Argentine citizen. You were entitled under that law to receive a certificate that the child is exempt from Argentine allegiance, being born to a member of a foreign legation residing in the Republic. The certificate forwarded by you is returned herewith, in order that you may have it canceled and a proper certificate, certifying to the diplomatic office held by the father, issued in its place. Should the authorities interpose any objection, the minister can doubtless set the matter right by applying to the foreign office for a certificate in due form. I am, etc., ROBERT BACON. BONDS OF THE ENTRE RIOS EASTERN RAILWAY COMPANY. File No. 5748. No. 118.] The Acting Secretary of State to Minister Beaupré. DEPARTMENT OF STATE, SIR: I inclose a copy of a letter from A. A. Lisman & Co., of New York, inquiring what has become of the issues of certain bonds of the Entre Rios Eastern Railway Company described therein. You will endeavor to secure the information desired and transmit it to the department for communication to Messrs. Lisman & Co. I am, etc., [Inclosure.] ROBERT BACON. Mr. Lisman to the Secretary of State. NEW YORK, April 5, 1907. SIR: Clients of ours are holders of the Entre Rios Eastern Railway Company 6 per cent gold-coin bonds, which bear the following indorsement : "This bond is secured by a guarantee made by the Argentine Republic of an income to the company of 7 per cent per annum upon the entire issue of its firstmortgage bonds for twenty years, which is pledged to the holder hereof for the payment of its interest and sinking fund." Would it be possible for your department to ascertain what has become of the issues of the security above named? The company issuing these bonds was a Massachusetts corporation formed in 1881. Very respectfully, yours, File No. 5748/2-3. No. 614.] A. A. LISMAN & Co. Chargé Wilson to the Secretary of State. AMERICAN LEGATION, Buenos Aires, September 25, 1907. SIR: Referring to the department's instruction No. 118, of April 10, 1907, inclosing copy of a letter from A. A. Lisman & Co. inquiring what has become of certain bonds of the Entre Rios Eastern Railway Company, I have the honor to inclose herewith a copy of a note, together with translation of same, which has just been received from the ministry of foreign affairs in regard to the above-mentioned bonds. CHARLES S. WILSON. I am, etc., [Inclosure.-Translation.] The Minister for Foreign Affairs to Chargé Wilson. MINISTRY FOR FOREIGN AFFAIRS AND WORSHIP, Buenos Aires, September 24, 1907. Mr. CHARGÉ D'AFFAIRES: In its note of May 29, last, the legation under your charge requested information concerning certain 6 per cent gold bonds of the Entre Rios Eastern Railway Company, which, according to the indorsement on same, enjoy the guarantee of the Argentine Government, and in reply to your request I have the honor to communicate to your excellency the following information that has been sent from the proper section of the ministry of public works: "The National Government, by law No. 1551, of October 7, 1884, made Messrs. Javier Arrufó & Co. grantees of the Entre Rios Eastern Railway Company, which runs from Concordia to Gualeguaychú, and this concession was confirmed by the decree of the government of the Province of Entre Rios on August 23, 1872, which province guaranteed 6 per cent annually on the effective cost, fixing the cost per kilometer of this railway at $23,557.50 national gold money by decree of November 12, 1886. However, as the grantees did not fulfill the contract, and by virtue of law No. 2716, of September 5, 1889, by which all concessions whose terms had not been fulfilled by the grantees were canceled, said concession was therefore canceled, because the first section of the above-mentioned line that ought, according to the contract, to have been opened for public service in November, 1889, was not opened, the work having been abandoned shortly after having been begun and the grantees restricting themselves to works of slight importance. August 19, 1907." I avail, etc., E. S. ZEBALLOS. AMENDMENT OF THE ARGENTINE CUSTOMS REGULATIONS. File No. 4013. No. 456.] Minister Beaupré to the Secretary of State. AMERICAN LEGATION, Buenos Aires, December 14, 1906. SIR: I have the honor to refer to Mr. White's No. 381, of June 23 last, transmitting a copy of an executive decree of May 31 last, regulating customs law No. 4933, and to inclose herewith a copy of an executive decree of the 27th ultimo, cut from the Boletin Oficial, No. 3926, of the 7th instant, which annuls article 89 of the above-mentioned executive decree of May 31 last. This decree provides for the use of Argentine warehouses for goods in transit from foreign parts to the countries contiguous to the upper waters of the rivers Parana and Paraguay and tributaries. I accompany the decree with a translation. A. M. BEAUPRÉ. [Inclosure. Translation.] Ministry of Finance. [Annulling article 89 of the decree of May 31 last, regulating the customs law.] BUENOS AIRES, November 27, 1906. Considering that the provisions of article 89 of the decree regulating law No. 4933 gives rise in practice to certain inconveniences that it is necessary to avoid, and in view of the advisability of fostering the development of the com merce of transit and of the coasts, to which there will contribute above all else the conveniences afforded them and the facilities accorded them in customs procedure, The President of the Republic, in general session of his