sador at Washington as conceding all that the American interests could properly ask. It was never suggested that vessels or cargoes with an enemy destination should be allowed to proceed. His Majesty's Government were, moreover, given to understand that the provisions of the arrangement were acceptable to the United States Government. 5. As the United States Ambassador has already been informed, it is intended shortly to furnish a statement showing precisely what cargoes, or what portions of cargoes, His Majesty's Government have dealt with under the above arrangement, and, as regards those which they have decided to purchase at contract price, under the terms of paragraph 1 of the arrangement, direct discussions have already been opened with special representatives of the American parties interested in London. 6. A considerable portion of the cotton has already been sold, and arrangements are being made for handing over the proceeds to the parties entitled to receive the total value as a first installment of the completed transaction. It is obvious that all these arrangements require some time for adjustment. Meanwhile it is not believed that the original owners can, as appears to be apprehended, be suffering acutely by the delay of full payment. It is to be presumed that, in accordance with the customs of trade, the owners drew bills for the value of their goods before or at the time of shipment, and, if such bills have been negotiated in the usual way, it is difficult to understand why the drawers should be put to inconvenience on this account, at least before the date when the bills fall due. 7. On an impartial review of the facts it will, His Majesty's Government feel sure, be admitted that no arbitrary interference with American interests has, in regard to these cargoes, occurred, seeing that His Majesty's Government have acted throughout in conformity with the terms of an arrangement agreeable to the interests concerned, and that United States citizens will suffer no pecuniary loss. 8. As regards other American cargoes or portions of cargoes which have been placed in the Prize Court, His Majesty's Government only resort to this measure in cases where either the goods concerned are contraband, or there is evidence that, although ostensibly consigned to a person in a neutral country, they are in reality destined for the enemy, in contravention of the rules of blockade. The right to submit such cases to the public investigation of a judicial tribunal is one which His Majesty's Government can not forego, and they feel convinced that enlightened opinion in the United States of America can not adversely criticise their course of action in this respect. 9. It is true that a number of these cases have been pending in the Prize Court for some time. This is notably the case in regard to certain vessels carrying large shipments of meat and lard, ostensibly consigned to Scandinavian ports. The United States Government are, however, no doubt aware that much of the delay involved in these instances is due to the fact that negotiations have been carried on for many weeks with a representative of the principal American meat packers for an arrangement designed to limit the importation into neutral countries adjacent to Germany to the quantities actually required in those countries for bona fide home consumption. The American meat packers have demanded, as a part of the settlement to be agreed upon, that His Majesty's Government should buy the cargoes of the several ships now held up in the Prize Court. Hence the delay in bringing these cases to adjudication. It may be added that the ill-success which has so far attended these negotiations is due not to a refusal of His Majesty's Government to entertain the idea of purchase, but to the uncompromising attitude taken up by the American negotiator, who appears unwilling even to discuss any modification of his own demands as regards price. This stage having now been reached, His Majesty's Government have decided to go on with the Prize Court proceedings in these cases, and it is not ex pected that a decision will be much longer delayed. 10. It may finally be pointed out that the repeated complaints as to the great injury suffered generally by American trade in consequence of the interference due to British naval measures derives little substance from the published American trade returns. A table of figures taken from these returns, and showing the amount of recent American trade with Germany and with neutral countries supplying Germany, is annexed hereto. It certainly tends to disprove any contention that American trade with neutral countries has recently suffered. It will be seen. that whereas American exports to Germany and Austria in February, 1915, fell twenty-one million five hundred thousand dollars, as compared with the same month in 1914, American exports to Scandinavia, Holland, and Italy rose by the enormous figure of sixty-one million two hundred thousand dollars. 