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having informed the British Government to that effect, this Government decided to let the matter rest after receiving from the British Government a promise that they were, in the language of a note addressed by Sir Edward Grey to the American ambassador at London, “ willing not to capture the remaining ships of the company, unless they were found to be carrying contraband, until the prize court has given a decision in the cases which are now pending, provided, of course, that the proceedings in court are not unduly prolonged by the defendants." The owners of the vessels have informed the department that they have complied strictly with the British Government's conditions, and the department has no information to the contrary.

If any one of these vessels should carry contraband, the British Government would be warranted in exercising their belligerent right to detain such vessel. But the carrying of contraband by one of these vessels would, of course, furnish no legal justification for interference with other vessels carrying innocent cargoes, and the observance by the British Government of the express language of their promise respecting the immunity of these vessels would prevent any such interference.

I observe from your note that you have been instructed by Sir Edward Grey to inform me that "the immunity from capture at present enjoyed by the American Transatlantic Co.'s vessels can only be continued provided that an assurance is given by the company that the vessels will not trade with Scandinavia or Hölland.”

Under these circumstances, before giving further consideration to the matters referred to in your note I would like to be informed whether, as would appear from your note, it is the intention of the British Government to repudiate their promise respecting the treatment of these vessels which in good faith has been relied on by this Government and by the owners of these vessels. I am, etc.,

ROBERT LANSING. The real significance of these incursions upon the commercial rights of neutrals upon the “high seas” were greatly accentuated by the publication of the recommendations of the entente conference held in Paris in June, 1916, in the matter of trade after the war. These resolutions called forth adverse criticism from such men as Ambassador Francis, who declared there was no reason why better commercial relations should not exist between us and European commercial nations, speaking, especially for the trade with Russia. Continuing, he said:

That end can not be accomplished, however, if the principles of resolutions of the economic conference of the allies at Paris last June are confirmed and carried out.

Those resolutions, while inspired by the desire to prevent a revival of economic supremacy, as it were, of the countries with which the allies are at war, are at the same time a discrimination against commerce with all neutral countries, many of which have been supplying the allies with requirements for a successful prosecution of the war, and in so doing have provided much material without which the allies would not have been as successful as they have been.

The idea that America has experienced nothing but benefit from the war is a mistake, and the charge that America desires to see the war continue because of the profits she derives has so little foundation that it needs no explanation or defense.

On March 30 another order in council modifying the declaration of London in numerous details was promulgated. It was styled “ The declaration of London order in council, 1916.” On the 7th of July another order in council was announced, as follows:

AMBASSADOR W. H. PAGE TO THE SXCRETARY OF STATE.

No. 4181.]

AMERICAN EMBASSY,

London, July 10, 1916. Sir: I have the honor to inclose herewith, for the information of the department, a copy, in duplicate, of the text of an order in council dated the 7th instant, which has been received from the foreign

flice, called “ The maritime rights order in council, 1916,” which effects a change in the rules hitherto adopted by the British Government to govern their conduct of warfare at sea during the present hostilities.

There is also transmitted herewith a copy, in duplicate, of a memorandum which has been drawn up by the British and French Governments explaining the grounds for the issue of the aforementioned order in council. I have, etc.,

WALTER HINES PAGE. [Inclosure 1.)

ORDER IN COUNCIL.

At the court at Buckingham Palace, the 7th day of July, 1916. Presenti The Kings Most Excellent Majesty in council. Whereas by an order in council dated the 20th day of August, 1914, His Majesty was pleased to declare that during the present hostilities the provisions of the declaration of London should, subject to certain additions and modifications therein specified, be adopted and put in force by His Majesty's Government;

And whereas the said declaration was adopted as aforementioned in common with His Majesty's allies;

And whereas it has been necessary for His Majesty and for his allies from time to time to issue further enactments modifying the application of the articles of the said declaration;

And whereas orders in council for this purpose have been issued by His Majesty on the 29th day of October, 1914, the 20th day of October, 1915, and the 30th day of March, 1916; .

And whereas the issue of these successive orders in council may have given rise to some doubt as to the intention of His Majesty, as also as to that of his allies, to act in strict accordance with the law of nations, and it is therefore expedient to withdraw the said orders so far as they are now in force;

Now, therefore, His Majesty, by and with the advice of his privy council, is pleased to order, and it is hereby ordered, that the declaration of London order in council No. 2, 1914, and all orders subsequent thereto amending the said order are hereby withdrawn;

And His Majesty is pleased further to declare, by and with the advice of his privy council, and it is hereby declared, that it is and always has been his intention, as it is and has been that of his allies, to exercise their belligerent rights at sea in strict accordance with the law of nations;

And whereas on account of the changed conditions of commerce and the diversity of practice doubts might arise in certain matters as to the rules which His Majesty and his allies regard as being in conformity with the laws of nations, and it is expedient to deal with such matters specifically;

It is hereby ordered that the following provisions shall be observed :

(a) The hostile destination required for the condemnation of contraband articles shall be presumed to exist until the contrary is shown, if the goods are consigned to or for an enemy authority, or an agent of the enemy State, or to or for a person in territory belonging to or occupied by the enemy, or to or for a person who, during the present hostilities, has forwarded contraband goods to an enemy authority, or an agent of the enemy State, or to or for a person in territory belonging to or occupied by the enemy, or if the goods are consigned “ to order,” or if the ship's papers do not show who is the real consignee of the goods.

(b) The principle of continuous voyage or ultimate destination shall be applicable both in cases of contraband and of blockade.

(c) A neutral vessel carrying contraband, with papers indicating a neutral destination, which, notwithstanding the destination shown on the papers, proceeds to an enemy port, shall be liable to capture and condemnation if she is encountered before the end of her next voyage.

