Agreement for Penhsihu Coal Mining Company, Ltd., May 22, 1910

1. After this Agreement shall have been sanctioned by the Chinese Government the Penhsihu Coal Mining Enterprise will be registered as a Sino-Japanese Company. The Company will be called the Penhsihu Coal Mining Company, Limited, hereinafter referred to as "the Company." The Japanese firm is hereinafter referred to as "Messrs. Okura & Company."

2. The Chinese Government has agreed on a valuation of the properties of the Penhsihu Mine at 350,000 dollars. After the signing of this contract the Company will hand over shares to the value of 350,000 dollars to the Chinese Government. 3.-The capital of the Company will be 2,000,000 Peiyang dollars. One-half will be subscribed by Chinese merchants, but in view of the fact that the Chinese Government has already 350,000 dollars invested in the mining properties only 650,000 dollars will be subscribed to complete the Chinese shares. Messrs. Okura & Company will be responsible for the subscription of the remaining 1,000,000 dollars. Interest on mine-shares and the cash-shares will begin to run on the day the Company starts operations in the former case and on the day cash is paid up in the latter case. 4. The profits of the Company will be divided as follows:

(a) Profits up to 8 per cent. will be paid on the 2,000,000 dollars as interest. In case the profit is insufficient for payment of 8 per cent. a lower interest will be paid.

(b) After paying the 8 per cent. interest, any profits will be divided into ten equal parts, one of which is to be put aside as a reserve fund, 21⁄2 parts will be paid to the Chinese Government as a contribution, and 61⁄2 parts will be equally divided among the Chinese and Japanese shareholders. When the shareholders consider the reserve fund to be sufficient they may, by mutual agreement, cease putting aside further sums to reserve. No interest is to be paid on the reserve fund.

5. There will be two Directors-in-chief, one Chinese and the other Japanese. The rest of the posts on the staff will be equally divided amongst Chinese and Japanese by the mutual consent of the two Directors-in-chief. Any enterprise concerning engineering or financial matters must receive the sanction and signatures of the two Directors-in-chief before being put into execution. The Directors-in-chief must make reports to the Director-General on each occasion. All documents and accounts will be managed by qualified officials of the Company in the most up-to-date manner possible and kept in both the Chinese and Japanese languages so that each Director-in-chief may be able to examine the contents. All the Company's affairs will be controlled and directed by the two Directors-in-chief of their representatives under the Company's seal, and under the signatures of the two Directors-in-chief. Chinese dates will be used in book-keeping and the paying out of dividends.

6. The Company will be considered formally constituted on the day the Chinese Government shall register it.

7. After the formation of the Company, when it is considered necessary by the two Directors-in-chief to increase the capital or to contract loans, the shareholders will be consulted. Then the shareholders of each nationality will be responsible for half the amount. Loans may not be contracted from persons of any nationality other than Chinese and Japanese. The Company's properties will not be mortgaged unless there be urgent necessity for loans. The shareholders may not sell their shares without the Company's consent. Only Chinese workmen will be employed in the mines. 8. The term of this agreement is thirty years, beginning on the day the Company is registered by the Chinese Government. At expiration of this Agreement the Company will enter into voluntary liquidation. The Chinese Government will then return the mine-share certificates to the Company and in return take back the mining area. The Company will as quickly as possible sell off its movable property, rails, mine-timbers and buildings at a fair price. The shareholders of each nationality will take one-half of the proceeds of sale and of the reserve fund. At this time all share certificates will be returned and cancelled unless by mutual consent this agreement is renewed. After expiration of this agreement, should the Chinese Government desire to carry on the undertaking by itself it can do so by taking back the mining area and paying adequate compensation for the movable property, rails, minetimbers and buildings.

9. For every long ton of coal produced the Company will pay likin of .06 K'u p'ing tael of sycee silver and a tax of .10 K'u p'ing tael of sycee silver. For the mining area the Company will pay .2 K'u p'ing tael of sycee silver for each mow occupied. As export tax the Company shall pay .1 K'u p'ing tael of silver as customs duty. In case, however the Chinese shall concede any lower rate of taxation to any Sino-Foreign company in the future, this Company may demand the same rate. When the new mining laws are promulgated by the Board of Agriculture, Industry and Commerce, the Government may, through the Governor of Manchuria, order the Company to alter this Agreement in order to comply with the new laws.

