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No. 45. (Circular 2.) Sic,— Downing Street, 10th June, 1886. I have the honour to transmit to you, for your information and publication in the colony under your government, a copy of a parliamentary paper containing the Convention between the Governments of Great Britain and Spain respecting the commercial relations of the two countries, signed at Madrid, on the 26th of April last. I have, &c, GEANVILLE. The Officer xidministering the Government of New Zealand.

Enclosure. Convention between the Governments of Great Britain and Spain respecting the Commercial Eelations of the two Countries. (Signed at Madrid, 26th April, 1886.) The Government of Her Majesty the Queen of the United Kingdom of Great Britain and Ireland, and the Government of Her Majesty the Queen Eegent of Spain, being desirous of facilitating the commercial relations of their respective countries, have named as their representatives for that purpose—the Government of Her Majesty the Queen of the United Kingdom of Great Britain and Ireland, Sir F. Clare Ford, Her Britannic Majesty's Envoy Extraordinary and Minister Plenipotentiary at Madrid, &c. ; the Government of Her Majesty the Queen Eegent of Spain, his Excellency Senor Don Segismundo Moret y Prendergast, Minister of State, &c. ; who, being duly authorized by their respective Governments, have agreed upon the following articles : — Article I.—The Government of Her Majesty the Queen Eegent of Spain will grant to the United Kingdom of Great Britain and Ireland, and to Her Britannic Majesty's colonies and foreign possessions, most-favoured-nation treatment in all that concerns commerce, navigation, and consular rights and privileges in Spain and in the Spanish colonies and foreign possessions co-extensive in amount of benefit with that accorded to France and Germany under the treaties of the 6th February, 1882, and the 12th July, 1883. The provisions of this Convention shall come into operation on the Ist July next, unless by mutual consent any other date may be fixed, and on condition that on that date the alcoholic scale, according to which duties are levied on Spanish wines on their introduction into the United Kindom of Great Britain and Ireland, is modified in accordance with the terms of the following article. Abticle ll.—The Government of Her Britannic Majesty will continue to grant to Spain, her colonies and foreign possessions, most-favoured-nation treatment in the United Kingdom of Great Britain and Ireland, and in Her Britannic Majesty's colonies and foreign possessions, in all that concerns commerce, navigation, and consular rights and privileges. They will, in addition, apply to Parliament for the necessary authority to provide that the limit of the lower half of the alcoholic scale shall extend up to but not exceed 30 degrees of proof spirit. Article 111. —The present Convention has been drawn up subject to the sanction of the Legislatures of the United Kingdom of Great Britain and Ireland and of Spain respectively. When approved, it shall remain in force until the 30th June, 1892 ; and in case neither of the high contracting parties should have notified twelve months before the said date the intention of terminating it, the present Convention shall remain binding until the expiration of one year from the day on which either of the two high contracting parties shall have denounced it. Done in duplicate at Madrid, this 26th day of April, 1886. (1.5.) F. Claee Foed. (ii.S.) S. MoEET.

Sir Clare Fobd to Senor Moebt. M. le Ministee,— , Madrid, 26th April, 1886. I have the honour to inform your Excellency that I have received the authorization of the Earl of Eosebery, Her Majesty's Principal Secretary of State for Foreign Affairs, to sign with your Excellency the Convention which we had agreed to draw up for facilitating the commercial relations between Great Britain and Spain, and a copy of which I have the honour to transmit herewith to your Excellency. I shall feel obliged if your Excellency will name a day when I can proceed to the Ministry of State in order to sign the Convention in question. Before doing so, however, I have been instructed to place on record the following points, on which we are also agreed, but which it has not been thought necessary to insert in the body of the instrument which I propose to sign with your Excellency:— The first point refers to wines in bottle, which it is understood may be excluded, at the option of Her Majesty's Government, from the stipulations of Article 11. of the Convention. The second point refers to a possible future division of the lower half of the alcoholic scale. It is understood that nothing in the Convention shall preclude Her Majesty's Government from dividing, if at some future time it shall be found desirable to do so, the present lower half of the alcoholic scale at a point not above 15 degrees, and treating wines below that point differently from wines above it. It is further agreed that it shall be open to any British colony to withdraw from the present Convention on notice to this effect being given by Her Majesty's Minister at Madrid to the Spanish Minister for Foreign Affairs within a year after the date of its signature. The agreement on the part of the Government of Her Majesty the Queen Eegent of Spain on