th of August, I proceeded to Chinkiang in the Wachusett, which vessel was en route for Hankou, to aid the consul in settling the controversy about the north bank; or if this should be impracticable, in getting at the facts for your information. I found it impracticable to settle the matter then. A long correspondence ensued, and I have not been able in consequence, to make my report at an earlier date.

The British consul at Chinkiang was absent upon my arrival, and the vice-consul ill, so that I was unable to concert any line of action with either of those persons. I called upon the Tantai at once; he was unable to give me any information, further than that he would not, at the moment, insist upon his previous request for the removal of the receiving ships, but that he could not consent to the occupation of the north bank by our merchants, neither could he indemnify the merchants for their outlays. He was a new officer, and appeared to be ignorant of the history of the port. I procured from him copies of two despatches from the imperial commissioner, which I enclose, marked Nos. 1 and 2.

The circumstances which bear upon the question are substantially, as follows: When the river was opened, 1861, and for more than three years afterwards, the south bank at Chinkiang was threatened by the insurgents, while there was comparative safety on the north bank. The north bank, moreover, afforded a good anchorage and a ready access to the Grand Canal, which led away through a great country far to the north, and by lateral branches eastward and westward, to all parts of one of the largest and most fertile plains in the

world.

It is not to be wondered at, then, that when steamers were allowed to receive and discharge cargo to and from the north bank, a populous town grew up. In five years from 12,000 to 15,000 Chinese had located themselves there, who were engaged in trade, that more or less depended upon, and at the same time aided the foreign steamers.

Our merchants were alive to the prospects of the port, and at an early date located lands sufficient for their probable wants. Those lands were, in the cases of Messrs. Russell & Co., and Messrs. Heard & Co., in actual use at the time the attempt was made, which has

since been successful, to drive away the merchants and others, natives and foreigners, from that side. It is to be noted, however, that these lands were rented for a term of fifteen years in each case, and not purchased.

In April, 1865, the Chinese authorities commenced to arrange for a salt station at Chinkiang, by opening a short canal, which was requisite to perfect the connection between districts where salt is manufactured, and the Yangtsi at that point. This new canal is the one shown in the enclosed sketch which divides Messrs. Olyphant & Co.'s land from the salt yard. By it the salt is brought to the store yard, and from thence it is shipped into junks, and carried to interior points.

In June, 1865, the work was so far advanced that the salt junks commenced to rendezvous at Chinkiang. In a few weeks not less than 1,000 junks had collected off the salt yard, as shown in the sketch. They extended in tiers 17 deep, more than three-quarters of a mile below the point, and over ground that had been used for the foreign anchorage, and quite surrounding two of the receiving ships, which latter had to be moored in consequence. In October strenuous measures were undertaken to force the removal of all residents on the north side. These were steadily persisted in, and at the date of my visit to Chinkiang, the place where, a few months before, so large a number of people had lived, was quite deserted.

There seem to be three questions involved:

1st. Have our vessels the right to anchor on the north side of the river?

2d. Have our merchants the right to rent lands and build houses on the north bank? 3d. Whether the merchants, in view of all the circumstances, can justly demand indemnity for land, &c., on the north bank?

The first question is readily answered.

The final clause of rule 6, of the supplementary treaty, declares that, "the limits of the ports shall be defined by the customs, with all consideration for the convenience of trade, compatible with due protection of the revenue, also the limits of the anchorage, within which lading and discharging is permitted by the customs, and the same shall be notified to the consuls for public information." Accordingly, as shown in enclosure No. 3, the British consul at Chinkiang and the Tantai consulted together, and concluded that the part of the river near Chih-hwa-chue and Pah-hwa-chue, both on the north bank, would be most convenient for the anchorage, and a proclamation was issued, declaring that to be the anchorage. The reasons given are such as form an admission, on the part of the native authorities, that the south side is unfit for the purpose. Upon this head, other evidence, in abundance, could be offered, if it were necessary or desirable.

