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 The next problem was to re-organise the provincial administration in each of the Three Provinces. This task was more difficult in Liaoning than in either of the other two, because Mukden was the centre of this provincial administration; most of the influential men had fled, and for a time a Chinese provincial administration continued to be carried on at Chinchow. It was three months, therefore, before the re-organisation was completely accomplished. Lieutenant-General Tsang Shih-yi, the existing President of the Liaoning Provincial Government, was first approached on September 20th and invited to organise a Provincial Government, independent of the Chinese Central Government. This he refused to do. He was then put under arrest and released on December 15th.

After General Tsang Shih-yi had refused to help in the establishment of an independent Government, another influential Chinese official, Mr. Yuan Chin-kai, was approached. He was a former provincial governor and a Vice-President of the North-Eastern Political Committee. The Japanese military authorities invited him and eight other Chinese residents to form a "Committee for the Maintenance of Peace and Order". This Committee was declared to have been formed on September 24th. The Japanese Press at once acclaimed it as the first step in a separatist movement, but Mr. Yuan Chin-kai publicly disclaimed any such intention on October 5th. The Committee, he said, had "been brought into being to preserve peace and order after the breakdown of the former administration. It assisted, moreover, in relieving refugees, in restoring the money market, and it attended to some other matters, solely for the sake of preventing unnecessary hardship. It had, however, no intention of organising a Provincial Government or declaring independence".

On October 19th, the Committee opened the Board of Finance, and Japanese advisers were appointed to assist the Chinese functionaries. The Director of the Board of Finance had to obtain the approval of the military authorities before giving effect to the Board's decisions. In the districts, the tax collectors' offices were controlled by the Japanese gendarmerie or other agencies. In some cases, they had to submit their books daily for inspection to the gendarmerie, whose approval had to be obtained for the disbursement of any monies on public objects, such as police, justice, education, etc. Any case of remittance of taxes to the "hostile party" at Chinchow was to be at once reported to the Japanese authorities. At the same time, a Financial Readjustment Committee was organised the chief business of which was to re-organise the taxation system. Japanese representatives and the representatives of Chinese guilds were allowed to take part in discussions on taxation. According to a statement in the "History of the Independence of Manchukuo", dated May 30th, 1932, and submitted to the Commission by the "Department of Foreign Affairs" at Changchun, these discussions led to the abolition on November 16th, 1931, of six taxes, the reduction of four others by half, the transfer of eight others to local governments, and the prohibition of all levies, without a legal basis.

On October 21st, the Board of Industry was opened by the Committee, whose name was now changed to that of "Liaoning Province Self-Government Office". The consent of the Japanese military authorities was sought and obtained and a number of Japanese advisers were appointed. Before issuing any orders, the Director was required to obtain the approval of the Japanese military authorities.

Lastly, the Liaoning Self-Government Office organised a new North-Eastern Communications Committee, which gradually assumed control of various railways, not only in Liaoning Province, but also in Kirin and Heilungkiang. This Committee was separated from the Liaoning Self-Government Office on November 1st.

On November 7th, the Liaoning Province Self-Government Office transformed itself into the Liaoning Provincial Government ad interim,