Papers Relating to the Foreign Relations of the United States, 1921, Volume I

893.74/191

The Minister in Denmark (Grew) to the Secretary of State

Copenhagen, October 12, 1921.
[Received October 27.]

No. 380

Sir: With reference to my telegram No. 73 of October 11th, 9 p.m.,⁶⁹ relating to the protest lodged with the Chinese Government by the Danish Legation at Peking against the contract signed with the Chinese Government by the Federal Telegraph Company, I have the honor to report that, in spite of my oral representations, as instructed in the Department’s telegram No. 31, of July 1, 6 p.m.,⁷⁰ to the effect that the discussion of this case appeared to have covered all relevant issues and that the Government of the United States considered it unnecessary to pursue the question further, the Legation has received a further note from the Foreign Office in which the Danish Government persists in its intention to maintain its protest lodged with the Chinese Government against the Federal Telegraph Company’s contract.

A copy of the note, which is under date of October 10th, 1921, is transmitted herewith. The Legation will withhold its reply to this note from the Foreign Office pending further instructions from the Department.

I have [etc.]

J. C. Grew

[Enclosure]

The Danish Minister for Foreign Affairs (Scavenius) to the American Minister (Grew)

Copenhagen, October 10, 1921.

Monsieur le Ministre: In your note no. 104 of July 5th⁷¹ concerning the protest lodged with the Chinese Government by the Danish Legation at Pekin against the contract signed with the Chinese Government by the Federal Telegraph Company you were good enough, under instructions from your Government, to inform me that it is not the intention of the American Government to contend that the contractual rights of the Great Northern Telegraph Company are to be retroactively annulled or that they are to be held invalid by reason of anterior treaty stipulations, save in so far as they are based upon concessions which were actually in excess of the power of the Chinese Government to make. On this latter point you refer to art. 15 of the American treaty of 1844, by which the Chinese Government undertakes that American citizens in China “are not to be impeded in their business by monopolies or other injurious restrictions”.

In reply to your note I have the honour to inform you that the Danish Government cannot admit that art. 15 of the American treaty of 1844 prevents the Chinese Government from granting concessions similar to that granted to the Danish company, but contends that the said article solely pledges the Chinese Government to establish and preserve the freedom of commerce in China.

The treaties signed with China by several states in the period 1842–44 intended to deliver the commerce in China from the oppressing monopoly of the so-called Hong-merchants, and to guard against the revival of similar monopolies. This clearly appears from the text of the articles in question, see art. V in the British treaty of 29th August 1842 (“the Emperor of China agrees to abolish the practice in future”), art. IX in the French treaty of 24th October 1844 (“Aucune autre société privilégiée ne pourra désormais s’établir non plus qu’aucune coalition organisée dans le but d’exercer un monopole sur le commerce”), and art. XV in the Swedish-Norwegian treaty of March 20th, 1847, which is verbally identical with art. 15 in the American treaty. That the actual aim of this treaty was to abolish the commercial monopolies is also seen from the passage quoted below, contained in a note dated June 21st 1844⁷² to the Chinese negotiator Kiying [Tsiyeng] from the American negotiator Cushing, to wit: “The American Government would like perfect reciprocity in all commercial relations, involving no export duties; but accepted the plan arranged with the English, and would only propose such articles as may procure to the citizens of the United States a free and secure commerce in the ports open to the nations of the West.”

The diplomatic correspondence previous to the treaties 1842–44, fully confirm the view that the freedom of commerce and the abolishment of commercial monopolies were the main points in the negotiations with China, not only in the said period, but up to the Tientsin-treaties of 1858, and the same view is held by the American historiography, vide Hosea B. Morse The International Relations of the Chinese Empire. The Period of Conflict 1834–1860 pag. 307 and pag. 563.

Art. 15 of the American treaty of 1844 thus only precludes the Chinese Government from granting commercial monopolies but cannot be taken to prevent the said Government from regulating activities of a specific nature, such as for instance telegraph service, railways, etc. by way of concessions.

With reference to the above and once more directing your kind attention to the observations set forth in my note of the 23rd [29th?]⁷³ of March last I venture to express the confident hope that the American Government will realize that the Danish Government must protect the legitimate and well-acquired rights of the Great Northern Telegraph Company in China by maintaining the protest lodged with the Chinese Government against the Federal Telegraph Company’s contract.

I avail myself [etc.]

Harald Scavenius

69. Not printed.
70. Ante, p. 442.
71. See telegram no. 31, July 1, to the Minister in Denmark, p. 442.
72. MS., Despatches from China, vol. 2, p. 309.
73. Ante, p. 422.