Alexey Ostashev

ACTIVITIES OF JAPANESE COAL CONCESSIONS IN NORTHERN SAKHALIN.

The question of the evacuation of Japanese troops from Northern Sakhalin was raised by the delegation of the Far Eastern Republic (which included Northern Sakhalin) at the conference in Dairen (11.07.1921 16.04.1922), where Japan was offered to withdraw troops from Primorye and Northern Sakhalin within a month in exchange for concessions and economic benefits. The Sakhalin issue was actively discussed at the Washington (1921) and Changchun conferences, at the negotiations between representatives of the USSR and Japan in Tokyo (1923). The solution of the issue of the liberation of Northern Sakhalin continued at the Beijing negotiations of 1924-1925. During this period, the USSR began to pursue a tough course towards Japan: limiting benefits for Japanese fishermen, limiting the issuance of entry visas. Japanese business circles began to exert pressure on the central authorities in order to normalize relations with the Soviet Union. The same demand was made by many workers, supported by part of the intelligentsia. As a result, both the Japanese and Soviet sides made mutual concessions, and at the Beijing negotiations in 1924-1925, the issue of the liberation of Sakhalin was resolved.

On January 20, 1925, the "Convention on the Basic Principles of Relations between the USSR and Japan" was concluded in Beijing, on the basis of which the evacuation of Japanese troops from Northern Sakhalin was to be completed by May 15, 1925. One of the key concessions of the USSR to the Japanese was the provision of concession contracts to Japanese firms for the exploration and production of minerals on the island. At that time, Japan experienced great difficulties in importing foreign coking coal from England and America. This pushed it to obtain a coal concession on Sakhalin.

On the other hand, the signing of concession agreements with Japan was beneficial not only to the Japanese, but also to the Soviet side. As early as the early 1920s, at the dawn of the New Economic Policy (NEP), in an environment of deep decline in production, disruption of economic life and destruction of productive forces, the top officials in the leadership of the USSR proposed to use foreign capital in the form of concessions in addition to internal reserves and opportunities. In addition to the economic policy of the USSR in the Far East (attracting investment, improving the distribution of productive forces in the country, etc.), the concession policy of the USSR in the Far East also included a political aspect the need to use the contradictions between America and Japan to prevent a new intervention.

According to Protocol B of the Beijing Convention, the Government of the USSR agreed to grant a concession to Japanese concerns recommended by the Japanese Government for the exploitation of coal deposits on the west coast of Northern Sakhalin. Concession contracts were to be concluded within five months from the date of the complete evacuation of Japanese troops from Northern Sakhalin.

However, in Japan itself, a wide discussion unfolded: does the country really need a coal concession on Sakhalin?

On April 24, 1925, the Osaka Jiji Shimpo newspaper noted: "According to a poll of experts, the coal of Northern Sakhalin is not good enough to arouse our interest, so it is said that the miners are trying to challenge the government in their own loincloths (in our understanding, by taking off their last trousers). However, unlike oil, coal is not something necessary for national defense, so if it cannot be mined without loss to the miners or the government, some people argue that it would be normal to give up the coal rights they received under the Beijing Treaty. It is not right that the government makes such great sacrifices to extract coal in Northern Sakhalin."

On April 29, the same newspaper, in an article titled "Sakhalin Coal Company: Is It a State Subsidy?" wrote: "The government initially believed that the new coal concession would be very simple and easy to manage, and on the basis of this policy, it began negotiations with the Association of Coal Enterprises of North Sakhalin to establish a new company with the association's investment. However, the association was well aware that the operation of the concession in the area would be extremely difficult. The association has now asked the government to take over the investment of about 5 million yen it has made so far and to proceed with plans to establish a new company under the auspices of the government."

On May 8, Natsionalnaya Gazeta published an article with its vision of the situation with the Sakhalin coal concession: "With regard to the establishment of the North Sakhalin Coal Concession Company, the Sakhalin Coal Enterprises Association submitted to the government in early April all the research materials related to the North Sakhalin coal deposits and a plan for the establishment of the company, which included the results of the association's activities from the start of the business to the present. However, time passed, and no decision was made. The association's argument is that it is unlikely that the company will be able to operate on a profitable basis with little capital. Therefore, the natural result is the creation of a large company. However, due to the great difficulties in raising funds in the current economic downturn, the government hopes to either give a government guarantee of profits or create a semi-public company. The government's intention in this regard is to compensate the company for its losses, but in order to create a semi-public company, a bill or budget must be submitted and approved by parliament. However, since there is currently no absolute need for the country to set up a coal company in North Sakhalin, the government plans to set up a commercial company. But then the only way to guarantee a profit is to either borrow at low interest rates or through a government promise to buy coal. However, the Navy already has coal mines in Korea and now it no longer needs coal. The Ministry of Railways already buys coal at extremely low prices, even below the cost of Sakhalin coal. For these reasons, if the government fails to secure purchases of Sakhalin coal, the only option left is to lend capital, but the Finance Ministry's Deposits Department amended the law this year to create an investment committee to tighten lending and adopted a policy of not issuing any funds for this type of business.

On May 14, 1925, the Chgai Shogy Shinpo newspaper wrote, "The cost of coal production is approximately 6 yen 90 sen per ton, and the selling price of the FOB steamship is 8 yen. Assuming a profit of about 1 yen 10 sen per ton, the profit from the annual export of 150,000 tons will be 165,000 yen, which is just under 2.8% of the capital of 6 million yen, in which case there is no hope of attracting private shareholders. If the government provided a subsidy of 3 million yen, it would result in a profit margin of 5.5%. Negotiations are currently underway on this matter. Currently, Dui coal costs 8 yen, with a loading cost of 2 yen 50 sen, a shipping fee of 4 yen, an insurance fee of 10 sen, a shipping fee of 24 sen, a shipping cost of 52 sen, and a percentage of 10 sen. A total of 15 yen 47 sen. Given the quality of the coal, can we expect it to be bought on the market for 15 yen 47 sen per ton?

In the end, despite the hype in the newspapers, political arguments outweighed economic ones, and the Japanese government made a fundamental decision to send a delegation to the USSR to conclude a concession agreement on coal mining in Northern Sakhalin.

On May 26, 1925, Mr. Kimura Kusuyata from the Mitsubishi concern and Mr. Hashimoto Keisaburo from the Hokushin Union were summoned to the official residence of the Prime Minister. They were presented with 14 points of conditions approved by the decision of the Cabinet of Ministers to reach a final compromise between the government and future concessionaires, namely: Business plans of companies, determination of charters, mergers, liquidations, appointment and dismissal of managers, transfer of important assets, issuance of bonds and large loans are subject to mandatory approval (licensing) by the government; Shareholders of these companies can only be subjects of the Empire of Japan; In relation to an oil company, strict obligations are imposed on it to maintain infrastructure in strictly defined areas and perform mandatory exploratory drilling; In relation to a coal company, similar obligations are established for exploration and production; In the oil sector, the government reserves the preemptive right to buy out all production products; In relation to coal, similar measures of priority state buyout are not established; The government retains the right to full administrative supervision and control over the activities of both companies; In the event that the net profit of companies exceeds the threshold of 15%, half of the amount of this excess profit must be transferred to the state treasury; For a coal company, the requirements for coordinating the dismissal of directors and approving minor operational business plans with the government are canceled (a total of 5 such exceptions are provided).

At the request of the government, potential concessionaires provided their drafts of the Statutes and business plans of future joint-stock companies. The most concise was the business plan of the North Sakhalin Coal Syndicate, which proposed to obtain a concession for the Douai and Rogatiy mines. The authorized capital of the syndicate was planned at 10 million yen and paid - 6 million. Of these, it was planned to spend 2.55 million yen on the acquisition of coal mining rights, and 2.15 million yen on the development of mines and related equipment. The working capital for current activities was to be 1.3 million yen. The project of income and expenses for the first 4 years of operation is presented in the table:

The Sakhalin Coal Joint Stock Company (Sano Union) claimed to receive a concession for the Petrovsky mine, which was acquired by Shigeru Sano in February 1925. The authorized capital of the company was to be 500 thousand yen and the paid-up capital was to be 400 thousand yen. Of these, it was planned to spend 60 thousand yen on the acquisition of concession rights, and 230 thousand yen on the arrangement of mine structures and equipment. The working capital for current activities was 110 thousand yen.

In the first year of operation, it was planned to produce 18 thousand tons of coal, in the second - 35 thousand tons, in the third - 70 thousand tons. The project of income and expenses for the first 5 years of operation is presented in the table:

During the Japanese occupation, the limited partnership "East Mining Company" operated the Polovinka mine, to which it declared its concession claims. The authorized capital of the future joint-stock company was planned at 1 million yen and paid-up - 750 thousand. Free working capital was 130 thousand yen. A comparative plan of operating activities and payback is presented in the table:

*Note from 1928: Capital increased by 100,000 yen (to 850,000 yen) through the collection of a targeted contribution of 5 yen per share to expand capacity to accommodate increased production.

The most detailed plan was presented by the Sakai partnership. The company planned to hire 20 Chinese workers with a salary of 850 yen per month (an average of 42.5 yen per employee) and 3 Japanese technicians with a monthly salary of 210 yen (70 yen per employee). The productivity of 1 Chinese worker was to be 1.7 tons per shift, the number of working days per month was 25. In addition, the company incurred capital costs for laying second railway tracks, moving sections of tracks, equipping a coastal warehouse, purchasing a new mainline steam locomotive, expanding the fleet of trolleys, building 3 new freight barges, conducting mining and tunneling operations on new coal seams, installing an automatic loader on the pier, building warehouses, houses for the Japanese and barracks for coolies, for which it was planned to spend over 130 thousand yen over 4 years. The balance of income and expenses is presented in the table:

As we can see, the business plans of small Japanese entrepreneurs and groups were so incredible in their profitability that they were primarily of interest to the Japanese press. On June 13, 1925, the newspaper "Hochi Shimbun" was published under the headline "The Incredible Situation with the Agnevo Coal Mine in Northern Sakhalin!" On June 10, the newspaper wrote, at the official residence of the Prime Minister, at the meeting of the founders, the draft charter and plan of the new company were presented. According to this document, the authorized capital of the Agnevo Joint Stock Company should be 2,000,000 yen, divided into 40,000 shares with a par value of 50 yen each. Of these, the Sakhalin Industrial Union (represented by the chairman Mr. Haruoma) was to contribute 800,000 yen, and the remaining 1,200,000 yen was planned to be raised through open subscription among investors. According to this ambitious plan, it was planned to pay dividends in the amount of 7.3% of the invested capital in the 1st year of the company's operation, 8.3% in the 2nd year, and reach a yield of 26.6% in the 3rd year. The area of coal fields was estimated at 900,000 tsubo (about 300 hectares), and the total coal reserves at 20000000 tons. The Sakhalin Union of Entrepreneurs, relying on its own data and field exploration conducted by the Mitsubishi concern, subjected this plan to devastating criticism. It turned out that the Sakhalin Union had previously bought the rights to this problematic area for only 7000 yen. According to an independent examination, the government capital of 2 million yen looks not just overstated, but absurd, and the business plan itself is unprecedentedly inflated.

Moreover, providing investors with such deliberately false and exaggerated data about future fabulous dividends could turn into an international scandal, undermine confidence in Japanese business and lose the hard-won Sakhalin concessions. According to reports, Chief Cabinet Secretary Kenji Egi now deeply regrets that he approved this document and put his visa on it without conducting proper verification.

The Tokyo Asahi Shimbun newspaper of June 14, 1925 wrote: "According to the results of geological analysis provided by Mitsubishi experts, out of the five declared sections of the Agnevo mine (with the exception of the second sector), all the seams contain a colossal volume of illiquid impurities and waste rock. Mining them will require colossal costs for coal preparation, and the quality of the raw material itself barely reaches the low-grade lignite of the second class. The reserves of conditioned coal, located above the groundwater level, amount to a modest 180,000 tons, a figure that differs from government statements by as much as two orders of magnitude (a hundred times less than declared!). In this regard, the Executive Union intends to send an official request to the government demanding clarification of the origin of such inaccurate data in official documents. The business plan, previously presented and distributed at the official residence of the Prime Minister, contained colossal additions and falsifications. In the current conditions, when the fraud was revealed, an attempt to conduct an open subscription for the shares of the new company and collect capital among investors was doomed to complete failure, since no one would invest in a knowingly fictitious enterprise. Representatives of the coal syndicate said that the government should not succumb to the blackmail of private individuals, whose assets on Sakhalin are in fact "empty paper." The inclusion of such unreliable and economically unprofitable objects in the general program of state support will seriously damage the national interests of the country and weaken Japan's position in the upcoming interstate negotiations with the Soviet government."

As a result, the Japanese government officially approved a plan according to which all small private enterprises and independent mine owners were to unite under the auspices of a single Sakhalin syndicate, so that the Japanese side would act at the upcoming official negotiations in Moscow as a single consolidated front.

However, the entrepreneurs who developed the Agnevo mine during the Japanese occupation of Northern Sakhalin categorically refused to obey this decision of the Cabinet of Ministers. Based on their initial business plans, they made a strong demand to be given the right to send their own representatives, independent of the syndicate, to conduct separate negotiations with the Soviet authorities.

On this occasion, the newspaper "Hoti Shimbun" (17.06.1925) came out with an article "The position of the owners of the Agnevo mine". They refuse to compromise and criticize the Sakhalin Industrial Union. A conflict within the Japanese delegation is inevitable." Representatives of Agnevo, the newspaper wrote, say that their business plan is based on real economic theory, and the position of the Sakhalin Industrial Union and the Ministry of Finance is dictated exclusively by the interests of large banking monopolies, which feel great and do not want to share profits with independent industrialists. They expressed their indignation on June 17 at a specially convened council of investors.

The owners of the mine emphasize that the Sakhalin Industrial Union is trying to get their hands on a promising site for a song. They claim that the rights to Agnevo originally belonged to them legally, went through a chain of legal agreements (including agreements with Stakheev) and were officially recognized and guaranteed by the Soviet side when signing the Beijing Treaty.

"The fact that the government is now trying to force us to donate the mine to the new Sakhalin Consortium is a blatant robbery in the interests of the oligarchs," Agnevo said. They flatly refused to withdraw their business plan and said that if the Sakhalin Union sent a representative to Moscow, Agnevo would send his own commissioner to defend his rights directly before the Soviet government. As a result, the Japanese side risked coming to Moscow split and engaging in an "internal squabble" in front of foreign diplomats.

S. Mitinari

The Ministry of Foreign Affairs of Japan reacted to this demarche with a sharp and categorical refusal. The Ministry of Foreign Affairs stressed that the separate actions of individuals are absolutely unacceptable, since they grossly violate the unified diplomatic line of the state. Due to the clash of private commercial interests in international negotiations, internal strife will inevitably arise, which will seriously damage the national interests of Japan. In this regard, the government officially stated that it considers the Agnevo group as a "third party" acting contrary to state policy, and will not provide any diplomatic or legal support to their representatives. Moreover, the government reserved the right to revoke their licenses and prohibit the loading of coal on their ships in the ports of Sakhalin. However, the hype in the press did its job and a compromise was reached between small entrepreneurs and the government: the government recognized the claim of small firms to conclude independent concession contracts, in return the companies agreed to delegate their rights to conclude contracts to a delegation officially elected and approved by the government.

On June 19, 1925, the founders of the North Sakhalin Oil Joint-Stock Company (Chairman of the Executive Committee for the Establishment: Suenobu Michinari), the North Sakhalin Mining Joint-Stock Company (Chairman of the Executive Committee for the Establishment: Suenobu Mithinari), the Sakhalin Coal Joint-Stock Company (Founders' Representative: Saito Noboru), the North-Sakhalinsk Coal Industry Joint-Stock Company (Founders' Representative: Sakai Ryuzo), and the Eastern Mining Joint-Stock Company (Founders' Representative: Tsukahara Kaichiro) requested the Imperial Government to recommend them to the Soviet Government as operators (concessionaires) for the development of oil or coal deposits in Northern Sakhalin on the basis of the Convention on the Basic Principles of Relations between Japan and the Union of Soviet Socialist Republics and the Protocols thereto.

On June 24, 1925, a notification came from the Cabinet of Ministers Chancellery that these petitions were satisfied on the following conditions.

Special conditions:

1. The appointment of representatives and advisers who will negotiate and conclude concession agreements with the Workers' and Peasants' (Soviet) Government shall be subject to the mandatory approval of the Government of Japan.

2. At the conclusion of these treaties it is necessary to be under the direct direction and control of the Imperial Ambassador in Moscow.

3. When concluding these agreements, all operators (companies) are obliged to coordinate their actions with each other in order to develop a common position. On the main requirements, it is necessary to obtain the consent of the Ambassador in advance. In case of disagreements between the operators, the issue is referred to the Ambassador for final decision.

4. In case of violation of any of the above points, the Government's recommendation may be annulled.

5. Immediately after the conclusion of concession agreements, the relevant joint-stock companies must be officially established. Separate orders may be issued regarding public subscription for shares.

6. Written undertakings to accept these terms and conditions must be given without delay.

On June 25, 1925, the founders of the North Sakhalin Coal Syndicate, Masao Saito and Michinari Suenobu, submitted a petition to the Cabinet of Ministers Secretariat to delegate their powers at the upcoming Soviet-Japanese negotiations to Masao Okumura. Similar petitions for the delegation of powers in the negotiations to Masao Okumura were made by the Sakai Union and the Sano Union. From the East Mining Company, Tsukahara Kaichiro was recommended to participate in the negotiations. After satisfying the submitted requests, on July 6, 1925, the founders and representatives of the companies selected to receive concessions in Northern Sakhalin signed a commitment to accept and comply with the conditions of the Japanese government.

This is what the signed commitment of the Eastern Mining Company looked like:

"Due to the fact that our candidacies were recommended as representatives for negotiations on concessions in Northern Sakhalin, we commit to the following

1. In our capacity as representatives to negotiate concessions in Northern Sakhalin, we undertake to follow the instructions of our Ambassador to Russia at the meeting place (Moscow).

2. We undertake to avoid mutual competition with other representatives of similar concessions, on the contrary, we will strive for full agreement, act in solidarity and strictly observe our obligations.

