Office of the Historian

693.003/915: Telegram

The Minister in China (MacMurray) to the Secretary of State

Peiping, October 18, 1929—5 p.m.
[Received October 19—2:30 p.m.65]

903. (a) Cunningham, as Senior Consul, has submitted for the consideration of the diplomatic body the text of a recent notification Number 1157, issued August 12th by the Commissioner of Customs at Shanghai, setting forth a new version of import tariff under rule I. Pertinent portions of the notification are as follows:66

“In accordance with instructions received from the Inspector General of Customs the public is hereby notified that Rule I of the Former Import Tariff, providing, inter alia, for arbitration in cases of dispute [Page 815] regarding valuation of goods, et cetera, is abolished and a new rule is promulgated in which a Tariff Board of Inquiry and Appeal takes the place of the former Board of Arbitration. The new version of rule I is as follows:—

1.
The duty-paying value of any import liable to an ad valorem rate of duty shall be determined on the basis of the wholesale market value of the goods in local currency at the port of importation. This latter value, when converted into Haikwan taels, shall be considered to be higher than the duty-paying value by (a) the amount of the duty on the goods, and (b) 7 per cent of the duty-paying value of the goods. …
5.
The importer, if dissatisfied with the decision of the Customs as to the value or classification of imported goods, or the amount of duty or charges assessed thereon, may, within twenty days after the filing of the application to pay duty on [or other] Customs entry, file a protest in writing with the Commissioner of Customs, setting forth specifically his objection thereto. Pending a decision in the case, the merchandise—in the discretion of the Customs—may be released to the importer upon payment of a deposit sufficient to cover the full amount of duty and such additional duties as may be claimed by the Customs. Upon the filing of protest the Commissioner shall within fifteen days thereafer review his decision, and, if the protest is not sustained, the case shall be referred to the Inspector General of Customs with the request that it be submitted to the Kuan-Wu Shu for the consideration and decision of the Tariff Board of Inquiry and Appeal. (Kuan-Wu Shu is understood to be the term adopted by the Nationalist Government as the equivalent of the former Shui Wu Ch’u.)
6.
Questions regarding procedure, et cetera, which had not arisen [may arise] during the sittings of the Tariff Board shall be decided by the majority. The final finding of the maximum rate [majority of the] Board, which must be ratified by the Kuan-Wu Shu and announced within fifteen days of the reference (not including holidays), shall be binding. …
9.
This provisional rule is effective as soon as it is promulgated. It is subject to change at any time upon notice being given.”

The complete text of the notice is being forwarded by mail.

(b) It will be noted that the new procedure for determination of disputes with regard to the valuation of imports provides for unilateral action by the customs authorities instead of the arbitral method of procedure specified in rule I, annex II, of the Sino-American treaty of October 20, 1920.67 Although the tariff treaty of July 28 [25], 1928,68 does not specifically provide for the annullment of the method fixed by the treaty of 1920, it does state in article I that the “principle of complete national tariff autonomy shall apply.”

I therefore assume that the Department would not desire that any protest should be made by the Consul General at Shanghai against [Page 816] the application of the new procedure as laid down in the notification of August 12th. I shall, however, await your instructions before taking a definite position in the matter.

MacMurray
  1. Telegram in four sections.↩
  2. Notice corrected on basis of complete text transmitted to the Department by the Consul General at Shanghai in his despatch No. 6375, August 16; received September 13, 1929 (693.002/96). Omissions as indicated in the original telegram.↩
  3. Foreign Relations, 1921, vol. i, pp. 459, 490.↩
  4. ibid., 1928, vol. ii, p. 475.↩