The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1912-12-10
Word forWo ord He Reads
1t to Secretary Of State
Knox.
ASKS SETTLEMENT
BY ARBITRATION
England Objects Strongly to Al
legged Violation of Hay-Paunce-
tote Treaty by Exemption of
Tolls to American Coast
wise Shipping Through
Panama Canal.

Britain's formal note Of protest against
that section OF the Panama Canal act
which eXempts American coastwise
shipping from payment OF tolls for
passage through the Panama Canal. a
document written by Sir Edward Grey,
British Minister for Foreign Affairs.
was presented TO Secretary of State
Knox tonight by the British ambas-
sador, James Bryce who read the note
word for word To the secretary at tho
iatter's home. II is an elaboration OF
the points of objection in the nota
presented TO the State Department last
July. In brief these objections are:
THAT. while 1t was clearly In vio-
lation Of the HayPauncefote treaty
either to remit or 10 refund tolls on
all American shipping using the canal.
the same objection probably would
apply 20 the coastwise trade shipping
in view of the probable impossibility
of framing regulations that would not
result in a preference to American
shipping"
! In addition to supporting these
points by long arguments Sir Edward
indicates very clearly that strong re-
sistance will be offered TO any attempt
to exclude from the canal British ships
owned by Canadian railroads or whose
owners may be guilty of violating the
Sherman antitrust act. He holds thar
this section of the act cannot apply
TO British shipping. but only 20 United
States vessels.
Fears for Future.
He also indicates in his note that
underlying the objection to the exemp-
, ton from toll of American coastwfse
ships is an apprehension that in the
future the principle might be EXTENDED
to cover American ships in the foreign
trade.
| otherwise, the note is devoted almost
entirely to an effort to demonstrate
| that any such exemption Of American
/ shipping as is proposed Is in direct
conflict with the terms of Nsne Hay.
Pauncefote treaty, and that President
/ Taft was clearly wrong when he took
the contrary view
Generally, the British note might be
summed up as a clear definition OF the
differences between the two govern
ments regarding the construction OK
the -Pauncefote treaty. winding
up with a proposal that the issues
should be settled by arbitration, pro-
vided that they cannot be adjusted by
mutual agreement, for which a way
remains open
Secretary Knox listened attertiveiy
! to the reading of the note, and prom
ised TO take the matter under care
REQUIRE some time. II has been
strongly intimated in Official circles.
however that IL was the Presidents
intention to settle this important ques-
tion before closing his administrators
either by recomme nding that the SEN
ate agree to submit 1t to arbitration
or. preferably, by the more dfrect
, means of an agreement between the
two nations referred 70 III to-oaS
British note.
The ambassador was accompanied by
Mr.. Innes. the counselor and first sec
rotary of the embassy. and In readihs
the entire British note TO the secre-
ta~y followed the instructions OF Str
Edward Grey.
snys Taft Doesn't Understand-
Sir Edward begins his note with tne
statement that the President does nos
fully appreciate the British point OF
view and has misunderstood even the
note of July s. He says the British
government does not seek to prevent
the United states from granting SUB
sides to its own shipping passing
through the canal nor seek TO deprive
the United states of any liberty when
is open to either themselves or TO any
other nation to encourage its own snip
ping or own commerce by subsidies
The purpose of the United states in
negotiating the -Pauncefote treaty
Was TO recover tneir freedom Of OBJ
lection an obtain the right which
they had surrendered in the Clayton
Bulwer treaty 10 construct the canal
themselves
But this complete liberty Of action
vas to be limited by the maintenance
Of the complete principle Of equal
treatment FOR both English and Unit
81 states ships. The word ~neutFaiizs-
tior-- in the preamble OF the Hay
rsuncefote treaty is not confined TO
belicrrent operations. but refers TO
the system Of cqua! rights. for which
article : provide Joint protection
.,g .suai treatment are the only mat
te-S alluded to TO which thst neutral
izafion must refer
1t certainly was not the intention or
the United states government. Gays
sir Edward. that any responsibility
for a.. protection o. the canal should
attach O. Their, in the future. Neutrali-
cation. therefore. must refer 10 tue
system ~ equal rights.
The not. then declares that the silva.
ton created by the substitution Of the
Mathematics treaty FOR the Clay
fo--gaiuve- treaty was Identical with
nat re~uiting from tire boundary
oate~s treatv % 1893 between Great
Britain and the United states. which
i- brief provided that the boundary
waters should b. free and open 20
commerce ~appIying equally ard With
out discrimination 20 the inhaoitarrS
ships. vessels and boats % both coun-
tries but al such rules and reEuis-
sious and al tolls charged shall apply
alike % me subjects o. citizens % ths
nfzh contracting parties. and th<t
shall b. pis~sd IN terms Of equality ~
the use thereof"
Referring % the third Article % th7
Hav-rzuncefote treaty. the note poin<s
out that the Erst % TIE suez csaa
rules. which the treaty adopts fer tss