Show FILE TOTE CANAl GANAL TO lOllS LL eat at Britain Proposes Arbitration ion tion to of Dispute in Formal Prost Protest Pro Pro- test st at Presented by f lor o 01 Bryce on Exemption Plan h Jt t 1 OF CONGRESS SAID TO TOBE TOBE TOBE BE BE VIOLATION OF TREATY Will Be Made Also ays ays Sir Edward Grey to to Exclude Ships Owned by Canadian Roads 4 A D. D C C. Dee Dec 9 Great GreaL real Br Britain tain formal nole note of f fl ft l tt t again t t that thai section of the tho tuna aina canal act which exempts l shipping from of or tolls toll for passing through Panama canal a n t document nt writ writ- r Kb Sir Edward Gre Grey British rain min 1 fOl foreign affairs was present present- J Ic Secretary c Knox tOl i hl b Ly by the thet t h h-ador h James Bryce who tI the e nole note ord ord for word vod to the tarV tani at a the latter's laUer's home It is s eJ pf pi the points of st t n the note nole presented to fo the state e p rt last Julyn July p s fn n brief the these thee e objections are aro ka k That while it was clearly in viola viola- a 9 Haj J tre treaty ty S 'S i. i mt or 1 i-e i f nS on op nit ill 1 r JC the canal cannI P rp same objection probably would Iy to tho the coastwise trade shipping s g jeW o of the probable impossibility regulations that would ouid not ilot in hu ina a a preference to American pin i addition to theeo thoo ills ils it L by iy lon long arguments Karl Earl arl Gre Grey cates cates clear clearly that strong resistance l J c offered red to lo nn an any attempt to exle ex- ex le fI from ruin tile the canal British ships ed b by Canadian railroads or whoso whose r rs ma may be guilty guilt of ot violating theman tho the thoman thorman man antitrust 1 t act He holds that ts of the act cannot apply to tosh sh shipping but bUl only to United 1 B te tes teeNe eNe re Indicates that underlying the obIon obion ob- ob Ion to the exemption from toll of ot coastwise ships Is an Continued on Page 2 b Column 1 1 I I I W BRITAIN if g FILES PROTEST i- i r Proposes Arbitration of Dispute j I O Over Oer er Question of Panama f t Canal Tolls Tol J- J V Continued from Pago Page 1 benIon that In the future the princ- princ f ik 3 ta a pie pIc might ht bo ho extended to cover cr AmenI Amen Ameri- i I can ships shit In the tho foreign trade J D Declares Declare cl View Je Wrong Otherwise tho the note is In devoted almost al- al 4 most entirely to ton an n effort to demon- demon I r rt strate that t au any such Sueh exemption of or oft I t I American merlean shipping as is proposed is In lr Ii Ir direct conflict with tho the terms of tho the thoI ther I r Hay Ilay treaty an and that Pres- Pres J. J I dent ent Taft TaCt was clearl clearly wrong when ho took the tho view contrary The Tho British noto note might bo be summed up a as a n. definition of ot the tho differences between the tile two governments p v ving Ing th the construction of ot the Hayi Hay- Hay i 1 treaty winding up with n a proposal osal that tho the issues be bo settled b by arbitration if thoy cannot bo be adjusted a JJ b by p mutual a agreement for tor which a way war remains open Secretary I Knox Knot nox listened attentively I s to to the tho reading reading- of ot tho noto and promIsed prom- prom to take tho the matter under consid- consid a which ho lie felt would require i some time It has lias been strongly hit hit- I 4 v mated in official circles that It was wasI 1 t. t the Presidents President's Intention to this his Important question before closing I C J administration either b by p recommendIng recommend recommend- I In Ing that tho the Senate agree to submit it 3 to arbitration or preferably by tho the moro direct means of ot an agreement nt b between the two nations f I few few- Point Polut of View t 2 Sir Edward Grey p begins his noto note i with ith the statement that tho the President does not fully appreciate the British 1 point of or view and has misunderstood o i. i Vw the no note noto to of ot July S. S He says sas it Is note not t i e tho the caso 50 that tho British government go a i seeks to prevent pre the tho United States from fromi i granting ranting subsidies to its own shipping v passing through h the cana canal nor does docs It n Ii seek to deprive the tho United States of ot nb b s' s 1 any m liberty which Is 15 open either to I Ife themselves or an any other nation n to en- en a courage a its Hs own shipping shippIng- or own corna com com- e 1 a merco marco b by subsidies The Tho purpose of ot s c the tho the United States In negotiating neg Hay treaty was ns to recover their freedom of ot action an and obtain the right which thoy had bad surrendered In tho Clayton Clayton-Bulwer treaty to construct the tho canal themselves es But this completo complete liberty of ot action was to bo be limited bythe by br bythe the maintenance of ot the tho complete principle prin ciple of at equal treatment for tor both En English Eng