Our vessels have therefore the right, under existing regulations, to anchor near the north bank, and these regulations cannot, in view of the facts as admitted by the native authorities, be altered without violence to the convenience of trade.

I have already (in my despatch No. and its enclosure) argued that our people have the right to rent land and build houses on the north bank at Chinkiang, and it is not necessary for me to go over the ground again. I desire, however, to call your attention to that despatch, and I take the liberty to do so, because I am strongly persuaded of the justice of the views therein expressed.

The answer to the third question is ready, if the second be answered affirmatively. Our people having, as a matter of right, purchased land on the north bank, cannot be required to give it up, but they may, of course, consent to do so, making their own terms. They are willing, in view of the opposition of the authorities, to give up their lands, upon being recompensed for their actual outlays for them, and, clearly, they could not be asked to do less.

If the second question be answered negatively, there is still something to be said for the merchants, for, as nearly as I can get at the facts, they were ignorant that the Chinese had always held that the permission to trade on the north bank was only temporary, although it would appear from the circumstance that their leases were made for short terms, that they were not able to procure absolute titles. Still they may very well have thought, in the absence of notification by their own authorities, that this was due to a reactionary movement on the part of the Chinese, which deserved no special attention.

Had the Chinese, upon the opening of the river, notified to this office or to the legation that, while the temporary use of the north bank would be permitted, in view of all the circumstances, such use could only extend to the date when the country along the southern bank should be pacified, they would have taken the course which would have saved them (granting that the treaty is to be interpreted as they say) from trouble. But if it is to be held that a lapse of this kind is fatal to them, then, perhaps, the Chinese may turn upon us and say, "We notified the British consul at Chinkiang of our views. If you had sent a consul there to look out for matters, as you are bound to do under the treaty, your officer would have been similarly notified."

I would not decide the question at Chinkiang simply upon the interpretation of the treaty. I know that you will interpret it liberally for each side, but it should not be forgotten that the Chinese have even been disposed to narrow the limits within which foreigners may have freedom of trade and movement, and that success, in this instance, would be likely to embolden them to action that would be far more disastrous.

I enclose various copies of letters and documents as shown in the schedule. For replies to various points raised by the Chinese, I refer you to these, instead of going over the ground here. I enclose also copies of the leases in question.

I have the honor to be, sir, your obedient servant,

Hon. ANSON BURLINGAME,

United States Minister, Peking.

GEO. F. SEWARD.

The Tantai to Mr. G. F. Seward.

[No. 1408.]

Ying, the Tantai of Chinkiang, would inform the consul, in regard to the lands rented by American merchants at Tshib-hwa-cheu, the Tantai has been thinking out a good plan for the settlement of the matter in such manner that the said merchants may not suffer loss. The Tantai finds that no seal has been affixed to the deeds in question by the local magistrates, and that the deeds are not in the name of the foreign merchants, and that according to Chinese law the land should be confiscated and the vendors should be punished.

The Tantai further thinks that, although the merchants paid out their money for the rent of these lands, they violated the 12th article of the treaty in two points. The first point is that they clandestinely rented lands at a place not open to foreign trade, and the second point is that they did not send the deeds to the local magistrates for seal, which bars any claim upon the magistrate to require a refunding of the moneys paid. But the Tantai further thinks that when the transactions were gone into the merchants had no idea of the position in which they were placing themselves, or perhaps they allowed their perceptions to be befogged by their compradores, so that they paid a good price; so that, if the Tantai should not be more compassionate to them, their losses would be very heavy. But then, if the consul general expects the Tantai to refund the prices originally paid and the expenses that have been incurred, that is too difficult to be done. Besides, at the time of making the sales there were, doubtless, many vague expenses incurred by the original owners, which would render the repayment of the amount nominally paid for the land a matter too onerous to be borne by them now. On both sides (the purchasers and the sellers) there was a breach of law; and now on both sides there should be a yielding to the claims of justice.