cabinet, decrees: ARTICLE I. Article 89 of the decree of May 31 of the current year, regulating law No. 4933, is annulled, the procedure having in the future to follow the provisions of article 31 of said law. ART. II. Merchandise proceeding from the bordering countries in transit for established ports of Bolivia and Paraguay and of the Brazilian States of the upper Parana and river Paraguay, shall be deposited in the fiscal warehouses, which for this purpose shall be established in the depots of Pilcomayo and Posadas. The deposit shall be made after permission obtained and on the presentation of the general manifest of the cargo that the vessel carries. ART. III. There may likewise be deposited in said warehouses the merchandise in transit, proceeding from beyond the sea, for transshipment or reembarkation and destined for the ports mentioned in the preceding article, after the corresponding permission is obtained and on presentation of a certificate (guia) that shall be taken in the first Argentine port of call and shall be verified in said deposits, partial withdrawals being noted until its final cancellation. ART. IV. The permit to which the preceding articles refer shall be requested of the chief of the corresponding depot by the agent of the vessel, its nature to be determined from the details contained in the general manifest or in the certificate taken in the first Argentine port of call according to the case. ART. V. The withdrawal of the merchandise deposited in the warehouse shall be made by application of the agent of the vessel, who shall solicit permission according to the requirements prescribed in Article III. ART. VI. The merchandise stored in the deposits of transit shall be exempt from payment of storage for the time fixed by Article II of law No. 4908. At the expiration of the period it shall be subject to the duties imposed on that stored on general deposit. ART. VII. For the execution of the provisions of articles 2 and 6 the ministry of public works shall plan the construction of two sheds of 10 meters front and 40 meters deep in the depots. ART. VIII. Let it be communicated, published, and given to the National Register. FIGUEROA ALCORTA. E. S. ZEBALLOS. File No. 4013. No. 104.] The Acting Secretary of State to Minister Beaupré. DEPARTMENT OF STATE, Washington, February 8, 1907. SIR: I have to acknowledge the receipt of your dispatch No. 456, of December 14 last, transmitting an executive decree authorizing the temporary storage, free of duty, of merchandise proceeding from the bordering countries in transit to established ports of Bolivia and Paragua and of the Brazilian States of the upper Parana and the River Paraguay. The inclosure to your dispatch has been read with satisfaction as tending to ameliorate, in a mutually beneficial manner, restrictions on commerce. I am, etc., ROBERT BACON. File No. 8573. No. 585.] RAILWAY-CONCESSION LAW. Minister Beaupré to the Secretary of State. AMERICAN LEGATION, Buenos Aires, August 9, 1907. SIR: I have the honor to report that on the 6th instant National Deputy Emilio Mitre presented in the Chamber of Deputies a project of law relating to future railway concessions and to existing railways in the Argentine Republic. The three principal objects of the bill are to make general regulations for all future concessions; to establish uniformity in the privileges granted to railway companies and as regards governmental control of their tariffs; and to impose a fixed percentage tax on their net profits in exchange for their exemption from taxation and from customs duties upon materials for construction and operation. The bill provides that until 1947 (when the privileges granted to the Southern Railway will cease) all materials imported for future railways will be free from duties, in consideration of an annual payment of 3 per cent upon the net profits, which will also free the company from the national, provincial, and municipal taxes. The existing companies may, within six months from the promulgation of the law, declare their option to avail themselves of the privileges, provided that they agree to pay the tax and consent to be subjected to the operation of article 9 of the bill, which declares that the national executive shall fix the tariffs when the gross profits of the railway have in three successive years exceeded 17 per cent upon its capital in shares and debentures, the working expenses being limited to 60 per cent of the receipts, and not to include remuneration of persons paid by the company abroad. For these purposes the capital will be fixed by the executive when the line is opened, and may not be increased without its consent. If the existing companies do not declare such option within the six months, they will be subject, at the expiration of the term of their privileges, to the payment of all taxes and duties and to the prescriptions of the law in other respects. In this way uniformity of privileges and obligations will be established at the expiration of forty years at the latest. Afterwards the privileges will only be retainable by payment of a tax of 3 per cent on profits. I give below a summary of the speech made by Deputy Mitre in presenting his bill, which defines very clearly the policy which he thinks should be pursued in relation to railways: The project which I submit to the House is susceptible of division into two parts, one of which has reference to the railway concession hereafter to be made by Congress, while