3. We undertake to make joint efforts to acquire these concessions.

4. On mineral extraction tax (royalties) and other tax liabilities, as well as on other important issues, we undertake to come to an agreement and coordination with others in the same industry and categorically undertake to avoid any separate (single) actions.

We hereby submit the above memorandum.

July 4, 14th year of the Taish era (1925)

Representative of the founders of the Eastern Mining Joint Stock Company

Tsukahara Kaichiro (signature/seal)"

At the beginning of July 1925, the Acting Ambassador of Japan to the USSR, Sato, handed an official letter to the People's Commissar for Foreign Affairs, G. V. Chicherin: "I have the honor to declare to Your Excellency that I, acting on the basis of the instructions of my Government, hereby notify on behalf of the Imperial Government of the following.

In connection with the fact that earlier in Beijing a treaty was concluded between Japan and the Union of Soviet Socialist Republics, namely the Convention on Basic Principles of Mutual Relations and Protocol B thereto, which regulate these relations in accordance with the provisions provided for in Protocol B:

1. With respect to concessions for oil fields:

To recommend the Petroleum Industrial Syndicate of North Sakhalin as an official Japanese entrepreneur provided for in paragraphs 1 and 2 of Protocol B.

2. With respect to concessions for coal deposits:

To recommend the North Sakhalin Coal Industrial Syndicate, as well as the Sano Syndicate, the Inoue Syndicate (Sakai) and the Tsukahara Syndicate as official Japanese entrepreneurs provided for in paragraph 3 of Protocol B.

With regard to the coal deposits in the Douai area, separately mentioned in paragraph 3 of Protocol B, the rights to develop and manage them shall be transferred to the above-mentioned Coal Industrial Syndicate of Northern Sakhalin.

Official representatives:

Mr. Nakazato Shigetsuru has been appointed as the representative of the oil concession entrepreneurs.

Mr. Okumura Masao has been appointed as the representative of the coal concession entrepreneurs.

Mr. Kawakami Toshihiko has been appointed Chief Adviser to these representatives.

Mr. Okumura Masao and Mr. Tsukahara Koichiro have been appointed as representatives of other coal syndicates.

All of the above-mentioned persons, accompanied by their staff, will soon arrive in Moscow to conduct direct negotiations on the conclusion of formal concession agreements, of which I hereby notify Your Excellency.

At the same time, I express the hope that immediately upon the arrival of the said representatives and advisers, the Government of the Union of Soviet Socialist Republics will immediately begin formal meetings and commercial negotiations concerning the signing of concession agreements.

The Imperial Government expects that all necessary measures will be taken to reach and legally formalize an agreement as soon as possible on the basic terms set out in Protocol B, which I consider to be a great honor.

I take this opportunity to express to Your Excellency the assurances of my highest consideration.

Sincerely, (signature)."

The Soviet side was also preparing for negotiations. On June 17, 1925, a special meeting of the Main Concession Committee of the USSR on the concession issue in the Far East was held. The main attention was paid to the Japanese concessions in Northern Sakhalin and the development of the basic principle of the state's policy towards them: "Concessions should be profitable for the Japanese, but at the same time not too much curtail our interests."

A.A. Ioffe

To discuss the terms of concession agreements and other problems that arose in the course of negotiations with the Japanese side, a special commission was created under the Main Concession Committee, consisting of representatives of the Supreme Council of National Economy, the People's Commissariats of Agriculture, Finance, Foreign Trade, Foreign Affairs, representatives of the Dalrevkom, and positions were worked out that had to be strictly adhered to in relation to the concessionaires, namely: 1) to concede in trifles, but to adhere to a firm position on the main issues (mandatory observance of Soviet legislation, strict observance of the terms of concession agreements, etc.); 2) not to encourage the Japanese to more intensive development of deposits, taking into account their already extreme interest and the danger of their economic conquest of Northern Sakhalin; 3) in the event of the organization of any auxiliary enterprises by concessionaires (harbors, roads, etc.), to achieve their joint use; 4) to establish a norm of no more than 25% for foreign workers;

I.O. Shleifer

In the summer and autumn, coordination meetings and meetings of the Soviet and Japanese delegations were held, at which the articles of concession agreements were worked out in detail, and various aspects of relations were determined. The Soviet side was represented at the negotiations by A.A. Ioffe, I.O. Shleifer, M.G. Gurevich and others, the Japanese businessmen were represented by Admiral S. Nakasato, the representative of the Union of Japanese Miners Okumura Masao, Kawakami Toshihiko and others.

In view of the special conditions that had arisen in Northern Sakhalin, the Union of Soviet Socialist Republics agreed to exempt from the existing right (exchange of notes between the Ambassador of the USSR to China, L. M. Karakhan, and the Envoy Extraordinary and Minister Plenipotentiary of Japan in Beijing, Yoshizawa Kenkichi, attached to the Peking Convention), to allow Japanese concerns that exploited oil and coal deposits in Northern Sakhalin to continue work, but only until the conclusion of concession contracts. At this time, firms were also exempt from operating fees, taxes, and duties until the conclusion of a concession agreement.

M. Okumura

F.E. Dzerzhinsky

It should be borne in mind that on the basis of the Beijing Convention, the export of coal from the island before the conclusion of the concession agreement was prohibited (as an exception, from August 4, 1925, the export of coal from the North Sakhalin mines was allowed, but with the obligation to pay duties and fees immediately after the conclusion of the contract, as well as the duty-free import of 250 tons of cargo to the Douai mine), and therefore the incentive for mining, which was carried out in Due and Rohaty only in order to preserve the main core of workers and employees, was also lost. Therefore, the delay in signing the concession contract was by no means in the interests of the Japanese. Subsequently, firms that did not conclude concession agreements were allowed to export the mined coal to Japan with the payment of taxes and share deductions provided for by concession contracts.

On Friday, December 11, 1925, in the afternoon, Okumura Masao, representative of the Okumura Masao, formed under Law No 37 of March 30, 1925. Japanese syndicate of the North Sakhalin coal enterprises "Kita Sagaren Sekitan Kogio Kumiai" and the company "Sakai Kumiai", in the presence of Kawakami Toshihiko and the head of the legal department of the Supreme Council of National Economy of the USSR M. Stepukhovich, signed two concession agreements for the exploitation of coal areas in Northern Sakhalin. However, according to archival documents, the official signing of concession agreements took place on December 14, 1925, but Okumura Masao had to leave for Germany on the evening of December 11, so he could not attend the official signing of the document and signed both copies of concession agreements "in advance".

On Monday, December 14, 1925, at a meeting of the Supreme Council of the National Economy of the USSR, concession agreements were signed by the Chairman of the Supreme Council of National Economy F.E. Dzerzhinsky, which were signed by the Deputy People's Commissar for Foreign Affairs of the USSR M. Litvinov. The signing of the agreements and photographing with the delegates were also attended by the adviser to the Japanese delegation T. Kawakami, the Japanese ambassador Tanaka Tokichi, as well as members of the Soviet commission for the conclusion of agreements A.E. Minkin, M.G. Gurevich, A.V. Musatov and M. Yapolsky.

According to the first concession agreement, the company "Kita Sagaren Sekitan Kogio Kumiai" was granted the right to exploit three coal deposits with a total area of 5505 hectares, including the Duisky allotment with an area of 1293 hectares, the Vladimir allotment with an area of 1634 hectares and the allotment in the area of the Bolshaya Machi River with an area of 2578 hectares. The term of the concession was set at 45 years.

However, the Japanese side needed to make changes to its own legislation, which would allow Japanese companies to legally operate on the territory of Northern Sakhalin. Initially, the draft imperial decree regulating the creation and operation of concession joint-stock companies in Northern Sakhalin was developed for the creation of semi-public and semi-private joint-stock companies, and Article 3 of the draft stated that "shares are registered in the name of the imperial government and subjects of the empire."

A.E. Minkin

Tanaka Tokichi

The authorized capital of the company was to be 15 million yen, of which 5 million yen was allocated from the budget, with 7.5 million yen for individuals and legal entities could buy shares. Since the Sakhalin concessions were initially considered by the Japanese as compensation for the "Nikolaev" incident, the emperor's advisers considered that the profits received from the concessions should be divided between the government and the general public.

It must be said that some Japanese reporters "got wind of" the insidious plans of the Japanese government and soon the pages of the newspapers were full of revelatory articles.

"Many Japanese semi-official concerns have performed very poorly in the past, partly because of their party connections, and partly because of the arbitrary management of their affairs by a few executives," the Japan Weekly Chronicle paraphrased an editorial in the Asahi newspaper. The newspaper also warned Japanese businessmen "against the illusion into which they may fall, that there is every opportunity to make easy money in Northern Sakhalin."

As a result, at a conference of vice ministers on February 13, 1926, it was decided to delete the original proposal in the above-mentioned imperial decree, which made the "imperial government" a shareholder, and to make the joint-stock companies purely private. At a cabinet meeting on February 22, 1926, preceding the issuance of the decree on concession companies, issues related to oil and coal production, which had previously been under the jurisdiction of the Navy, were transferred to the jurisdiction of the Ministry of Trade and Industry.

On March 6, 1926, the Official Gazette published Imperial Decree No. 9, signed by Prince Regent Hirohito the day before. The preamble stated that "the purpose of this law is to carry out business activities related to the extraction of oil or coal in Northern Sakhalin in accordance with the concession agreement on the basis of the Protocol on the Agreement Governing Relations between Japan and the Soviet Union (Protocol B of the Beijing Convention)."

The decree stated that the Emperor allowed the establishment of joint-stock companies on the territory of Japan for the purpose of conducting oil or coal production in Northern Sakhalin on the basis of an agreement between Japan and the Soviet Republic. The founders of the companies were required to submit to the Ministry of Trade and Industry an application for permission to organize these companies, attaching to it the charter and business plan. The established companies were officially registered in the register of the Ministry of Industry and Trade, which supervised the activities of such companies, approved changes in the composition of the board, the budget and business plans of the companies, the issue of shares, the list of shareholders, as well as the liquidation of these companies, if any. The shares of the companies are nominal. Their holders can only be Japanese citizens and legal entities. If necessary, the Minister of Industry and Trade can order an audit of the financial condition and assets of joint-stock companies. The minister can cancel the decisions of the board of directors of joint-stock companies if they are contrary to the law or national interests. The preemptive right to purchase oil and coal from companies belongs to the Imperial Government. A certain part of the profit received from the sale of coal and oil is deducted to the state budget. The decree came into force on March 10, 1926.

Kawakami Toshihiko

Tamaki Makita

On March 26, 1926, the Cabinet of Ministers of Japan adopted a resolution "On the Payment of Compensation for Coal Deposits in the Douai Region". It stated that on the basis of the Soviet-Japanese Convention (the Beijing Treaty) and related concession agreements, coal mining enterprises in the areas of Due (Vladimirovka) and Mgachi in Northern Sakhalin were to be transferred to a new established enterprise - the North Sakhalin Mining Joint-Stock Company. However, according to the initial business plan submitted by the founders, the new company had to pay the old syndicate a huge amount of 4,050,000 yen for these rights (including 200,000 yen of the cost of the initial acquisition of rights). Such a high price jeopardizes the profitability of the future enterprise and makes its creation extremely difficult. In order to balance the income and expenses of the new company and ensure a smooth placement of shares among investors, it was considered necessary to reduce (write off) the value of the transferred rights by 2,000,000 yen.

Kuisaburo Hashimoto

Funada Katsuo

On the other hand, during the period of the Japanese expeditionary force on Sakhalin, exploration, production and related operations at the coal mines in Due were carried out by the Mitsubishi Joint Stock Company (Mitsubishi Gooshi Kaisha) on the basis of the decision of the Cabinet of Ministers of April 1, 1919. In connection with the withdrawal of the Japanese expeditionary force from Sakhalin, this contract was automatically terminated. Accordingly, the army had to buy out all the above-mentioned property in accordance with the terms of the treaty. However, as a result of diplomatic negotiations on concessions (with the USSR), most of the territories on which this equipment was located were outside the officially established concession zone. As a result, further use of these objects became impossible.

On the basis of the foregoing, in accordance with Article 4 of the Law on the Completion of the Settlement of the Special Account for Emergency Military Expenses, the government allocates funds in the amount of one million yen from the material expenditure of the emergency military budget transferred to the general budget and transfers it as a payment to Mitsubishi. Thus, the remaining 1,000,000 yen of the reduction in value was charged directly to the coal syndicate itself. However, the syndicate management stated that the unconditional write-off of such an amount was extremely painful for them, and sent a petition with the following compromise proposal: to formalize this 1,000,000 yen as an interest-free loan from the syndicate of the new company. The Ministry of Trade and Industry, after studying the situation, recognized this request as justified and forced, and therefore considered it possible to make these concessions and asked the Cabinet of Ministers to approve this decision.

Asano Soichiro

On May 26, 1926, the Ministry of Trade and Industry submitted a secret memorandum to the Cabinet of Ministers, according to which the joint-stock company "Hokushinkai" and "Kita Sagaren Sekitan Kogio Kumiai" were to be liquidated and two separate new joint-stock companies were established in their place. The founders of the new companies would be "specialized entrepreneurs", and the shares of the companies would be open for subscription among the general public. All commercial relations and obligations of the liquidated companies to the firm "I. Stakheev and Co" should be regulated by ordinary civil law methods.

Fujioka Jookichi

Yuwawa Kankichi

Kawakami Toshikiho, the former Japanese envoy to Poland, was elected president of the society (after his death on September 13, 1935, executive director Nishihara Tamihei assumed the duties of president, and in June 1937 Mitsui Yonematsu was elected president).

The managing directors were: Funada Katsuo, Suenobu Michinari, Hashimoto Kesuboro, Hayashi Ikutar, Fujioka Jookichi. The members of the audit committee were Asano Sooichiro and Yugawa Kankichi. It was decided that the annual remuneration of each of the directors and auditors would be 15,000 yen, and the meeting ended there.

The main shareholders of the coal joint-stock company were Mitsubishi, Mitsui, Okura, Shibusawa, Sumitomo, and Asano. The company's fixed capital was 10 million yen (200,000 shares), of which 70,000 shares were transferred directly to the joint-stock company, 65,000 were distributed among the founders, and 65,000 shares were offered for sale on the stock exchange.

Financial Reference: Paid-in capital (paid-in capital/paid-up capital) is the real amount of money or the value of other assets that shareholders actually contributed to the company in exchange for the issued shares. At that time, when creating a company or increasing its capital, investors did not need to pay the entire value of the shares at once.

1. Denomination and first installment: The share cost a fixed amount for example, 50 yen. But at the time of subscription (establishment), the investor paid only a part, for example, 20 yen (this is the first stage).

2. Shares in installments: The investor officially became the owner of the shares, but they still had a "debt" to the company.

3. Inquiries as needed: When a joint-stock company needed money for the purchase of machine tools or construction, the board of directors announced: "The second (or third) stage of payment has arrived. We ask everyone to pay an additional ... yen per share."

The system of "share payment stages" (called in Japanese) is very different from modern rules, but was standard practice in the late 19th and first half of the 20th century (including the Russian Empire and Japan)

It should be noted that the company's shares were freely bought and sold on the Tokyo Stock Exchange.

Shares of the North Sakhalin Mining Joint Stock Company on the Tokyo Stock Exchange in 1926-1943 (in yen)

Regarding coal concession shares, the book "A Guide to Investing in Stocks: Which Stocks Are Good?" by Katsuji Sataji, published in 1934, wrote the following:

"Strengths:

1) Exclusive access to rich, undeveloped, selected coal with a 40-year mining contract. 2) Excellent coal quality provides exclusive distribution channels to steel and gas companies. 3) With the establishment of Nippon Steel, sales conditions have become favorable. 4) Production is expected to increase in the future, and due to the optimization and mechanization of work inside and outside the mine, product prices will not increase significantly. 5) Opportunity to increase revenue and profits.

Weaknesses:

1) Due to the need to attract Russian contract personnel, increased equipment costs and poor working conditions make it difficult to reduce production prices. 2) The company is not located in a favorable geographical location. 3) During periods of economic downturn, the company's profitability negatively affects trends in the steel industry. 4) Since coal is a special type used as coking coal for steel production, its value depends on trends in the steel industry. 5) The company's shares have extremely low liquidity.

Quotations of KKKK shares on the stock exchange. 1933-1934

Okura Kishichiro

Kodano Jukoro

Investment value: Due to disadvantages such as high production costs, difficulty in lowering product prices due to unfavorable working conditions and unfavorable geographical conditions, the company's recovery is likely to be slower than that of domestic mining companies. However, the improvement in the economic situation is likely to continue, and for now, the company's strengths will be fully manifested. Given the potential payouts and dividend increase in the future, the stock represents a profitable purchase on falling prices. The target price for the year is likely to be 35 yen. However, given the low market volume, caution should be exercised. However, a price of around 20 yen will be a good investment proposition."

Among the largest shareholders of the company were: Mitsubishi Gooshi (31143 shares), Mitsui Koozan (17925 shares), Okura Gumi (15425 shares), Okura Kishichiro (7500 shares), Kimura Kusuyata (7500 shares), Makita Tamaki (7500 shares), Asano Soichiro (3000 shares), Kadono Jukoro (3000 shares), Yugawa Kankichi (3000 shares). In total, there were 1000 shareholders in the register of shareholders at the end of 1928. At the end of 1934, there were already 2272 shareholders in the register of shareholders. there were 2802 shareholders. However, the true, albeit secret, founder of the oil and coal joint-stock companies and their main shareholder, who owned shares through nominees, was the Japanese imperial government. Many Japanese economists referred to these two concession joint-stock companies as quasi-public companies, as the government provided them with special protection and strictly controlled their activities from the point of view of national policy. In addition, the bonds issued by the companies had state guarantees for the payment of principal and interest.

100 yen KKKKK share certificate

Registration Document of "Kita Karafuto Kogio Kabushiki Kaisha"

On August 21, the joint-stock company was officially registered in the register of the Ministry of Trade and Industry of Japan. On August 30, 1926, Okumura Masao, a representative of Kita Sagaren Sekitan Kogio Kumiai, and Kawakami Toshihiko, a representative of Kita Karafuto Kogio Kabushiki Kaisha, signed an agreement transferring the rights to develop the North Sakhalin coal concession enterprises from the coal syndicate to the North Sakhalin Joint Stock Company. As compensation, the coal syndicate was paid 4.7 million yen, including the cost of coal mined and the cost of negotiating the concession agreement. Of these, 1 million yen was issued as an interest-free loan with the condition that it be paid as the company makes a profit.