(d) A vessel carrying contraband shall be liable to capture and condemnation if the contraband, reckoned either by value, weight, volume, or freight, forms more than half the cargo. And it is hereby further ordered as follows:

(i) Nothing herein shall be deemed to affect the order in council of the 11th March, 1915, for restricting further the commerce of the enemy or any of His Majesty's proclamations declaring articles to be contraband of war during the present hostilities.

(ii) Nothing herein shall affect the validity of anything done under the orders in council hereby withdrawn.

(iii) Any cause or proceeding commenced in any prize court before the making of this order may, if the court thinks just, be heard and decided under the provisions of the orders hereby withdrawn so far as they were in force at the date when such cause or proceeding was commenced, or would have been applicable in such cause or proceeding if this order had not been made.

This order may be cited as “The maritime rights order in council, 1916."

And the lords commissioners of His Majesty's treasury, the lords commissioners of the admiralty, and each of His Majesty's principal secretaries of state, the president of the probate, divorce, and admiralty division of the high court of justice, all other judges of His Majesty's prize courts, and all governors, officers, and authorities whom it may concern are to give the necessary directions herein as to them may respectively appertain.

ALMERIC FITZROY. [Inclosure 2.)

MEMORANDUM. At the beginning of the present war the allied Governments, in their anxiety to regulate their conduct by the principles of the law of nations, believed that in the declaration of London they would find a suitable digest of principles and compendium of working rules. They accordingly decided to adopt the provisions of the. declaration not as in itself possessing for them the force of law but because it seemed to present in its main lines a statement of the rights and the duties of belligerents based on the experience of preyious naval wars. As the present struggle developed, acquiring a range and character beyond all previous conceptions, it became clear that the attempt made at London in time of peace to determine not only the principles of law but even the forms under which they were to be applied had not produced a wholly satisfactory result. As a matter of fact, these rules, while not in all respects improving the safeguards afforded to neutrals, do not provide belligerents with the most effective means of exercising their admitted rights.

As events progressed, the Germanic powers put forth all their ingenuity to relax the pressure tightening about them and to reopen a channel for supplies; their devices compromised innocent neutral commerce and involved it in suspicions of enemy agency. Moreover, the manifold developments of naval and military science, the invention of new engines of war, the concentration by the Germanic powers of the whole body of their resources on military ends, produced conditions altogether different from those prevailing in previous naval wars.

The rules laid down in the declaration of London could not stand the strain imposed by the test of rapidly changing conditions and tendencies which could not have been foreseen.

The allied Governments were forced to recognize the situation thus created, and to adapt the rules of the declaration from time to time to meet these changing conditions.

These successive modifications may perhaps have exposed the purpose of the allies to misconstruction; they have therefore come to the conclusion that they must confine themselves simply to applying the historic and admitted rules of the law of nations.

The allies solemnly and unreservedly declare that the action of their warships, no less than the judgments of their prize courts, will continue to conform to these principles; that they will faithfully fulfil their engagements, and in particular will observe the terms of all international conventions regarding the laws of war; that mindful of the dictates of humanity, they repudiate utterly all thought of threatening the lives of noncombatants; that they will not without cause interfere with neutral property; and that if they should, by the action of their fleets, cause damage to the interests of any merchant acting in good faith, they will always be ready to consider his claims and to grant him such redress as may be due.

FOREIGN OFFICE, July 7, 1916.

Our Government's first communication on the proposed “blacklist” policy was made on July 19. After, several communications on the subject the Government dispatched the following note, giving our position on the matter in controversy :

THE ACTING SECRETARY OF STATE TO AMBASSADOR W. H. PAGE.

[Telegram.]

proscripts betweenost painful

DEPARTMENT OF STATE,

Washington, July 26, 1916. You are instructed to deliver to Sir Edward Grey a formal note on the subject of the enemy-trading act, textually as follows:

“ The announcement that His Britannic Majesty's Government has placed the names of certain persons, firms, and corporations in the United States upon a proscriptive "blacklist' and has forbidden all financial or commercial dealings between them and citizens of Great Britain, has been received with the most painful surprise by the people and Government of the United States, and seems to the Government of the United States to embody a policy of arbitrary interference with neutral trade against which it is its duty to protest in the most decided terms.

“ The scope and effect of the policy are extraordinary. British steamship companies will not accept cargoes from the proscribed firms or persons or transport their goods to any port, and steamship lines under neutral ownership understand that if they accept freight from them they are likely to be denied coal at British ports and excluded from other privileges which they have usually enjoyed, and may themselves be put upon the blacklist. Neutral bankers refuse loans to those on the list and neutral merchants decline to contract for their goods, fearing a like proscription. It appears that British officials regard the prohibitions of the blacklist as applicable to domestic commercial transactions in foreign countries as well as in Great Britain and her dependencies, for Americans doing business in foreign countries have been put on notice that their dealings with blacklisted firms are to be regarded as subject to veto by the British Government. By the same principle Americans in the United States might be made subject to similar punitive action if they were found dealing with any of their own countryinen whose names had thus been listed.

“ The harsh and even disastrous effects of this policy upon the trade of the United States and upon the neutral rights upon which it will not fail to insist are obvious. Upon the list of those proscribed and in effect shut out from the general commerce of the world may be found American concerns which are engaged in large commercial operations as importers of foreign products and materials and as distributors of American products and manufacturers to foreign countries and which constitute important channels through which American trade reaches the outside world. Their foreign affiliations may have been fostered for many years, and when once broken can not easily or promptly be reestablished. Other concerns may be put upon the list at any time and without notice. It is understood that additions to the proscription may be made 'whenever on account of enemy nationality or enemy association of such

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