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 III.

The United States adopts, as the basis of the neutralization of such ship-canal, the following Rules, substantially as embodied in the Convention of Constantinople, signed the 28th October, 1888, for the free navigation of the Suez Canal, that is to say:

1. The canal shall be free and open to the vessels of commerce and of war of all nations observing these Rules, on terms of entire equality, so that there shall be no discrimination against any such nation, or its citizens or subjects, in respect of the conditions or charges of traffic, or otherwise. Such conditions and charges of traffic shall be just and equitable.

You will observe that Article III provides in express terms that the vessels of all nations observing the Rules embodied in the Treaty are to have the use of the Canal on equal terms and without discrimination. The words 'all nations' are not qualified in any way: there is no exception in regard to vessels of the United States. But the matter does not rest there. The preamble refers to a 'general principle of neutralization' established in an earlier Treaty of 1850, and Article III is intended to give effect to the principle so established: so that it is not possible to construe the Treaty of 1901 without taking into account the principle established in 1850, and reaffirmed in the later Treaty. It is necessary, therefore, for us first to go back to 1850 and to appreciate the state of things which led up to the agreement of that year, the position of the two parties to it, and the Canal projects which were then before the minds of the negotiators; and then to see what the intention of the two nations was in entering into that arrangement. These matters will be made the more clear if I recall to you, as briefly as may be, the history of the various