Minister Rockhill to the Secretary of State.

No. 55.]

Sir: With reference to previous correspondence concerning the cancellation of the concession of the American China Development Company, I beg to state that on receiving instructions I at once sent Mr. Williams, the Chinese secretary of this legation, to the foreign office and instructed him to put the following questions to the minister:

This legation is in receipt of reliable information that the Chinese minister at Washington has entered into a provisional memorandum of settlement with the American China Development Company, in which he recites the fact that the Chinese Government has canceled and annulled the concession and contract of the said company and has refused to permit it to continue the construction of its railway, and that he offers as reasonable indemnity to the company the sum of six millions and three-quarters.

* * * * * * *

On the 12th instant, not having received any reply from the foreign office in accordance with the promise made to Mr. Williams in his interview of the 9th instant, I sought a personal interview with the minister. I failed to secure it, and then asked to see him on Sunday and was received by him on that day.

* * * * * * *

Yesterday I received a note from the foreign office, a copy of which is herewith inclosed, giving a reply to the question which I had submitted to it in writing. Although this note states that the Chinese minister may have been acting within his authority in concluding the arrangement mentioned, it does not either state that such an arrangement has been made nor does it declare that such an arrangement, if [Page 133] made, has the approval of the Imperial Government. I can not therefore consider that this answer is satisfactory, but I shall await further instructions before I mention the matter further to the foreign office.

* * * * * * *

I have, etc.,

W. W. Rockhill.
[Inclosure 1.]

Memorandum Left at the Chinese Foreign Office August 12, 1905.

The Chinese minister in Washington, representing the Imperial Government, has signed with the American China Development Company a provisional memorandum of settlement. In this the Chinese minister states that, his government having canceled and annulled the concession and contract of the said company and refused to permit it to continue the construction of the railway, he has suggested as a reasonable indemnity and offered to pay to the company the sum of six and three-quarter millions of gold dollars (United States currency).

The President wishes to have an immediate answer from the Imperial Government stating whether or not the recital of facts in the above-mentioned provisional agreement was authorized by the Chinese Government, and, in case it has not so authorized, asks that it will immediately notify the Chinese minister at Washington to that effect.

[Inclosure 2.]

Prince Ch’ing to Minister Rockhill.

With reference to the matter of the Hankow-Canton Railway, concerning which your excellency called at my board yesterday and left a memorandum to the effect that His Excellency Liang had reached an agreement with the American China Development Company, by which the company’s contract was nullified and an indemnity therefor was suggested by him, etc., and in which you desired to know whether or not the Chinese Government had sanctioned such a settlement and given His Excellency Liang authority for his action in the matter, I have the honor to state that my board has made inquiry into the matter and finds as follows:

The grand council, last year and this year, copied and sent to His Excellency Chang Chih-t’ung altogether three confidential letters of instruction from the Emperor directing him, by order of the Throne, to devise some means to gain back control of the railway.

The Chinese Government therefore, having given Chang Chih-t’ung authority to act in this matter, and, moreover, Chang Chih-t’ung’s memorial requesting that he and Liang be empowered to act cojointly therein having been approved, is it plain that His Excellency Liang certainly acted within his authority.

I therefore write this letter for your excellency’s information, and trust you will transmit the contents thereof to your government.

I also take this occasion, etc.

Cards of foreign office inclosed.