Ens- lish and United States ships Meaning of ot Neutralization in tho preamble of ot the Hay treat treaty Is not confined confined con con- fined to belligerent crent operations but re refers reters re- re fers ers to the system of or equal rights for tor which article eight provides Joint prot protection and equal treatment are the only matters alluded to to to which that U neutralization must refer It certainly was not tho the intention of ot the tho United States government says saya Sir Edward Gre Grey that any responsibility hUH for or th the protection o of the canal should attach to them In tho future Neutralization therefore must refer to tho the s system of or equal rights nights Tho The note noto declares that the situation created b by the substitution of or tho the Hay Hay- treat treaty for tor tho the Clayton Clayton-Bul- treat treaty was vaa identical with that re resulting ro- ro suiting from tram the boundary waters treaty of or 1 1909 09 between Grout Groat Britain and tho the United States which In brief provides pro that the tho boundary waters should bo ho freo treo and open to commerce ii U. U dis I t i o t a v n nb b I a e c s c l to tho tho i inhabitants hab t Sh ships shins l e vessels and antI boats bonts of or both countr countries 69 S but hut all aU such rules and regulations and all tolls charged shall apply alike jo 10 tho the subjects or citizens or ot tho high hith contracting parties and amI the they shall hall bo placed on terms tennis of ot equality in tho the use thereof It Is also asserted that a l similar though moro more restricted provision ap appeared appeared ap- ap In tho the treaty of ot Washington and It is recalled how strenuously the United States protested as a violation vio yb- 10 lation of ot equal oqual rights against tho system system tem tern which Canada had Introduced of ot a t rebate of ot A lar largo large o portion of ot tho the tolls of or c certain freights on the Welland WeIlan Canal canal ca ca- nal and ancl how in the taco face of ot that protest tho the system was abandoned Suez Canal Rule Referring to tho third article of or the tho Hay Ia treaty tho the note nole points out that tho the Suez canal rule which the treaty treat adopts l for tor the Panama canal is s that the thC waterway a shall be free freo and andopen andopen open to tho the vessels es of ot commerce and war of ot all nIl nations observing tho the rules on n terms of ot entire equality so that there here shall be no discrimination against I any ny such nation It is said that the Presidents President's statement of at the case cose I Is wholly at variance with tho the real provisions pro pro- visions when ho treats the words all I nations as excluding the tho United d States because J It t had constructed tho the canal on I Its ts own territory and thereby acquired an n absolute right of ot ownership In Including In- In eluding luding the tho right to allow its own commerce the use of or the canal upon such uch terms as It saw saV fit It IL The They tho the British government consider consider con con- sider sidor says rs Sir Edward Gre Grey Groy that t bythe by bv bythe the Clo Clayton Clayton-Bulwer ton Bulwer treaty treat tho the United States had surrendered the tho right to I construct the tho canal and by tho the Hay- Hay A treaty A they A recognized L that on mo too looting woung mat tuat ino tue canal canai should be open to British and United States State vessels on terms of ot equal treat treat- ment mont If It the to rules set out In tho the Hay treaty se secure to to Great Britain no more than most- most nation favored treatment the value of or orthe the consideration given for Sn ing tho ho Clayton Bulwer treaty treat is not apparent to his majesty's government Nor Is It easy to see III In what wa way th the principle of ot article VIII of oC the CI Clay Clay- Y- Y ton Bulwer treaty which provides for equal tr treatment of oC British and United States ships has been maintained The argument advanced In the United States Senate that tho the words all an nations nations na na- na- na cannot Include tho the United States which would otherwise be ho prevented from tram using using- Its own territory for ro- ro its warships or landing I troops is briefly dismissed b by the statement that It is completely complete overturned overturned overturned over over- turned by a reading of or the Hay launce fote treaty In connection with tho the Suez canal conventions As 5 the tho United States did lid not own the canal zone when the Hay hlay treat treaty was made it lid dill not flOt include tho the Suez canal rules which recognized the right of or Turkey tho the local sovereign so and of ot Egypt to tako take such sueh measures as might ht bo be necessary sal sary for fOl or the defense of ot her posses posses- Admit flight to 0 Protect Sir Ir Edward Edwar Grey continues ow that tho the United