Now, as regards the American merchant wanting the price originally paid and the interest, the Tantai thinks, on the contrary, that when the land was rented for 15 years and the price paid was 1,000 taels, as three years have elapsed, there should be a deduction of 200 taels.

The Tantai has already set forth this matter by petition despatched to the imperial commissioner, and his reply has been received that, according to the principles of justice, the half of the price originally paid should be collected from the renters and paid over to the American merchants; and this would be justice to both parties; and the Tantai has asked for permission to require the district magistrate of Kyang-too-Sufien to send this amount to the Tantai, that it may be paid over.

The Tantai thinks that the consul general will see the propriety of this plan; wherefore the Tantai begs that the consul general will speedily make this known to the American merchants, and send him a reply, that the amount may be paid over to the consul general to be distributed.

Hereafter the lands rented at Tshih-hwa-keu will in nowise concern the American merchant, and the four deeds will remain in the Tantai's office for the record of the case. Thirtieth day of the 8th month.

October 8, 1866.

No. 658.]

B. JENKINS, Interpreter.

Mr. G. F. Seward to the Tantai.

UNITED STATES CONSULATE GENERAL,

Shanghai, October 13, 1866.

SIR: I have received your despatch of the 8th instant.

I am afraid that you have mistaken the object of my negotiation with you.

I was instructed by my superior officer at Peking, to whom I had referred our correspondence touching the north-bank question, to investigate the matter.

Having proceeded to your port and satisfied myself of the justice of the position taken by the merchants, I urged, with a view to save further trouble, that you should recognize, this right to remain on the north side; and, when I found that you would not do this, I told you how you might compromise with the merchants, so far as lands already acquired were concerned, viz., by paying them for their outlays. I proposed this with the sanction of the merchants, who, while they would vastly prefer to retain their lands, were not desirous of standing in a position of hostility to yourself.

As to the question of the treaty right, that would rest for discussion at Peking.

I did not go up to your port to urge a pecuniary indemnity, and I am not disposed to do so now. The question stands at the moment in this wise: if you think that the arguments which I adduced at our interview were just, you may either put the merchants in quiet possession of their several properties or pay them for their outlays. If you do not, then the only course is to submit the whole question to arbitrament of higher authorities. Touching the points raised in your despatch, I have to remark, as follows:

1. The treaty right to purchase land on the north bank, This point has already been fully discussed by us.

2. Absence of seals on deeds. I do not know that it is necessary to have any seal. In the American treaty the legal fees for seals are mentioned, but there is no stipulation that deeds must be sealed. In the appropriate article of the British treaty, the word seal does not

occur.

3. Names of foreign merchants do not appear in deeds. The Chinese names of the mercantile houses are given, I believe, although it is true that they are not described as foreign hongs. That such were meant, however, every one familiar with trade at the ports would, I think, understand.

4. Land clandestinely rented. I do not know why you should say this, for that these lands had been rented has been a matter of common notoriety, and could not well have been concealed, had there been any object for it.

5. Proposition for partial payment. The merchants are unwilling to claim possession of the north bank, or of anything on account thereof, if they have not a just claim based on the treaty-right, or if by informalities their titles to the land are not good. They believe that they would be put in a wrong position should they consent to do so.

6. Proposition that the original renters should make this partial payment. The merchants consider that their transactions with the renters were complete when they made payment for and received possession of the lands in question, and that it would be bad faith to claim against them.

7. The requirements of justice. It appears from the governor general's despatches, copies of which you allowed me to take, that the object of having the Chinese and foreigners removed from the north bank, was to give room for the great salt station which has been recently established there. Now, the salt commissioners ought not to take up lands belonging to foreigners without their consent, and without paying them their price. Perhaps the governor general upon further investigation would agree in this view, and not ask the present renters to give up their lands, whether or not they are willing, and the lessors, who seem to be innocent, to pay them all indemnity.

Having thus answered the points_raised by you, in order that it may not appear that I acknowledge that they have force, I may say, in conclusion, that it is not desirable to spin out our discussion.