February 15, 1927 The Soviet government agreed to the transfer of the concession agreement from the syndicate of the North Sakhalin coal enterprises "Kita Sagaren Sekitan Kogyo Kumiai" to the joint-stock company "Kita Karafuto Kogio Kabushiki Kaisha"

It should be noted that in addition to large firms, the Japanese government recommended to the Soviet side as potential concessionaires firms with relatively small capital. Under the concession agreement of December 14, 1925 with the Sakai Kumiai company, the latter was granted concession use of the area of 1, 2, 3 and 4 Kuznetsov allotments according to the land survey of 1917 (with a total area of 463 hectares) on the west bank of the Agnevo River, which was operated by the Oriental syndicate. The concession agreement was almost identical to the contract with Kita Sagaren Sekitan Kogio Kumiai, except for paragraph 14, in which the share of the Soviet side (royalties) was set at 5% for annual production of up to 50,000 tons of coal and increased by 0.25% for every 10,000 tons, reaching a maximum value of 8% for production of more than 160,000 tons of coal per year.

On February 23, 1926, the Soviet side signed a concession agreement with the Tsukahara Kumiai company (fixed capital of 1 million yen) for a period of 32 years (paragraph 15 of the Treaty).

Tsukahara Kaichiro

It should be noted that Tsukahara Kaichiro did not have recommendations from the Japanese government and concluded a concession agreement not on the basis of the Beijing Convention, but as a private person. The concessionaire was granted a concession of an area of 6 square kilometers in the upper reaches of the Kostina River along the western coast of Northern Sakhalin, 65 km south of Aleksandrovsk. Unlike the agreement with Kita Sagaren Sekitan Kogyo Kumiai, which managed to obtain a special tax regime for itself, the Tsukahara Kumiai corporation had to pay all taxes, fees and duties (including local ones) on the same basis as homogeneous Soviet state enterprises operating on the basis of commercial settlement.

Of course, there were legal conflicts. As early as April 7, 1926, the lawyer A. Du Pac de Marsoulier sent a letter to C. Tsukahara, in which he pointed out that "The concession located in the area of the Kostina River on the Russian island of Sakhalin and granted to the Tsukahara syndicate by the Soviet government in Moscow is the property of the company "Toyo Kogyo Goshi Kaisha" with its head office at 3 Ezra Coad, Shanghai (China), of which I am a partner and in which I act as an agent. In addition, I would like to confirm that, in my opinion, the new company to be created for the Kostin concession with the support of the Japanese government and/or through a merger with the Japanese consortium Paper, Coal and Oil will be formed on the basis of the following general principles: The authorized capital of the new company to be created will be 1,600,000 yen, of which: payments to Toyo Kogio Goshi Kaisha - 300,000 yen, expenses for trips to Moscow - 50,000 (27,577.69 rubles), profit from the promotion - 400,000, expenses for geological studies of the Kostin River section - 50,000, working capital - 700,000 yen."

Until November 1, 1927, the company was granted the exclusive right to conduct coal exploration in this territory, after which, after providing the received maps and data on explored coal reserves, the concessionaire had the right to apply for the allocation of appropriate areas for coal mining. The agreement provided for mandatory financial costs for exploration work in the amount of at least 150 thousand rubles until December 1, 1927. For the use of the allotted areas, the concessionaire was obliged to pay the government of the USSR a fee of 1 ruble per year per hectare.

In 1926, a geological survey of the Agnevo mine took place. Geologists discovered 8 coal seams, 2.4-2.7 m thick.

On December 9, 1926, the company submitted a five-year plan of work at the Agnevo coal mine to the management of the mining district of Northern Sakhalin.

"The Sakai Partnership is committed to establishing production and equipping the plant using the latest technical advances. To do this, it is extremely important to accurately establish the parameters of all buried seams and the nature of their occurrence. Practical activities will include clearing debris in the Main Tunnel, the Daisei and Tencho mines, as well as in other workings. Exploration ditches, pits and inclined workings will be excavated along all outcrops to the surface for a detailed study of each seam. Coal mining will begin primarily at the Main Tunnel, i.e. seam No2. As previously indicated, the reserves here do not exceed 110,000 tons. A pillar mining system will be used, in which excavation is carried out in an upward direction, leaving coal pillars 11 meters long and 8 meters wide, followed by a transition to the systematic extraction of these pillars. To ventilate the workings, raise-workings will be passed, which, like transport routes, will be securely fastened with frame support. Mining operations will be carried out in two shifts with a planned movement of the faces by 20 meters per month. The workings will be laid with a certain slope. Despite the extremely small amount of water entering the mine, drainage ditches will be equipped in the lower part of the workings to drain mine water to the outside. Due to the need for a set of preparatory works, actual production will not be able to begin until May 1927, therefore, during the 1927 reporting year, direct coal mining is not planned.

The priority tasks are:

1. Export and shipment of previously mined coal.

2. Repair of existing buildings in order to convert them into workers' dormitories that fully comply with the regulatory requirements of Soviet legislation.

3. Construction of new office and residential buildings prescribed by the rules.

4. Repair of the loading rack.

5. Repair and partial reconstruction of access roads from the mine to the coast.

6. Overhaul of the main operating underground workings, as well as the arrangement of a coal sorting site.

The concessionaire considers it his most important duty to fully comply with the laws and regulations of the USSR. Since the existing residential buildings are not able to accommodate a large number of workers, during the first year all efforts will be directed to their arrangement even before the start of mass production. In the period from 1926 to 1927, it is planned to build 2-3 barracks-type buildings with a capacity of 40-50 people each, a bathhouse, a dryer, 2 buildings for administrative and technical personnel, as well as to erect a lamp building equipped with fire-fighting equipment and safety lamps.

In the period 1927-1928, coal production in seam No2 in the amount of up to 20,000 tons will begin, but the main forces will continue to be focused on geological exploration.

In the period 1928-1929, the volume of production from this tunnel will be increased to 30,000 tons with continuous exploration work.

In the period 1929-1930, production will remain at the level of 30,000 tons with parallel exploration.

In order to ensure high demand in the market, the concessionaire is introducing an efficient coal washing technology, without which it is impossible to remove inclusions of carbonaceous shale and sandstone. Without high-quality cleaning, the production of conditioned coal is almost impossible, so specialists are currently completing the design of a coal sorting plant.

In 1927, the dormitories were renovated, which could accommodate a large number of workers and had the necessary amenities. However, the mine lacked fire-fighting equipment and safety lamps to illuminate the tunnels.

On June 30, 1927, the company appealed to the USSR Trade Mission in Japan with a statement, in which it indicated that during the summer season it planned to export 20 thousand tons of coal from Northern Sakhalin, for which it needed to use 80-100 workers in the work. On the basis of 17 of the Concession Agreement, the Sakai Kumiai company asked to approve a list of essential goods, food, household items, medicines, etc., which were to be delivered to the Agnevsky mine from Japan. However, the manager of the enterprise, V. Kito, who left Japan for Aleksandrovsk, died on the way to the city of Maoka in Southern Sakhalin in August 1927 and the enterprise was forced to do without the chief manager. In April 1928, the company reached an agreement for the supply of 2 thousand tons of coal and received an advance payment of 4000 rubles. As a result, by June 1, 1930, there were 16 thousand tons of coal in the coal warehouse of the mine.

On September 29, 1927, the Japanese government received a petition from the president of Sakai Kumiai, Sakai Ryuzo. He wrote about the extremely difficult working conditions of enterprises in Soviet Russia. "Doing business in Northern Sakhalin, which is under the control of the Soviet government with a completely different state, political and economic system, is fraught with colossal difficulties, bureaucratic procedures and unfavorable conditions that exceed all expectations. Deductions for the lease of state property, social insurance of employees, the delivery of company equipment to the mines and depreciation of property at high rates, as well as other issues, require coordination with the Soviet authorities at every step and impose extremely complex and troublesome procedures on concessionaires, which makes their work difficult. In addition to being subject to the tax burden in Russia, these enterprises are also burdened by Japanese tax laws and suffer from double taxation as a result. However, the crisis in the domestic coal mining industry has reached such an extreme level that we have not been able to obtain funds for business through the placement of shares. . The financial crisis, the bankruptcy of domestic financial institutions, the closure of factories and the collapse of commercial enterprises all this destroyed the means of financing enterprises located in Russia, and now we are in a situation where we have no choice but to suspend all affairs. These concessions were received by our country as compensation for the "Nikolaev" incident and are of historical importance, so in the eyes of the people of Japan they should continue to exist," the coal concessionaire wrote to the authorities. At the same time, the entrepreneur can be said to blame the Japanese government for the fact that it, having provided financial support to two large companies - oil and coal - while being their main founder and shareholder, completely forgot about small companies and did not provide them with any financial subsidy for the development of the business. "For example, Hokushinkai," wrote R. Sakai, "for the symbolic sum of more than 700,000 yen, received from the Ministry of the Navy all the facilities and results of many years of research in which the state had invested millions of yen. In addition, under the pretext of compensation for the property, it was allocated subsidies in the amount of several million yen, which provided it with extremely favorable conditions for the start.

The coal syndicate, which had close ties with the Ministry of the Army and the Expeditionary Force, also enjoyed long-term support, conducted profitable activities at the Douai mine on behalf of the military, and eventually received concession rights free of charge, securing huge profits for itself. Moreover, at the end of March last year, representatives of the syndicate, during behind-the-scenes negotiations with the military leadership, received a direct cash subsidy of one million yen from the state to speed up the process of establishing their company.

Initially, I undertook the development of the Agnevo mine not for personal gain, but guided by a sense of civic duty and a desire to devote myself to a cause of great national importance. That is why I meekly endured the unfair and biased attitude of the previous government, steadfastly overcame all difficulties and did everything possible to implement the concession rights.

We earnestly request that urgent consideration be given to providing us with the same facilities that were specifically granted to the representatives of the "KKKCC" and "KKKKK" as a just measure to ensure equal opportunities for all concession enterprises in Northern Sakhalin."

However, the government did not hear "an honest entrepreneur who cares about state prestige and historical justice" and no subsidies were allocated to him. By June 1927, the debt of the Sakai Kumiai company exceeded 10 thousand yen. In a telegram dated June 7, 1927, Consul General S. Sasaki pointed out that "in addition to wage arrears, the company is delaying the payment of social insurance contributions for April and May, payment for the storage of coal in the port of Alexandrovsk, rent of land for warehouses, as well as rent for three months and other state fees. According to available information, the Soviet authorities are preparing to seize property or sell it at auction, and the amount of debts is very significant. In the absence of the manager, the employees who remain here are in complete confusion. According to the answers of these employees, instead of wasting the office for the sake of a dubious sale of coal or plans to create a new company, it is wiser at the moment to carry out a large-scale reorganization, leave only the watchman and calmly wait for the right moment. Be that as it may, judging by the incoming internal information, the situation cannot be ignored for a minute. I ask you to immediately force Mr. Sakai to transfer the amount of 5000 yen to the account of the mine." As a result of diplomatic pressure, the society was "generous" and transferred to its employees in North Sakhalin ... 2000 yen.

In August 1928, the Japanese Consul General in Aleksandrovsk, S. Sasaki, telegraphed to the Japanese Foreign Ministry: "The local Sakai Partnership has reached such extreme poverty that the employees do not have enough money even for daily food. The management of the branch again appealed to me with a desperate plea for help. The collapse of the Sakai Partnership, recommended by the state, will not only cover the Japanese with shame before the Soviet side, but will also cause colossal damage to other economic projects of Japan in the region. I ask you to listen to a detailed dossier-report from the official of the Ministry of Trade and Industry, Mr. Miyagi, who recently visited these places, to exert tough pressure on the company's management and force them to send a money transfer in the amount of 5000 rubles to the mine. As for long-term measures, I ask you to make a prompt decision on the future of the enterprise. The head of the local branch hid these problems for a long time due to internal difficulties, but now the issue requires an immediate solution."

In response to the Ministry's inquiry about the state of affairs and lack of financial resources, the society replied as follows: "The real reason for the difficulties that have arisen is the general financial stagnation and the unfavorable economic situation at home in recent years. As a result, the turnover of funds of our Partnership has slowed down. However, the immediate cause of the crisis was the interruption of communication with this remote region, as well as the mutual misunderstanding of the current circumstances and plans of the parties. Before the manager of the local branch left for Sakhalin this summer, we carefully coordinated the financial policy with him. In April of this year, an agreement was signed with the port administration of Nikolaevsk for the supply of 2,000 tons of coal at a price of 7 rubles per ton. At the time of signing the contract, we received an advance payment of 4,000 rubles. In addition, about 1,000 rubles were expected to be received as a return of collateral for travel expenses previously withheld by the Soviet side. Also in mid-June, the first batch of shipped coal was handed over to the port authority of Nikolaevsk, for which a payment of 3,500 rubles was due in accordance with the terms of payment for each batch upon delivery. It was assumed that at the expense of these receipts, the local branch would be able to fully meet its internal needs, without resorting to money transfers from Japan, where the financial situation is now extremely difficult. We were fully confident that things on the spot were going according to plan, since no alarming news had come from there. However, at the end of July, we suddenly received a laconic telegram demanding that the money be sent without explanation. We immediately sent a request for clarification of the situation, but again only a short telegram came in with a demand for money. While we were trying to find out the details and inform them of our countermeasures, an official notification came from you. Because of these discrepancies in calculations, we found ourselves in a very difficult position. Nevertheless, we have already sent direct instructions to the site and transferred about 1500 rubles there on August 24 as the first emergency measure. According to our calculations, this amount should be quite enough to cover the most urgent and critical expenses of the local branch. In the official appeals of the consulate, the amount of 5000 rubles is mentioned, but we believe that this figure includes absolutely all items of expenditure, both urgent and secondary. According to our plans, the funds sent will be enough to stabilize the situation for the first time."

At the beginning of September, 1,500 rubles arrived on Sakhalin, but, as the acting consul Shimomura aptly remarked, "these funds were only a drop in the ocean. The new manager, S. Kinoshita, again turned to me with a desperate plea for help, since it is impossible to remedy the current disastrous situation on our own. We cannot stand idly by from the sidelines, and the rescue of the employees is a matter of extreme urgency that does not tolerate the slightest delay. I ask you to hold tough negotiations with Mr. Sakai in his homeland and force him to send at least another 3,000 rubles, despite any of his difficulties."

The economic crisis that broke out in Japan in 1929 finally crippled the company. The company completely stopped sending funds to pay salaries to employees, cover administrative expenses, and pay social insurance, ordered to close the company's representative office in Aleksandrovsk by the end of June and evacuate employees to Agnevo. As a result, 7 permanent workers of the concession were left not only without cash payments, but also without food. As a result, 7 permanent workers of the concession were left not only without cash payments, but also without food, because the company, despite the pleas of employees, did not carry out any food supplies to the island during the navigation of 1929. By the end of 1928, the mine had 2 bags of rice and 3 bags of flour in stock. As a result, in April 1929, the manager of Kinoshita officially appealed to the management of the KKKK with a request to lend 15 bags of flour, but was refused. Then he was forced to borrow this amount of flour from the Soviet state trade department, at the same time notifying the main office of what had happened and demanding the urgent dispatch of supplies. Only in June did a reply telegram come from Japan: "We have agreed with the North-Sakhalinsk Mining Joint-Stock Company on assistance, temporarily take 15 bags of flour from them." By that time, the flour borrowed from the Soviet side had been completely eaten. Having hardly obtained from the Soviet authorities an extension of the debt repayment period, the Agnevo workers received these 15 bags from the Japanese company, but these stocks were completely exhausted by mid-September.

In order to cope with the financial deficit, in July, part of the concession equipment in the amount of 958 rubles 82 kopecks under the guise of personal belongings of employees was illegally sold to a private person.

It got to the point that on August 8, 1929, the manager of the mine, S. Kinoshita, was forced to lease the only steam locomotive available under concession to the Sakhalin District Finance Department. Moreover, he did this without waiting for the permission of the board of the society in Tokyo, since it was necessary to pay insurance premiums to the social insurance department, and there were no funds available.

Moreover, to cover the debts of the society, the mine workers borrowed money from friends and acquaintances, but soon they stopped lending to them.

The Consul General in Alexandrovsk, S. Sasaki, in Letter No. 163 dated August 24, 1929, pointed out: "The possibilities of borrowing on the spot have been exhausted, and there is no property left for sale. All resources have completely dried up, as detailed in the attached petition. In the past, in such critical cases, we have sent inquiries by telegraph, but replies from Tokyo usually come with great delay. Given that the situation requires urgent measures, this time we are sending an official report by diplomatic mail and earnestly ask you to immediately exert influence on the company's management through the appropriate departments. The situation this time goes beyond the framework of an ordinary commercial dispute. It is unacceptable that the employees and workers of a concession enterprise that has received a state recommendation from Japan should be reduced to extreme poverty in a foreign country and tearfully beg the consulate for salvation. The organs of Soviet power and trade unions on the spot exercise the strictest and most detailed control over the observance of working conditions and the attitude towards workers. It is no longer possible to ignore the actions of the company's management. Under severe ideological pressure, without support from relatives or friends, Japanese citizens in trouble are forced to rely exclusively on the help of the consulate. We cannot look indifferently at our starving compatriots and allow a shameful demonstration of our internal incompetence before the Soviet authorities. As a last resort, I intend to temporarily allocate the minimum necessary funds from the fund for assistance to compatriots or for another suitable item of expenditure on the condition that the main office of the Sakai Partnership will subsequently fully reimburse these costs. I hereby report on the situation and ask for your approval."

On October 10, 1929, he wrote in a telegram addressed to the Minister of Foreign Affairs K. Shidehara: "The local department of social insurance sent a demand to the Sakai cooperative for the payment of contributions for June, July, August and September. The head of the Kinoshita cooperative turned to me in complete despair, in connection with which I temporarily lent him 170 Soviet rubles. The problem of the Sakai company greatly complicates my situation on the spot... .

