I called on the Acting Minister for Foreign Affairs yesterday [1]
and spoke as instructed in your telegram S.C.6 [2] and telegram
50. [3] He appeared to accept our explanation as to why we now
considered the exchange of notes would be adequate but emphasised
that the Chinese Government was most anxious to have the treaty
which would adjust all outstanding questions such as rights of
commerce, national treatment for Chinese in Australia and the
establishment of Consulates. He agreed that at present the rights
of Australians in China in these respects were not safeguarded nor
were the rights of the Chinese in Australia and asked whether we
realized that China could deny Australians the right to trade,
travel and reside.

(2) I replied that you were not prepared to negotiate on these
questions at present and had decided to limit the present
negotiations to the question of extraterritoriality. Other
questions could be left for subsequent negotiations as they were
at present of academic importance only. Meanwhile, we were
confident that China would not discriminate against Australians
any more than Australia would discriminate against Chinese.

(3) The Director of the Treaty Department [4] who was also present
then recapitulated the arguments about the unfavourable effect on
Chinese opinion if the Australian Treaty was not on the same lines
as the British and the Acting Minister pointed out that the
question was of greater importance to China since she had more
nationals in Australia than we have in China. They pressed to get
clarification of the position by specific reference in the Treaty
to Chinese rights.

(4) I again explained your intention to limit the negotiations to
extraterritoriality. He asked whether the Commonwealth Government
was prepared to enter into negotiations for a commercial treaty at
some future date and I replied that I had no instructions. I
should, however, be glad to have your views on this point.

(5) I was asked whether the Commonwealth Government was willing to
sign a treaty omitting the question of the commercial treaty and
Consulates, but including an article ensuring national treatment
for Chinese in Justice, Taxation, etc. I replied as in paragraph
(4).

(6) Chinese finally agreed to put the proposal before the
Government but said they had no copy of the original China Order
in Council available and asked if copy could be secured. I am
endeavouring to get one here but if unsuccessful it may be
necessary to telegraph the text.

EGGLESTON