States and the British Possessions in North America, as regards the fisheries, being referred for consideration and inquiry to an International Commission, on which two Commissioners to be hereafter ap pointed, in consultation with the Government of the Dominion, should be the British representatives.

Should the Government of the United States concur in this, it would be advisable that no time should be lost in appointing Commissioners on their side, and in the Commission commencing its labors; and, as it is scarcely probable that the Commissioners will be able to report, and a treaty be framed, before the commencement of the next fishing-season, it would be also desirable that you should agree upon some means, by license or otherwise, by which disputes may be avoided in the meanwhile.

ARTICLES XVIII TO XXV.

At the conference on the 6th of March the British Commissioners stated that they were prepared to discuss the question of the fisheries, either in detail or generally, so as either to enter into an examination of the respective rights of the two countries under the treaty of 1818 and the general law of nations, or to approach at once the settlement of the question on a comprehensive basis.

The American Commissioners said, that, with a view of avoiding the discussion of matters which subsequent negotiation might render it unnecessary to enter into, they thought it would be preferable to adopt the latter course, and inquired what, in that case, would be the basis which the British Commissioners desired to propose.

The British Commissioners replied, that they considered that the Reciprocity Treaty of 5th June, 1834, should be restored in principle.

The American Commissioners declined to assent to a renewal of the former Reciprocity Treaty.

The British Commissioners then suggested that if any considerable modification were made in the tariff arrangements of that treaty, the coasting trade of the United States and of Her Britannic Majesty's Possessions in North America should be reciprocally thrown open, and that the navigation of the river St. Lawrence and of the Canadian Canals should be also thrown open to the citizens of the United States on terms of equality with British subjects.

The American Commissioners declined this proposal, and objected to a negotiation on the basis of the Reciprocity Treaty. They said that that treaty had proved unsatisfactory to the people of the United States, and consequently had been terminated by notice from the Government of the United States, in pursuance of its provisions. Its renewal was not in their interest, and would not be in accordance with the sentiments of their people. They further said that they were not at liberty to treat of the opening of the coasting trade of the United States to the subjects of Her Majesty residing in her possessions in North America.

It was agreed that the questions relating to the navigation of the river St. Lawrence, and of the Canadian Canals, and to other commercial questions affecting Canada, should be treated by themselves.

The subject of the fisheries was further discussed at the conferences of the 7th, 20th, 22d, and 25th of March.

The American Commissioners stated that if the value of the inshore fisheries could be ascertained, the United States might prefer to purchase, for a sum of money, the right to enjoy, in perpetuity, the use of these inshore fisheries in common with British fishermen, and mentioned $1,000,000 as the sum they were prepared to offer.

The British Commissioners replied that this offer was, they thought, wholly inadequate, and that no arrangement would be acceptable of which the admission into the United States, free of duty, of fish the produce of the British fisheries did not form a part; adding that any arrangement for the acquisition by purchase of the inshore fisheries in perpetuity was open to grave objection.

The American Commissioners inquired whether it would be necessary to refer any arrangement for purchase to the colonial or provincial Parliaments.

The British Commissioners explained that the fisheries within the limits of maritime jurisdiction were the property of the several British Colonies, and that it would be necessary to refer any arrangement which might affect colonial property or rights, to the colonial or provincial Parliament; and that legislation would also be required on the part of the Imperial Parliament. During these discussions the British Commissioners contended that these inshore fisheries were of great value, and that the most satisfactory arrangement for their use would be a reciprocal tariff arrangement, and reciprocity in the coasting-trade; and the American Commissioners replied that their value was over estimated; that the United States desired to secure their enjoyment, not for their commercial or intrinsic value, but for the purpose of removing a source of irritation, and that they could hold out no hope that the Congress of the United States would give its consent to such a tariff arrangement as was proposed, or to any extended plan of reciprocal free free admission of the products of the two countries; but that, inasmuch as one branch of Congress had recently, more than once, expressed itself in favor of the abolition of duties on coal and salt, they would propose that coal, salt, and fish be reciprocally admitted free; and that, inasmuch as Congress had removed the duty from a portion of the lumber heretofore subject to duty, and as the tendency of legislation in the United States was towards the reduction of taxation and of duties in proportion to the reduction of the public debt and expenses, they would further propose that lumber be admitted free from duty from and after the 1st of July, 1874, subject to the approval of Congress, which was necessary on all questions affecting import duties.

