French concession are applying new laws in opium and narcotic drug cases over objection of the Shanghai Municipal Council and the French authorities. The former regard the new laws as too drastic, fear possible congestion in jails and think attempt may be made to establish licensing system in the Settlement. It is understood that the Shanghai Municipal Council will ask that persons convicted under new laws be incarcerated in Chinese prisons and that no opium establishments be licensed in the International Settlement. See despatch 126, February 1, 1936.53 There has been an attempt in certain quarters to place the Municipal Council in a bad light for objecting to the new laws on these grounds. See despatch No. 162, February 7, 1936.54

GAUSS

893.114 Narcotics/1509

The Ambassador in China (Johnson) to the Secretary of State No. 272

PEIPING, February 28, 1936. [Received March 23.]

SIR: I have the honor to acknowledge the receipt of the Department's telegram No. 19 of January 29, 12 noon, with regard to Customs Notification No. 1480 of December 9, 1935,55 limiting to the Central Health Laboratory the importation into China of narcotics, similar poisonous substances, and strychnine.

54

In compliance with the Embassy's telegraphic instruction of February 5, 5 p. m., a copy of which is enclosed, the Counselor at Nanking reported in a despatch of February 7, 1936, addressed to the Embassy, a copy of which is enclosed,54 that Mr. Peck 56 called on Dr. J. Heng Liu, Director of the National Health Administration and, in reply to his inquiries, was told that the importation of narcotics, similar poisonous substances, and strychnine is now a Government monopoly, that any persons or organizations in China requiring these substances will in the future be obliged to purchase them from the National Health Administration, "purchase permits" being issued to permit the transportation in China of the articles purchased, that strychnine was added to the list of narcotic drugs because it is used in the manufacture of heroin pills, that the statement in the Customs Notification No. 1480 to the effect that importations of these poisonous substances must be covered by certificates issued by the Ministry of the Interior

"Not printed; for enclosure transmitted with this despatch, see p. 567. 54 Not printed.

Copy sent as enclosure to despatch No. 149, December 27, 1935, from the Ambassador in China; neither printed.

56 Willys R. Peck, Counselor of Embassy in China.

probably referred to purchases by departments of the National Government other than the National Health Administration, and that a great effort was being made to restrict the importation of various substances used in the manufacture of heroin pills and other harmful narcotics.

The Embassy also, in compliance with the Department's instruction, directed the Consulate General at Shanghai to report fully to the Department the probable effect on American commercial and professional interests and the attitude of those interests, in reply to which the Consulate General stated in despatch No. 155 of February 11, 1936 (copies of which were forwarded direct to the Department),57 that a full report on this subject was in the course of preparation for transmission to the Department.

An officer of the Embassy made inquiries of the British, French, and Japanese Embassies to ascertain their attitudes toward this apparent monopoly of the importation of the substances in question. Neither the French nor Japanese Embassies appeared to have given the question any consideration, seeming not to have knowledge of Customs Notification 1480. An officer of the British Embassy stated that a report had been made to its Government, that there had as yet been no reaction, and that it was probable that no action would be taken as long as imports of the substances in question were not being interfered with, as was the case, and that consideration had not yet been given to what might be done if such imports were interfered with.

Following the receipt of a copy of the report of the Shanghai Consulate General with regard to the probable effect on American commercial and professional interests and the attitude of those interests, the Embassy will submit further comment. Respectfully yours,

For the Ambassador:

F. P. LOCKHART Counselor of Embassy

893.114 Narcotics/1526

The Ambassador in China (Johnson) to the Secretary of State No. 299

PEIPING, March 11, 1936. [Received April 6.]

SIR: I have the honor to refer to the Embassy's despatch No. 272 of February 28, 1936, regarding the restrictions imposed upon the import into China of strychnine and other narcotics by virtue of Cus

57 Not printed.

toms Notification No. 1480, and to observe that, according to the information supplied by the Consulate General at Shanghai in its despatch No. 22 of February 21 to the Department,58 American interests in China are evidently very little concerned by the application of the new regulations, excepting as regards the monopolistic features of the regulations which might have undesirable effects on prices and quality of the materials purchased. The despatch continues with the observation that "there is a general feeling amongst the American interests concerned that the Chinese should not be hindered in their endeavor to effect control of the narcotics trade, and the tendency of the American interests is to cooperate with the Chinese Government in carrying out the regulations provided they are enforced in an impartial manner and onerous restrictions are not imposed on American persons or firms having a legitimate use for narcotics." This attitude, the Embassy believes, is in general an accurate counterpart of the Department's policy regarding the question of control of trade in narcotic drugs in China.

