exempting them from the payment of further duty, and this is irrespective of how such goods are to be transhipped to their destination. This special certificate will be stamped in accordance with regulations, and will be good for two months only.

Whenever such certificates are applied for, a signed declaration must be presented showing to what port the goods are consigned, and stating that in case evidence of the arrival of the goods in the port mentioned is not forthcoming within the two months limit, the applicant will be willing to forfeit three times the amount of the half-duty. In order to avoid the trouble of preparing a guarantee on each occasion, however, it will be permissible to draw up a bond of a similar nature which will hold for a year, and to deposit the same in the Customs-house. Such bond, if presented by a foreigner, must be sealed by a consular officer, and if presented by a Chinese, must be sealed by the Commissioner of Customs. If a yearly bond is not furnished, then a signed declaration made for each shipment will suffice. The forms for these bonds and declarations shall be determined upon by the Imperial Maritime Customs.

II. In all cases where goods are shipped to the newly opened ports under special certificate, such goods must correspond exactly with the declaration.

In case of any discrepancy or of the shipment of any goods not on the declaration, not only will the Customs-house where such declaration was made collect a fine amounting to three times the half-duty levied upon the entire shipment, but the goods which have been shipped to the newly opened port will there be confiscated.

NUMBER 1908/1.

GERMANY (Deutsch-Asiatische Bank), GREAT BRITAIN (Chinese Central Railways, Limited) AND CHINA.

Agreement for the Imperial Chinese Government five per cent Tientsin-Pukou Railway loan.*-January 13, 1908.

This Agreement is made at Peking on the 10th day of the 12th Moon of the 33rd year of Kuang Hsü, corresponding to the 13th day of January, 1908, and the contracting parties are:

His Excellency Liang Tunyen, Acting Junior Vice President of the Wai-wu Pu, duly authorized to act on behalf of the Imperial Government of China, of the one part, and (a) the Deutsch-Asiatische Bank, Shanghai, (b) the Chinese Central Railways, Limited, London, hereinafter called "The Syndicate,” of the other part.

ARTICLE I-The Imperial Government of China authorizes the Syndicate to issue a 5% Gold Loan for an amount of five million pounds sterling (£5,000.000.00). The loan shall be of the date on which the first series of bonds is issued

*Text as printed in Wang, p. 395. See Note to this document, post, p. 694.

to the public and shall be called the "Imperial Chinese Government Five Percent Tientsin-Pukou Railway Loan."

ARTICLE II. The loan is designed to provide capital for the construction of a government railway line from a point connecting the Imperial Railways of North China at or near Tientsin through Techou and Tsinanfu to Ihsien near the southern frontier of Shantung, hereinafter known as the Northern Section of the Tientsin-Pukou Railway Line, and from Ihsien to a point at or near Pukou (opposite Nanking on the Yangtze-kiang), hereinafter known as the Southern Section of the Tientsin-Pukou Railway Line. The total length of these two sections being about 1085 kilometres, equal to about 2170 Chinese Li. The survey line shall be open to revision by the Director General of the Railway.

ARTICLE III.—The capital so provided shall be solely devoted to the construction of the railway line including the purchase of land, rolling stock and other equipment, and to the working of the line and to payment of interest on the loan during the period of construction, which is estimated at four years from the actual beginning of the works, the commencement of the works not to be delayed beyond six months after this agreement has been signed, within which period the Syndicate shall notify the Director General that the sum of five hundred thousand pounds (£500,000.00) has been placed at his disposal, to be held in Europe or remitted to China as he may direct, as a first instalment on account of the proceeds of the loan. This amount of £500,000.00, or whatever portion thereof is actually advanced, together with interest thereon not exceeding a charge of six percent per annum, shall be deducted from the proceeds of the first sale of the bonds.

ARTICLE IV.—The rate of interest for the loan shall be five per cent per annum on the nominal principal and shall be paid to the bondholders half-yearly. The said interest shall be calculated from the date on which the loan is issued to the public and shall be paid by the Imperial Chinese Government during the time of construction either from the proceeds of the loan or from other sources, and afterwards, in the first place, out of the revenue of the Railway, and then from such other revenues as the Chinese Government may think fit to use for the purpose in half-yearly instalments according to the amounts specified in the schedule attached to this agreement and fourteen days before their due dates, Western Calendar, as calculated half-yearly from the date on which the loan is issued to the public.

