Treaty of Nanking The Treaty of Nanking ( or Nanjing ) was signed on the 29th of August 1842 to mark the end of the First Opium War ( 1839 – 42 ) between the United Kingdom of Great Britain and Ireland and the Qing Dynasty of China . It was the first of unequal treaties against the Chinese because Britain had no obligations in return . In the wake of China ' s military defeat , with British warships poised to attack the city , representatives from the British and Qing Empires negotiated aboard HMS " Cornwallis " anchored at Nanjing . On 29 August 1842 , British representative Sir Henry Pottinger and Qing representatives , Qiying , Yilibu , and Niujian , signed the treaty . It consisted of thirteen articles and ratification by Queen Victoria and the Daoguang Emperor was exchanged nine months later . Terms . Foreign trade . The fundamental purpose of the treaty was to change the framework of foreign trade which had been in force since 1760 ( Canton System ) . The treaty abolished the monopoly of the Thirteen Factories on foreign trade ( Article V ) in Canton and instead five ports were opened for trade , Canton ( Shameen Island until 1943 ) , Amoy ( Xiamen until 1930 ) , Foochowfoo ( Fuzhou ) , Ningpo ( Ningbo ) and Shanghai ( until 1943 ) , where Britons were to be allowed to trade with anyone they wished . Britain also gained the right to send consuls to the treaty ports , which were given the right to communicate directly with local Chinese officials ( Article II ) . The treaty stipulated that trade in the treaty ports should be subject to fixed tariffs , which were to be agreed upon between the British and the Qing governments ( Article X ) . Reparations and demobilization . The Qing government was obliged to pay the British government six million silver dollars for the opium that had been confiscated by Lin Zexu in 1839 ( Article IV ) , 3 million dollars in compensation for debts that the Hong merchants in Canton owed British merchants ( Article V ) , and a further 12 million dollars in war reparations for the cost of the war ( VI ) . The total sum of 21 million dollars was to be paid in installments over three years and the Qing government would be charged an annual interest rate of 5 percent for the money that was not paid in a timely manner ( Article VII ) . The Qing government undertook to release all British prisoners of war ( Article VIII ) and to give a general amnesty to all Chinese subjects who had cooperated with the British during the war ( Article IX ) . The British on their part , undertook to withdraw all of their troops from Nanking and the Grand Canal after the emperor had given his assent to the treaty and the first installment of money had been received ( Article XII ) . British troops would remain in Gulangyu and Zhoushan until the Qing government had paid reparations in full ( Article XII ) . Cession of Hong Kong . In 1841 , a rough outline for a treaty was sent for the guidance of Plenipotentiary Charles Elliot . It had a blank after the words " the cession of the " islands " of _ _ _ _ _ " . Pottinger sent this old draft treaty on shore , with the letter " s " struck out of " islands " and the words " Hong Kong " placed after it . Robert Montgomery Martin , treasurer of Hong Kong , wrote in an official report : The terms of peace having been read , Elepoo the senior commissioner paused , expecting something more , and at length said " is that all ? " Mr . Morrison enquired of Lieutenant - colonel Malcolm if there was anything else , and being answered in the negative , Elepoo immediately and with great tact closed the negotiation by saying , " " all shall be granted — it is settled — it is finished " . " The Qing government agreed to make Hong Kong Island a crown colony , ceding it to the British Queen " in perpetuity " ( in Chinese version ) to provide British traders with a harbour where they could unload their goods ( Article III ) . Pottinger was later appointed the first governor of Hong Kong . In 1860 , the colony was extended with the Kowloon peninsula and in 1898 , the Second Convention of Peking further expanded the colony with the 99 - year lease of the New Territories . In 1984 , the governments of the United Kingdom and the People ' s Republic of China ( PRC ) concluded the Sino - British Joint Declaration on the Question of Hong Kong , under which the sovereignty of the leased territories , together with Hong Kong Island and Kowloon ( south of Boundary Street ) ceded under the Convention of Peking ( 1860 ) , was transferred to the PRC on 1 July 1997 . Aftermath and legacy . Since the Treaty of Nanking was brief and with only general stipulations , the British and Chinese representatives agreed that a supplementary treaty be concluded in order to work out more detailed regulations for relations . On 3 October 1843 , the supplementary Treaty of the Bogue was concluded at Bocca Tigris outside Canton . Nevertheless , the treaties of 1842 – 43 left several unsettled issues . In particular it did not resolve the status of the opium trade . Although the American treaty of 1844 explicitly banned Americans from selling opium , the trade continued as both the British and American merchants were only subject to the legal control of their consuls . The opium trade was later legalised in the Treaties of Tianjin , which China concluded after the Second Opium War . The Nanking Treaty ended the old Canton System and created a new framework for China ' s foreign relations and overseas trade which would last for almost a hundred years . Most injurious were the fixed tariff , extraterritoriality , and the most favoured nation provisions . These were conceded partly out of expediency and partly because the Qing officials did not yet know of international law or understand the long term consequences . The tariff fixed at 5 % was higher than the existing tariff , the concept of extraterritoriality seemed to put the burden on foreigners to police themselves , and most favoured nation treatment seemed to set the foreigners one against the others . Although China regained tariff autonomy in the 1920s , extraterritoriality was not formally abolished until 1943 .