ARTICLE II.

With the intention of meeting the legitimate desire of His Majesty the German Emperor, that Germany, like other PowTerritory leased. ers, should hold a place on the Chinese coast for the repair and equipment of her ships, for the storage of materials and provisions for the same, and for other arrangements connected therewith, His Majesty the Emperor of China cedes to Germany on lease, provisionally for ninety-nine years, both sides of the entrance to the Bay of Kiao-chau. Germany engages to construct, at a suitable moment, on the territory thus ceded, fortifications for the protection of the buildings to be constructed there and of the entrance to the harbour.

ARTICLE III.

In order to avoid the possibility of conflicts, the Imperial Chinese Government will abstain from exercising rights of Limits of terri- sovereignty in the ceded territory during the term of the lease, and leaves the exercise of the same to Germany within the following limits:

tory leased.

(1.) On the northern side of the entrance to the bay:

The peninsula bounded to the north-east by a line drawn from the north-eastern corner of Potato Island to Loshan Harbour.

(2.) On the southern side of the entrance to the bay:

The peninsula bounded to the south-west by a line drawn from the south-westernmost point of the bay lying to the south-south-west of Chiposan Island in the direction of Tolosan Island.

(3.) The Island of Chiposan and Potato Island.

(4.) The whole water area of the bay up to the highest water-mark at present known.

(5.) All islands lying seaward from Kiao-chau Bay, which may be of importance for its defence, such as Tolosan, Chalienchow, &c. The High Contracting Parties reserve to themselves to delimitate more accurately, in accordance with local traditions, the boundaries of the territory leased to Germany and of the 50-kilom. zone round the bay, by means of Commissioners to be appointed on both sides.

Delimitation.

Rights of Chinese ships in Kiaochau Bay.

Chinese ships of war and merchant-vessels shall enjoy the same privileges in the Bay of Kiao-chau as the ships of other nations on friendly terms with Germany; and the entrance, departure, and sojourn of Chinese ships in the bay shall not be subject to any restrictions other than those which the Imperial German Government, in virtue of the rights of sovereignty over the whole of the water area of the bay transferred to Germany, may at any time find it necessary to impose with regard to the ships of other nations.

Navigation sig

nals.

ARTICLE IV.

Germany engages to construct the necessary navigation signals on the islands and shallows at the

entrance of the bay.

No dues shall be demanded from Chinese ships of war and merchantvessels in the Bay of Kiao-chau, except those which may be levied upon other vessels for the purpose of maintaining the necessary harbour arrangements and quays.

Port dues.

ARTICLE V.

Should Germany at some future time express the wish to return Kiao-chau Bay to China before the expiration of the Return of leased lease, China engages to refund to Germany the expenditure she has incurred at Kiao-chau, and to cede to Germany a more suitable place.

territory.

Germany engages at no time to sublet the territory leased from China to another Power.

The Chinese population dwelling in the ceded territory shall at all times enjoy the protection of the German Government, Chinese in leased provided that they behave in conformity with law and order; unless their land is required for other purposes

territory.

they may remain there.

If land belonging to Chinese owners is required for any other purpose, the owner will receive compensation therefor.

As regards the re-establishment of Chinese customs stations which formerly existed outside the ceded territory, but within Customs stations. the 50-kilom. zone, the Imperial German Government intends to come to an agreement with the Chinese Government for the definitive regulation of the customs frontier, and the mode of collecting customs duties, in a manner which will safeguard all the interests of China, and proposes to enter into further negotiations on the subject.

SECTIONS II AND III."

I. The Chinese Government sanctions the construction by Germany. of two lines of railway in Shantung. The first will run from Kiao-chau and Tsinan-fu to the boundary of Shantung province via Wei-hsien, Tsinchow, Pashan,

Railways in Shantung.

The following sections of the German-Chinese Agreement of March 6, 1898, have never been made public by the German Government, but have been privately communicated to persons interested in the development of the Protectorate. See Proceedings before the Budget Commission of the Reichstag, April 29, 1898 in Brit. Blue Book, China No. 1 (1899), p. 67. See also for Précis of these Sections of the Agreement Brit. Blue Book, China 1 (1899), p. 152. The text as given here of these sections of the Agreement is based on unofficial publications, but is, it is believed, substantially correct.

Tsechuen and Suiping. The second line will connect Kiao-chau with Chinchow, whence an extension will be constructed to Tsinan through Laiwu-hsien. The construction of this extension shall not be begun until the first part of the line, the main line, is completed, in order to give the Chinese an opportunity of connecting this line in the most advantageous manner with their own railway system. What places the line from Tsinan-fu to the provincial boundary shall take in en route is to be determined hereafter.

II. In order to carry out the above mentioned railway work a ChinoGerman Company shall be formed, with branches at Railway company to be organ- whatever places may be necessary, and in this Company both German and Chinese subjects shall be at liberty to invest money if they so choose, and appoint directors for the management of the undertaking.

ized.

