1010 CORRESPONDENCE, ETC. 



light dues in cases where similar vessels registered and owned in the 

 Colony are exempt. They recognised that those concessions are 

 substantial, but they consider that they are the least injurious to the 

 interests of the Colony. On the other hand, they have pressed the 

 right of the Colonial Government to prevent Newfoundlanders serving 

 on American vessels, and they have urged the United States Govern- 

 ment to accept the prohibition of the use of purse seines and of Sunday 

 fishing. These proposals are now under the consideration of the 

 United States Government, and no effort will be spared to secure the 

 most favourable terms possible for Newfoundland pending the further 

 discussion of the main questions at issue. 



8. His Majesty's Government earnestly trust that in the carrying 

 out of anv modus vivendi which may be found necessary, and in the 

 conduct of negotiations, they will receive the fullest co-operation of 

 the Newfoundland Government. In his speech at the Colonial Con- 

 ference Sir R. Bond repudiated any desire to limit the treaty rights of 

 American citizens, and asked for nothing but justice and responsi- 

 bility sanctioned by the spirit and forms of the British Constitution. 

 His Majesty's Government feel, therefore, entitled to rely on his help 

 in arranging conditions on which the fishery may be carried on pend- 

 ing the final settlement of the dispute with the United States as to the 

 meaning of the Treaty of 1818; for they have no doubt that vour 

 Ministers will agree that the strict observance of treaty obligations 

 is binding upon all portions of the British Empire. 



I have, &c., ELGIN. 



Lord Elgin to Governor MacGregor. 



[Telegram.] 



(Sent 5.15 p.m., July 23, 1907.) 



We have now received answer from the United States Ambassador 

 to our note of the 20th June, which was shown to your Prime Minister, 

 and a copy of which was privately sent to you on the 21st June. The 

 effect of the note is that the United States Government cannot give 

 their acquiescence to the present proposals of His Majesty's Govern- 

 ment which they feel would be tantamount to yielding all vital ques- 

 tions in dispute. In their opinion the surrender of the right to hire 

 local fishermen, and the surrender at the same time of the use of purse 

 seines and of fishing on Sunday would render their treaty rights worth- 

 less. We are, therefore, face to face with a reference of pending ques- 

 tions to arbitration and an ad interim renewal of the Modus Vivendi. 

 The United States Ambassador has proposed arbitration before the 

 Hague Tribunal and suggests that a conclusion to the proceedings 

 will be reached in so short a time that last year's Modus Vivendi can 

 be continued without causing any real hardship to the Colony. If, 

 however, we refused to renew the agreement as to the employment of 

 Newfoundland fishermen, they would be compelled to insist on the 

 use of purse semes. To give up both points they would consider 

 equivalent to abandoning altogether their treaty rights. 



From the proceedings at the Conference and also from the corre- 

 spondence which took place with me, His Majesty's Government are 

 aware that Sir R. Bond is desirous to have all the outstanding ques- 



