EXPLANATORY NOTE

Accompanying Ultimatum delivered to the Minister of Foreign Affairs by the Japanese Minister, May 7th, 1915.

1.  With the exception of the question of Fukien to be arranged by an exchange of notes, the five articles postponed for later negotiation refer to (a) the employment of advisers, (b) the establishment of schools and hospitals, (c) the railway concessions in South China, (d) the supply of arms and ammunition and the establishment of arsenals and (e) right of Missionary propaganda.

2.  The acceptance by the Chinese Government of the article relating to Fukien may be either in the form as proposed by the Japanese Minister on the 26th of April or in that contained in the Reply of the Chinese Government of May 1st.  Although the Ultimatum calls for the immediate acceptance by China of the modified proposals presented on April 26th, without alteration but it should be noted that it merely states the principle and does not apply to this article and articles 4 and 5 of this note.

3.  If the Chinese Government accept all the articles as demanded in the Ultimatum the offer of the Japanese Government to restore Kiaochow to China, made on the 26th of April, will still hold good.

4.  Article 2 of Group II relating to the lease or purchase of land, the terms “lease” and “purchase” may be replaced by the terms “temporary lease” and “perpetual lease” or “lease on consultation,” which means a long-term lease with its unconditional renewal.

Article 4 of Group II relating to the approval of police laws and Ordinances and local taxes by the Japanese Council may form the subject of a secret agreement.

5.  The phrase “to consult with the Japanese Government” in connection with questions of pledging the local taxes for raising loans and the loans for the construction of railways, in Eastern Inner Mongolia, which is similar to the agreement in Manchuria relating to the matters of the same kind, may be replaced by the phrase “to consult with the Japanese capitalists.”

The article relating to the opening of trade marts in Eastern Inner Mongolia in respect to location and regulations, may, following their precedent set in Shantung, be the subject of an exchange of notes.

6.  From the phrase “those interested in the Company” in Group III of the revised list of demands, the words “those interested in” may be deleted.

7.  The Japanese version of the Formal Agreement and its annexes shall be the official text or both the Chinese and Japanese shall be the official texts.

Whilst it would be an exaggeration to say that open panic followed the filing of this document, there was certainly very acute alarm,—­so much so that it is today known in Peking that the Japanese Legation cabled urgently to Tokio that even better terms could be obtained if the matter was left to the discretion of the men on the spot.  But the Japanese Government had by now passed through a sufficiently anxious time itself, being in possession of certain unmistakable warnings regarding what was likely to happen after a world-peace had come,—­if matters were pressed too far.  Consequently nothing more was done, and on the following day China signified her acceptance of the Ultimatum in the following terms.