The important point in this connection would seem to be the question of whether American practitioners of medicine and surgery are to be required to register with the Chinese authorities in order to obtain needed supplies of strychnine and other narcotic drugs. The Department has previously indicated, in its instruction No. 129 of June 5, 1930,58 that it considers American practitioners in China to be subject to the jurisdiction of American laws and courts and therefore not required to conform to Chinese regulations which would subject them to control by Chinese authorities. The Department further stated in its telegram No. 198 of June 16, 1931, 4 p. m.,59 however, that, in the absence of American laws and regulations specifically applicable to American practitioners in China, it considered it advisable to cooperate as fully as possible with the Chinese authorities in efforts directed toward the establishment of reasonable regulations on the subject. The sense of that instruction was communicated by the Legation to the Minister for Foreign Affairs by a formal note dated June 27, 1931,58 with the express limitation that the proffered cooperation was "subject to the understanding that jurisdiction over American citizens in China must be retained by the appropriate American officials."

The Department observed in its aforementioned instruction of June 5, 1930, that the problem was then primarily one of evolving a suita

ble policy to be followed in the existing circumstances. The question seems to be essentially the same at the present time. In this connection, it is to be noted that, although certain undesirable factors certainly still persist, nevertheless the situation as regards the administration of health services and the practice of medicine has undergone a marked improvement since 1930 (due in no small part, it should be said, to the influence of League experts and other foreign advisers). Questions of the permanence of the existing regime in Nanking quite apart, the inevitable tendency in China, as a whole, is toward the exercise of ever more control by the Chinese authorities over Chinese administrative processes. It would appear to be the better wisdom to shape American policy to fit that tendency, and in this particular matter the Embassy would therefore recommend that American citizens in China should be directed to conform to the regulations laid down in Customs Notification No. 1480. This would require their registration with the Chinese authorities, it will be observed, but this fact would not appear to involve directly the principle of extraterritorial jurisdiction by American officials over citizens of the United States.

Respectfully yours,

NELSON TRUSLER JOHNSON

893.114 Narcotics/1524: Telegram

The Ambassador in China (Johnson) to the Secretary of State

PEIPING, April 2, 1936-8 p. m. [Received April 2-7:20 p. m.]

166. Embassy's 69, Feb. 18, 2 p. m. It is reported in the Chinese press that 2 opium wholesalers in Peiping commenced business on March 25, and that 12 opium retail shops have been "ordered" to begin trade as of April 1. It is also reported that a certain opium wholesaler in Tientsin has recently put in an order for a large consignment.

It is understood that two factors have operated to delay the institution of the proposed monopoly control in North China: (1) The power exercised by existing illegitimate dealers who hold large opium stocks, and (2) the doubt in the minds of potential operators as to whether the business will, under the present circumstances, so flourish as to warrant the payment of the comparatively large stamp fees. The program is, nevertheless, evidently going through.

By mail to Tokyo.

JOHNSON

893.114 Narcotics/1537: Telegram

The Secretary of State to the Ambassador in China (Johnson)

WASHINGTON, April 10, 1936-7 p. m.

89. Your despatch No. 172, January 14. Your despatch No. 272, February 28. Your despatch No. 299, March 11. In view of the provisions of Articles 5 and 6 of the Narcotics Limitation Convention of 1931, the Chinese Government is considered to be within its rights in limiting to a single organ of the national government the importation and distribution of the drugs to which that Convention applies and to be entitled to take adequate steps under that Convention, which applies Article 7 of the Geneva Drug Convention of 1925,61 to limit delivery to or possession by authorized persons of such drugs in order to limit the use of such drugs exclusively to medical and scientific purposes. The Department, therefore, is not disposed to object to the requirements of Customs Notification No. 1480 or of the regulations, translations of which accompanied your despatch No. 172 of January 14, 1936, insofar as they relate to the drugs to which the Narcotics Limitation Convention of 1931 applies.

The Department accordingly approves the recommendation contained in your despatch No. 299 of March 11 and requests that American citizens in China to whom the Customs Notification and regulations are intended to apply be informed of this Government's desire to cooperate with the Government of China for the more effective accomplishment of the purpose of the Narcotics Limitation Convention, namely, to prevent the use, for other than medical or scientific purposes, of the drugs to which the Convention has application; that in order to make this cooperation effective the American citizens concerned should be advised to conform to Customs Notification No. 1480 and the provisional regulations, translations of which accompanied your despatch of January 14, subject to the understanding that exclusive jurisdiction over American citizens in China must be retained by the appropriate American authorities and that necessary supplies of narcotic drugs shall not be withheld from any American national in China who is recognized by the Government of the United States as lawfully entitled and qualified to dispense, prescribe or use the drugs solely for medical and scientific purposes.

The substance of this telegram may be communicated to the Foreign Office if occasion should arise for replying to the Foreign Office note of December 30, 1935.62

HULL

60 Foreign Relations, 1931, vol. 1, p. 675.

61

League of Nations Treaty Series, vol. LI, p. 337.

*Not printed.