The merchants will positively not agree to different terms than those offered by them, and if you cannot come up to this standard, it is better to say so, and to refer the matter to Peking

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SIR: I recur on this occasion to a despatch transmitted by Mr. Williams in your absence, which despatch bears date August 5th, 1866, and was received at this department on the 15th of November last. The despatch communicates the proceedings which have been taken at Shanghai and at Peking in regard to an instrument which has been promulgated by the consul-general of France at Shanghai, and which is entitled "Reglement d'organization municipale de la concession Francaise de Shanghai." The despatch is accompanied by a copy of that instrument and by a copy of a correspondence concerning it which has taken place between Mr. S. Wells Williams and George F. Seward, esq., consul-general at Shanghai, and a similar correspondence which has taken place between Mr. Seward and C. A. Winchester, esq.,her Britannic Majesty's consul residing at Shanghai. Mr. Seward and Mr. Winchester, in this correspondence, have presented objections to the proceeding of the French consulate, which are

deemed worthy of consideration. If, however, I do not misunderstand the papers before me, the protest of Mr. Seward against the regulations, although made in accordance with sentiments of the same character entertained by the British, Prussian, and Russian consul general, in fact stands alone, those authorities having declined to commit themselves formally upon the subject.

In connection with this matter, the Prussian government has addressed itself to this government, through its minister plenipotentiary residing here, Baron Von Gerolt. I give you for your information a copy of the baron's letter, and of the answer to it, which has been given by this department.

The President's views of the matter are these: He sustains for the present the objections and protest which have been made against the French regulations by the United States consul general; and the imperial government at Paris will be advised thereof. This decision, however, is not conclusive of further proceedings. The decision is taken for the purpose of referring the whole matter to yourself for conference with the representatives of Great Britain, Prussia, and Russia, if they shall be authorized and willing to engage in such conference, to the end that you may be able to report whether in your opinion the rights and interest of the United States require consent on the part of this government to the proposed French regulations; and if so, whether any, or what, modifications thereof are desirable and practicable.

You will report fully upon the whole subject, without unnecessary delay. A copy of this despatch will be communicated to the governments of France, Great Britain, Russia, and Prussia, respectively.

It is scarcely necessary to say, that while the subject shall remain unsettled you will take great care that no unnecessary collision or altercation shall arise between yourself and your associates in regard to it.

I am, sir, your obedient servant,

WILLIAM H. SEWARD.

ANSON BURLINGAME, &c., &c., &c.

Baron Gerolt to Mr. Seward.

PRUSSIAN LEGATION,

Washington, March 11, 1867. SIR: The royal government has instructed me to get information as to the ground taken up by the United States government in the difference now pending between the French consul at Shanghai on one side, and the representatives of the United States, Great Britain, and Prussia, on the other, in reference to the administration of the so-called "Concession Française," at Shanghai.

It appears that since the year 1849 certain territories ceded for that purpose by the Chinese government have been settled by French, English, American, and German colonists. After some time, practical experience having shown that a separate administration by the representatives of the three first-named countries was injurious on account of the community and concatenation of interests, it was proposed to adopt henceforth for that administration cosmopolitan principles.

This plea, however, has only been executed so far as regards the English and the United States governments; the representative of France having protested against any measure tending to abrogate the executive power of the French government over the Concession Française. The latter government, moreover, published for the French territory a "réglement d'organisation municipale," against which the English and American representatives consid ered themselves bound to protest, to guard the interests of the numerous foreign elements, whom the said "réglements" would have placed under French rule.

The royal government, for its part, is disposed to consider that the regular proceeding on the part of the French government would have been to bring about a previous arrangement with the governments of the other interested powers as regard the foreign (that is, not French) subjects interspersed among the French population.

Previously, however, to taking any steps in the matter, my government wishes to know the position taken up by the United States government, and particularly whether the latter has indorsed the action of its representative in China.

I have the honor to be, sir, with the highest consideration, your obedient servant, FR. V. GEROLT.

Hon. WILLIAM H. SEWARD,

Secretary of State.

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