Should com

instructions to assist the agents and to help them in their work. plications arise with the people of the country, it will be the duty of these delegates to adjust them in cooperation with the local authorities, in such fashion that no misunderstanding may arise and no quarrel be started among the population.

If incidents take on a grave character and cannot be satisfactorily settled locally, a report will be drawn up in order to enable the Authorities of Yunnan to settle the matter with the Consul General of France. If the question lies outside the powers of the High Authorities, it will be taken to Peking, where it will be settled between the Chinese Government and the Minister of France.

ARTICLE XXXII.-During construction, there shall be paid monthly to the High Authorities of Yunnan a sum of 4450 taels to defray the expenses of maintenance and the traveling expenses of the high official resident in Mengtsz, of two mandarins under his orders (one of them concerning himself with lands, and the other with justice, in that city), of one functionary corresponding to them near the High Authorities at Yunnan Fu, of twelve delegates assigned by the Province to assist in the construction of the line, of ten chiefs of police and two hundred and forty men of the guard, of one interpreter, and of all the subordinate functionaries.

ARTICLE XXXIII.-The present regulations, when they shall have been approved by the Chinese Government, will constitute the definitive rule by which all questions concerning the construction and operation of the railway will be determined.

*

ARTICLE XXXIV.-At the end of twenty-four years the Chinese Government may enter into negotiations with the French Government to take back the line and all properties connected therewith, upon the full payment of the costs of construction, industrial profits, interest paid, and the expenses of every sort attributable to the railway (moyennant le remboursement intégral des frais de construction, de la main d'œuvre industrielle ainsi que des garanties d'intérêt payées et les dépenses de toute nature imputables au chemin de fer.)

If at that time the said costs, values and expenses have been fully repaid by the revenues of the line, the line and all its appurtenances may be turned over without charge into the hands of the Authorities of Yunnan, who will take control of it. For the appraisement of the construction and other expenses, the French budget accounts, established at the time when the negotiations above contemplated may have been entered into, will be taken as a basis for estimating whether or not China would eventually have to make a payment before entering into possession of the railway.

Done and signed at the Ministry for Foreign Affairs at Peking, in four originals, October 29, 1903 (10th day of the 9th moon of the 29th year of Kuang-Hsü), by Their Excellencies Mr. Lien Fang, Secretary of State at the Ministry for Foreign Affairs of China, and Mr. Pierre Réné Georges Dubail, Envoy Extraordinary and Minister Plenipotentiary of the French Republic in China.

(Sgd.)

G. DUBAIL.

(Sgd.)

LIEN FANG.

* The French text to which the Editor had access gave this figure as vingt-quatre; there is, however, some reason to doubt whether this was not a typographical error for quatre-vingt (i.e., eighty).

Note.

Doc. Dipl., Chine, Juin—Octobre, 1900, contains the following comment concerning the Yunnan Railway:

"By a convention of the 9-10 April, 1898, the French Government secured for itself or for the Company chosen by it, the right to build a railway from Laokay (frontier of Tongking), to Yun-nan Hsien (450 kilometers), and a law of December 25, 1898, authorized the Government of Indo-China to grant a guarantee of interest to the Company which might become the grantees of this line.

"In conformity with this law, the Governor General of Indo-China signed the 15 June 1901, with a syndicate of the principal financial houses of Paris, a convention for the building of the railway from Laokay to Yun-nan Hsien and for the working of the whole line from Haiphong to Yün-nan Hsien.

This convention was ratified by a law of July 5, 1901.

"The principal provisions of the convention are the following:

"The syndicate agrees to organize, within three months from the date of the passage of the law approving the convention between the Government of Indo-China and it, a stock company with a capital of 12,500,000 francs, to work the line from Haiphong to Laokay which is to be built by the Government of Indo-China, and for the purpose of building itself and working the railway from Laokay to Yün-nan Hsien. The company will receive from the colony a subvention of 12,500,000 francs and also a guarantee of three millions of francs payable during 75 years, for the bonds which it shall have issued for the purpose of building the railway.

"Last July (1901) the Compagnie française des chemins de fer de l'Indo-Chine et du Yunnan was organized, and the bonds have just been issued.

66

'For the purpose of building the line from Laokay to Yün-nan Hsien, the company has negotiated with the Régie générale des chemins de fer and the Société de construction des Batignolles, which have formed for this purpose the Société de construction de chemins de fer indo-chinois with a capital of 4 million.

The Société de construction has sent during the present month (October, 1901), survey parties to Yün-nan for the final study of the line."

The line from Hokow to Yunnan Fu was completed in 1910.

