stipulations of this agreement, the original stipulations of the protocol of 1901 and of annex 17 thereto shall immediately come into force. Done at Peking the 27th September, 1905. (Prince of Ch'ing's signature.) ERNEST SATOW. Y. UCHIDA. A. J. CITTERS. G. KOZAKOW. CANCELLATION OF THE AMERICAN CHINA DEVELOPMENT COMPANY'S CANTON-HANKAU RAILWAY CONCESSION. No. 46.] The Chinese Minister to the Secretary of State. CHINESE LEGATION, Washington, December 22, 1904. SIR: I have been instructed to inform you that it is the decision of the Imperial Chinese Government to cancel and annul the agreements made with the American Chain Development Company, bearing date April 14, 1898, and July 13, 1900. This step has been forced upon the Imperial Government by a course of conduct pursued by the company which leaves the Imperial Government no alternative. Article 17 of the supplemental agreement of July 13, 1900, stipulates that "the Americans can not transfer the rights of these agreements to other nations or people of other nationality." In spite of this plain provision and of the earnest opposition of the representatives of the Imperial Government a majority of the shares of the company's stock has been transferred to Belgians and other foreigners, and the control of the company has passed into other than American hands. The representatives or officials of the company have promised to have these shares held by foreigners in violation of the agreements retransferred to bona fide American stockholders, but they still remain in foreign hands. Article 14 of the agreement of April 14, 1898, binds either party not to impair in any manner or to any extent the value of the obligations created by and under the contract. The said company has sought, against the protest of the Imperial Government and in violation of the terms of the agreements, to compel the trust company in whose hands the bonds have been deposited to deliver a large portion of them to the development company. The said company has sent to China a person as its representative who does not represent the American stockholders, and he has taken without authority from the proper representatives of the Imperial Government the whole charge of the railroad and its affairs contrary to the terms of the agreements. The amount of money spent on the Kwangchow section of the road has far exceeded the estimates. The engineers employed on the road have taken advantage of their position to go into business for their own profit. The company's foreign employees have repeatedly committed murder by the reckless use of firearms, and some of them have absconded with all the money in their charge. No attention has been paid to the demands for the surrender of the murderers or the return of the misappropriated money. These are some of the flagrant violations of the right of China to exercise supervision over the road and its employees. Repeated warnings from the official representatives of the Imperial Government against the outrageous course pursued by the company in its dealings with the Government and the people of China appear to have fallen on deaf ears. As the railroad which the American China Development Company undertakes to build passes through three of the most populous provinces of the Empire-namely, Kwangtung, Hunan, and Hupehthe people of these provinces naturally take a deep interest in the progress of the work. The follies committed by the company have filled them with indignation and astonishment. Public meetings have been frequently called during the last few months to denounce the company and its employees. Public sentiment runs so strong against the company that it can find no defenders. It is the unanimous voice of the people that the contract with the American China Development Company should be canceled. They have presented a petition to the Waiwu Pu on the subject, which has been laid before the Throne. The court, which is always sensitive to public opinion, has accordingly given orders to the Viceroy Chang Chih-tung and other members of the Imperial Chinese railway administration to cancel the agreements with the American China Development Company. The viceroy, who represents the people of the three provinces, considers it impossible to oppose the wishes of tens of millions of people in order to relieve a bad situation attended with such serious consequences as to affect the safety of the country and the welfare of the people. At this juncture when the commercial relations between China and the United States are steadily increasing and improving my government feels sure that the United States Government, which has repeatedly helped to protect the integrity of China, will not countenance any interference on the part of the people of any country that may injuriously affect American interest in China. Copies of telegrams from the Imperial Chinese railway administration are herewith inclosed for your information, and I will thank you to favor me with an expression of your views thereon. Accept, etc., CHENTUNG LIANG-CHENG. [Inclosure 1.-Translation.-Imperial Chinese Legation, Washington, December 21, 1904.] Telegram from the Imperial Chinese railway administration. SHANGHAI, December 19, 1904. Viceroy Chang is commanded by a special Imperial decree to make a careful investigation of the facts which justify the cancellation of the contract with the American China Development Company with a view to safeguard the rights and interests of China. Director-General Sheng is of opinion that the American China Development Company has violated the contract, which renders cancellation unavoidable. Article 17 of the supplemental agreement stipulates that "the Americans can not transfer the rights of these agreements to other nations or people of other nationality." Now, a majority of the shares of the company's stock is held by Belgians and Frenchmen, and the control of the company has passed into other than American hands. Article 14 of the main agreement binds either party not to impair the value of the obligations under the contract. Now, a certain Cito, who does not represent the American stockholders, has been sent to China and taken the whole charge of the road without proper authority. The work on the road has not been completed within the time limit. The amount spent on the Kwangchow section of the road has exceeded the estimates. There are instances of engineers taking advantage of their position on the road to go into trading for their own benefit. Foreign employees have repeatedly committed murder by the reckless use of firearms; some have absconded with all the money in their charge. No attention has been paid to the demands for the return of the misappropriated money or for the surrender of the murderers. These are some of the flagrant violations of the right of China to exercise supervision. You will please make known to the Secretary of State that the main and supplemental agreements with the American China Development Company will be annulled. In view of the improving commercial relations between China and the United States, it is reasonable to suppose that the United States Government, which has repeatedly helped to protect the integrity of China, will not countenance any interference on the part of the people of any country that may injuriously affect American interests in China. [Inclosure 2.