9. Manifest dues. You state that for some time past manifest dues on merchandise intended for the Republic of Panama coming from abroad have been collected by Consuls of the United States, and that this practice is contrary to the spirit and intent of the Taft Agreement and should be stopped. In reply, I beg to inform you that there is doubtless some misunderstanding on this point as the certification of manifests of cargo destined either for the Canal Zone or the Republic of Panama by American Consuls is not required. American Consuls collect consular fees only when they act for the Republic of Panama, and if the Panaman Government can show that manifest fees have been collected by American Consuls this Government will be glad to receive the information in order to take such action as may be necessary.

For your information in this connection I beg to quote the pertinent part of the latest instructions to American consular officers on this subject, dated July 13, 1917:

"... the Department is informed that the Government of Panama has effected a change in the collection of consular fees whereby all fees arising from the certification of invoices, manifests and other documents relating to shipping shall be paid hereafter at the port of destination instead of at the port whence the merchandise may be shipped. Drafts for the share of such receipts accruing to the American consular officers will hereafter, it is understood, be mailed to the Consul. It is understood furthermore that no change is contemplated with respect to those fees arising from the performance of notarial acts, such as the authentication of signatures and similar services...."

10. Cemetery for the city of Colon. You state that Colon is in a peculiar situation in having no site of its own for the burial of its dead, and that the only available cemetery is in the Canal Zone where a heavy rate is charged for the privilege of burial. You ask that the present cemetery in the Zone be turned over to the Colon municipal authorities so that they may administer it and use it freely without rates of any kind, or else that land be assigned and delivered to the city for the construction of a new cemetery. While it is true that the city of Colon has no cemetery of its own and uses the Mount Hope cemetery in the Zone, I would point out to you that no restrictions are placed on the interment of Panamans therein, and that the commercial rate of $25.00 for permanent burial does not appear to be heavy, and is, as a matter of fact, I believe, less than one-half the rate charged for permanent burial in the Panaman cemetery at Panama. In the case of pauper burials a charge of $10.00 for a permanent grave is made against the municipality of Colon, or the latter can have the body cremated for its account for $6.00, and temporary burial can be had for a period of two months

for $2.50. These rates certainly do not appear to be excessive, and I understand that the cemetery has been used satisfactorily by Colon since 1850.

11. The renting of houses in the Canal Zone to private persons. This charge is unfounded and has been fully explained previously in this note.

12. The establishment of storage warehouses on the Isthmus. It is regretted that you do not give any details with regard to this matter. There are at the present time no storage warehouses in the Canal Zone excepting warehouses for Canal stores which are available for sale to employees and to ships transiting the Canal. My Government must, however, insist, in the interest not only of its own commerce, but of that of the entire world, in which both it and the Government of Panama are vitally interested, upon the right granted by your Government in the Treaty of 1903, that goods which pass through the Canal, either in a single ship or by transshipment at a Canal Zone port, shall pass without duty or tax of any kind excepting the commercial taxes of handling and storage.

13. The concession of facilities to the merchants of Colon and Panama in supplying stores and other material to ships that cross the Canal. This would appear to be a repetition of point 6-c, mentioned above, and has been fully treated in the earlier part of this communication. I would again point out, however, that the local merchants now enjoy privileges in this business which are far in excess of those enjoyed by similar merchants in any other port of the world, as they use the Railway Company's docks without charge for delivering their goods in competition with the Railway Company itself.

14. The establishment of Panaman customs stations in the terminal ports of the Canal for the clearing and examination of merchandise, baggage and passengers for the cities of Colon and Panama. It appears that imports destined for the Republic of Panama are transferred to warehouses in Colon or Panama City, where they are inspected by the customs officials of Panama. In certain cases of perishable goods, which it is desired to send to their destination without delay, it appears that the inspection is made on the Railway Company's piers on Canal Zone territory by Panaman inspectors, and that these inspectors have been permitted free access to those docks in the Canal Zone to make such inspections. They, of course, have nothing to do with the shipments that come into the Zone itself for use therein.

15. The regulation and effectiveness of the passport formalities in cases of persons going to the territory of the Republic through the ports of the Canal Zone. You do not specify any difficulties that

have arisen in this matter, but this Government will not fail to consider any suggestions made by the Panaman Government at the time of the negotiation of the proposed treaty.