11. Similar figures for the month of March have not yet reached His Majesty's Government, but they have received statistics for that month of the value of exports and imports through New York as issued by the collector of that port, and, while pointing out that the large increase in value of exports in 1915 compared with those of 1914 (as shown in the tables annexed), they desire especially to call attention to a separate statement indicating the increase in amount of the exports to Scandinavian and Dutch ports of two commodities only, bacon and lard. These figures show that as against one thousand two hundred and fifty-three boxes of bacon and nine thousand one hundred and eighty-six tierces of lard exported to the ports noted in the above countries in March, 1914, there were exported in March, 1915, thirty-two thousand two hundred and twenty-two boxes of bacon and ninety-five thousand six hundred and seventy-six tierces of lard. 12. His Majesty's Government consider that the abnormal increase of supplies imported by neutral countries as shown in these statistics alone justifies their assumption as to the ultimate destination of many items of cargo consigned to one or other of the countries in question on vessels which they have detained, but they would call attention to the fact that it is only when they believed themselves to be in possession of conclusive evidence of the enemy destination of the cargo that they have seized such cargo, and that American interests, as for instance in the case of cotton, have received especially sympathetic consideration. No. 57189/15.] [Inclosure 2.] FOREIGN OFFICE, Sir Edward Grey presents his compliments to the United States Ambassador, and with reference to the Foreign Office memorandum No. 57189 of May 14th has the honor to inform His Excellency that the opening statement, to the effect that only one American vessel was then detained in the United Kingdom, did not embrace cotton ships, which are dealt with in subsequent paragraphs of the memorandum. There were, as His Excellency is aware, two American cotton ships, the Southerner and the Carolyn, then detained in the United Kingdom. Sir E. Grey considers that the memorandum of May 14th was not sufficiently explicit on this point, in regard to which he wishes to leave no room for misunderstanding. Ambassador Page to the British Secretary of State for Foreign Affairs. [Memorandum.] AMERICAN EMBASSY, London, June 3, 1915. The American Ambassador presents his compliments to His Majesty's Secretary of State for Foreign Affairs and has the honor to acquaint him that he is in receipt of a communication from the consul general in London, in which he requests that he may be informed regarding the amount of raw cocoa and preparations of cocoa exported from Great Britain to Holland, Denmark, Sweden, Norway, and Italy during the four months ending April 30, 1915, as compared with the same period of 1914 and 1913. Mr. Page ventures to hope that should no inconvenience be found in so doing, Sir Edward Grey may be so good as to cause him to be furnished with the desired information in this connection. Note Verbale from the British Embassy. BRITISH EMBASSY, Washington, August 6, 1915. Comments have reached His Majesty's Government from various quarters that a misapprehension seems to have arisen with regard to the British note of July 31 concerning the steamer Neches, which it was asserted had been interpreted as stating that the cargo of the vessel had been seized as a reprisal measure against Germany's submarine policy. Sir Edward Grey has requested me to explain that the misunderstanding arises no doubt from the brevity of the note. The note admits no illegality of procedure. The seizure was not meant in the nature of a reprisal, but was based solely on the British contention of the absolute legality of the Orders in Council as explained in the note of July 23, to which the Neches note refers. It is also explained that in stating that the British Government does not yet know what steps neutrals have taken against German submarine policy, no reference was intended to the action of the United States 1 Printed in Special Supplement, July, 1915, p. 162. Copper pyrites and other copper ores. Copper unwrought and part wrought, copper wire, alloys and compounds of copper. Cork, including cork dust. Corundum, natural and artificial (alundum), in all forms. Cotton, raw, linters, cotton waste, cotton yarns, cotton piece-goods, and other cotton products capable of being used in the manufacture of explosives. Cresol and its mixtures and derivatives. Cyanamide. Docks, parts of. Emery in all forms. Equipment of a distinctively military character. Ethyl alcohol. Explosives, whether specially prepared for use in war or not. Ferro alloys, including ferro-tungsten, ferro-molybdenum, ferromanganese, ferro-vanadium, and ferro-chrome. Field forges and their component parts. Field glasses. Flax. Floating docks and their component parts. Forage and feeding stuffs for animals. Formic ether. Fuel, other than mineral oils. Fuming sulphuric acid. Furs utilizable for clothing suitable for use in war. Glycerine. Gold. Gun mountings and their component parts. Hair, animal, of all kinds, and tops, noils, and yarns of animal hair. Harness and saddlery. Harness of a distinctively military character, all kinds of. Hemp. Hides of cattle, buffaloes, and horses. Horseshoes and shoeing material. Hydrochloric acid. Implements designed exclusively for the manufacture of munitions of |