On February 12, 1930, S. Sasaki wrote in telegram No 2003: "The local branch of the Sakai Kumiai company has not received any news from Mr. Sakai for about six months, and recently the financial support has also stopped. In this regard, the manager of this branch, experiencing extreme concern, appealed through our department to the head office of the company with a request to clarify the situation.

According to the information received, the coal mine and the local management consider it an irresponsible step that 215 of our compatriots (workers) are left without any use of their labor, despite their willingness and requests to work. We ask you to immediately convey to Mr. Sakai the contents of this telegram and convince him to send the necessary funds to ensure the life and welfare of the hired workers who are members of this union."

As a result of the telegrams received, the Minister of Foreign Affairs of Japan instructed the Ministry of Industry and Trade to initiate an investigation into the Sakai Kumiai Association. As a result, the Ministry received an explanatory note from the head of the company, R. Sakai, in which, in particular, the following was stated: "In order to meet the daily living needs of the employees, material supplies were sent in excess of the basic needs as early as September. Local employees from time to time send telegrams indicating specific amounts to cover expenses. As for current expenses, the Association is not able to fully satisfy all their requests in a row, but after assessing the real situation, it always sends the amounts recognized as necessary. Due to general financial difficulties, there are indeed small arrears and delays, but the assertion that the Association does not send money for living at all is erroneous.

Such suspicions can damage the company's reputation and cause distrust on the part of the Soviet authorities. However, as indicated earlier, all basic needs of the staff are covered by material supplies. As for other remittances, funds within the country are distributed sparingly, and payments are made in an amount that is considered to be minimally sufficient. Regarding excessive requests from the field, Vice-Consul Suzuki also noted that the living expenses of workers can still be reduced, and the Association takes this opinion into account when calculating payments.

Local workers are remote and poorly informed about the internal situation in their home countries. Frequent reports and interim news could give rise to false rumors among them, cause unnecessary fears and alarms. In addition, local employees do not have deep knowledge to properly understand all the legal and commercial nuances of establishing a joint-stock company. Attempts to explain the situation in detail could lead to misunderstandings and disagreements in the work.

Our Association, unlike other similar companies that received state benefits and support for the development of oil and coal rights, is forced to act alone. We faced many obstacles and pressure from the Soviet authorities, and the process of creating a full-fledged joint-stock company was delayed.

For several years, the Association has made every possible effort to protect and preserve concession rights. In the current situation, we can only wait for further decisions and directives from the Japanese government, since due to changes in laws and other conditions, it has become extremely difficult to promote a business on its own.

In this regard, R. Sakai as a private person is no longer able to raise capital, and the delay in the process of creating a company damages the reputation of the business both at home and abroad. There is a risk of complete loss of promising rights to concessions. As a representative of the Association, I deeply regret the lack of my own strength and resources to quickly solve the problem.

We are currently working hard to overcome the crisis with the support of officials and individuals in order to complete the establishment of the company as soon as possible and resume work on Sakhalin this summer. I ask the ministry to understand our situation, provide full patronage and provide the necessary instructions."

The Japanese company was "hammered" not only by Japanese pro-government bureaucrats, but also by Soviet ones. In July 1929, the Sakai Partnership received an official request from the authorized trade mission of the USSR in Japan, A.M. Bekman: "Three full years have passed since the signing of the concession agreement for the development of Sakhalin coal deposits. Despite this, no appropriate measures have been taken over the past time for the industrial development of the concession territory. We consider it necessary to state that over the years the economy of the region has not received the expected volumes of Japanese capital, which jeopardizes the fulfillment of the terms of the agreement. In this regard, the Soviet side insistently demands to provide a detailed production plan for the current operating year indicating the exact schedules for geological exploration and operational work in the selected areas of the Agnevo mine. We ask you to send a written response as soon as possible."

While the bureaucratic correspondence between the Japanese government departments was going on, the remnants of food at the mine came to an end. Only on September 25, an agreement was reached to borrow 50 bags of white rice, 30 bags of barley, 3 barrels of soy sauce and 2 tanks of kerosene from the KKKKK warehouse.

By June 1930, the company's wage arrears to its employees amounted to 23247 yen. Including mine manager Kinoshita Shigenar - 9608 yen, engineer Ota Saichiro - 4258 yen, accountant Majima Katsuji - 2520 yen, worker Hashimoto Hitoshi - 743 yen, Chinese workers Yi Kamen Saku - 706 and Ji Zhenhe - 806 yen, translator H.E. Lysenko - 4606 yen.

On June 12, 1930, Consul General Sasaki telegraphed to the Japanese Foreign Ministry: "Mr. Kinoshita, the manager of the association, who is now in Alexandrovsk, has submitted a petition to me regarding the procedure for paying salaries to employees. Leaving aside the moral assessment, the content of the enclosed petition points to facts that not only violate labor legislation, but are absolutely inadmissible in this country. If this information reaches an official investigation with the local authorities, then for this state, which positions itself as a workers' and peasants' state, it will develop into a serious and large-scale political scandal!" .

As an emergency measure, on July 18, 1930, the head office of the company in Tokyo proposed to sell the property, inventory and other accessories belonging to the association to the North Sakhalin Mining Society and to make payments to employees at the expense of the funds received. It was proposed to pay off the remaining wage arrears gradually, as the coal reserves remaining after the arrest was lifted by the Soviet side were sold.

On December 3, 1930, H.E. Lysenko sent a letter to the Consul General of Japan in Alexandrovsk with a request to recover his salary from the bankrupt company. In particular, he wrote: "On the recommendation of the head of the administrative department of the Japanese expeditionary forces, General Shunji Takasu, on May 15, 1925, I was invited as a Japanese translator to work in the office of the society with a salary of 150 yen per month. From the very first month of my work, the society did not accurately pay me my salary, except for very small amounts and very rarely. As for the last 3 years before my dismissal, that is, until August 31 of this year, I did not receive a penny at all. So, from May 15, 1925, to August 31, 1930, the society is obliged to pay me a salary according to a certificate issued to me by the company's accountant, Mr. Majima, 5236 yen and 33 sen.

As for me, in spite of the fact that society has not paid me my salary all the time, and hoping for the future of society, I tried in every possible way to conceal both financial difficulties and the difficult situation of society in general, borrowed money for society from my acquaintances and in my own name. Part of the money I borrowed for society has not yet been paid by me. When I left for Japan, I asked him, and he himself promised to intercede for payment of my salary. But there is still no information from him..." In the end, on December 30, the interpreter Lysenko received his money... in Vladivostok.

M.L. Rukhimovich

It should be noted that in addition to the company's wage arrears to its employees, it also owed payments to the USSR budget. As early as February 13, 1928, the representative of the Supreme Economic Council of the USSR, M.L. Rukhimovich, filed a lawsuit with the Supreme Court of the USSR against the Sakai Kumiai society, in which he asked to recover from the latter 5367 rubles 68 kopecks as rent for the property transferred to the concessionaire, in accordance with 11 and 36 of the concession agreement for the period from December 14, 1925 to October 1, 1927. However, in response to this lawsuit, Sakai Kumiai sent a statement to the Supreme Court of the USSR, in which it pointed out that the issue of rights to the property of the Agnevo mine was a controversial diplomatic issue between the governments of the USSR and Japan and therefore the company could not submit to the court any explanations on the claim. By the way, in the ruling of the Supreme Council of the SSCC of November 2, 1928, it was stated that the original act of transfer of the leased property from the representative of the USSR to the representatives of the concession did not have the signatures of the latter, which, according to 11 of the concession agreement, meant that the concessionaire had not formally accepted the property.

It should be noted that as early as December 1925 February 1926, on the basis of the Order of the Main Mining Administration of the USSR No 842 of November 29, 1925, the Deputy Head of the Mining District M.S. Shutovsky, together with the Technical Inspector N. Gerasimov, the Government Inspector for the Supervision of Foreign Concessions I.G. Tsykalov, the Plenipotentiary Representative of the Union of Miners I.G. Ivochkin, with the participation of the Chief Mining Engineer of the Mitsubishi Company Tsunesuke Ootani, the Head of the Due Mine, the Mining Engineer Aimi Tomiji, the Assistant Manager Ojima Shuji and the interpreters G. Zhuravlev and Ogato Koreaki, conducted a detailed survey and inventory of all production and residential facilities of the mines of the Japanese concessionaires. In the course of the inspection, all production facilities located on the territory of the mine allotment were divided into categories of state and private property and detailed inventory lists were drawn up. In addition to movable and immovable property, these inventories also included: office cabinets, camp beds, portable, hanging, wall and table lamps, armchairs, chairs, tables, inkwells, ashtrays, mirrors, alarm clocks, basins for washing, soap dishes, towels, napkins, curtains, pillows, rugs, bed linen, kettles, pots, trays, water decanters, glasses, cups, plates, forks, spoons, knives, as well as scoops for charcoal, Japanese wooden sandals, and the "cherry on the cake" - a toilet seat (porcelain).

In July 1926, letters of notification were sent to representatives of concession companies on behalf of the Sakhalin Mining District about the need to evaluate the property located in the territories allocated to the enterprises. From August 1 to August 5, 1926, a commission consisting of the chairman, assistant to the head of the Sakhalin Mining District M.S. Shutovsky, senior controller of the Sakhalin District Financial Department G.I. Simonov and the Commissioner of the Far Eastern Regional Committee of the All-Russian Union of Miners G.N. Kuznetsov, as well as a representative of the concessionaire "Kita Sagaren Sekitan Kogio Kumiai" Sano Shigeru and mining engineer Aimi Shuji, with the translator G.N. Zhuravlev, made an inventory and assessment of the property. On August 6, 1926, the commission in the same composition made an inventory and assessment of the Vladimir mine. But if the Japanese recognized the Vladimirsky mine as the property of the USSR and there were no problems with the valuation of its property in the amount of 5182 rubles 95 kopecks and the signing of the corresponding act, then with regard to the property of the Due mine, the representative of the concessionaire S. Sano categorically refused to sign the act of evaluation and lease of the property, stating that the property on the territory of the concession belonged to the company by the right of succession, since it was bought from Mr. Kuznetsov during the occupation. He agreed to recognize only the cost of renting the "Soviet" property, which he personally estimated at 966 rubles 94 kopecks. It should be noted that for the period from December 14, 1925 to April 1, 1929, the concessionaire paid 683.3 rubles for the lease of the property of the Vladimir mine, and 125.63 rubles for the "undisputed" property of the Duisky mine.

On August 13, 1926, the Acting Consul General, A. Suzuki, appealed to the agent of the People's Commissariat for Foreign Affairs in Alexandrovsk, M. Mikhailov, with a request for a statement by the representative of the Union, Mr. S. Sano, and demanded clarification of the grounds for the return of buildings and movable property to the USSR. "The first question on our part is whether the state owns property, buildings that have not been built or maintained by state institutions, and therefore the concessionaire cannot find a reason to agree with the proposal that these buildings and movable property be returned to the government of the USSR."

On August 27, 1926, the agent of the People's Commissariat for Foreign Affairs in Alexandrovsk, M. Mikhailov, turned to the Deputy Consul General T. Murase with the following reply: "Gracious Sovereign! Acknowledging the receipt of letters from your predecessor, Mr. Suzuki, No. 34 of August 13 and No. 35 of August 16, informing of the refusal of the Japanese company "Kita Sagaren Sekitan Kigio Kumiai" to recognize the USSR's property rights to the buildings of the Due and Rogatiy mines, I have the honor to state the following:

All buildings, wharves, roads and equipment erected during the period of Japanese occupation without the official permission of the Government of the USSR are legally the property of the Soviet state. According to paragraph 11 of the Concession Agreement, they are subject to lease to the concessionaire exclusively on the basis of lease for the entire term of the agreement.

1. The position of the authorized Japanese society, Mr. Sano, that the property of the mines belongs to Japanese firms on the basis of private property rights is fundamentally wrong. The facilities were erected by the Mitsubishi company in the occupied territory of the USSR without any consent of the Soviet government. With the restoration of the full sovereignty of the USSR over Northern Sakhalin, all these facilities, including those of a semi-military nature, became the property of the USSR.

2. The Soviet government could not protect this property during the occupation for objective reasons.

3. These assets cannot be recognized as private property, since the commercial activities of Mitsubishi were directly related to serving the needs and interests of the Japanese occupation army.

4. For the Soviet authorities, the Japanese Coal Company legally exists only from the moment of signing the Concession Agreement. Paragraphs 11 and 12 of the Treaty clearly establish the obligation of the Japanese side to accept the terms of the Sakhalin Mining District on the inventory, evaluation and acceptance of these objects for paid lease use, as well as to pay for the use of the mine near Cape Rogaty for the entire period of occupation.

On the basis of the above, expressing satisfaction with our past contact work with the Consulate General, I ask you to give a proper explanation to Mr. Sano about the need to accept the proposals of the Sakhalin Mining Department as soon as possible in order to avoid disruptions in the work of the fields."

On September 8, 1926, the Consul General sent another message to the agent of the People's Commissariat for Foreign Affairs Mikhailov, in which he stated that Mr. Sano would not change the views he expressed. Therefore, the Consul General considered it necessary to wait for the result of the resolution of this issue at the Embassy of the Ministry of Foreign Affairs of Japan in Tokyo.

On December 1, 1926, the Japanese Embassy in Moscow sent an official document to the People's Commissariat for Foreign Affairs of the USSR, which stated: "In accordance with the agreements concluded between the Soviet government and the Japanese mining companies in 1925, the objects owned by the Soviet government and related to these companies have been transferred to the interested parties for use. The Japanese government and Japanese businessmen have shown their intention to consider the property in Northern Sakhalin as belonging to the Soviet government. However, the provisions of the Concession Agreement do not grant the Soviet Government the right of ownership of Japanese property in the concession territory."

On December 21, 1926, the People's Commissariat for Foreign Affairs of the USSR sent the following reply to the Japanese ambassador: "According to reports from the local authorities of the Soviet Union in Northern Sakhalin, representatives of the Japanese concession companies for the development of oil and coal deposits refused to sign the acceptance certificate, since they refused to recognize the property in the concession territory as belonging to the Soviet Union. The Soviet Union cannot but admit that these actions of the representatives of the Japanese concession companies are a violation of the relevant terms of the concession agreement concluded by the said companies. According to paragraph 11 of the concession agreement... in the presence of the representative of the concessionaire, an inventory of the property and an appraisal report must be drawn up, as well as special transfer reports, which must be signed by the representative of the concessionaire. The actions of the representatives who refuse to sign the inventory of the delivery of state property and the appraisal report are clearly illegal. there are no other owners in the concession territory except the Soviet Government... If the property inventory report and the valuation report are not signed, the concession contracts will be terminated...

On January 19, 1927, the Japanese Embassy, in Note No. 3, acknowledged receipt of Note No. 11923 of the People's Commissariat for Foreign Affairs, dated December 21, 1926. The Embassy stated that it could not accept the assertion that, by virtue of the mere fact of the existence of certain acts, property which rightfully belonged to the Japanese Government and subjects, and which they had never renounced, should be deemed to have passed into the possession of the Government of the U.S.S.R. The Japanese Embassy wished to know on what day and in what order the property had changed hands without the knowledge of its owners. Leaving aside the discussion of the principles involved, however, the Embassy could not but consider that the views of the People's Commissariat did not seem to take into account the notes exchanged in Peking between the delegates of the Japanese and Allied Governments of January 20, 1925, as well as the facts which have since arisen concerning the disposition of Japanese property in Northern Sakhalin.

The above-mentioned notes agree that the work then being carried on by the Japanese in Northern Sakhalin in both the oil and coal fields is to be continued until the concession contracts are concluded, as provided for in the Protocol annexed to the Peking Convention on the same date as the notes. This agreement is final, showing that the property owned by the Japanese in the oil and coal fields will continue to be their property. This property, which is not included in the inventory drawn up by the Commander of the Japanese Army of Occupation, has changed hands without the knowledge of its owners.

In order to bring the matter to a peaceful settlement, the Japanese Embassy submits it to the People's Commissariat for reconsideration and earnestly requests a satisfactory answer to its previous note.

The Japanese Embassy wishes to add its own point of view to the assertion of the People's Commissariat that the refusal on the part of the concessionaires to sign the acts of transfer of facilities belonging to the Japanese in the concession areas constitutes a violation of the Concession Treaties." The People's Commissariat seems to believe that Article 11 of the Concession Treaties, by referring to the facilities of the Federal Government, covers all facilities existing in the concession areas. The People's Commissariat thus seems to postulate, if the Japanese Embassy correctly understands, on the one hand, that Japanese ownership of the oil and coal fields in Northern Sakhalin has passed into the possession of the Federal Government in accordance with Union law, and, on the other hand, that the provisions of the concession contracts themselves implicitly recognize the restitution of property in the concession areas.

The first paragraph has been refuted above. With regard to the second, the Japanese Embassy would like to point out, first, that the above-mentioned Article 11 clearly provides for the transfer of not all property in the concession areas, but only that which belongs to the Federal Government, and further that neither the article in question nor any other article of the concession contracts transfers to the Government of the USSR the right to property owned by the Japanese in the concession areas. Secondly, it should be noted that, in view of the fact that the concessionaires and the owners of the facilities in question were not identical persons, the question of the disposal of Japanese property in the oil and coal fields is entirely beyond the competence of the concessionaires and could not, and in fact was not, considered by them during the negotiation of the Concession Agreements. It goes without saying that the oil and coal concessionaires are to receive the property of the Federal Government in accordance with Article 11, but there is no reason why there should be any transfer of Japanese property from the Federal Government. The Embassy is therefore unable to accept the request of the People's Commissariat to inform the concessionaires of the advisability of signing the transfer documents. The Embassy also considers unfounded the assertion that the refusal of the concessionaires to sign such documents constitutes a violation of the Concession Agreements.

On June 27, 1928, the People's Commissariat for Foreign Affairs of the USSR in a Note to the Embassy of Japan directly stated that "the terms of concession agreements are inviolable and cannot be subject to any cancellation or change, except in cases of mutual consent of both parties, formalized through the Main Concession Committee. In view of this, the People's Commissariat should note that it is deprived of the opportunity to interfere in the actions of a party that has resorted to the method of resolving a dispute with the other party provided for by concession agreements."

