the proceedings.  But all cases purely between Japanese subjects and mixed cases between Japanese or Chinese, relating to land or disputes arising from lease contracts, shall be tried and adjudicated by Chinese Authorities and the Japanese Consul may also depute an officer to attend the proceedings.  When the judicial system in the said Province is completely reformed, all the civil and criminal cases concerning Japanese subjects shall be tried entirely by Chinese law courts.

    RELATING TO EASTERN INNER MONGOLIA

    (To be Exchanged by Notes)

1.  The Chinese Government declare that China will not in future pledge the taxes, other than customs and salt revenue of that part of Eastern Inner Mongolia under the jurisdiction of South Manchuria and Jehol Intendency, as security for raising a foreign loan.

2.  The Chinese Government declare that China will herself provide funds for building the railways in the part of Eastern Inner Mongolia under the jurisdiction of South Manchuria and the Jehol Intendency; if foreign capital is required, China will negotiate with Japanese capitalists first, provided this does not conflict with agreements already concluded with other Powers.

The Chinese Government agree, in the interest of trade and for the residence of foreigners, to open by China herself certain suitable places in that part of Eastern Inner Mongolia under the jurisdiction of South Manchurian and the Jehol Intendency, as Commercial Marts.

    The regulations for the said Commercial Marts will be made in
    accordance with those of other Commercial Marts opened by China
    herself.

    GROUP III

The relations between Japan and the Hanyehping Company being very intimate, if the said Company comes to an agreement with the Japanese capitalists for co-operation, the Chinese Government shall forthwith give their consent thereto.  The Chinese Government further declare that China will not convert the company into a state enterprise, nor confiscate it, nor cause it to borrow and use foreign capital other than Japanese.

    Letter to be addressed by the Japanese Minister to the Chinese
    Minister of Foreign Affairs.

Excellency:  I have the honour to state that a report has reached me that the Chinese Government have given permission to foreign nations to construct, on the coast of Fukien Province, dock-yards, coaling stations for military use, naval bases and other establishments for military purposes; and further, that the Chinese Government are borrowing foreign capital for putting up the above-mentioned constructions or establishments.  I shall be much obliged if the Chinese Government will inform me whether or not these reports are well founded in fact.

    Reply to be addressed by the Chinese Minister of Foreign Affairs to
    the Japanese Minister.