2 Kenneth S. Latourette, 



When the "Empress of China" had reached Canton, trade 

 had been strictly confined to that port for nearly a generation. 

 The Portuguese colony at Macao, at the mouth of the Pearl 

 River, and the factories at Canton were the only spots where 

 residence was permitted.*^ The existing regulations had some of 

 them been in force since 1720, some since 1760.*^ The central 

 institution was the "co-hong," through which all trading was 

 done, and through which the government communicated with 

 the foreigners. This body dated from an imperial edict of 1720 

 which substituted it for a single "Emperor's Merchant."*^ It 

 had been dissolved in 1771 only to be reinstated in 1782, and was 

 in full working order when the first American arrived. This 

 Hong Sheiing or Yeung Hong Sheung ("Foreign Associated 

 Merchants") known more commonly by the pidgin-English cor- 

 ruption, "Co-hong,"*^ was a loose monopoly established by the 

 imperial government expressly for the control of the foreign 

 trade at Canton. It was composed of a varying number of 

 "hong merchants." Theoretically thirteen in number, they were 

 usually fewer, and sometimes dwindled to six.^*' Far from being 

 a stock company, each merchant did business independently of 

 the others, enjoyed his own profits, and, legally at least, bore 

 his own losses. They acted together merely for the control of 

 foreigners and the enforcement of trade regulations. There 

 later grew up a mutual responsibility for debts, but this seems not 

 to have been an integral part of the system, and was sanctioned 

 only by special arrangement after each new failure.^^ With true 



^° There had been a little trade at Ningpo in 1755 but soon after that 

 an imperial edict restricted all foreign commerce to Canton. Williams, 

 History of China, p. 96. 



*' William C. Hunter, The Fan Kwae in Canton before Treaty Days, 

 1825-1844, pp. 28, 34. Eitel, Eur. in China, p. 5.. 



■"^ Hunter, Fan Kwae in Canton, pp. 28, 34 ; Eitel, Eur. in China, p. 8. 



*^ Samuel Wells Williams, Establishment of American trade at Canton, 

 in China Review, 5 : 152-164, p. 155. 



^ Memorial to Emperor, Sept., 1837, Ch. Rep., 6 : 292-296. John Francis 

 Davis, China, 2 v., London, 1857, 1 198. 



" C. Toogood Downing, The Stranger in China, or the Fan Qui's visit 

 to the Celestial Empire in 1836-7. 2 v., Philadelphia, 1838, 2:123-133. 

 In 1830 an attempt was made to abolish it entirely which succeeded for 

 at least a few years. Responsibility was renewed in 1838 in a special 

 case. Davis, China, i : 127-128. 