ARTICLE V. The term of the loan shall be thirty years. Repayment of principal shall commence after the expiry of ten years from the date of the loan. and except as provided in Article VI. hereinafter, shall be made by yearly amortization to the Deutsch-Asiatische Bank and the Hongkong and Shanghai Banking Corporation in half-yearly instalments out of the revenues of the line or such other revenue as the Chinese Government may think fit to use for the purpose, according to the amount specified in the schedule attached to this agreement, but fourteen days before their due date, Western Calendar, as calculated halfyearly, from the date on which the loan is issued to the public.

ARTICLE VI.-If at any time after the lapse of ten years from the date of the loan the Imperial Chinese Government should desire to redeem the whole

outstanding amount of the loan, or any part of it, not yet due for repayment in accordance with the schedule of repayments hereto attached, it may do so until the 20th year, by payment of a premium of 22 per cent. on the face value of the bonds (that is to say, by payment of £102. 10s. for each £100 bond) and after the 20th year without premium; but in each and every case of such extra redemption, the Imperial Chinese Government shall give six months notice in writing to the Syndicate and such redemption shall be effected by additional drawings of bonds, to take place on the date of an ordinary drawing, as provided for in the prospectus of the loan.

ARTICLE VII.-The Deutsch-Asiatische Bank and the Hongkong and Shanghai Banking Corporation having been appointed by the German and British parties of the Syndicate, respectively, Agents for the service of the loan, the half-yearly payments due for amortisation and interest, referred to in Articles IV. and V., shall be made, in accordance with the amounts of the Schedule attached to this Agreement, and fourteen days before their due dates as fixed by Articles IV. and V., to those Banks by the Director General of the Railway, who shall hand to said Banks in Shanghai or in Tientsin fourteen days before the said due dates, in shares to be arranged by the Banks, funds in Shanghai or Tientsin sycee sufficient to meet such payments in gold in Europe, exchange for which shall be settled with the said Banks on the same day, the Railway Administration having, however, the option of settling exchange with the two banks at any date or dates within six months previous to any due date for the repayment of interest and principal. These payments may, however, be made in gold, if the Imperial Chinese Government should happen to have gold funds bonâ fide at their disposal in Europe not remitted from China for the purpose and desire so to use them.

In reimbursement of expenses connected with the payment of interest and the repayment of principal of the loan, the Hongkong and Shanghai Banking Corporation and the Deutsch-Asiatische Bank will receive a commission of one quarter per cent. on the annual loan service.

ARTICLE VIII.-The Imperial Government of China hereby engages that the interest and principal of this loan shall duly be paid in full, and should the revenue of the Railway and/or the proceeds of the loan not be sufficient to provide for the due and full payment of interest and repayment of principal, the Director General shall memorialize the Throne and the Imperial Government of China will thereupon make arrangements to ensure that the amount of the deficiency shall be met from other sources and handed over to the banks on the date upon which funds are required, to complete full payment of interest and repayment of principal.

ARTICLE IX.-The loan is hereby secured:

1. By likin and internal revenues of the province of Chihli to the amount of 1,200,000 Haikuan taels a year.

2. By likin and internal revenues of the province of Shantung to the amount of 1,600,000 Haikuan taels a year, and

3. By the revenue of the Nanking likin collectorate (to the amount of 900,000 Haikuan taels a year) and of the Huai-an native customs (to the amount of 100,000 Haikuan taels a year) in the province of Kiangsu.

The provincial revenues as above stated are hereby declared to be free from all other loans, charges or mortgages.

So long as principal and interest of the loan are regularly paid, there shall be no interference with these provincial revenues; but if the principal or interest of the loan be in default at due date, then, after a reasonable period of grace, likin and suitable internal revenues of the three provinces sufficient to provide the amounts above stated shall forthwith be transferred to and administered by the Imperial Maritime Customs, in the interest of the bondholders. And so long as this loan or any part thereof shall remain unredeemed, it shall have priority both as regards principal and interest over all future loans, charges and mortgages charged on the above-mentioned revenues of the three provinces. No loan, charge or mortgage shall be raised or created which shall take precedence of, or be on equality with this loan, or which shall in any manner lessen or impair its security over the revenues of the three provinces as above stated; and any further loan, charge or mortgage charged on the said revenues of the three provinces shall be made subject to this loan, and it shall be so expressed in every agreement for every such future loan, charge or mortgage.

It is understood and agreed that so long as this loan is unredeemed the railway shall under no circumstances be mortgaged nor its receipts given as security to any other party.

