The Concession and Treaty. The treaty granting to the United States the concession and rights necessary for the construction, operation, and control of the Panama Canal was signed by Secretary Hay and the Colombian Chargé d'Affaires, January 22, 1903, and ratified without change by the United States Senate, March 17. It is a lengthy treaty, containing twenty-eight articles, but is remarkable for the conciseness and directness with which each provision is stated.

Being intrusted with the duty of investigating and reporting upon the question of rights, privileges, and franchises, and believing that the negotiation of a treaty for a canal concession would follow shortly after its report was made, the Isthmian Canal Commission embodied in its report a full statement of the facts meriting consideration in framing a treaty. In discussing the nature of the concession required by our government, the Commission stated that the United States should obtain authority from the country granting the concession:

To enter its territory and excavate a canal there with such additional authority as may be necessary to make and enforce police and quarantine regulations, establish and collect tolls and other proper charges, and protect the canal and those engaged in its construction and operation, and the persons and property using and passing through it when completed, such powers and privileges to be exercised subject to the sovereignty of the Republics in which the property is situated.

In order to exercise these rights and perform these functions, the United States will require the control of a strip of territory from sea to sea, including the canal and auxiliary works, with sufficient space at each terminus for all port and harbor accommodations, including offices, warehouses, residences for officials and workmen, docks, lighthouses, and quarantine stations. Within this area those charged with the direction of the canal project during the period of construction, and with the management and operation of the work and its auxiliaries after completion, should have power to protect the entire line from intrusion by evil-disposed persons, prevent smuggling, regulate the kinds of business that ordinarily require control, and enforce police, sanitary, and other appropriate rules and regulations, as well as contracts relating to the construction and operation of the canal.

The strip should be of sufficient width to prevent wrongdoers from easily withdrawing beyond the limits of police jurisdiction and thus

avoid arrest and escape punishment. It should be not less than ten miles in width; that is, five miles on each side of the centre of the canal throughout its entire length, and including its terminal harbors.

The Canal Commission did not consider it necessary for the United States to acquire sovereignty over the territory adjacent to the canal. The desirability of our country's having the sole and undivided ownership and control of the canal when constructed was emphasized, and the recommendation was made that the compensation to be paid by the United States should be definitely fixed either as a single payment or as a predetermined annual payment, or as a combination of these two methods. The Commission believed that "a compensation to be dependent on the earnings and profits of the enterprise would be subject to the objections which make a div'ded ownership undesirable." In most particulars the treaty accords with the suggestions made by the Commission.

The treaty authorizes the New Panama Canal Company to sell out to the United States; exempts the Panama Railroad Company from its financial obligation to Colombia, and gives the United States a lease for a period of one hundred years, renewable at the option of the United States, of a strip of land ten kilometers wide across the Isthmus of Panama. The United States no only recognizes the sovereignty of Colombia over this leased strip, but "disavows any intention to impair it in any way whatever, or to increase its territory at the expense of Colombia or of any of the sister republics in Central or South America." The United States secures the right to construct the canal and harbors, to establish free ports at the termini of the canal, to maintain hospitals, and drainage and sanitary works along the line of the canal and its dependencies, and to instal waterworks and a sewerage system in Colon and Panama, with the authority to "collect equitable water rates during fifty years." Colombia agrees not to cede or lease to any foreign power any territory in the Department of Panama, and the United States guarantees that no country shall be allowed to seize such territory. The damages caused to private land-owners by changing the course of the Chagres River, or by flooding its valley, and the damages inci

dent to the construction and operation of the canal, are to be borne by the United States, the amount of the damages to be fixed by a joint commission of the two countries. This joint commission is also empowered to appraise the land that may be expropriated by the United States in the construction of the canal, and this commission is to "establish and enforce sanitary and police regulations." Colombia is to collect no duties or taxes on the commerce using the canal, except to collect duties on importations into Colombia. There are to be no taxes levied on the property of the United States within the canal strip, nor upon the officials and employees in the service of the canal.

Article XIII. of the treaty defines the system of government to prevail within the canal strip, and is one of the most important parts of the convention:

The United States shall have authority to protect and make secure the canal, as well as railways and other auxiliary works and dependencies, and to preserve order and discipline among the laborers and other persons who may congregate in that region, and to make and enforce such police and sanitary regulations as it may deem necessary to preserve order and public health thereon, and to protect navigation and commerce through and over said canal, railways, and other works and dependencies from interruption or damage.