On May 20, 1929, the Japanese embassy sent note No 78 to the People's Commissariat for Foreign Affairs of the USSR, which, in particular, said: "In the opinion of the Government of Japan, the existing disagreements regarding the ownership of some property of Japanese concession enterprises in Northern Sakhalin can be resolved only through negotiations between the two Governments, and in fact these negotiations are underway."

M.I. Vasiliev-Yuzhin

F.V. Lengnik

In response to this note, on July 8, 1929, the People's Commissariat for Foreign Affairs of the USSR sent a note to the Japanese Embassy with the following content: "... The People's Commissariat considers it useful to note that the essence of the dispute between the Japanese concessionaires in Northern Sakhalin and the Supreme Council of the National Economy of the USSR has never served and could not serve as a subject of negotiations between the Government of the USSR and the Japanese Government, since the latter is not the body that is provided for by concession agreements with the corresponding Japanese firms as an instance for resolving disputes arising from the practical application of these agreements."

After long legal and diplomatic ordeals, on January 31, 1930, a meeting of the Civil Collegium of the Supreme Court of the USSR was held under the chairmanship of M.I. Vasilyev-Yuzhin and members of the Collegium N.N. Ovsyannikov and F.V. Lengnik, with the secretary A.F. Yakovlev and with the participation of the Assistant Prosecutor of the Supreme Court of the USSR A.V. Belousov, which considered the claim of the Supreme Economic Council of the USSR against the Sakai Kumiai society. In its decision, the court indicated that on October 20, 1926, the property located in the area of the Agnevo mine was handed over by the USSR government to the Sakai Kumiai concession and accepted by the latter, which is confirmed by the witnesses I.K. Ruslanov, M.S. Shutovsky and K.E. Krasilnikov interrogated in the case. The value of the property in 1913 prices was determined at 65,637 rubles 94 kopecks. Based on this, the court determined that the rent for the period from December 14, 1925 to October 1, 1929 was 9,522 rubles 88 kopecks.

The arguments of the defendant in the application of September 18, 1928 that the issue of the right to property located on the territory of the concessionaire is disputable and that negotiations on this issue are being held in Moscow between the Embassy of Japan and the People's Commissariat of Foreign Affairs of the USSR, the court recognized as "unworthy of respect", since the procedure for resolving disputes and disagreements between the Government of the USSR and the Concessionaire under the agreement of December 14, 1925 is provided for in paragraph 35 of the agreement, according to which all these disputes and disagreements are resolved by the Supreme Court of the USSR.

On the above grounds, the Supreme Court of the USSR found the claim to be satisfied and decided to recover the specified amount from the concessionaire.

After the court decision, the opinion prevailed in Japanese business and diplomatic circles that the lawsuit filed against Sakai Kumiai had an ulterior motive - the desire to resolve the issue of the right to property in Northern Sakhalin in favor of the Soviet government. Simply put, with this court decision, the government of the USSR wanted to break the resistance of concession enterprises and force them to sign documents on the lease of state property and payment for its use to the state treasury. And they did not have to wait long. On October 4, 1930, the representative of Kita Karafuto Kogyo Kabushiki Kaisha, engineer Nakamura, signed an act of inventory and valuation of property, as well as an act of acceptance of this property for lease at the Douai mine in the amount of 196072 rubles and at the Mgachi mine in the amount of 619 rubles. However, recognizing the USSR's ownership of property does not mean paying for rent. From 1925 to 1939, the oil and coal concessions were in arrears of lease payments in the amount of 892457 rubles 58 kopecks, excluding penalties and discounts for depreciation.

On February 5, 1930, the Supreme Court of the USSR issued a writ of execution No 140 and on its basis on June 7, 1930, the head of the Sakhalin District Administrative Department and the Workers' and Peasants' Militia, A.I. Kostin, with the participation of the expert V.L. Drachev and the trusted company Majima Katsuji with the translator H.E. Lysenko, drew up an inventory report of the company's products, consisting of 6457 cubic meters of coal, and took samples to determine its quality and cost. Separately, it was indicated that all the coal available to the company was mined as early as 1924 and contained traces of weathering. All coal reserves were seized. On June 27, 1930, an auction was scheduled for the arrested coal in the amount of 10243.98 rubles, to which the company protested, pointing out that an incomparably low price of 2.5 rubles per ton was set for coal, while in 1928 the company sold this coal to the Nikolaev port at a price of 7 rubles per ton. The company demanded an expert assessment of the cost of coal and asked to cancel the scheduled auction. Nevertheless, the auction took place, but was held without a single participant and was not successful. On July 4, 1930, a second auction was held, to which not a single buyer appeared and the auction was declared invalid. Immediately after the auction was closed, the bailiff, guided by the regulations of the Civil Procedure Code, issued a decision to transfer all the seized coal reserves near the mine (in the amount of 5,000 tons) to the full and unconditional ownership of the plaintiff - the Supreme Council of the National Economy of the USSR - on account of the complete cancellation of the debt and the termination of enforcement proceedings. The forced arrest was officially lifted from all other coal storage balances at the Agnevo mine. The USSR never received the payments due by the court decision, received only coal, which by that time had undergone severe weathering, as a result of which its calorific value decreased to almost zero.

In the end, due to a lack of funds, on June 16, 1930, with the consent of the Ministry of Industry and Trade of Japan, Sakai Kumiai began the transfer of concession rights to its deposits to the Kita Karafuto Kogyo Kabushiki Kaisha company, and by August 31, the transfer process was completed. But this was done without the knowledge of the Soviet side, with the help of the transfer of rights to trust management. That is, from a formal point of view, the contract remained formalized for Sakai Kumiai.

The new owner did not hesitate and already in August 1930, the mine was inspected for half a month by Associate Professor of the Imperial University of Hokkaido Sugiyama Suketoshi and his students Kisaburo Yashima, Hiroshi Ozaki, Ito Ichiro, Seichi Mabuchi, Junichi Iwai, Yuji Nagasawa. The results of the survey showed that the mine was completely abandoned.

On August 18, 1931, the head of the Sakhalin Mining District, Golovatsky, accompanied by a specialist engineer, suddenly went to the Agnevo coal mine to inspect the activities of the enterprise. He met with engineer Ota Saichiro and demanded that he be escorted to the exit to the tunnel. During the inspection, it turned out that coal had not been mined at the Agnevo mine for 5-6 years. The outer supports and walls of the workings were very dilapidated and collapsed in places, and the car tracks were bent and completely unusable. It is absolutely unacceptable to leave it in this form."

On September 13, 1931, the manager of the Kita Karafuto Kogio Kabushiki Kaisha, S. Murayama, also visited and examined the Agnevo mine. However, the results of the survey were disappointing: "At present, the resumption of work is economically inexpedient, and at this stage we have no choice but to leave the facility under the supervision of the current personnel on site."

As a result, work in Agnevo did not begin, and for a long time there were only 2 watchmen and a "trusted" Katsuji Majima at the mine. They lived exclusively on the money that was paid for a leased steam locomotive, which was operated by various Soviet organizations and finally, in 1933, its last tenant - the Alexandrovsky port - burned the grate of the locomotive, as a result of which it was out of order. As a result, it turned out that the Sakai Kumiai company was almost liquidated as a result of bankruptcy in 1929, and everyone simply "forgot" about its Sakhalin concession. And even after clarifying all these circumstances, the Soviet side did not annul the concession agreement, although there were all formal legal grounds for this.

In July 1934, the Consul General in Alexandrovsk sent a request to the Sakai Kumiai company, in which he asked to immediately begin the development of the mine in Agnevo, arguing that if the profitable enterprise was not launched, the Soviet side could take measures to liquidate the concession. By October 25, 1934, Sakai Ryuzo, teaming up with Tsutsuyoshi Sukemon, created the North Sea Woodland Coal Co Ltd. company with an authorized capital of 1 million yen. investors for the development of the Sakhalin mine, planning to attract investment from Toyama and Fukui prefectures, but to her great regret, a major investor Shotaro Yashima (), who expressed interest in this enterprise, died of illness in August 1934 and the plan to revive Agnevo stalled.

In 1935, negotiations were progressing between the head of the partnership, Ryuzo Sakai, and the company "Kitaetsu Seishi" (Hokuetsu Paper Mills, Ltd.) on the joint management of the Agnevo mine. In this regard, it was decided to conduct an on-site inspection. "Sakai Kumiai" sent a geological exploration team of 6 people to the island (five employees from the "Kitaetsu" side led by Suke Yajima, and Kan Chomei from the Sakai partnership), which arrived on the island on October 2. On the day of arrival, the group paid a courtesy visit to the manager of the Due mine, Mr. Murayama. They asked him to provide the necessary assistance in conducting the survey. Murayama willingly agreed to help and expressed his joy that this concession, which had been idle for a long time, was finally showing the first signs of resuming work. On October 16, they went back to their homeland (Japan) on a passing ship that left Douai.

On January 17, 1936, the Consul General in Aleksandrovsk, Ogata, sent a telegram to the Minister of Foreign Affairs, K. Hirota: "On January 16, the local Soviet mining department sent a written request to the official representative of the Sakai association in Northern Sakhalin, K. Majima, demanding that a detailed report on the planned work and the current state of the enterprise be provided by January 20. Majima reports that since the return to Japan of the inspectors who worked here last year, he has not received any notifications or instructions from Sakai, in connection with which he is in difficulty and cannot prepare a full-fledged answer. He earnestly asks to urgently convey to Sakai the demand to provide basic data for the report. For my part, I consider it necessary to provide assistance and ask you to convey this request to the leadership of the association."

The other concession, Tsukahara Kumiai, never started work and was unable to exercise, at least partially, such as Sakai Kumiai, its concession rights by transferring them to third parties. It is only known that in June 1926, the employees of the geological company, under the personal supervision of K. Tsukahara, who came to the island, inspected the location of the concession area, and found that it was one of the most densely forested areas on the west coast, and that it would take much longer than planned to carry out the survey and demarcation there. And, of course, a huge amount of money would be required later, which would need to be invested in clearing the site and new equipment for coal mining.

After a partial walk tour and reconnaissance of the coast, the work was temporarily suspended with the intention of returning to it after the completion of comprehensive preparations for conducting an accurate instrumental survey. Following this, the expedition members returned to Japan.

According to the report compiled by engineer I.A. Preobrazhensky, the occurrence of coal in the concession area was determined in 6 seams, of which he had already discovered 3 seams.

On March 18, 1927, the founding meeting of the Kostina Mine Joint Stock Company was held in Shanghai under the chairmanship of Ijihara Tokuichiro. The authorized capital of the company amounted to 1 million yen, divided into 20 thousand shares with a par value of 50 yen. At the same time, the Charter of the company was approved and elections were held for the board of directors and auditors. Yoshinosuke Ehara, Kaichiro Tsukahara, Kusajiro Takagi, Kenji Sakuma were elected directors; Nagao Tomo was elected auditor. After that, an application was submitted to the Shanghai Chamber of Commerce for the official registration of the established joint-stock company "Kostina Tanko Kabushiki Kaisha", which became the official successor in rights and obligations of the Tsukahara Partnership, to which the rights to explore and develop coal deposits in Northern Sakhalin were transferred.

The received certificate of registration was certified by the Consulate General of Japan in Shanghai. After that, having received the necessary official confirmation (certificate) from the Ministry of Foreign Affairs of Japan, in July 1927, the joint-stock company sent a petition to the Trade Mission of the USSR in Tokyo (to its Concession Commission) for the transfer of rights and obligations under the Moscow agreement from the original Tsukahara partnership in favor of this newly created company. However, the Soviet side, for unknown reasons, delayed the issuance of permission for re-registration, which caused internal doubts and disputes in the company, led to a split among investors from the Tsukahara group and forced to suspend activities, causing a huge loss of time and causing inconsistency of actions.

On November 14, 1928, a representative of the company filed a petition to extend the period of exploration work As a result, the Soviet side extended its permit for coal exploration until December 31, 1929, but did not undertake either buildings and structures on the island, or the delivery of workers and equipment to the island of Tsukahara Kumiai. It is only known that the total amount of expenses for exploration and remuneration of administrative personnel from February 1926 to June 1930 amounted to 284 thousand yen. Therefore, according to 11 and 34 of the concession agreement, the Soviet side had every reason to terminate it. However, for political reasons, the Soviet side recognized the termination of the contract earlier than 1930 as inexpedient. On October 10, 1929, the company received a notification that the concession agreement with it was terminated from January 1, 1930, but only on May 25, 1930, on the basis of a resolution of the Council of People's Commissars of the USSR, the contract with this company began to be considered terminated. Thus, the only really working coal mining concession enterprise on the island was the Kita Karafuto Kogio Kabushiki Kaisha.

It should be said that the concession agreement brought great disappointment to the expectations of the Japanese concessionaires, since the Makariev allotments and the VI Semenovsky mine near Cape Rogati were excluded from the concession. But the Soviet side found a legal excuse, stating that these areas had already been concessioned to the firm "Kunst and Albers", which in 1923 registered the documents issued by the tsarist government for 4 Makariev allotments in the Douai area and 4 Anastasiev allotments in the Mgachi region in the commission under the Dalprombureau, thereby confirming its rights to them. Of course, this was just a trick to prevent the Japanese from getting a "tasty piece of coal". The Japanese side decided to "buy" the rights to the Makariev allotments from Kunst and Albers and in 1927 reached an agreement with the latter on the assignment of rights. But on July 19, 1927, the Council of People's Commissars of the USSR did not approve the agreement on the transfer of rights. In April 1931, the Makariev allotments of Kunst and Albers and the Pilven allotments of the Briner Trading House were nationalized.

By its decree of May 8, 1926, the Far Eastern Concession Commission (Dalkoncessessky), established under the Far Eastern Revolutionary Committee by the resolution of the Bureau of the Dalrevkom of March 17, 1923, was entrusted with the general supervision of the implementation of concession agreements and informing the Main Concession Committee about the state of affairs on Sakhalin. For effective control over the activities of concession enterprises in Northern Sakhalin, a special commission was formed under the chairmanship of a representative of the Sakhalin Revolutionary Committee.

It included representatives of the People's Commissariats for Foreign Affairs, Labor and Agriculture, as well as the head of the Sakhalin Mining District and his two deputies, who were engaged in supervising coal and oil enterprises in the Soviet part of the island. The commission was in charge of labor protection and organization of the delivery of workers, control over the import of equipment and supplies, development of deposits and organization of production, safety, supervision of the general situation in the concession, organization of assistance in relations with local authorities, etc.

In the summer of 1926, the company applied for the import of a large batch of mining equipment through the Trade Mission in Tokyo. However, the Soviet side delayed the issuance of permits, citing the need to coordinate the nomenclature of goods with the central departments in Moscow. The company stated that among the imported goods were pumps and spare parts necessary to prevent flooding of mines in winter and any delay could lead to damage to property, for which the USSR as the owner of the subsoil was also responsible. Only in September 1928, "belt conveyors" (belt conveyors) were installed at the enterprise for the mechanical supply of coal to ships, which made it possible to increase the loading of coal by 20,000 tons per year. A power plant with a capacity of 300 kW was also built.

It should be noted that the delay in the import of mine rimming was only the "first swallow". Before he had time to start working, the coal concessionaire unexpectedly faced a huge number of problems.

1. The Soviet authorities introduced a strict ban on the use of the Japanese yen even for internal settlements of the company with Japanese employees. The Soviet side demanded that all payments, including purchases in Japanese shops at the mines, be made exclusively in chervonets. However, the forced exchange of yen for chervonets at the official (overvalued) rate of the State Bank of the USSR would lead to an actual depreciation of the salaries of Japanese specialists by 20-30%, which would cause ferment among the engineering staff. Ambassador Tanaka officially declared in the People's Commissariat of Finance of the USSR that the KKKK was a Japanese legal entity, and the restriction of the right to pay its subjects in their national currency undermined the financial stability of the concession.

2. The tax department in Alexandrovsk demanded that the administration of Kita Sagaren provide payroll sheets and forcibly withhold income tax from payments to Japanese employees in favor of the USSR budget. If the company refused to act as a tax agent, the Soviet authorities threatened to seize the Society's bank accounts and bring the management of the representative office (Mr. Sano) to justice for "sabotaging tax legislation". The KKKKK company and the Japanese Foreign Ministry made a categorical protest. First: Japanese employees are paid in yen in Tokyo, and on Sakhalin they receive only small advances for personal needs. Second: The Japanese already pay taxes in Japan. Taxing them with Soviet taxes is "double taxation".

3. Soviet trade organizations (in particular, the Sakhalin branch of Gostorg) set special inflated prices for food (meat, vegetables) and fodder for horses for the Japanese company, which were 2-3 times higher than the prices for the local population and Soviet enterprises. Moreover, the local authorities forbade the Japanese to buy products directly from local peasants and private traders, requiring all transactions to be carried out only through state bodies at fixed exchange rates. Thus, the USSR used the monopoly in the domestic market to pump out the currency from the Japanese as much as possible, making their maintenance on the island extremely expensive.

4. The authorities in Aleksandrovsk demanded that every Japanese engineer and technician obtain a special Soviet identity card and work permit. At the same time, the Soviet side insisted on a questionnaire that included questions about political views and past place of service (including military service). It is quite understandable that the USSR sought to obtain a detailed dossier on each Japanese specialist in order to identify intelligence officers among them and exert psychological pressure. The KKKKK company protested against this procedure, considering it a form of political control and interference in personnel affairs. The Japanese argued that their national passports and an official list certified by the company and the consulate were enough to identify employees.

5. In the navigation of 1926, the Concessionaire delivered several trucks and cars to Sakhalin to transport people and equipment between Aleksandrovsk and the mines. In the conditions of established snow cover, the use of vehicles (including caterpillar trucks) is critically important for the life support of the mines. The local Soviet authorities (administrative department) refused to issue license plates and driving permits to the Japanese, citing the lack of "Soviet driver's licenses" of Japanese drivers and the inconsistency of the cars with the technical regulations of the USSR. Moreover, the Japanese were forbidden to move on public roads outside the mines themselves. At the same time, the command of the local Soviet garrison in Aleksandrovsk appealed to the administration of the "KKKKK" with a demand to provide the company's trucks for "the needs of local defense" and winter maneuvers. The Soviet authorities stated that according to the laws of the USSR, if necessary, all vehicles in the country could be temporarily mobilized. The Japanese side perceived this as an attempt at hidden confiscation, fearing that after the maneuvers, the cars would be returned in non-working condition or not returned at all.