The British Commissioners, at the conference on the 17th of April, stated that they had referred this offer to their government, and were instructed to inform the American Commissioners that it was regarded as inadequate, and that Her Majesty's Government considered that free lumber should be granted at once, and that the proposed tariff conces sions should be supplemented by a money payment.

The American Commissioners then stated that they withdrew the proposal which they had previously made of the reciprocal free admission of coal, salt, and fish, and of lumber after July 1, 1874; that that proposal had been made entirely in the interest of a peaceful settlement, and for the purpose of removing a source of irritation and of anxiety; that its value had been beyond the commercial or intrinsic value of the rights to have been acquired in return; and that they could not consent to an arrangement on the basis now proposed by the British Commissioners; and they renewed their proposal to pay a money equivalent for the use of the inshore fisheries. They further proposed that, in case the two governments should not be able to agree upon the sum to be paid as such an equivalent, the matter should be referred to an impartial Commission for determination.

The British Commissioners replied that this proposal was one on which they had no instructions, and that it would not be possible for

them to come to any arrangement except one for a term of years and involving the concession of free fish and fish-oil by the American Commissioners; but that if free fish and fish-oil were conceded, they would inquire of their government whether they were prepared to assent to a reference to arbitration as to money payment.

The American Commissioners replied that they were willing, subject to the action of Congress, to concede free fish and fish oil as an equivalent for the use of the inshore fisheries, and to make the arrangement for a term of years; that they were of opinion that free fish and fish-oil would be more than an equivalent for those fisheries, but that they were also willing to agree to a reference to determine that question and the amount of any money payment that might be found necessary to complete an equivalent, it being understood that legislation would be needed before any payment could be made.

The subject was further discussed in the conferences of April 18 and 19, and the British Commissioners having referred the last proposal to their government and received instructions to accept it, the Treaty Ar. ticles XVIII to XXV were agreed to at the conference on the 22nd April.

16 F

APPENDIX F.

BRITISH EVIDENCE.

No. 1.

TUESDAY, July 31, 1877.

The conference met.

Captain SIMON CHIVARIE, forty-five years of age, of Souris, Prince Edward Island, was called on behalf of the Government of Her Britannic Majesty, sworn, and examined:

By Mr. Davies:

Question. For how many years have you followed the business of a fisherman?-Answer. I have pursued it from the year 1848 up to the present season.

Q. As a business?-A. Yes.

Q. Where have you followed it; solely in British American waters ?— A. No. During part of this time I have fished on the American coast. I have principally fished, however, in the Gulf of St. Lawrence.

Q. Where did you begin the business?-A. I began it in the Gulf of St. Lawrence, in an American schooner called the Josephine.

Q. In what year?-A. In 1848.

Q. And did you so pursue it continuously-A. We made one trip that. season in this bay.

Q. And that was in British Canadian waters-in our own waters ?-A. Yes. Then I went back to the States, and came down next season in another schooner.

Q. What was your catch during the trip you have mentioned ?—A. Three hundred barrels. We only went one trip that season.

Q. And that was in the year 1848-A. Yes.

Q. Speaking with reference to the tonnage of the fishing schooners, would you tell us whether there was much difference in them?-A. The general run of vessels was about sixty-five tons. Some, however, have gone as high as one hundred and thirty tons of late years.

Q. But during this year, 1848, and during the years 1850, '55, and '60, what was it?-A. There were a few large vessels having a tonnage of one hundred and forty.

Q. But what was the general average?—A. It was from seventy-five to eighty tons.

Q. What was the size of the Josephine-A. It was seventy-five tons. Q. And you caught three hundred barrels in one trip; where was this? A. Yes. At the bend of the island.

Q. Will you explain what is the bend of the island?-A. It lies between the East Point and the North Cape of Prince Edward Island. Q. Speaking with reference to distance, will you tell us how far you fished from the shore in the bend of the island?-A. During that trip we caught fish principally within three miles of the shore. We were very close to it, because it was in October, the latter part of the fishing season.

Q. You are quite sure of that?-A. Yes.