Colvile to Newcastle

I have the honour to acknowledge Mr Merivale's letter of the
27th Ultimo addressed to Mr Barclay Secretary of the Hudson's Bay
Company stating that Her Majesty's Government have under their
consideration the propriety of authorizing freedom of trade within the
settled parts of Vancouver's Island, subject to restrictions as to the
sale of spirituous liquors, and that your Grace will be happy to receive
such observations as the Hudson's Bay Company may think proper to submit
to you upon this subject.

In reply to which, I have to observe, that the Company does not
claim the right to, and has not 
exercised any exclusive dealings with
the Indians of Vancouver's Island since it became a Colony, neither has
there been any restriction on the freedom of trade as regards the
Indians or any other parties.

This state of matters is so well known in the Island that any
further declaration or proceeding of Her Majesty's Government would
appear to be unnecessary, and if such were to be made, it might be
construed to be something in addition to what already exists, and lead
to employing the Indians to carry on traffic with the Country on the
Continent, contrary to the rights of the Company under their License of
Trade.

The only way in which traffic with the Indians can be really and
permanently useful to the Settlers, and at the same time beneficial to
the Indians
is by the employment of Indian labour in cutting down wood
to clear the Country, in the cultivation of the soil, and in fishing; a
course to which it has been the policy of the Company to give every
encouragement.

Having submitted these observations, I have only to add that the
Company will not object to any course which your Grace may consider
proper to direct, having due regard to their rights under the License of
Trade.