SPECIAL REPORTS FOR FEDERAL TRADE COMMISSION. 208

Government. In 1913 the company obtained approval of the Government to
jistribute dividend of 7 per cent, and in the following year that of 8 per cent.
The company is paying dividend of 2% per cent to the Government shares of
100,000,000 yen.' .
Company’s enterprises: ‘Besides railway business the company is engaged in
these enterprises, viz, shipping, harbor, colliery, gas, electricity, hotels, exploitation
 of the railway zone, and experimental laboratories.

While no reference is made in the above quotation to the company’s
 workshops, an examination of its capital account shows an
expenditure of $3,019,872 for that purpose. In a uecent instance,
when locomotives were needed for the Chosen railways, the tenders
were limited to three Japanese companies, including the South Manchuria
 Railway Co., which received the order. Notwithstanding the
fact that some 200 out of 208 locomotives now in use on the Chosen
railways are of American manufacture, the representative of a prominent
 American firm, who was on the ground, was not allowed to bid.
The South Manchuria Railway Co. was, however, unable to fill the
contract without ordering a large number of parts from the American
firm. Direct competition by American manufacturers under such
conditions, in which orders are placed by the Government with semigovernment
 concerns, regardless of price, is manifestly out of the
question, although some business may be done, as in the instance
above quoted, along a different line. As the company’s workshops
are equipped with Emerican machinery to turn out the various kinds
of rolling stock and railway equipment, the outlook for American
competitors in these lines is not bright.
Judging by the import returns, the only other lines of trade in
which the operation of combinations might be looked for are the
cotton goods and machinery schedules. As to cotton goods, while the
activities of the Japan Cotton Spinners’ Association are undoubtedly
increasingly felt in this field, particularly by their chief competitors,
the British, the said association, as its name implies, appears to be a
confederation of cotton manufacturers for certain specific purposes
rather than a syndicate or combination of capital. (The history,
organization, and methods of the Cotton Spinners’ Association are
fully described in Special Agents’ Series No. 86, Cotton Goods in
Japan, published by the Department of Commerce.) As to mashinery,
 no known combinations are operating here other than the
South Manchuria Railway Co., above referred to.
Government attitude toward industry.—There are no important
international syndicates or combinations operating in Chosen, nor
any known combinations of buyers, unless in the latter category
might be included the various branches of the Chosen Government
General, which are the chief purchasers of railway materials and
building supplies.
The only field (other than Christian missions) in which foreign
capital is invested to any extent are the gold mines, the more important
 of which are owned and managed by Americans.
On the other hand, the Government owns and operates the railways,
 and has taken over the direct control of a number of the more
productive industries, as noted above. The principal construction
works, such as harbors, roads, and public buildings, are controlled
by the Government, a large proportion of such works being paid for

| The ven is equivalent to $0.498 United States gold.