16. With regard to the operation of the Volstead law in the Canal Zone you do not state how it hampers freedom of trade through that Zone and Canal ports, and I would call your attention to the provisions of Section 20, Title III, of that Act providing that "this section (prohibiting the introduction, manufacture, sale, etc., of intoxicating liquors in the Canal Zone) shall not apply to liquor in transit through the Panama Canal or on the Panama Railroad." It has not been brought to my attention that this law or any interpretation thereof has as yet operated to the detriment of Panaman commerce. 17. The control of wireless communications within the territory of the Republic. This matter was fully discussed in my note of January 11, 1923, by which I informed you that the United States Government, while insisting upon its rights under the 1903 Treaty and the maintenance of the decree (No. 130) of August 29, 1914, is ready to discuss with the Government of Panama the practicable measures which might be taken to adapt the regulations laid down for the control of wireless communication in Panama to the new conditions which have arisen as a consequence of the developments in the science of wireless communication.

18. The proper delimitation of the functions exercised by the health service in the cities of Panama and Colon in order to avert conflicts between them and the Panaman officials. You do not state specifically what the conflicts are which it is intended to avert, and it is not quite clear to what you refer. However, it may be said in general that the proper operation and maintenance of the Canal requires the United States to exercise as complete sanitary control as possible over the Canal and the ports and other necessary places in Panama, and the right of the United States to do so is based on Article VII and other provisions of the 1903 Treaty. In this connection you are referred to Señor Bunau-Varilla's letter to the Secretary of State, dated January 19, 1904.

19. The settlement of the difficulties pending with regard to the collection of the contribution by which are paid the costs of the water mains and sewers laid in the cities of Panama and Colon for the account of the Republic. I am advised that the payment of these charges was made by your Government on May 19th last, thus disposing of this question.&

20. The question of land communication between the cities of Panama and Colon and the remainder of the Republic. You do not go into detail on this matter, but I would point out that there is now

*Post, p. 698.

96-673 - 77 - 52

a ferry over the Canal at Pedro Miguel which gives adequate access to west side areas and there are certain roads from Balboa to Gamboa (leading through Pedro Miguel) and from Colon to Fort Randolph, about half way to Cativa. There does not as yet appear to be an economic necessity for further roads than those that already exist, but when that necessity arises and when the Panaman Government has constructed contributary roads outside of the Zone, the American authorities will be hospitable to any proposals from the Panaman authorities for linking these highways up with the Canal ports. I have noted with gratification your statement that in entering upon negotiations for a new agreement after the abrogation of the Taft Agreement, Panama does not intend to assume the attitude of a nation whose interests are antagonistic to those of the United States, but desires to deal with the United States openly and frankly as a staunch friend, and I am confident that with the removal from the discussion of points which, as I have said, could not be regarded as tenable or as presenting questions for consideration, the way will be prepared for the appropriate statement by each Government of its point of view on the matters which will properly enter into the negotiations. If Panama will come to the negotiations in the spirit which you describe, and which also animates my Government, I am confident that a satisfactory arrangement will soon be reached. CHARLES E. HUGHES

Accept [etc.]

tion to Abrogate the 1904 Taft Agreement, Followed by Panamanian Protests*

711.192/7

President Coolidge to the Secretary of State

THE WHITE HOUSE, October 15, 1923. MY DEAR MR. SECRETARY: Replying to your letter of October 15th, suggesting that notice be given to the Government of Panama of the intention to abrogate the Taft Agreement, I am writing to authorize you to inform the Panaman Government that the Government of the United States will abrogate the so-called Taft Agreement on May 1, 1924.

Very truly yours,

CALVIN COOLIDGE

711.182/7

The Secretary of State to the Minister in Panama (South)

WASHINGTON, October 18, 1923. SIR: You are informed that the House of Representatives on Tuesday, February 6, (Legislative day of Monday, February 5) passed without amendment the Senate Joint Resolution 259, authorizing the President to abrogate the International Agreement embodied in certain executive orders relating to the Panama Canal, commonly known as the Taft Agreement. A copy of this Joint Resolution is attached herewith for your information.

You will please inform the Panaman Foreign Office that the Government of the United States will, in virtue of the congressional authorization above cited, abrogate on May 1, 1924, the International Agreement, commonly called the Taft Agreement, embodied in the executive orders mentioned in the Senate Joint Resolution.

I am [etc.]

[Enclosure]

CHARLES E. HUGHES

Senate Joint Resolution 259 Authorizing the President to Abrogate the International Agreement Embodied in Certain Executive Orders Relating to the Panama Canal

WHEREAS it is provided in the act entitled "An act to provide for the opening, maintenance, protection, and operation of the

Foreign Relations of the United States, 1923, Vol. II, pp. 676-677, 682-687.