893.74/266
The Department of State to the Chinese Legation99
Aide Memoire
The Department of State has been informed that the Chinese Ministry of Communications is reluctant to take such steps as are necessary for the purpose of giving effect to the arrangements between the Chinese Government and the Federal Telegraph Company for the erection of certain wireless stations in China. It is understood that this failure of the Ministry of Communications either to enter into the new arrangements technically necessitated by the Federal Company’s having associated the Radio Corporation with itself in this undertaking, or to take such other action as might be requisite to enable the Federal Telegraph Company to proceed with the work, is due to a protest which has been lodged with the Chinese Government against the existing contracts between the Ministry of Communications and the American interests concerned.
The Government of the United States believes that the issues involved in this matter concern primarily the interpretation to be given to the principle of equality of commercial and industrial opportunity in China, and it holds that this question is one of principle which can not be compromised without the impairment of a policy which it has always consistently maintained and which was clearly set forth in the letter of the Secretary of State to Minister Sze under date of July 1, 1921,1 with reference to the traditional support which the Government of the United States has given to the principle of the open door. This principle has further been reasserted and confirmed in the Nine-Power Treaty signed at the Washington Conference on the Limitation of Armament2 which, among other things, provides in Article III that:
“With a view to applying more effectually the principles of the Open Door or equality of opportunity in China for the trade and industry of all nations, the Contracting Powers, other than China, [Page 789] agree that they will not seek, nor support their respective nationals in seeking—
. . . . . . . . . . . . . .
(b) any such monopoly or preference as would deprive the nationals of any other Power of the right of undertaking any legitimate trade or industry in China, or of participating with the Chinese Government, or with any local authority, in any category of public enterprise, or which by reason of its scope, duration or geographical extent is calculated to frustrate the practical application of the principle of equal opportunity.”
It is furthermore provided in this Article that:
“China undertakes to be guided by the principles stated in the foregoing stipulations of this Article in dealing with applications for economic rights and privileges from Governments and nationals of all foreign countries, whether parties to the present Treaty or not,”
The Department of State has also been informed that the agreement for the return to China of the leased territory of Kiaochow3 contains the following provision (Article 12):
“The Government of China declares that upon expiration of the telegraph and cable monopoly granted to the foreign concerns it will discontinue the monopoly upon its own initiative and will not further grant any monopoly for the electrical transmission of messages to any government, company or individual.”
In connection with the provision quoted above from the Shantung Agreement, the Government of the United States, apart from any question as to the validity of the particular positive grants which the Chinese Government may by contract have vested in companies of other nationality, takes the view that no contractual stipulations on the part of the Chinese Government could suffice to divest American citizens, for the benefit of such other companies, of their existing treaty rights not to be “impeded in their business by monopolies or other injurious restrictions;” and the Government of the United States reserves all its rights with respect to any purported telegraph or cable monopoly.
- The following notation appears on the file copy: “Handed to the Chinese Chargé on Mar. 9, 1923, by the Secretary”.↩
- Foreign Relations, 1921, vol. i, p. 439.↩
- Ibid., 1922, vol. i, p. 276.↩
- Not printed.↩