the other treats of the railways already existent. In reference to the first I have deemed expedient the incorporation into one legislative scheme of all the general provisions consigned in the latest railway concessions approved by Congress and sanctioned in a certain measure by experience, with certain modifications counseled by the exigencies of practical application. I have also introduced a capital reform in the creation of a railway tax, in virtue whereof the companies will, for the first time, contribute to the defrayment of public expenditure. As far as concerns the future concessions to be granted by Congress, it will be undoubtedly advisable to reduce their clauses to a uniform scheme under one comprehensive enactment. In my project I have introduced those clauses generally counseled by the public offices of that department and already sanctioned, as I have just said, by Congress on numerous occasions. Article I of the project clearly defined this idea, laying down specifically that the provisions of the project shall be valid for all railway concessions, either in respect of main lines or branch lines to be granted in future. The subsequent articles contain the provisions of a general character to which I have referred and which are connected with the adoption of rolling stock, the weight of rails, and accessory materials; with the fixing of the terms within which the initial process of the concessions must take place, i. e., from the signing of the contract, submitting of the plans, commencement of their works and their eventual termination; the guaranties necessary to insure the performance of the obligations assumed by the concessionaires; the penalties to be incurred by them in default of such performance; the declaration of public utility in reference to the ground occupied by tracks, stations, sheds, and other constructions connected with the concession. In article 8 is set forth the principal reform contained in the project, namely, that in reference to the creation of a tax of 3 per cent upon the profits of each company, under exemption from every other form of import. It is well known that in this country there has prevailed in the matter of railway concession a policy of ample liberality, perfectly justified by the necessities of the time in which the first lines were built. At that time it was a matter of urgency to promote the introduction of foreign capital by insuring to it all possible protection, and this has been the invariable rule in our legislation. The national constitution lays down in article 67 as one of the attributes of Congress the task of furthering the construction of railroads by granting privileges of a temporary character. In the course of time and as the result of the progress of the country, the position of the railway companies has progressively improved and at the present day the capital invested therein is well remunerated. The moment has therefore arrived in which, without departing from the policy of encouragement and stimulation with respect to these companies that have contributed so greatly to the progress of the country, we should put upon them the same obligations that already fall upon the other taxpayers of the nation by claiming from them the contribution of a portion of their gains toward the maintenance of the public administration. The best form of imposing this contribution has seemed to me that of a tax upon the profits of the companies, thus initiating a tributary legislation based upon a tax upon income, which basis is adopted in nations more advanced than ourselves and has almost universal sanction. The proportion I have adopted of 3 per cent upon the profits is the same that for many years has ruled in England for the collection of the "income tax," and represents a very moderate burden, seeing that it would be the only one the companies would have to bear. By article 9 of the project is established the intervention of the executive power in the fixing of the tariffs, another point of capital importance in this kind of transport service. I have fixed upon the proportion of 17 per cent between the receipts and the capital of the companies' lines as the determinant for the intervention of the Government in the tariffs, and in so doing have proceeded on considerations of a technical order that will more properly be dealt with in detail when the project is discussed, and on which I here confine myself to a mere reference. I think the provision is an equitable one, leaving on the one hand to the companies a sufficiency of net profit to insure to the capital they invest the remuneration to which they may legitimately aspire, whilst completely excluding the possibility of gains so exorbitant as to imply an extraordinary burden upon the factors of production which utilize the carrying power of the companies. The following articles of the project contain obligations implying a reduction in the tariffs for the conveyance of material and articles belonging to the nation, intended for the construction of national public works authorized by acts of Congress; equality in the tariffs of the telegraphic service; the obligations of the companies to convey the public mails free of charge; to permit the construction of telegraph lines and other complementary clauses inclusive of one of a general character relative to the intervention of Government in the inspection of the works of the concession; and to the right of the State of expropria |