In the event of the Chinese Government, during the currency of this loan, entering upon definite arrangements for the revision of customs tariff accompanied by stipulations for the decrease or abolition of likin, it is hereby agreed, on the one hand that such revision shall not be barred by the fact that this loan is secured by likin and provincial revenues, and, on the other hand, that whatever likin is required to provide the security of this loan shall neither be decreased nor abolished except by previous arrangement with the Syndicate, and then only in so far as an equivalent is substituted for it in the shape of a first charge upon the increase of customs revenue consequent upon such revision.

ARTICLE X.-The Syndicate is hereby authorized to issue to the subscribers to the loan, Bonds for the total amount of the loan for such amounts as may appear advisable to the Syndicate. The form of the Bonds shall be settled by the Syndicate in consultation with the Director General or the Chinese ministers in London and Berlin. The Bonds shall be engraved in English or Chinese and German as may be required; they shall bear the facsimile of the signature of the Director General and of his Seal of Office, in order to dispense with the necessity of signing them all in person. But the Chinese Minister in London or Berlin, as the case may be, shall, previous to the issue of any Bonds, put his seal upon each Bond with a facsimile of his signature, as a proof that the issue and sale of the bonds are duly authorized by, and binding upon, the Imperial Chinese Government, and the representatives of the Syndicate in London and/or Berlin shall countersign the bonds as agents for the issue of the loan.

In the event of bonds issued for this loan being lost, stolen or destroyed, the Syndicate shall immediately notify the Director General and the Chinese Minister in London and/or Berlin, as the case requires, who shall authorize the Syndicate to insert an advertisement in the public newspapers notifying that payment of same

has been stopped and to take such other steps as may appear advisable or necessary according to the laws and customs of the country concerned, and should such bonds not be recovered after a lapse of time to be fixed by the Syndicate, the Director General or the Chinese Minister in London or Berlin, as the case may be, shall seal and execute duplicate bonds for a like amount and hand them to the Syndicate, by whom all expenses in connection therewith shall be defrayed.

ARTICLE XI.-All bonds and coupons and payments made and received in connection with the service of this loan shall be exempt from all Chinese taxes and imposts during the currency of this loan.

ARTICLE XII.—All details necessary for the prospectus and connected with the payment of the interest and repayment of the principal of this loan, not herein explicitly provided for, shall be left to the arrangement of the Syndicate in consultation with the Chinese Ministers in London and Berlin. The Syndicate is hereby authorized to issue the prospectus of the loan as soon as possible after the signing of this Agreement; and the Imperial Government will instruct the Chinese Ministers in London and Berlin to co-operate with the Syndicate in any matters requiring conjoint action and to sign the prospectus of the loan.

ARTICLE XIII-The loan shall be issued to the public in two or more series of bonds, the first issue to be made to the amount of £3,000,000 as soon as possible after the signature of this agreement and not later than twelve months from the date thereof. The price to the Imperial Chinese Government of the first series of bonds shall be 93 per cent. of their nominal value. The second and any subsequent series shall be issued in time to permit of uninterrupted continuance of the work of construction, in amounts to be determined by the Director General, and the price payable to the Chinese Government in respect of these series shall be the actual rate of their issue to the public, less flotation charges of 51⁄2 points retainable by the Syndicate (that is to say, a charge of £5 10s. Od. for every £100 bond issued). Subscriptions will be invited by the Syndicate in Europe and in China both from Chinese and Europeans on equal conditions, preference being given to the application of the Chinese Government, provided such application be made before the issue of the prospectus to the public.

ARTICLE XIV. The proceeds of the loan shall be paid to the credit of the Tientsin-Pukou Government Railway account with the Hongkong and Shanghai Banking Corporation and the Deutsch-Asiatische Bank in China, London or Berlin, as the case may be. Payments of loan proceeds into the credit of this account shall be made in instalments and on dates conforming to the conditions allowed to the subscribers to the loan. Interest at the rate of 4 per cent. per annum shall be granted on the credit balance of the portion of this account kept in London and Berlin, and interest on the credit balance of the portion kept in China will be allowed at the Banks' rates for current account or fixed deposits. as the case may be, to be arranged. After deduction of the funds required for the service of interest and for commission on this service during the time of construction, the Banks will hold the net proceeds with accrued interest to the order of the Director General, who, in ordering payment of any sums exceeding £20,000 shall give notice to the Banks ten days before the day on which they are required. Requisitions on the loan funds will be drawn in amounts to