On this occasion, Ambassador Tanaka immediately lodged a strong protest with the People's Commissariat of Foreign Affairs of the USSR, pointing out that the property of a foreign concessionaire imported under a special contract was immune from requisition. The mobilization of KKKKK vehicles paralyzed the supply of fuel and food to the mines, which would lead to a humanitarian catastrophe in Japanese villages in winter.

After the demarche of the Japanese ambassador to the People's Commissariat of Foreign Affairs, the Soviet government sent an order to Alexandrovsk on the inadmissibility of forced requisition of the property of the Japanese concession for military needs. The demand of the local garrison for the transfer of trucks was officially withdrawn.

Despite the success with the trucks, the KKKK company complained about the increasing cases of petty theft of tools and dynamite from warehouses in Douai. The Soviet police refused to investigate these cases, stating that the Japanese were "poorly guarding their facilities." The Japanese administration considered the Soviet militia on Sakhalin insufficiently effective and asked to allow Japanese guards and key employees of the company to carry firearms (pistols and hunting rifles). The Soviet side responded with a categorical refusal. Moreover, the GPU authorities on Sakhalin seized from the Japanese even the weapons that had previously been allowed to be carried by Mitsubishi employees, and banned the import of new ones, fearing the creation of "Japanese armed detachments" near the Japanese border.

6. The Soviet authorities on Sakhalin demanded that the KKKK immediately pay social insurance arrears for all workers, including those who had previously worked for Mitsubishi. The Japanese side insisted that according to the Concession Agreement, the company was obliged to provide medical care and life insurance to workers independently, through its structures (hospitals and foundations), and did not have to pay additional contributions to the Soviet budget for the services that it already provided. The requirement of "double payment" (to maintain one's own hospitals and pay to the social insurance of the USSR) was a violation of the balance of interests laid down in the 1925 treaty. It is quite understandable that the USSR used the social insurance system as a way to additionally tax the concession and increase the dependence of workers on the Soviet state (since benefits would be paid by the Soviet authorities). Japan, on the other hand, saw this as an attempt to undermine the "paternalistic" model of management, where the worker had to depend only on the company.

Continuing this point, the Soviet social security authorities and the labor inspectorate insisted that treatment and examination of industrial injuries should be carried out exclusively by doctors of the state health insurance system. Moreover, the authorities on Sakhalin refused to recognize the diplomas of Japanese doctors, requiring them to pass exams on knowledge of Soviet medical regulations and register with local health authorities.

7. The KKKK company officially complained about the actions of the Soviet postal and border authorities (GPU) in Aleksandrovsk, stating that the personal and business correspondence of Japanese employees was systematically opened and detained for "checking the contents". The Japanese side was extremely concerned that confidential information about mining plans, financial reports and personal orders of the management fell into the hands of the Soviet authorities. This was considered as direct interference in the commercial activities of the enterprise.

8. The Soviet port authorities demanded that the concession enterprise undergo a complete re-registration of the entire auxiliary fleet (previously owned by Mitsubishi) under Soviet laws. Until the completion of this procedure, Japanese boats were forbidden to go to sea to service coal terminals. Soviet inspectors refused to recognize Japanese certificates of technical condition of ships, demanding an expensive examination by Soviet specialists. The Japanese side considered this a hidden form of extortion and an attempt to disrupt the last loading of coal before freezing. The concessionaire stated that according to Article 29 of the Concession Agreement, the company had the right to use its own equipment.

In addition, the Soviet management of the port in Aleksandrovsk imposed severe restrictions on the movement of Japanese auxiliary vessels (tugboats and barges) between the coal terminals in Douai and loading points. The Soviet side demanded that each movement of the vessel, even for a short distance along the coast, be registered as a foreign voyage. The concessionaire stated that according to Articles 28 and 29 of the Concession Agreement, the company had the right to unhindered use of port facilities and vessels for the needs of the enterprise. The requirement to register "cabotage" (internal) passages as international voyages led to huge losses of time and the payment of unnecessary port dues. The concession, through the Japanese ambassador in Moscow, required the recognition of the status of "technological transport" for the company's vessels, which did not require complex customs clearance when moving between sections of the same concession. On November 26, at 11 a.m., a steam boat belonging to the concession was detained by the Soviet authorities on its way from Douai to Aleksandrovsk. Upon arrival at the port, representatives of the local authorities (GPU/Border Service) expressed suspicion of "illegal border crossing" or "unauthorized movement". Although the official reason was "checking navigation documents", the real goal of the authorities, according to the Japanese side, was to establish full control over the company's communication channels between the mines and the consulate.

By December 1926, relations between the Japanese company and the Soviet authorities on Sakhalin had heated up to the limit. The company realized that ordinary mail or couriers on boats were intercepted or detained by the GPU. Therefore, the management of the concession actually began to use diplomatic mail and ciphers of the Japanese Foreign Ministry as their secure communication channel so that Soviet intelligence could not find out their internal instructions and financial plans.

At the same time, the analytical department of the Department of Europe and America of the Japanese Foreign Ministry gave an assessment of the current situation and prospects for concession activities in Northern Sakhalin. In particular, it was pointed out that if at the stage of signing the main contracts in Moscow the Soviet side showed a certain flexibility in order to attract capital, now a period of systemic administrative pressure has begun. An analysis of the actions of the GPU, local trade union organizations and tax authorities allows us to conclude that there is a coordinated policy. The Soviet government seeks to create conditions under which the exploitation of resources will become economically inexpedient for Japanese companies. The essence of this tactic is to deprive it of practical meaning through by-laws, labor legislation and customs barriers without formally violating the letter of the concession agreement.

Risks for Japan:

If this trend continues, concessions in Northern Sakhalin over the next two years may turn from profitable assets into enterprises requiring permanent state subsidies. However, Sakhalin is a key link in ensuring the energy security of the Empire, especially in terms of supplying the Navy with fuel."

The following measures should be taken:

1. To instruct the embassy in Moscow (Ambassador Tanaka) to declare a resolute protest against the "broad interpretation" by the Soviet bodies of the local level of the provisions of the main treaty. It is necessary to seek firm guarantees of the immutability of the tax regime.

2. To recommend to the management of the coal and oil companies (Mitsubishi, Mitsui, etc.) to stop the practice of isolated concessions. It is necessary to create a united front of concessionaires to negotiate with the trade unions in the 1927 season.

3. To strengthen control over internal correspondence and the composition of Russian personnel in the field in order to prevent leaks of confidential information to the GPU and trade union bodies.

According to paragraph 12 of the Concession Agreement, the company undertook to carry out geological exploration work in the areas allotted to it. Since 1926, the coal deposits of the concession plots were explored by Shimizu Saburo, a professor at Tohoku University in Sendai. In 1927, he arrived in Sakhalin with 7 senior students: Tan, Oishi, Sugiyama, Ishikawa, Obata, Shibayama and Matsuda. The work was carried out on the map of 1:6000, on an area of about 24 sq. km, and more than 300 exposed outcrops of coal seams were described and sketched in detail. The work was carried out for 3 months, but was exclusively of the nature of geological research, not exploration. Nevertheless, the Japanese geologist estimated the thickness of the formation in Machi at 200 m. Exploration by K. Uemura and S. Shimizu in the area of Machi established the presence of 7 coal seams. Previously, Shimizu estimated the reserves of birth at 5 million tons, but he did not make a very favorable review of the deposit. In the area of Doue between the Postovaya and Kirpichnaya valleys, under the guidance of geologists Shimizu and Kato, 2 students continued geological study of the mine area.

During the period of the concession in the area of the Duiskoye deposit, the company developed 8 mines. Initially, coal was mined in mines No 1 and 2 (opened in May 1920 and July 1923), 3 and 4 (began work in August-September 1924), No 5 (opened in April 1925, mothballed), then, in September 1927, mine No 6 was laid, in August 1928 mine No 7, in July 1930 mine No 8-1 (Ogorodnaya), in 1934 mine No 8-2 (Mitsumata or Trekhruchyovaya).

According to the production plan, from 1927 to 1932, the Japanese planned to extract and export to Japan 815 thousand tons from the Douai mines, 305 thousand tons from the Machin mine and 75 thousand tons from the Vladimir mine. A total of 1195 thousand tons.

On May 30, 1927, a general meeting of the company's shareholders was held in Tokyo, at which a report on the company's work since its foundation was presented. In particular, in 1926, the company produced only 9048 tons of coal. According to the company's business plan, the annual coal production was to increase from year to year and by 1935 to reach 300 thousand tons. Already in the 4th year of operation, the Company's mines had to be equipped with all the necessary equipment.

In Soviet archival documents there is data that in 1925 the Japanese concession enterprise in Northern Sakhalin produced 13,071 tons of coal, in 1926 42,700, in 1927 115384, in 1928 110,550, in 1929 111625, in 1930 120833, in 1931 131,050, in 1932 125555, in 1933 140,160, in 1934 160,160, in 1935 186700, in 1936 178800, in 1937 45823, in 1938 5170, in 1939 1571 tons of coal. In total, 1604815 tons were mined in 1925-1942.

Archival documents of Japanese statistics show that during this period 1,481,169.58 tons of coal were mined, 253,860.6 tons were purchased from the USSR and exported to Japan.

Table XI

Mining, purchase and export of coal by the coal concession of Kita Karafuto Kogio Kabushiki Kaisha in 1925-1943 (in tons)

* - from May 15 to December 31, 1925 in Douai and Rohat (from December 14 to December 31, 850 tons of coal were mined in Douai)

For the first two years, the coal concession, according to the developed production plan, was supposed to work in a deficit mode, although, according to the documents of the Main Concession Committee, in 1926/27 the concession received a profit of 80 thousand rubles, while extracting coal for 431 thousand rubles and exporting it for 360 thousand rubles.

However, according to Japanese archival documents and accounting documents of the joint-stock company, in 1926-1928 the concession worked at a loss, but already from the 1929 operational year it began to make a profit (in yen), according to the table below.

Table XII

Profit and loss account of the joint-stock company in 30.08.1926/31.03.1927 - 01.04.1943/31.03.1944 operating years (in yen).

* - profit in the balance sheet was shown at the expense of state subsidies, which were included in the column "other income".

Exported coal was mainly supplied to the metallurgical plants of the Japanese corporation Nippon Steel. The table below shows the distribution of Du coal in 1936 and 1937.

Table XIII

Distribution of export coal from Northern Sakhalin in 1936 and 1937

According to the Concession Agreement, instead of general and local taxes, the concessionaire paid a single tax in the amount of 3.33 percent of the value of the gross output extracted, 4 percent for the lease of property, as well as a share deduction from 5 to 8 percent, depending on the amount of coal mined. In the 1926/27 operational year alone, the Soviet side received 19,325 rubles from the concessionaire in the form of various payments, and in the 1927/28 operational year - 58,750 rubles. In total, in 1925-1930, the concessionaire's payments to the state amounted to 106,800 yen. For the 1927 fiscal year, the amount of "royalties" amounted to 19,549.71 yen. In 1928-1934, the concession paid the Soviet side in the form of a share of 31.5 thousand tons of coal.

However, before it had time to start working, the concession faced a peculiar interpretation of the concept of a "single tax" by the Soviet side. Local authorities immediately demanded that the Japanese company pay customs, stamp, office and excise duties. In the accounting documents of the company itself, it was indicated that in the period from August 16, 1926 to March 30, 1927, the company paid the Soviet side a total of 42,633 yen in the form of stamp duties, trade union dues, social insurance fees for employees and other payments.

Only after a long correspondence between the Japanese consulate and the embassy with the People's Commissariat for Foreign Affairs of the USSR, Japanese entrepreneurs managed to "fight off" most of the tax payments. The issue of port dues was resolved for a long time. Only on June 4, 1926, the Glavkoncessskom in its telegram No 6431611 confirmed that by the order of the Central Committee of the People's Commissariat of Foreign Affairs given to the head of the Nikolaev port, the concessionaire was exempt from collecting port dues at the points of loading and unloading on the island of Sakhalin. In the port points of mainland Russia, port dues were to be collected from the concession on a general basis.

Immediately, like the devil out of a snuffbox, an order from the local regional finance department jumped out of the box on the immediate payment by the concession enterprise of taxes on the consumption of tea, sugar, silk fabrics, knitwear, cigarettes and refined alcohol. Moreover, a demand was made to pay the tax in foreign currency. Customs stated that although Article 17 of the concession agreement exempted the company from duties, it allegedly did not concern the consumption tax. At the same time, the Japanese noted that the customs officers themselves were in a deplorable financial condition: the central government did not send enough funds, and they were forced to literally extort money from Japanese companies, hiding behind an arbitrary interpretation of the agreement.

The Japanese company immediately sent complaints to the consulate, the consulate to the embassy, and the embassy sent a note of protest to the People's Commissariat for Foreign Affairs of the USSR, stating that if the local "tax authorities" did not lag behind the concession, then all losses from the collection of such taxes, according to 6 of the concession agreement, the Japanese side would demand compensation to the Government of the USSR. It should be noted that the Japanese Consul General S. Sasaki in his reports to the Japanese Foreign Ministry brilliantly described the "backstage" of the Soviet administration on Sakhalin: customs officials simply wanted money for their needs and tried to "pull" the law on the Japanese. Victory in this case not only saved money for companies, but also created an important precedent: taxes on Sakhalin are regulated by an agreement in Moscow, and not by the desire of the local chief.

First of all, this concerned the income tax introduced on Sakhalin in October 1930. And if there were no problems with Soviet and Chinese workers, then Japanese workers preferred to receive only 10% of their wages. And the rest, at their request, was transferred to their families directly in Japan. On February 26, 1927, the president of the company, T. Kawakami, in written explanations to the employees of the company's accounting department, pointed out that "Japanese employees should accrue in the payroll the amount that is convenient for reporting and will not be related to their actual salary. The real salary will be transferred to the personal account of each employee in Japan. When the company's employees return home, the head office will make the final payment to them. If there is no objection, we will begin the implementation of this plan on April 1, 1927.

Of course, income tax was not paid to the Soviet budget from such a "hidden" part of the salary. In addition, the Japanese administration kept most of the accounting in Japanese, in accordance with the rules adopted in Japan. The Soviet side constantly demanded that the Japanese administration keep accounting records in Russian and according to the rules adopted in the USSR, and for failure to comply with this requirement, they threatened to bring the administrative elite to criminal responsibility. But the Japanese stated that they kept records to the extent required of them by Japanese law, published them in the Japanese press and did not intend to make any changes in this regard.

Summary Financial Report of Kita Karafuto Kogio Kabushiki Kaisha for 1927-1943 (in thousands of yen)

In February 1932, the government of the USSR introduced a one-time fee for the needs of cultural and housing construction (cultural and housing collection), which also included employees of concession enterprises in Northern Sakhalin. The fee was levied on a monthly income of 75 rubles, depending on earnings, it ranged from 18 to 140 rubles, and if the salary was over 500 rubles - 35%. The received salary of the fee had to be divided by 8, and the resulting amount (for example, 18:8 = 2.25) was subject to deduction from the employee's salary. It should be noted that from February 1, 1932, the concessionaire most carefully withheld and transferred the fee from Soviet workers, but the withheld fee from Japanese workers remained in the cash register of the enterprise "until the explanation of the Center." In just 1.5 years, the Japanese side "hid" 945 rubles 40 kopecks from the tax inspectorate. In addition, the cultural objects they use are also maintained at the expense of the company on the basis of a collective agreement. Thus, Japanese workers do not enjoy the benefits to which this tax is directed at all. In spite of this, the Soviet side clings exclusively to its own interpretation and, guided by the same considerations as in relation to its citizens, imposes this special tax on our workers."

On June 24, 1932, Consul General Sasaki telegraphed to the Minister of Foreign Affairs of Japan, Count Uchida: "The Soviet side is trying to force our enterprises to pay the tax, referring to an unjustified and biased interpretation of the rules. Our position, declared to the Soviet authorities, is a resolute protest. Since under the terms of the concession the obligation to provide housing lies with the company itself, the introduction of a fictitious tax on "cultural housing" is an unlawful duplication of obligations. We insist on the complete exemption of our employees from these payments. The collection of tax from Japanese workers who do not use Soviet infrastructure is absolutely illegal. The tax, positioned by the Soviet side as a temporary fee for the current year, actually turns into a permanent burden. Our department considers it inadmissible to create such a precedent under any pretexts. The position on the tax on cultural housing was sent to Ambassador Hirota in Moscow to protest to the central authorities of the USSR." As a result of energetic protests from the Japanese embassy, on July 15, 1932, the Soviet local tax authorities were ordered to completely exempt Japanese employees of concession enterprises from paying the cultural fee, including all disputed additional charges.

On June 14, 1934, the Japanese concession enterprises received a notification from the agent of the People's Commissariat for Foreign Affairs in Alexandrovsk that a surcharge of 10% was established in favor of the Red Cross Society on consular fees paid both in the USSR and abroad. The society informed the agent of the People's Commissariat for Foreign Affairs that, according to paragraph 20 of the Concession Agreement, it was exempt from all kinds of taxes and fees. And naturally, it would not make any additional payments either in favor of the Red Cross, or in favor of the "children of Germany," etc.

The issue of insuring the concessionaire's property in Soviet insurance organizations was also painfully resolved. For a long time, representatives of concession enterprises did not want to recognize the property on the territory of their enterprises as the property of the USSR and considered it their property, acquired during the years of occupation. Therefore, they were afraid to insure this property in Soviet insurance institutions, since when concluding a property insurance contract, it was necessary to indicate its value and the Soviet side could use this to collect lease payments from the concessionaire, based on the value of the insured property specified in the insurance.

On January 9, 1929, the director of the concession, S. Murayama, in his letter No 7 to the special commission for the supervision of concessions on Sakhalin, wrote: "There can be no question about the insurance of the buildings erected after the conclusion of the Concession Agreement, as well as three houses belonging to the Government of the USSR. As for the insurance of the disputed property, the question of ownership of which has not yet been decided, the opinion of the Company is that since this property is used as equipment of the Concession Enterprise, it must be insured against fire on the basis of 30 of the Concession Agreement, although it is the property of the Concessionaire, and therefore it has decided to insure it as well; but since the valuation of the property in this case is limited exclusively to the purpose of fire insurance, it should not be constrained by any other issues; in addition, the Company believes that the issue of insurance is a completely independent issue and has no connection with the question of ownership of property, therefore it should not affect the right of ownership of the Company, and the Company is sure that on your part there will be no objections to this opinion. Having expressed its opinion on the issue raised, the Company has the honor to inform you that it wishes to insure all hitherto uninsured property against fire and asks you, for your part, to make an appropriate order to the Gosstrakh Agent, and about the time of his business trip to the Concession, I humbly ask you to inform the Company so that it prepares all the necessary materials in a timely manner."