10. All the materials needed and purchased by the Company will be exempted from likin, but must pay the usual taxes to the maritime customs.

11. In consideration of the capital spent on the mine by Messrs. Okura & Company, in 1905 and 1909, the Company will take over all the property, including engines, buildings, construction and warehouse goods, etc., at a valuation of 1,000,000 dollars, which will be the Japanese capital. Messrs. Okura & Company will make a clear return of all the proceeds from sale of coal produced within that period. The Company will repay all the money spent by Messrs. Okura & Company, between the third moon and the formation of the Company, on new machinery, etc., and this machinery, etc., will be handed to the Company. Messrs. Okura & Company will hand in all proceeds from the sale of the coal produced within the period, and the coa! at surface or in store will be handed to the Company without claim for any payment thereon.

12. After the formation of the Company official surveyors will be despatched to make a surface survey of the concession, so as to fix its boundaries. The map will be sent to the Company as the official survey. If during the Company's mining operations any ancient objects of art be found these will be handed to the Chinese Gov

ernment.

13. Should the Company be in need of any land a fixed price will be paid as its rent. In case it be found necessary to pull down any buildings, or to remove any tombs, the case will be laid before the local official, who will notify the landowner of the fact, but the Company must pay fair compensation.

14. After signing this agreement, the Director-General will, within three months, instruct a representative to draft a set of the Company's Regulations together with Messrs. Okura & Company, preparatory to the operation of the Company. This set of articles will be handed to the Director-General for perusal and for forwarding to the Governor.

15. This Agreement will be drawn up in Chinese and Japanese. In case of dispute the Chinese version will be held to rule. There will be five copies of this Agreement: One copy will be kept at the Governor's Yamen, one at the Bureau of Foreign Affairs, one by Messrs. Okura & Company, one at the Company's Office, and one at the Japanese Consulate.

Dated May 22, 1910.

Signatures:

HAN KUO CHUN,

Commissioner of Foreign Affairs. HSIAO CHIH CHANG TSAO,

OKURA & COMPANY.

Japanese Consul.

No. 28

JAPAN AND CHINA

Agreement relating to the Chientao region.—September 4, 1909

The Imperial Government of Japan and the Imperial Government of China, desiring to secure for Chinese and,Korean inhabitants in the frontier regions the blessings of permanent peace and tranquility, and considering it essential in the attainment of such desire that the two Governments should, in view of their relations of cordial friendship and good neighborhood, recognize the River Tumen as forming the boundary between China and Korea, and should adjust all matters relating thereto in a spirit of mutual accommodation, have agreed upon the following stipulations:

ART. 1.-The Governments of Japan and China declare that the River Tumen is recognized as forming the boundary between China and Korea and that in the region of the source of that river the boundary line shall start from the boundary monument and thence follow the course of the stream Shihyishwei.

ART. 2.-The Government of China shall, as soon as possible after the signing of the present agreement, open the following places to the residence and trade of foreigners, and the Government of Japan may there establish consulates or branch offices of consulates. The date of the opening of such places shall be separately determined: Lungchingtsun; Chutszchie; Toutaokou; Paitsaokou.2

ART. 3. The Government of China recognizes the residence of Korean subjects. as heretofore, on agricultural lands lying north of the River Tumen. The limits of the district for such residence are shown in the annexed map.

ART. 4.-The Korean subjects residing on agricultural lands within the mixed residence district to the north of the River Tumen shall submit to the laws of China, and shall be amenable to the jurisdiction of the Chinese local officials. Such Korean subjects shall be accorded by the Chinese authorities equal treatment with Chinese subjects, and similarly, in the matter of taxation and all other administrative measures, they shall be placed on equal footing with Chinese subjects. All cases, whether civil or criminal, relating to such Korean subjects shall be heard and decided by

1 MACMURRAY, vol. I, p. 796; translation from the Japanese text, as printed in For. Rel., 1909, p. 119. Printed also in Am. Journal Int. Law, Supplement, 1910, p. Translation from Chinese text printed in CUSTOMS, vol. ii, p. 768.

132.

See Note to this document, post, p. 136.

2 The Chinese Government later fixed on November 2, 1909, as the date for the opening of all these ports.

the Chinese authorities in accordance with the laws of China, and in a just and equitable manner. A Japanese consular officer or an official duly authorized by him shall be allowed freely to attend the court, and in the hearing of important cases concerning the lives of persons, previous notice is to be given to the Japanese consular officers. Whenever the Japanese consular officers find that a decision has been given in disregard of law, they shall have right to apply to the Chinese authorities for a new trial to be conducted by officials specially selected in order to assure justice of the decision.