States has become become be be- come the practical sovereign of ot the canal his Ills majest majesty's s government g ma may not question its title to exercise belligerent belligerent bellig bellig- erent rights for Its Ita protection Tho The next point made is that tho exemption exemption ex ex- emption of ot American coastwise ship ship- piny piner from tolls would violate the undertaking un un- un- un that the tolls should bo lObo just and equitable as unless tho whole volume of shipping passing passing- through the canal is 18 taken Into account ac nc- ac- ac count there thero are arc no means of lIC determinIng determining determining deter deter- mining whether the tho tolls charged upon any ally particular vessel essel represents her herair fair air proportion of ot the current expend expendi Lures tures Regarding the presidents president's contention that the tue e effect of or the British claim would bo ho to prevent tho the United States from aiding Its own commerce in 1 n. away Va way that all nations mn may do do tIo It Is said that this J is Js not s so o. o Equal treatment as us specified in tho the treat treaty Is all that the British government go claims But It J does not follow tollow that the United States may not be debarred by the tho treaty from granting a a. subsidy to certain shipping ship ship- ping ping- in a a. particular wa way if It tho the effect affect would be bo to impose upon British or ot other foreign an unfair share I of ot tho the burden of the upkeep of r th i canal or to create a discrimination or prejudice British shipping rights T Therefore it is held that the ex ex- I I emption of ot the American coastwise whipping shipping an aR well as ns of ot shippinG shipping shipping ship ship- ping clearly conflicts with tho the treaty guarantees of ot equal treatment for British and American ships and that tho the interests of or foreign nations would thereby bo be seriously injured d In two respects I First In placing the entire cost of ot tho building bul of or tho canal upon foreign vessels and second In placing pine pine- ing the American coastwise trade trado Ina in ina a a. preferential position as re regards Rr R other shipping Thus Titus it might ho bo that a n. cargo carAO Intended ed for tor a United States port beyond the canal in direction tion Uon shipped on a n. foreign n ship could he be sent to its Ita destination more moro cheaply h hy by being landed at a United States port before reaching the Iho canal and thence forwarded as coastwise trade American vessels vessel also ma may combine foreign commerce with coastwise trade thereby entering Into direct competition tion with foreign vessels while the they retained the right of at free trot passage through h the canal Those These results result would fall more severely on British shipping than on any other The Tho British government Jo does docs 3 not read the section of ot the tho Panama canal act net prohibiting owned O or trust owned ships hIps from using the tho canal ennal ca canal en- en nal as applying applying- to or affecting British ships but it said If It this view low Is mistaken mistaken mis mis- taken they must reserve their ll right ht to examine tho the matter further and to raise such contentions as may seem seam justified Willing to Arbitrate In conclusion Sir Edward Gre Gry Grey reiterates relt- relt crates his governments government's assertion that the provisions of or the tho canal act as ns to tolls toUR conflict with British treat treaty rights and adds But tho they thoy recognize that man many persons perSons per per- sons of ot noto note i in tho the United States whose opinions are entitled to great weight hold that tho the provisions of ot the act do donot donot donot not infringe the tho conventional obligations obligations obliga obliga- by which tho the United States IB is bound and under these circumstances they desire to state their readiness to submit tho the question to arbitration if It tho government of or the tho United States would prefer preter to take tako this course A reference to arbitration would be ronde rendered red unnecessary If It the government government govern govern- overn- overn ment o of tho the United States should ho bo prepared to tal take e such steps step as would remove tho the objections to the act which his majesty's s government have haO stated Hated Finally Sir Edward Grey declares It ItIs Itis itis is with sith great reluctance that these ob obJections objections objections ob- ob have been raised that the they havo nave havo been con confined tined to the narrowest possible limits had recognized In tho fullest manner mannet the tIme right of or the United States to control the tIme canal c and antI that the British government g looked with confidence to the United States not to i Impair the safeguards granted g to British Brit ish lah shipping b by treat treaty |