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![handle is hein.trade/amchiatra0001 and id is 1 raw text is:
67TH CONGRESS, HOUSE OF REPRESENTATIVES. REPORT
4th Session. No. 1668.
TO AMEND THE CHINA TRADE ACT.
FEBRUARY 20, 1923.-Referred to the House Calendar and ordered to be printed.
Mr. VOLSTEAD, from the Committee on the Judiciary, submitted
the following
REPORT.
[To accompany H. J. Res. 455.]
The Committee on the Judiciary, having had under consideration
the resolution (H. J. Res. 455) to amend the China trade act, reports
the same back with an amendment and recommends that the resolu-
tion as amended do pass.
Amend by striking out the figures 264, in line 4, and inserting in
lieu thereof the figres21.
The China trade act was passed for the purpose of encouraging
American trade in China. It became a law in September, 1922, since
which time the Department of Commerce has sought to induce Amer-
ican business men to incorporate under its provisions, but without
success. Business men have found it more profitable to incorporate
under other laws. The amendment sought by this resolution elimi-
nates the requirement contained in section 9 of the act that a majority
of the directors and of the officers holding the office of president,
treasurer, or secretary must be residents of China and provides that
such majorities must be citizens of the United States.
The present law requires that citizens of China and of the United
States to secure the limited exemption from taxes allowed under it
must be residents of China. The resolution eliminates this require-
ment and allows such exemption to citizens of China and of the United
States. As the act is amended the exemption that is granted is only
from the tax imposed on the corporation as such, and the exemption
is only in respect to its income derived from sources within China.
Even as to income derived from sources within China the exemption
is as to only a portion of it, namely, the same proportion which the
stock of the corporation owned by citizens of the United States or
China bears to the entire capital stock of the corporation. Even this
proportion is based on stock owned by individuals and not by other
corporations or holding companies. If any stock passes into the](ViewImageLocal?handle=hein.trade/amchiatra0001&div=1&collection=&method=preview&ext=.png&size=3)