ART. 5.—The Government of China engages that land and buildings owned by Korean subjects in the mixed residence district to the north of the River Tumen shall be fully protected equally with the properties of Chinese subjects. Ferries shall be established on the River Tumen at places properly chosen, and people on either side of the river shall be entirely at liberty to cross to the other side, it being, however, understood that persons carrying arms shall not be permitted to cross the frontier without previous official notice or passports. In respect to cereals produced in the mixed residence district, Korean subjects shall be permitted to export them out of the said district, except in time of scarcity, in which case such exportation may be prohibited. Collection of firewood and grass shall be dealt with in accordance with the practice hitherto followed.

ART. 6. The Government of China shall undertake to extend the KirinChangchun Railway to the southern boundary of Yenchi, and to connect it at Hoiryong (Hueining) with a Korean railway, and such extensions shall be effected upon the same terms as the Kirin-Changchun Railway. The date of commencing the work of the proposed extension shall be determined by the Government of China, considering the actual requirements of the situation, and upon consultation with the Government of Japan.

ART. 7.—The present agreement shall come into operation immediately upon its signature, and thereafter the Chientao branch office of the Residency General, as well as all civil and military officers attached thereto shall be withdrawn, as soon as possible, and within two months. The Government of Japan shall within two months hereafter establish its consulates at the places mentioned in Article 2.

In witness whereof, the undersigned, duly authorized by their respective Governments, have signed and sealed the present agreement in duplicate, in the Japanese and Chinese languages.

Note

In connection with this agreement see aiso the detailed agreement for the KirinCh'angch'un Railway loan, August 18, 1909 (No. 25, ante); Sino-Japanese treaty and exchange of notes respecting South Manchuria and Eastern Inner Mongolia, May 25,

1915 (No. 35, post); and Kirin-Hueining Railway loan agreement of June 18, 1918 (No. 42, post).

As an annex to this agreement, see the following Japanese law (No. 40.) relating to adjudication by consular officers in Kanto (Chientao), dated April 5, 1910, as translated from the Japanese Official Gazette of April 6, 1910):

Japanese Law relating to Adjudication by Consular Officers in Chientao, April 5, 1910

"ARTICLE 1.-The public trial of offences liable to capital punishment, or penal servitude for life or for a limited period of at least one year, or imprisonment, the preliminary examination of which has been conducted by consular officers stationed in Kanto, shall belong to the jurisdiction of the District Courts of the Residency General [i.e., of Korea].

"ARTICLE 2.-The Minister for Foreign Affairs may, if he deems it necessary in connection with a criminal case belonging to the jurisdiction of consular officers stationed in Kanto, order the consular officer concerned to deliver the accused to a prison in Korea.

"ARTICLE 3.—In cases where, in accordance with the provisions of the preceding article, the accused is delivered to a prison in Korea, the Resident General shall, if the case belongs to the jurisdiction of the district courts, cause a public procurator of the Residency General Court of Appeal having jurisdiction over the locality where the prison to which the accused is delivered is located to apply to such court of appeal for the designation of jurisdiction; and if the case belongs to the jurisdiction of the local courts, he shall cause a public procurator of the Residency General District Court having jurisdiction over the locality where the prison to which the accused is delivered is located, to apply to such district court for the designation of jurisdiction.

"In connection with the application and adjudication mentioned in the preceding paragraph, the provisions of Article 33 of the Code of criminal procedure shall be applied mutatis mutandis.

[Article 33 of Japanese Code of criminal procedure: "A person desirous of making a motion relative to the designation of the competent Court must declare his intention in writing to the Court competent to rule.

"The Court must decide the motion according to the documents."]

"ARTICLE 4.-Appeals from or protests against decision rendered by consular offi cers stationed in Kanto in cases subject to the jurisdiction of a district court shall belong to the jurisdiction of a Court of Appeal of the Residency General.

"ARTICLE 5.-In the cases mentioned in Articles 1 and 4, the Residency General Courts to have jurisdiction shall be determined by the Resident General.

"Supplementary Clause

"Lawsuits and non-contentious matters accepted prior to the enforcement of this law shall be dealt with according to previous practice."