Tennent to Fortescue (Parliamentary Under-Secretary)

I am directed by the Lords of the Committee of Privy Council for
Trade to acknowledge the receipt of your letter of the 28th June
transmitting with reference to previous correspondence for their
consideration a copy of a despatch from the Governor of Vancouvers
Island reporting on a proposal to declare the Port of Victoria a free
Port.

It appears from this despatch that the Port of Victoria including
Esquimault Harbour has been always maintained on the footing of a
free Port, inasmuch as no duties on Imports or Exports have been
levied; it is open to the trade of all Nations, and vessels are not
subject to any charges except a small entrance and clearance fee, on
their arrival and departure from Port.

It further appears that no duties on Imports have up to the present
time been levied at any other Port of Vancouver's Island and that
this system of free imports into the Colony is the result of a policy
having for its object to encourage trade and render Victoria an
entrepot for the North West Coast of America.

My Lords are desirous to express their concurrence in this
policy—but they think at the same time that it is important with a
view to the attainment of the object aimed at that the Governor of
Vancouvers Island should be advised to issue a Proclamation declaring
Victoria a free Port of Entry and clearance for Ships and Goods.

I am directed however to request that you will call the attention of
the Duke of Newcastle to the possibility that at some future time it
may become either expedient or necessary to impose Customs Duties for
the purpose of Revenue in the Colony of Vancouvers Island and
therefore that in issuing such a proclamation, it should be done in such
a manner as not by implication to preclude the adoption of such
duties hereafter should they be deemed necessary.

If however this necessity should hereafter arise I am to state that
it appears to My Lords that the important object of commanding a
re-export trade to neighbouring places may be secured by the
establishment of a well regulated bonding system.

With reference to the remarks of Governor Douglas upon the commercial
dependence of the British Possessions on the North West Coast of
America upon the Californian Ports, I am to observe that it is
assumed that all the Goods imported into those possessions from such
Ports, are burdened with Customs Duties charged on articles imported
for consumption in California by the general Tariff of the United
States.

This assumption implies that the bonding system does not exist in the
Californian Ports a fact (if this be so) of which My Lords were not
aware, but with regard to which they think it very desirable that
enquiry should be made through the Foreign Office from the British
Consuls at the Ports in question.