-Translation.] CHANG (CHANG CHIH-TUNG). SHENG (CHENG HSUAN-HWAI). Telegram from the Imperial Chinese railway administration. SHANGHAI, December 21, 1904. With reference to the case of the American China Development Company, the gentry and people of the three Provinces directly concerned with one voice strongly urge the cancellation of the contract. They united in presenting to the waiwu pu a petition on the subject, which has been brought to the attention of the Emperor. The court, which is always sensitive to public opinion, has accordingly given orders to Viceroy Chang and his associates in the railway administration to annul the contract. As the representative of the three Provinces, Viceroy Chang considers it impossible, in opposition to the wishes of tens of millions of people to relieve a bad situation attended with such serious consequences as to affect the safety of the country and the welfare of the people. You will please add what has been said in regard to the popular feeling and public opinion of the country in your representations to the Secretary of State. CHANG. Chang Chih-tung and Sheng Hsuan-hwai to the Chinese Minister. [Telegram. Translation.-Left at the Department of State by the Chinese Minister.] SHANGHAI, January 2, 1905. Director-General Sheng has telegraphed the American China Development Company that the Chinese Government has informed the United States Government of the annulment of the railroad contract and that the Chinese Railway Company, which represents the Chinese Government, will not be liable for the $4,000,000 of bonds delivered by the trust company without the sanction of the director-general. Speaking for the gentry and people of the three provinces concerned, Viceroy Chang states that it is the firm determination of the tens of millions of people of the three provinces to have the contract canceled, and that they will under no circumstances recognize the $4,000,000 of bonds as valid obligations. You will inform the Secretary of State that China has all along taken the firm stand that the contract ought to be canceled and urge the importance of an immediate reply. You are also requested to publish in the newspapers without delay a statement to the effect that the American China Development Company having violated the contract the Imperial Chinese Government, in deference to the public sentiment of the gentry and people of the three provinces concerned, has canceled the contract in accordance with their petition; that only 32 miles of the road have been completed; that the work has now been entirely stopped; that the public is, therefore, warned from buying any of the $4,000,000 of bonds. You will communicate the above to the Secretary of State and the American China Development Company. CHANG CHIH-TUNG. SHENG HSUAN-HWAI. No. 52.] The Secretary of State to the Chinese Minister. DEPARTMENT OF STATE, Washington, January 4, 1905. SIR: I have the honor to acknowledge the receipt of your note No. 46, of the 22d ultimo, in which you inform the Department that it is the decision of the Imperial Chinese Government to cancel and annul the agreements made with the American China Development Company, bearing date April 14, 1898, and July 13, 1900; and you state the reasons which have forced the Imperial Government to take that step. In reply I have the honor to say that in view of the steadily increasing and improving commercial relations between the United States and China I feel convinced that you will strongly urge on your government not to take the action contemplated until all the interested parties have been heard from. Accept, sir, etc., The Secretary of State to Minister Conger. [Telegram-Paraphrase.] JOHN HAY. DEPARTMENT OF STATE, (Mr. Hay advises Mr. Conger that the Department has been informed by the Chinese minister at Washington that his government intends to cancel its agreement with the American China Development Company. The Government of the United States can not admit that the Chinese Government can take such action against an American company, and insists on the sole right to deal with the Chinese Government in diplomatic questions affecting the interests of this company. Instructs him to strongly urge the Chinese Government to postpone action until all the interested parties have been heard from. The Department is reliably informed that a sufficient number of shares of the company's stock to secure absolute control of the property has been purchased from foreigners by the American shareholders.) No. 868.] The Acting Secretary of State to Minister Conger. a DEPARTMENT OF STATE, Washington, January 6, 1905. SIR: I inclose herewith for your information a copy of a note from the Chinese minister here, informing the Department that it is the decision of the Imperial Chinese Government to cancel and annul the agreements made with the American China Development Company, bearing date April 14, 1898, and July 13, 1900; and stating the reasons which have forced the Chinese Government to take that step. I also inclose a copy of the Department's note to the minister, in reply." F. B. LOOMIS. a Printed ante. No. 53.] The Acting Secretary of State to the Chinese Minister. Washington, January 6, 1905. SIR: With reference to the information which you furnished to the Department on the 22d ultimo, regarding the decision of the Chinese Government to cancel and annul the agreements made with the American China Development Company, bearing date April 14, 1898, and July 13, 1900, I have the honor to inform you that on yesterday Secretary Hay sent a telegram to Minister Conger, saying that this government can not admit that the action contemplated by the Chinese Government can be taken in regard to a company which this government considers to be in good faith American, and concerning which this government insists that it has the sole right to deal with the Chinese Government regarding diplomatic questions affecting the company's interests until all the parties interested in the concessions have been heard from. The minister was, accordingly, again instructed to urge strongly on the Government of China that it postpone the action contemplated until all the parties interested had been heard from, and that this is all the more imperative at the present time, inasmuch as the Department is credibly informed that the American shareholders have bought enough stock from the foreign stockholders to secure absolute control of the property. Minister Conger was instructed to cable to the Department the result of his representations to the Chinese foreign office. Accept, sir, etc., FRANCIS B. LOOMIS. The Secretary of State to the Chinese Minister. DEPARTMENT OF STATE, Washington, January 6, 1905. DEAR MR. MINISTER: I have the honor to inform your excellency that I have received absolutely certain information that the American proprietors of the Canton and Hankau Railway have regained control of the complete ownership of a clear bona fide majority of the entire stock of that company, the control of which, as a matter of fact, had never entirely passed out of their hands. I trust the Chinese Government will see that this heavy sacrifice which has been made by the American proprietors to meet the criticisms and objections which have been made in China to the concession entitles them to the favorable consideration of your government and to the protection of that of the United States. I am, etc., No. 51.] JOHN HAY. The Chinese Minister to the Secretary of State. CHINESE LEGATION, Washington, January 6, 1905. SIR: I have the honor to acknowledge the receipt of your note of to-day's date, in which you kindly inform me that you have received absolutely certain information that the American proprietors of the Canton and Hankau Railway, to meet the criticisms and objections |