However, the Japanese were quickly disappointed with the activities of the Soviet monopolist, the Gosstrakh insurance company. "In the field of fire insurance, the Soviet authorities forcibly collect huge insurance premiums from the company as part of compulsory insurance of all our property, production facilities and buildings. However, in the event of an insured event, the Soviet insurance authorities, under any pretext - declaring an allegedly incomplete package of documents or violation of regulations - categorically refuse to pay compensation to the company. A recent example was the fire in October 1931. As a result, the internal equipment and inventory of our workers' club completely burned down. The insurance company refused to pay. In view of this, the company cannot feel safe insuring property only in Soviet organizations, and is forced to re-insure the same objects in Japanese insurance companies. This is another example of the inevitable double expenditure that undermines our budget," wrote concession president T. Kawakami to the head of the Bureau for Europe and Asia, Matsushima, on April 22, 1932.

On October 4, 1933, a fire broke out at the concession and the dormitory No 3 burned down completely, and the loss amounted to 9918 rubles 45 kopecks. On November 20, 1934, at 10:30 p.m., a fire broke out in the center of the village of Douai and destroyed the house where several families of engineers and technicians of the concession lived. The damage from the burnt building amounted to 3700 rubles and 500 rubles - the damage from the destruction of personal belongings of the victims. In both cases, the local office of Gosstrakh stated that the fire occurred due to the negligence of the concessionaire in connection with his failure to comply with Article 17 of the Decree of the Council of People's Commissars of the USSR No 1092 of May 28, 1933, according to which the insured person is obliged to inspect all the chimneys of the insured buildings and structures twice a month in winter and once a month in summer, and the concessionaire, allegedly, did not inspect at all. Therefore, the payment of insurance compensation was refused. After these incidents, the concessionaire applied to Gosstrakh with a statement of termination of the insurance contract and demanded the return of the paid insurance premiums.

Upon the expiration of the concession period, the enterprises of the concession company were to be transferred to the Soviet Government free of charge (together with all buildings and equipment) in such a condition that would make it possible to continue work at these enterprises without much effort and difficulty with the extraction of coal in the amount of the average production of the last five years at the concession enterprise.

For example, in 1926 the capital investments of Japanese merchants amounted to 598,600 rubles, in 1927 593,100, in 1928 271,400, in 1929 100,000 rubles. P. Sletov explains such a peculiar investment policy of the concessionaire as follows: "Sakhalin coal deposits, especially Duiskoye, are distinguished by extremely favorable natural conditions that ensure the profitability of developments. The excellent quality of coal, the thickness of the seams, the proximity of the sea and the terrain, which made it possible to use a natural slope to deliver coal to the shore all this, obviously, put the Japanese entrepreneur in especially stable conditions... He was little interested in improving the coal production itself in the mechanization of underground work. Mining is still carried out in primitive ways, not much different from the practice of pre-revolutionary Russian entrepreneurs... And is there any point in spending money on cutting machines, * when it is more profitable and easier to act as a contractor who organized daily labor, a transporter of products extracted by the muscles of the Soviet and Chinese worker... .

E.V. Lebedev

In January 1929, the chairman of the regional revolutionary committee, E.V. Lebedev, speaking at the First Congress of Soviets of the Sakhalin District, noted: "In the work of concessions, we are constantly faced with the stubborn desire of the concessionaire - to invest as little as possible, and to get as much as possible... Hence our task is to stubbornly fight against these tendencies of the concessionaire..."

However, some Russian scientists believe that the available data on Japanese investments in coal concession enterprises are very contradictory and incomplete. In particular, N.V. Maryasova believes that the main volume of capital investments was made by the concessionaire before 1930 and amounted to 4-4.5 million rubles, and for the entire period of its existence the capital investments amounted to approximately 5.5-6 million rubles.

Japanese archival documents give us the following picture of the concession enterprise's investments in the island coal industry (in yen): 1926 - 3854291, 1927 - 1252828, 1928 - 224763, 1929 - 144543, 1930 - 95764, 1931 - 154098 yen. In total, for 6 years 5726287 yen. Taking into account the exchange rate difference between the market value of the yen and the ruble, it can be argued that the concessionaire's capital investments significantly exceeded the amount of 6 million rubles.

During the same period, 400 tons of various kinds of cargo, equipment and food were imported from Japan in 1926, 4625 tons in 1927, 3562 tons in 1928, 2812 tons in 1929, 2790 tons in 1930, and 2412 tons in 1931. In total, 16627 tons.

By the beginning of 1933, according to the audit report carried out by representatives of the head office in Tokyo, the concession enterprise had a conveyor equipped with an 800-foot vibrating belt with a capacity of 75 hp, one air compressor with a capacity of 25 hp, three pneumatic drill hammers for drilling boreholes, 8 pneumatic jackhammers for coal mining and 6 coal scrapers* (of which 2 pieces with a capacity of 10 hp, 2 pieces with a capacity of 7.5 hp and 2 pieces with a capacity of 6.5 hp). The total length of tunnels in the mines by 1932 was 11105 meters. The main haulage workings are equipped with heavy rails, the track width is 2 feet, the total length is 8,070 meters, the stopes and intermediate drifts are equipped with light rails, the track width is 2 feet, the length is 1,850 meters. Mine technological platforms on the surface: track width - 2 feet, length - 1,285 meters. 9 electric winches were also used to lift coal cars from inclined shafts (of which 1 pc with a capacity of 60 hp, 3 pcs - 24 hp, 2 pcs - 20 hp and 3 pcs - 6 hp).

In the early 30s, jackhammers began to be used at the concession enterprises, which made it possible to significantly increase the labor productivity of miners, especially in comparison with state enterprises (6 tons and 4 tons of coal per shift, respectively). I would like to note that on average one employee of the concession enterprise accounted for 11.86 tons in 1926, 112.75 in 1927, 129.4 in 1928, 141.01 in 1929, 148.3 tons in 1930, 146.5 tons in 1931, 148.5 tons in 1932, 147.3 tons in 1933, and 122.0 tons of coal mined in 1934.

For artificial ventilation of the mines, there were 1 Sirocco fan, 3 Bano fans and 3 local ventilation fans. 18 drainage pumps were used to pump groundwater out of the mines. Of these, 11 drainage turbopumps with a capacity of 20 hp, (2 pcs) 10 hp (4 pcs), 7 hp (2 pcs) and 3 hp (3 pcs.) and 7 three-piston drainage pumps with a capacity of 7 hp (2 pcs), 5 hp (1 pc), 3 hp (3 pcs) and 1 hp (1 pc.) .

For the operation of electric motors both inside the mines and on the surface, a power plant built in November 1927 was used, equipped with 2 generator sets with a capacity of 300 kW each. Steam was generated by two Babcock-Wilcox water-tube boilers with a heating area of 215 square meters each. The station provided electricity to 1750 points of electric lighting. Subsequently, another 300 kW. generator was installed.

For coal storage, the company had several coal warehouses. The first such coal warehouse with a capacity of 1000 tons was built on the coast in the summer of 1927. In October 1927, from the mouth of mine No 6 to the coal warehouse, the construction of a cable car with a length of 272 meters with a maximum coal transportation capacity of 25 tons per hour was completed.

In the summer of 1928, for an uninterrupted supply of coal for loading, the concessionaire built 2 concrete warehouses with a capacity of 1000 tons of coal each near the pier. And in July 1929, the construction of a coal loading station was completed, a 900-foot belt conveyor ("Belt Combey") went from it to the pier, from which coal was supplied to barges through a bifurcated telescopic chute. The productivity of this conveyor reached up to 150 tons per hour.

It should be noted that the loading of coal was very successful, reaching 2100 tons in 14 hours of work of Japanese loaders. The maximum volume of loading per day (recorded on July 21, 1931) was 2550 tons. As a result of its use, the capacity for loading coal increased, and the risk of injury during loading operations was reduced. Simultaneously with transportation, coal was also sorted.

By 1933, the maximum daily amount of coal transported from mines and warehouses for loading onto ships was as follows: mine No 3 1300 tons, mines No 1 and No 6 1500 tons, mine No 2 1500 tons, mine No 4 1500 tons, coastal coal depot 1800 tons.

Coal was transported from the mines to the warehouses through a network of narrow-gauge roads. Namely, the length of the narrow-gauge railway from the end of the berth to the coal depot was 4900 m, to the coal depot of the third mine - 160 m, to the coal depot of the 2nd mine - 260 m, to the coal depot of mine 1 and mine 6 - 400 m, to the coastal coal depot - 160 m.

Trolleys were used to deliver coal from the mines to the warehouses. In 1932, their total number was 195 (171 wooden and 24 steel mine cars), with a capacity of 0.69 tons each. Due to the terrain, the trolleys rolled from the mine to the warehouse on their own, and they were rolled back with the help of locomotives. Since 1924, the delivery of trolleys was carried out by two steam locomotives of the Orenstein & Koppel plant, with a capacity of 25 hp each. The working pressure of the locomotive boilers was 11 atmospheres. The surface area of the heating of the boiler of each steam locomotive was 11.66 square meters. The weight of the locomotive was 7 tons, the maximum traction force was 1040 kg. In 1929, the number of steam locomotives reached three units. In addition to steam locomotives, there were also 4 draft horses in the concession.

For the shipment of coal, in July 1931, the company built a 2550 m long basket-type cable car from the entrance to mine No 8 to the coastal coal depot, with a maximum capacity of 35 tons per hour. Previously, during the melting ice and the beginning of navigation, when the first ships entered the port, they were often forced to stand idle. The reason was that in winter, due to the deep snow, it was impossible to use the narrow-gauge railway to deliver coal from distant mines to the shore, and there were not enough coastal warehouses. If the workers tried to clear the tracks by force, this would lead to technical breakdowns of the tracks and stops during the peak summer transportation period. Thanks to the launch of mine No 8 and its cable car, coal was delivered uninterruptedly throughout the winter directly to the shore warehouses by the sea, which completely eliminated this logistical disadvantage.

The cable car's buckets ("baskets") ran 75 feet (about 23 meters) directly above the coastal coal yard, allowing for direct coal filling from top to bottom without intermediate winches, providing a huge logistical advantage.

To transport coal to large displacement vessels, the company had at its disposal steamers "Sagaren-maru" and "Dattan maru" with a displacement of 40 tons each, equipped with duplex steam engines with a capacity of 110 hp, as well as a boat "Tomoe-maru" with a displacement of 20 tons, operating on a diesel engine with a capacity of 25 hp. and a boat "Hokui-maru" with a displacement of 17 tons, with a diesel engine of 23 hp.

In the first half of the 1930s, in addition to coal mining in Douai, the concessionaire prepared the Vladimirsky, Mgachinsky mines and other concession facilities for operation.

Douai Concession Pier

In June 1935, the Vladimir mine began operation. A number of preparatory works were carried out at the mine, including the construction in September of a 570-foot wharf for loading coal, a narrow-gauge railway about 1.3 km long, a coal warehouse, access roads, as well as the construction of dormitories for Russian workers, one dormitory for Japanese workers and a number of other facilities. By August, these facilities were completed, which made it possible to break through two galleries and start coal mining, which amounted to 50 tons per day. During the navigation period, 2110 tons of coal were mined and on September 4, 310 tons of coal were shipped to the Dongfeng-maru vessel. In total, 1155 tons of coal from the Vladimir mine were sent to Japan during the navigation of 1935.

On July 24, 1935, Professor of the Faculty of Geology of Tohoku University Mabuchi Seiichi arrived at the Vladimir mine to conduct a geological survey. However, on August 21, during geological surveys, he was arrested by local residents, who mistook him for a spy and saboteur. The scientist was taken to the village of Arkovo, where he was handed over to border guards, who sent him to the NKVD in Alexandrovsk.

On September 1, 1935, 42 Japanese, 122 Russians, and 9 Chinese worked at the mine, a total of 173 people. In 1936, 5 thousand tons of coal were mined at the Vladimir mine, and in 1937 it was planned to increase production to 15 thousand tons per year.

On July 2, 1935, the manager of the company "Kita Karafuto Kogio Kabushiki Kaisha" turned to the trade representative of the USSR in Japan, V.N. Kochetov, with a proposal to exchange coal from the Vladimir mine developed by the Japanese for coking coal from the Soviet Oktyabrskaya mine. However, the Soviet side refused.

As for the development of the deposit in the area of the Macha River, there is practically no information left in the archival documents.

In 1928, the company carried out exploratory drilling in this area, during which 501 tons of coal were mined and on October 7, 480 tons were taken to Japan on the ship "Kirin-maru" for factory tests, but later the work was stopped. On February 2, 1928, the president of the company, T. Kawakami, in a letter to the commercial director, pointed out that "since the beginning of work at the Douai coal mine, the company has suffered huge losses. In the end, it will be impossible to continue the business in the form in which it is. At this stage, it is absolutely necessary to find a way to reduce losses. We believe that the only way to save the situation is to combine mining activities with logging. Firstly, it is technically easy for us to implement. Secondly, it is extremely profitable. Coal mining requires a huge amount of timber (for support), and according to the contract we have the right to self-sufficiency in timber. If the Soviet side allows us to harvest the timber we need, we will be able to use our privileges: a) duty-free import of equipment, b) transfer of funds through the Bank of Korea, c) preferential rates of social insurance.

This will make our forest business much more profitable than that of purely forest companies (for example, Dalles).

According to Article 23 of our concession agreement, the company has the right to: 1. Harvest wood for the needs of its enterprises both inside and outside the concession zone. 2. Receive five-year plans for felling areas at the rate of 1.5 cubic feet of wood for each ton of coal mined. 3. Export abroad wood not used for the needs of the enterprise, in accordance with the general export rules."

To implement this plan, we need to secure territories with rich export timber. This is much easier than obtaining a new coal concession. In February 1928, we already submitted a petition to the trade representative Anikeev. Then he replied that the forests of Northern Sakhalin had not yet been explored and were not open for exploitation. However, this was only a pretext for refusal.

In the meantime, the Soviet Dalles Trust has already begun active work. Last winter they cut down significant quantities, and this summer they sent about 18,000 tons of timber to Japan. In the future, they plan to increase exports to hundreds of thousands of tons. If we delay, Dalles will monopolize all the best plots (especially in the Agnevo area), and our goal will become unattainable. We have already sent a protest to the Dalzemupravlenie (August 17) and applied for new forest plots in accordance with Article 23 of the treaty. To succeed, we need the support of our consuls and the ambassador in Moscow.

In order to achieve the above goals, it is crucial that the company does not limit itself to domestic consumption of timber. Our strategy is as follows:

1. Geographical reference: We insist on the allocation of forest plots in the immediate vicinity of our coal mines. This will minimize transport costs and use the existing infrastructure (roads, port facilities) for the dual purpose of exporting coal and timber.

2. Procurement volumes: According to our calculations, based on the projected coal production, we have the right to request clearing quotas that significantly exceed current needs. These surpluses, according to Article 23, can and should be sold on the foreign market (primarily in Japan) in order to maintain the financial stability of the concession.

3. Technical equipment: We plan to import modern Japanese logging equipment. Since this equipment is classified as "necessary for the development of the concession", it should be subject to duty-free import in accordance with the preferences in force. We are ready to prove that the export of timber through our company will bring the Soviet side more foreign exchange earnings in the form of duties and fees than the activities of the currently unprofitable "Dalles". The expansion of our activities will allow us to hire up to 200-300 additional Soviet workers, which will have a positive effect on employment in the region and will remove some of the claims of the trade unions

The amount of lumber unsuitable for mining will be 2,400,000 cubic meters per year after April 1931, which is more than double the current demand for logging. Due to the unavoidable circumstances of logging and exploration, the expected volume of unsuitable material will be 1,600,000 cubic meters." The table attached to the letter indicated that the concession had plans for 21,500 acres of forest areas in the valleys of the Nai-Nai, Machi, Khoe and Poronay rivers. The total volume of timber in these areas, according to conservative estimates, was at least 237 million cubic feet, of which 7.29 million cubic feet were supposed to be developed from 1927 to 1931.

As early as September 1926, the concessionaire sent an application to the Far Eastern Land Administration about the intention to cut down 1,775,000 cubic feet of timber in the area of the Agnevo River. On September 18, 1926, the deputy head of the department, P.T. Mamonov, in a reply letter to the concessionaire, indicated that the Far Eastern Land Administration had no objections to this application and would give the necessary instructions to the Sakhalin District Land Department. The Sakhalin Regional Land Department issued a permit for the concession to cut down 1,775,000 cubic feet of timber for a period of 5 years.

On August 6, 1929, the concessionaire sent a second request for cutting down timber in the areas of Khoe, Machi, Agnevo, Arkovo and Nai-Nai. However, at this time, the Dalles trust began its work on the island, which planned to harvest at least 87 million cubic meters of timber in 1929-1930. So the concessionaire's application was rejected and he had to part with the hope of replenishing his budget by exporting "unnecessary" Sakhalin timber to Japan.

Relations between the concession enterprise and its "subcontractors" - the Soviet enterprises "Glavugol", "ASO-ugol" and "Sakhalinugol" - were quite difficult. In connection with the start of work at the Makaryevskoye coal deposit, on December 21, 1931, the manager of "ASO-coal" P.N. Naranovich notified his Japanese counterpart in letter No 12-28-4425 that, in accordance with paragraphs 19 and 22 of the concession agreement, ASO-coal was starting to lay a dekovil track along the Postovaya Valley to the sea parallel to the narrow-gauge railway of the concessionaire, and was also starting the construction of a pier 150 meters from the concessionaire's wharf. The head of the coal enterprise invited the concessionaire to send his proposals on this issue no later than December 28, 1931.