NUMBER 1903/7.

BELGIUM (Compagnie Générale de Chemins de Fer et de Tramways en Chine) AND CHINA.

Loan Contract, and Operating Contract, for the Kaifengfu-Honanfu Railway.* -November 12, 1903.

(I)—LOAN CONTRACT.

Between the Undersigned:

1° The Imperial Chinese Railway Company, represented by H. E. Sheng Kung Pao, Director General, duly authorized by the Chinese Government,

2° La Compagnie Générale de Chemins de Fer et de Tramways en Chine,

* Translation of the loan contract, printed in Rockhill, p. 389, with date and signatures supplied from French version printed in Wang, p. 285; operating contract translated from the French text as printed in Wang, p. 315. Loan contract printed also in F. E. Review, vol. 5, p. 145; Kent, 278.

These contracts were modified by the Lung-Tsing-U-Hai Railway Contract of September 24, 1912 (No. 1912/11, post).

The Kaifengfu-Honanfu Railway is also known as the Pienlo Railway.

represented by Monsieur Armand Rouffart, its delegated Administrator, provided with full powers,

It has been agreed as follows:

ARTICLE I.-The Director General of the Imperial Chinese Railway Company H. E. Sheng Kung Pao has asked, in a report, the Chinese Government that a line of railway should be built starting from a point called Yung Tse on the Railway line of the Luhan where the latter crosses the River. From that point eastward to Kaifeng the line will be 170 li long and westward to Honan Fu it will cover 250 li. These two branches of the Luhan to be built by a Belgian party (groupe) which will make a Loan to build them.

This proposal was accepted by a decree dated the 30th day of the 10th moon of 25th year of the present reign.

Monsieur Rouffart, the representative of La Compagnie Générale de Chemins de Fer et de Tramways en Chine, has asked us by letter, to undertake this building, and we sent a Chinese official to accompany him in his preliminary study on the ground. After said study, Monsieur Rouffart estimated the probable cost of these two branches at ONE MILLION Pounds Sterling or 25,000,000 francs; and for all other terms the contracts from Peking to Hankow are to be followed.†

Under date of the 29th day of the 12th moon of the 28th year of the present reign, the Wai-wu Pu wrote to me that I was to discuss the terms of the contract with Monsieur Rouffart, and it asked me to settle the matter as promptly as possible.

Considering that Monsieur Rouffart has full powers from the Compagnie Générale de Chemins de Fer et de Tramways en Chine to negotiate this business for it, we, Director General of the Imperial Chinese Railway Company, and Monsieur Armand Rouffart representing the Compagnie Générale de Chemins de Fer et de Tramways en Chine, hereby enter into a contract for a loan, the product of which shall be applied to the building of the Railway from Honan Fu to Kaifeng Fu.

Before signing the contract, the Director General of the Imperial Chinese Railway Company has submitted said contract for Imperial Sanction, and it has been approved under date of October 29th, 1903, that is, the 10th day of the 9th moon of the 29th year of the Reign of Kuang Hsü.

This Decree shall form Annex 1 of the present contract. In virtue of the above the Director General, on account of the Chinese Government, makes a GOLD 5% Loan for the sum of 25,000,000 francs or 1,000,000 pounds sterling. This Loan shall be known as the Chinese Government 5% Gold Foreign 1903 Loan (Emprunt du Gouvernement Chinois 5% or Extérieur 1903).

ARTICLE II.-This loan shall be represented by 50,000 bonds of 500 francs GOLD each.

These bonds, the text of which is annexed to the present contract (Annex 2), shall be signed in the name of the Chinese Government by the Minister Plenipotentiary of China at Brussels.

See the loan and operating contracts for the Peking-Hankow Railway, June 26, 1898 (No. 1898/13, ante).

They shall be delivered in fractional bonds (coupons) of 1 to 2 bonds in such proportion as the Compagnie Générale de Chemins de Fer et de Tramways en Chine may request, the total number not to exceed 50,000; the expense of making these bonds shall be charged to the Compagnie Générale de Chemins de Fer et de Tramways en Chine. They shall bear 5% interest a year on the nominal capital payable in gold.

Interest shall run from the date of payment of the product (of the sale) of the bonds, and shall be payable the 1st January and 1st July of each year.

Coupons which have become due and have been paid, shall be classed in numeric order by the Compagnie Générale de Chemins de Fer et de Tramways en Chine, and at its expense, and it shall then send them to the Imperial Chinese Railway Company at Shanghai to be cancelled. If the returned coupons are lost in transmission, the Compagnie Générale de Chemins de Fer et de Tramways en Chine must publish the numbers of the paid and lost coupons in four different newspapers, and transmit to the Imperial Chinese Railway Company a declaration stating the loss.

