Extracts 28 July 1939

1. Following upon reports from various sources on the
intensification of efforts by the Japanese to develop their
fishing industry in waters adjacent to Australia, as well as
requests from the Premier of Western Australia [1] for an
indication of the policy of the Commonwealth Government in regard
to poaching and protection of the local industry, the Commonwealth
Government approved of an Inter-Departmental Committee to consider
and report on what steps, if any, should be taken to check the
activities of Japanese engaged in fishing for pearl and other
shell in waters adjacent to the Commonwealth of Australia and its
Territories.

This Committee, representative of the Department of External
Affairs, the Attorney-General's Department, the Department of the
Interior, the Department of Trade and Customs, the Department of
Health, the Prime Minister's Department (Territories Branch), the
Department of Defence, and the Department of Commerce, met at
Canberra on 3rd and 4th July, 1939.

[Paragraphs 2 to 8 dealt with questions of domestic concern.]

9. There are also the political and international aspects of the
matter. The Southward Expansion policy of the Japanese is well-
known, and the necessity for the exercise of adequate control over
the movement of the crews of Japanese fishing vessels in order to
check operations which might assist in the prosecution of that
policy is evident.

10. In the light of the foregoing considerations, it is abundantly
clear that some action should be taken to establish a form of
regulation and control over the pearling industry not only as
regards Australian pearlers but also Japanese vessels engaged in
fishing near the Australian coast. To this end, various
suggestions which have been put forward from time to time have
been considered by the Committee.

11. A certain degree of control over Japanese activities could be
effected by independent action on the part of the Commonwealth.

This method, which would involve legislative and administrative
measures intended to place serious restrictions upon activities
within Australian territorial waters, would be unsatisfactory in
that, while it would tend to provoke Japan, it would be largely
ineffective because it could be applied only in territorial
waters, it would be difficult to police adequately, it would not
materially assist the Australian pearling industry and it could
not operate to preserve the pearling beds which lie outside the
three-mile limit.

12. An alternative method of securing control would be by
agreement with the Japanese Government. Such an agreement, if
secured, would obviate the possibility of international
complications arising and would be more effective than the other
method, in that it would, if carried out in good faith, protect
both the Australian pearler and the beds. Provision could be made
in such agreement to safeguard against the dangers previously
referred to as regards customs, quarantine and immigration. With
respect to this method, it is to be noted that an unofficial
approach was recently made to the Commonwealth Government, at the
instance of Japanese fishing interests, for the conclusion of an
agreement providing for the limitation of the amount of shell to
be taken. An approach to the Japanese Government, with a view to
negotiating an agreement on the lines indicated, might, therefore,
be expected to be favourably considered.

13. It is recommended, therefore, that steps should be taken to
negotiate for an agreement between the Commonwealth of Australia
(and its Territories) and Japan to secure such objects as the
following:-

(i) The limitation of the amount of shell to be taken during the
season by each party to the agreement.

(ii) Regulation of the grade and class of shell to be taken.

(iii) Provision for rotation of the pearling grounds.

(iv) Arrangements whereby each Government would introduce a system
of licensing for its own vessels and nationals.

(v) Provision for Japanese vessels to report at an Australian port
of entry for medical examination, immediately on arrival off the
Australian coast and before contact is made with any part of the
Australian coast or with any Australian vessel.

(vi) Provision for Japanese vessels to enter for wood, water or
other supplies, or for the purpose of careening, only at places
specified under the agreement.

The precise details of such an agreement would, of course, be the
subject of negotiation, and it is assumed that before any approach
were made to the Japanese Government with a view to negotiating an
agreement the views of the pearling industry in Australia would be
sought. However, notwithstanding any views which might be
expressed by those consulted regarding the economic aspects of the
problem, the Committee considers, for the reasons already given,
that the national aspect is of such importance as to justify the
opening of negotiations for an agreement.

[The final two paragraphs of the report contained proposals
regarding patrolling and reconnaissance of the area, and the
creation of a standing advisory committee to advise the Government
on policy and to co-ordinate action.

The report was signed by Lt Col W.R. Hodgson (Secretary of
Department of External Affairs and Chairman of the Committee),
J.A. Carrodus (Department of the Interior), H.F. Morris
(Department of Trade and Customs), J.G.B. Castieau (Attorney-
General's Department), Lt Col M.J. Holmes (Department of Health),
J. Brack (Prime Minister's Department, Territories Branch) and
Major James A. Chapman (Department of Defence). The Department of
Commerce was also represented at the inter-departmental meeting.

Subsequently, at the request of the Prime Minister, R.G. Menzies,
the Minister for External Affairs, Sir Henry Gullett, embodied the
points made in this report in a Cabinet submission (see Cabinet
Agenda 146, 23 August 1939, on AA: A2697, vol. 2). See also
Document 145.]