Page:Bearing and Importance of Commercial Treaties in the Twentieth Century, 1906.djvu/19

 duty on any bounty-fed products exported to the United States.

Also, under the Tariff of 1890, certain articles, raw sugar, molasses, coffee, tea and hides were made duty free, but the President was authorised to suspend the freedom of entry as against any countries which imposed unreasonable duties on American products.

On these provisions is based the now time-honoured American interpretation of the most-favoured-nation clause which is, that it is not applicable to reciprocity treaties. Thus, when the United States grants concessions to another State in return for compensating concessions, the United States Government holds that a third State is only entitled to obtain extension of the concessions to itself by granting similar concessions. In other words, concessions granted to any co-contracting State are only allowed gratuitously to third parties, when nothing is given for them; the clause does not cover any advantages granted in return for advantages.

In a despatch of July 17th, 1886, to the American Minister in China, Mr. Bayard explained the American view in the following terms:—

"In its commercial aspects the expediency of an unqualified favoured-nation clause is questionable. The tendency is towards its formal qualification, by recognising in terms what most nations hold in fact and in practice, whether the condition be expressed in the clause or not, that propinquity and neighbourliness may create special and peculiar terms of intercourse not equally open to all the world; or by providing that the most-favoured treatment, when based on special or reciprocal concessions, is only to be extended to other Powers on like conditions."