Office of the Historian

893.6363 Manchuria/53: Telegram

The Chargé in China (Gauss) to the Secretary of State

Peiping, October 21, 1934—6 p.m.
[Received October 21—10:50 a.m.]

478. Following from Mukden:

“October 21, 10 a.m. Representatives of the Standard-Vacuum Oil Company and the Asiatic Petroleum Company sent to Hsinking at the request of “Manchukuo” Finance Ministry were yesterday furnished by the latter with an oral statement regarding the proposed oil monopoly, summarized as follows: [Page 743]

(1)
The Government to control sales organizations excluding others from right of agencies or sales in the country.
(2)
The Government to use all the companies’ existing agencies as far as possible and to purchase at a reasonable price all equipment, with the exception of the Dairen and Newchwang plants, which the companies may be ready to dispose of.
(3)
Refined oil needs beyond the capacity of the Fushun shale oil plant and the Dairen refinery to be supplied by the present oil companies according to quotas based on the last 2 years.
(4)
Present companies to be given preference for Dairen refinery’s purchases of crude oil.
(5)
New monopoly law to be published shortly.
(6)
Monopoly has not yet decided to exercise control over lubricating oil or products other than light oil, gasoline and kerosene, all of which could be brought in under license and disposed of where possible without restriction.
(7)
Monopoly therefore requests companies to provide it with information regarding sales and imports during the past 2 years together with lists of agencies and also all plants and equipment to be turned over.
(8)
Should the companies fail to provide this information by November 15th monopoly would be compelled to use own judgment regarding determination of quotas.”

Tokyo is being informed. Legation’s comments will follow later.

Gauss