Mode of carrying out works.

III. All arrangements in connection with the works specified shall be determined by a future conference of German and Chinese representatives. The Chinese Government shall afford every facility and protection and extend every welcome to representatives of the German Railway Company operating in Chinese territory.

Division of

intentions.

Profits derived from the working of these railways shall be justly divided pro rata between the shareholders without profits. German regard to nationality. The object of constructing these lines is solely the development of commerce. In inaugurating a railway system in Shantung Germany entertains no treacherous intention towards China, and undertakes not to unlawfully seize any land in the province.

ing.

IV. The Chinese Government will allow German subjects to hold and develop mining property for a distance of 30 li Mines and min from each side of these railways and along the whole extent of the lines. The following places where mining operations may be carried on are particularly specified along the northern railway from Kiao-chau to Tsinan, Wei-hsien, Pa-shan-hsien and various other points; and along the Southern Kiao-chau-Tsinan Chinchow line, Chinchow-fu, Laiwu-hsien, etc.

Chinese capital may be invested in these operations and arrangements for carrying on the work shall hereafter be Chinese investors. made by a joint conference of Chinese and German representatives.

Protection to

All German subjects engaged in such works in Chinese territory shall be properly protected and welcomed by the Chinese authorities and all profits derived shall be fairly divided between Chinese and German shareholders according to the extent of the interest they hold in the undertakings.

miners.

In trying to develop mining property in China, Germany is actuated by no treacherous motives against this country, but German inten- seeks alone to increase commerce and improve the relations between the two countries.

tions.

Preferential

The Chinese Government binds itself in all cases where foreign assistance, in persons, capital or material, may be treatment prom- needed for any purpose whatever within the Province of Shantung, to offer the said work or supplying of materials, in the first instance to German manufacturers and merchants engaged in undertakings of the kind in question.

ised Germans.

In case German manufacturers and merchants are not inclined to undertake the performance of such works or the furnishing of materials, China shall then be at liberty to act as she pleases.

The above Agreement shall be ratified by the Sovereigns of both the Contracting States, and the ratifications exchanged in such manner that, after the receipt in Berlin of the Treaty ratified by China, the copy ratified by Germany shall be handed to the Chinese Minister in Berlin.

The foregoing Treaty has been drawn up in four copies, two in German and two in Chinese, and was signed by the Representatives of the two Contracting States on the 6th March, 1898, corresponding to the 14th day of the second month in the twenty-fourth year Kuang-hsü. (Great Seal of the Tsung-li Yamên.)

The Imperial German Minister,

(Signed)

Baron von HEYKING.

LI HUNG-CHANG (in Chinese), Imperial Chinese Grand Secretary, Minister of the Tsung-li Yamên, &c., &c.

WENG TUNG-Ho (in Chinese),

Imperial Chinese Grand Secretary, Member of the

Council of State, Minister of the Tsung-li Yamên, &c., &c.

No. 9.

RUSSIA.

CONVENTION BETWEEN RUSSIA AND CHINA FOR LEASE TO RUSSIA OF PORT ARTHUR, TALIENWAN, AND THE ADJACENT WATERS. a

SIGNED AT PEKING, MARCH 27, 1898.

[Translation.]

ON the 6th day of the 3rd moon of the 24th year of Kuang Hsü (27th March, 1898), His Majesty the Emperor of China especially deputed the Grand Secretary Li, and the Vice-President of the Board of Revenue Chang, as Plenipotentiaries to settle the matters connected with the loan of Port Arthur and Talienwan, with the Russian Chargé d'Affaires Pavloff.

The Convention drawn up is as follows:ARTICLE I. In order for the protection of the Russian fleet, and (to enable it) to have a secure base on the north coast of Necessity for China, His Majesty the Emperor of China agrees to lease to Russia Port Arthur, Talienwan, and the adjaBut this lease is to be without prejudice to China's authority in that territory.

lease.

cent waters.

Boundaries.

ART. II. The boundary of the territory leased in pursuance of the foregoing extends from Talienwan northward in accordance with the requirements (of the situation) on land, and of the protection of the territory, and permission shall be given for its being placed at whatever distance may be necessary.

The exact boundary and the other details of this Convention, shall be jointly arranged at St. Petersburgh with Hsü Ta-jên, after the sig nature of this Convention, with all possible expedition, and a separate special Article drawn up. After the boundary has been decided, all the territory included in it, and the adjacent waters shall be entirely handed over to Russia to use under lease.

ART. III. The term of lease is fixed as twenty-five years from the date of signature. On expiration an extension of the term may be arranged between the two countries.

Term of lease.

a From British Parliamentary Blue Book, China, No. 1. (1899), p. 128. The text of this convention has not been made public by the Russian Government; as given here it is a translation of "a Chinese précis of the agreement." H. Cordier, Hist. des Rel., III, 362, supplies a French version, but it is only a translation of the English here printed.