ARTICLE III.-The loan shall be redeemed in twenty years counted from the 10th year of issue, by the method of drawing by lots in the offices of the Compagnie Générale de Chemins de Fer et de Tramways en Chine, in accordance with the table annexed to the present contract (Annex 3). The drawings by lot shall take place on the third Wednesday of April in each year. The first drawing shall take place on that date beginning with the tenth year from the date of issue of the loan.

The numbers of the drawn bonds shall be published in four newspapers at the expense of the Compagnie Générale de Chemins de Fer et de Tramways en Chine.

ARTICLE IV. The bonds drawn by lots shall be paid in gold at their par value on the date on which falls due the coupon following the date of the drawing. Bonds presented for refunding must have attached all coupons still unpaid, and the amount of missing coupons will be deducted from the capital to be reimbursed. Interest on bonds will cease to accrue from the day set for reimbursement. Paid off bonds shall be classified and sent back by and at the expense of the Compagnie Générale de Chemins de Fer et de Tramways en Chine to the Imperial Chinese Railway Company at Shanghai to be cancelled. If these bonds should be lost on the way, the Compagnie Générale de Chemins de Fer et de Tramways en Chine, shall publish the numbers of the paid and lost bonds in four different newspapers, and transmit to the Imperial Chinese Railway Company a declaration stating the loss.

ARTICLE V.-The Chinese Government denies itself the right, before the date fixed for the first amortization, to fix a larger amortization, or to refund the whole loan or to convert it. After that date it shall be free to refund the loan at whatsoever time it chooses before the dates of payment, and the refunding made all contracts shall be declared annulled.

ARTICLE VI.-Coupons and bonds shall be paid off in francs in the office or offices entrusted with the management of the loan.

ARTICLE VII.—Interest payment and the reimbursement of the bonds pro

vided for in the present loan shall be guaranteed by the gross revenues of the Imperial Chinese Government.

Furthermore in virtue of the authorization already granted by the Chinese Government, and in accord with it, the Imperial Chinese Railway Company, declares that it makes a preferential assignment in favor of the payment of interest and of the capital of the present loan, and that it cedes and assigns in favor of said obligations, all the net receipts of the line from Kaifengfu to Honanfu, after the regular payment of all expenses of management and operating, the whole as elsewhere indicated in an operating treaty concluded between the Imperial Chinese Railway Company and the Compagnie Générale de Chemins de Fer et de Tramways en Chine, said treaty being annexed to and forming an integral part of the present contract. This assignment is made exclusively and irrevocably until complete redemption of the bonds of the present

contract.

ARTICLE VIII.-After auditing and noting the net receipts, the Imperial Chinese Railway Company shall direct the Compagnie Générale de Chemins de Fer et de Tramways en Chine to deposit these funds in a bank to be chosen by common consent. This bank shall convert into GOLD, in accordance with the provisions stipulated in the contract made between the Bank, the Imperial Chinese Railway Company and the Compagnie Générale de Chemins de Fer et de Tramways en Chine, and to the best advantage of the Imperial Chinese Railway Company, the sums paid it, and up to the full amount needed to insure the service of the loan at the next semi-annual payment.

These deposits shall continue to be made until the sum needed for the integral service of the loan on the following date of payment has been realized in GOLD, and in such manner that said service is insured at least three months before the date of the semi-annual payment.

The bank designated for the receipt of these sums shall use them to the best advantage of the Imperial Chinese Railway Company. The account in which these sums shall be carried shall be charged twenty days before the date of payment with the sums needed for the service of the loan, interest, amortization, money expenses, difference of exchange and the commissions provided for by the present contract.

ARTICLE IX.-The bank in which shall be deposited the loan funds shall have the right without further authorization to levy on said funds on deposit the amount of the coupons to be paid during the construction period; but it shall advise the Director General as these payments are made.

ARTICLE X.-To insure the guarantee just given to the bonds of the present contract, the Imperial Chinese Railway Company grants these bonds a special first-class guarantee on the Railway from Kaifengfu to Honanfu, on its fixed and rolling stock and its receipts.

This special assignment is accepted in the name of the bondholders by the Compagnie Générale de Chemins de Fer et de Tramways en Chine. In case of non-fulfillment of the obligations assumed by the Imperial Chinese Railway Company in the present contract, the Compagnie Générale de Chemins de Fer et de Tramways en Chine shall have full power to take such action against said