To meet the difficult problem of administering justice within the canal zone leased by the United States, the treaty provides for three kinds of courts: (1) Colombia is to establish judicial tribunals to determine controversies between citizens of Colombia and between Colombians and the people of any foreign nation other than the United States; (2) the United States is to maintain courts to settle disputes arising between American citizens and the citizens of the United States and the people of any foreign country other than Colombia; (3) the United States and Colombia are to unite in establishing civil and criminal courts composed of jurists appointed by the two countries, to have jurisdiction over controversies between the citizens of the United States and Colombia and between the citizens of all countries other than Colombia and the United States.

It is provided that the canal shall be neutral in perpetuity, in

conformity with the treaty of November 18, 1901, between the United States and Great Britain; but the United States secures the right to protect the canal. The new treaty in no wise limits the rights of the United States under the treaty of 1846-48 with New Grenada, by which we guaranteed the neutrality of the isthmian transit route and the sovereignty of Colombia. Article XXIII of the present convention gives us the following rights in connection with the defence of the canal:

If it should become necessary at any time to employ armed forces for the safety or protection of the canal, or of the ships that make use of the same, or the railways and other works, the Republic of Colombia agrees to provide the forces necessary for such purpose, according to the circumstances of the case; but if the Government of Colombia cannot effectively comply with this obligation, then, with the consent of or at the request of Colombia, or of her Minister at Washington, or of the local authorities, civil or military, the United States shall employ such force as may be necessary for that sole purpose; and as soon as the necessity shall have ceased will withdraw the forces so employed. Under exceptional circumstances, however, on account of unforeseen or imminent danger to said canal, railways, and other works, or to the lives and property of the persons employed upon the canal, railways, and other works, the Government of the United States is authorized to act in the interest of their protection, without the necessity of obtaining the consent beforehand of the Government of Colombia; and it shall give immediate advice of the measures adopted for the purpose stated; and as soon as sufficient Colombian forces shall arrive to attend to the indicated purpose, those of the United States shall retire.

The United States is given authority to establish and enforce regulations for the use of the canal, railway, and ports, and fix the tolls and other charges. The treaty stipulates that construction work shall begin within two years from the date of the ratification of the convention, and that the canal shall be completed within twelve years after the period of two years; unless the completion of the work within that time is rendered impossible by obstacles "at present impossible to foresee," in which case the period of construction may be prolonged for twelve years more. Our country is thus given twenty-six years to carry out the project of a lock canal. If we should decide upon a sea-level canal,

we may have ten years more to complete the task. We shall probably not require more than ten years for the construction of the canal.

As a compensation for the privileges obtained from Colombia by this concession, the United States is to pay Colombia $10,000,000 in gold at the time of the exchange of ratifications, and $250,000 in gold annually, the annual payments to begin nine years hence. The lump sum to be paid Colombia is somewhat larger than we had expected to pay, but the amount is not excessive. Although the payments to Colombia seem liberal, it should be borne in mind that Colombia is making important financial concessions to the United States. She is not only leasing to us a strip of country six miles wide across the Isthmus, but she is renouncing her claim (1) to the annual payment of $250,000 now received from the Panama Railroad Company, and (2) to her share of the profits from the operation of the canal. According to the concession now held by the Panama Canal Company, Colombia was to receive from five to eight per cent of the gross receipts from the operation of the canal, and the concession stipulates that this annual payment from the gross receipts shall not be less than $250,000. The railroad belongs to the Canal Company, and when the United States buys out the Canal Company, our country will own the railroad. Thus Colombia is surrendering a present annuity of $250,000 and a prospective income of $500,000 or more annually. (3) Furthermore, the concession now held by the Panama Railroad Company provides that in 1966 the railroad shall become the property of the Colombian Government. (4) Likewise the concession held by the Panama Canal Company stipulates that the canal shall revert to the Colombian Government at the end of ninety-nine years from the date of the completion of the canal. By the treaty now negotiated, Colombia loses the right of future ownership of the railroad and canal properties.

The powers secured by the United States seem to be all that will be required for the successful construction and satisfactory control of the canal. We are to obtain what is equivalent to a perpetual control of the strip of territory through which the waterway extends; and our authority in the regulation of sanitary con