Kato Isozo

The concessionaire did not hesitate to give a "respectful" reply. On December 27, the manager S. Murayama wrote in a letter to the coal industry department of the ASO for No 354: "As a result of a comprehensive discussion of the issue raised by you, we found, to our great regret, the impossibility of agreeing with your scheme, since the laying of a decking track and the construction of a pier in the area planned by you is not only technically completely impossible, but will intolerably constrain our work and will threaten the public improvement of our village."

On December 30, 1931, the chairman of the board of the society, I. Kato, wrote to the foreign sector of the Supreme Economic Council, the trade mission of the USSR in Japan and the Far Eastern Executive Committee: "Such undertakings not only hinder our operational work, but also trample on the rights granted to our Society on the basis of the concession agreement, and this, in turn, threatens our friendly relations with adverse consequences, to which we cannot but draw your favorable attention. The question of the Makariev allotments is not new. Our representative has repeatedly proved that they are unsuitable for independent profitable development. I tried to convince you of the same when I conducted negotiations with the Main Concession Committee in 1930. The project for the construction of a new track running parallel to our tracks is technically impracticable, and moreover, it runs counter to the interests of the ASO, because it is insane to lay new rails just for the development of 300,000 tons of coal, when it is possible to successfully use our existing ones. The Society hopes that you will not refuse to take appropriate measures to stop the construction of the road planned by the ASO. As for the export of coal extracted from the Makarievsky mines, in order to resolve this issue, you can, for example, sell us coal in your mine warehouses or hand over to our company the export of your coal, etc. .

And, although the workers of the ASO began preparatory work on the construction of their narrow-gauge railway, after the intervention of the Consul General of Japan in Aleksandrovsk, the Soviet side was forced to curtail these works, because the narrow-gauge railway would pass through the territory of the concession, and the concessionaire did not and did not intend to give permission for its construction on its territory to the Soviet coal enterprise. On January 15, 1932, the head of the mining district officially announced to the concessionaire that unauthorized construction work by Soviet organizations in the concession zone was henceforth strictly prohibited.

Thus, the concession "blocked" the possibility of the Soviet enterprise exporting coal from the Makarievsky mine. On March 14, 1932, negotiations began between the concession and the Sakhalinugol trust on the purchase of Makariev coal by the Japanese side. However, the price of 5.5 rubles requested by the Soviet side turned out to be too high (5.5 rubles in Japanese currency at the official exchange rate was 8.3 yen), so the Japanese insisted on a price not higher than 2.1 rubles per ton and the negotiations were interrupted. In April, the manager of the trust, E.T. Abakumov, agreed to reduce the selling price of a ton of coal to 3.2 rubles. The Soviet side demanded that payments be made exclusively in hard currency (yen or dollars) at the official state exchange rate of the USSR, which did not at all reflect the real purchasing power of the ruble on Sakhalin. The Japanese company proposed to pay according to the barter scheme (deliveries of Japanese mining equipment, food and overalls for Soviet workers), or to apply a special clearing rate. The Soviet side stated that this issue was beyond its competence and required direct agreement with the People's Commissariat for Foreign Trade and the People's Commissariat of Finance in Moscow. The parties agreed to wait for the final directives from their capitals by the beginning of May.

However, already in May, Sakhalinugol launched full-scale construction in the area of the Makarievsky mine. In less than a month, a workers' settlement was built there, coal mining began (46,700 tons were mined in a month), and the roads leading to the Japanese concession were blocked by the Trust's horse-drawn transport. In response to the protests of the Japanese side, the diplomatic agent of the People's Commissariat for Foreign Affairs on Sakhalin, Starkov, during a meeting with the leadership of the Japanese concession, bluntly stated that the Soviet economic bodies did not intend to suspend work and stressed that the creation of transport routes and coal mining on state plots were the sovereign right of the USSR, and the Japanese concession should not create obstacles to the technical progress of the region. The Japanese stated that such a position of the Soviet authorities threatened the very existence of the concession enterprise. They also noted that the Soviet workers behaved extremely provocatively, there were constant clashes over the use of roads and timber warehouses.

The situation gradually escalated. In August, a temporary branch line laid by the Soviet trust on the territory of the concession and intensive traffic of horse-drawn transport completely blocked the access roads of the concessionaire to the timber warehouse. As a result, the Japanese could not deliver fastening timber to the mines, which endangered the safety of Japanese miners. Soviet workers arbitrarily occupied the territory of the coal depot of the concession at the mouth of the Polovinka River, unloading more than 10,000 tons of their coal there.

The administration's demands to vacate the area were completely ignored. And they were ignored on completely legal grounds. The fact is that this site was not included in the concession zone and in 1926 it was transferred to the concession for use on the condition that it was immediately returned to the Soviet side at its first request. The manager of Sakhalin Coal officially stated that if the Japanese company did not agree to purchase coal at their price (3 rubles 20 kopecks), they would begin independent loading onto Soviet ships through the berths of the concession, referring to the order of the Far Eastern Executive Committee.

During an informal meeting, representatives of the Soviet trust "Sakhalinugol" hinted that they were ready to reduce the price for a batch of Makariev coal, planned for shipment in the first decade of September, if the Japanese company guarantees the provision of ships for loading before the onset of autumn storms. The volume of coal prepared for shipment on the shore is about 25,000 tons. In turn, the Japanese also unofficially proposed to set the purchase price at the level of 2 rubles 60 kopecks per ton, having drawn up a temporary agreement for the purchase of a test batch of 10,000 tons with the condition of shipment through Japanese berths.

In the end, the management of the concession decided to stop the unpromising disputes on the spot and postponed the negotiations to Tokyo, appealing directly to the Trade Representation of the USSR. In order to speed up the process of agreeing on the terms, the Soviet foreign trade body "Exportugol" in Vladivostok was involved in the dialogue. As a result of these coordinated efforts, the parties managed to bring their positions closer together and conclude an official contract in September 1932.

A temporary agreement was signed between the representative of the concession Ozawa and the representative of Sakhalin Coal S.I. Radchenko on the sale of 10 thousand tons of Makarievsky coal to the concession company. With the delivery of it until October 15, 1932 at a price of 4 yen per ton.

But then an unexpected complication arose. According to Article 15 of the concession agreement, the concessionaire could freely and duty-free export the extracted coal, but the agreement did not provide for any specific export conditions for the coal he bought from the Soviet side. In the event that the legal principle "mutatis mutandis" was applied to such coal, there would be no problems. Otherwise, when exporting coal purchased from the USSR, the concession would have to pay a tax fee of 2.35 yen and a ship fee of 2.25 yen for each exported ton of coal. And then the taxes would "eat up" all the profit that the concession could derive from the export of coal purchased from the USSR to Japan.

As a result, on May 2, 1933, an agreement was concluded between the Glavugol Trust and Kita Karafuto Kogio Kabushiki Kaisha on the purchase of Makariev coal by the latter, and the Japanese considered this their huge victory. According to the terms of the contract, the minimum purchase batch of coal was 35 thousand tons at a price of 4 yen per ton with a delivery date from May 1 to October 1.

On December 15, 1933, the president of the company, T. Kawakami, wrote to the Japanese Foreign Ministry: "Although we are determined to increase our own coal production, at present we consider it necessary to increase the amount of coal purchased from the Soviet side, and instead of coal of our own production, to use the purchase of coal from the Makarievsky and Rogaty mines, since such a purchase is much cheaper for us than coal production in Douai..."

From February 19, 1934, the price of 1 ton of coal increased to 4.5 yen. In 1933, the Japanese exported 41,434 tons of coal, and 10,550 tons from the Rogaty mine, 50,000 tons in 1934, 52,950 tons in 1935, and 56,120 tons in 1936. In 1937, it was planned to export 60,500 tons of Makariev coal, but in reality about 25,000 tons were exported.

One of the Sakhalin officials wrote about this: "The question of our Makarievsky mine stands apart. This mine, with its rich reserves of fine coal, is located directly behind the concessionaire's Duisky mine and has no free access to the sea. Thus, in the current situation, the production of the Makarievsky mine can only be shipped through the territory of the Japanese concession, and in fact a situation has arisen in which all the products of the Makarievsky mine have to be sold to the concessionaires... The Makarievsky mine is, as it were, a second concession to the Japanese...

The coal mined and purchased from the Soviet side was exported to Japan on ships chartered by the concessionaire. To deliver it to the pier, a kind of railway was laid along the Duya Valley near the workers' settlement, which did not need any engine. Every 2-3 minutes, a train of 3-4 trolleys loaded with coal rushed along the rails. Due to the fact that the track had a slight slope, there was no need to resort to the services of a steam locomotive.

The trolleys stopped at a giant elevator installed near the pier itself. The elevator received coal simultaneously from the trolleys and from a suspension road stretched to the pier from another mine. The elevator was unloaded from the coal, throwing it on the conveyor belt led along the pier.

The description of loading operations given in the work of P. Sletov is interesting: "On the roadstead, half a kilometer from the shore, a steamer stands and receives coal from the kungas. A business-like, gray, dusty to black coal dust boat brings empty kungas under the front truss of the loading device, from which coal pours directly to the bottom of the kungas. An endless belt, about a meter wide, about a finger thick, moves with a strip of coal evenly poured on it, the steady thunder of heavy scree is heard... The conveyor belt stretches from the shore for almost half a kilometer. There is no end in sight. The sight is spectacular. It seems that steamships come from Japan to Sakhalin, as to some kind of wonderful inexhaustible coal fall. Coal flows from the hills in a uniform river. The loading device stands on strong concrete bulls that can withstand the pressure of waves during spring and autumn storms. Its upper buildings are wooden, fastened with iron. Obviously, in case the conveyor stops, there is a narrow-gauge line around it to supply coal directly to the trolleys... Here is the beginning of the conveyor, which has gone underground. Here, near the elevator building, there is a rail circle blocked by an electromechanical drum. Trolleys launched from the hills run up here with a roar.

They stop not far from the drum and wait until they are grabbed and led two by two inside, into the clamps. The switch is turned on, the introduced trolleys are overturned together with the section of rails on which they stand, and a freshly emptied pair of trolleys appears from the ground, fixed, as an antipode, in a symmetrical part of the drum.

Chinese Workers' Concessions

Under the concession agreement, it was envisaged to attract Japanese administrative and technical personnel and Japanese highly qualified workers in the amount of no more than 50 percent and unskilled workers in the amount of no more than 25 percent of the total number. In cases where the Soviet side was unable to provide the concessionaire with the necessary number of workers and employees from among the citizens of the USSR and foreigners living on the territory of the USSR, the concessionaire was granted the right to hire the missing number of workers at his discretion, including foreign ones.

However, the recruitment of the labor force of concession enterprises began only in 1927, because the Far Eastern labor market was not able to allocate the necessary personnel for the coal industry in the usual manner. That is why in the first years after the conclusion of the concession agreement, the percentage ratio was not observed for objective reasons, which can be seen from the table below.

TABLE XIV

Number and Percentage of Soviet and Foreign Workers and Employees in the Japanese Coal Concession in 1925-1928

Japanese archival sources give us slightly different data on the number of workers of the Dui concession, which can be seen from the table below. Moreover, by the word "Russians" the Japanese meant all workers of non-Japanese nationality, that is, both Russians and Chinese.

TABLE XV

Number of employees of Kita Karafuto Kogio Kabushiki Kaisha in 1926-1932

In addition, the agreement did not clearly stipulate: who should be taken as foreigners? According to the interpretation of the concession agreement, the Soviet side took the Union citizenship as the main measure. The Dui concessionaire considered only the Japanese, but not the Chinese, motivating his actions by the fact that the Soviet labor exchanges themselves sent the Chinese, and this was indeed the case. Therefore, the Soviet side considered that until the work of the labor exchanges was corrected and the supply of labor to Soviet enterprises was radically reorganized, it would have to put up with the presence of Chinese foreign workers, considering them as the most acceptable foreigners.

The recruitment and delivery of labor for the concession was carried out by Soviet recruiting bodies, to which the concessionaires submitted their applications in accordance with the established procedure. It must be said that the enterprises of Sakhalin were attracted by an element for the most part adventurous (lumpen-proletariat), and at best easy-going, young, poorly qualified. As noted in the documents of the Dalkontsessky, stored in the Khabarovsk Regional State Archives, "among all this rabble, there was a significant percentage of the criminal element, deliberately sent by Vladivostok to Northern Sakhalin."

The morale of the workers in the concession left much to be desired. Apart from minor violations of peace and order, only under the Douai, 100 workers had a criminal record. Drunkenness, brawl, mass absenteeism, greed in wages, theft of small items, various equipment, neglect of the sanitary condition of their homes - all this was used by the concessionaire as a means of justifying the preservation of an increased percentage of foreigners. Sometimes the concessionaire put forward direct demands to revise the percentage of Soviet and foreign labor at concession enterprises. The first demarche of this kind was made by the concession management in connection with the murder of a Japanese employee Munemasa Isaburo on October 29, 1927. Soviet miner K.V. Streltsov killed the Japanese with a knife in the back when he refused to reinstate Streltsov at work.

Eyewitnesses describe the picture of the crime as follows: at 10:15 a.m. on October 29, Streltsov came to the office for regular negotiations. Munemasa was sitting at the table and reading medical certificates. The killer stealthily approached from behind and stabbed him in the back with a dagger (blade length about 15 cm). Munemasa shouted "It hurts!", jumped up, took off his jacket and tried to chase the attacker, but after 30 meters he fell from blood loss. The killer ran to the police station and surrendered. Munemaso was taken to the hospital. According to the doctors, the blow fell between the 7th and 8th ribs, pierced the lung and cut the pulmonary artery. Death occurred at 12:10.

This made a great resonance on the activities of the Japanese concession, whose employees massively declared their desire to leave for Japan. The case began to acquire the character of a diplomatic proceeding, in which the Japanese, taking advantage of this event, began to demand not only pensions for the relatives of the murdered and an apology from the government of the USSR, but even a revision of the concession agreement in the direction of expelling Soviet workers from concessions, and the introduction of Japanese troops to protect the concession.

On November 2, 1927, the Consul General of Japan in Alexandrovsk, S. Sasaki, wrote to the agent of the People's Commissariat for Foreign Affairs L.I. Wolf: "The unexpected news about the murder of Mr. Munemas, the head of the workers' department of the administration of the K.K.K.K.K. Society in Douai, former worker Streltsov, aroused panic among the Japanese workers and employees in Douai, losing hope for the further development of the concession enterprise, especially since this murder took place in the afternoon during the performance of official duties in the Office in the presence of all employees... To my great regret, I must tell you that recently in Douai there were frequent thefts, hooliganism, about which articles were repeatedly written in the local newspaper on this matter, and in the end it came to murder. In May of this year, when my colleagues visited the Douai mine, they assured the Japanese workers that they could fully trust the Soviet authorities in matters of protecting public order. It is with deep regret that I have to state that recent events prove the opposite. The Japanese are indignant not only at the murder itself, but also at the fact that the Soviet authorities do not take measures against the lawlessness of the "Soviet elements".

L.I. Wolf

Some even express fears about a possible repetition of the tragedy in Nikolaevsk (the Nikolaev incident of 1920).

The agent of the People's Commissariat for Foreign Affairs did not hesitate to respond diplomatically. "Dear Sir! I hereby acknowledge receipt of your note of November 2. Allow me once again to express my deepest condolences on the tragic death of Mr. Munemas. Nevertheless, I cannot agree with your assertion that "the fate of the concession has been called into doubt" because of a criminal incident. The panic that has arisen among the Japanese personnel seems to us excessive and unfounded. The Soviet investigative bodies have taken the most decisive measures: in addition to the murderer of Streltsov himself, several other persons suspected of complicity have been arrested and taken into custody. I assure you that the criminal will be punished to the fullest extent of Soviet laws. As for your fears of security, the Soviet authorities are taking all necessary measures to maintain order and protect the interests of the concession enterprises. We believe that this sad incident should not be an obstacle to the further peaceful development of our economic relations. Sincerely, Wolf."

On November 8, 1927, the ship "Kaifuku-maru" with the ashes of the deceased arrived in the port of Otaru. On the same day, the Hokkaido Times published an article entitled "The secret hand of the Communist Party? The murder of a Japanese man in Northern Sakhalin threatens an international scandal."

The Japanese side feared that the murder was not just a domestic conflict, but a consequence of the "anti-Japanese atmosphere" fueled by the local authorities. The arrival of the ship with the ashes and witnesses in Japan caused a storm in the press, which made this case a matter of national importance. In particular, the same Consul General Sasaki pointed out: "Analyzing the causes of the tragedy, it should be recognized that it was a consequence of the "cult of the omnipotence of the workers" prevailing in the USSR. The Soviet authorities in the regions are showing criminal negligence in matters of discipline and supervision of workers. In this regard, I consider it my duty not only to seek the punishment of the murderer, but also to raise the question of the political responsibility of the local authorities... We must not miss this moment to force the Soviet authorities to sign an agreement on guarantees of personnel safety, otherwise the further operation of the concession will be fraught with constant risk."

On November 24, 1927, in the city of Aleksandrovsk, a Visiting Session of the Khabarovsk Nikolaev on the Amur District Court on Sakhalin was held under the chairmanship of People's Judge Lebedeva, which considered the criminal case of Streltsov. In the course of the judicial investigation, it was established that "Streltsov Konstantin Vasilyevich, working at the Due mine in the concession enterprise "Kita Karafuto Kogio Kabushiki Kaisha" as a kickback, on August 19, being dismissed for absenteeism without valid reasons, After repeated appeals to the office for his rehiring, having received a refusal and wishing to avenge his dismissal, on October 29, 1927, at about 12 o'clock in the afternoon, coming to the office of the enterprise, he stabbed the Japanese Mr. Munemaso Isaburo in the back, who died of this wound on the same day about half an hour later in the mine hospital, whose death followed, according to the conclusion of expert doctors, from hemorrhage, as a result of damage to the left lung, i.e. thereby Streltsov committed a crime under Article 136 of the Criminal Code... His "accomplice"... Mekhov Sergey Stepanovich, knowing about Streltsov's repeated statement to take revenge on the Japanese for his dismissal, on October 26, being sure that Streltsov would not carry out his threats, satisfied Streltsov's request, giving him his knife, with which Mr. Munemaso Isaburo was killed, i.e. thereby he committed a crime under Articles 17 and 136 of Art. of the Criminal Code of the RSFRS, and therefore guided by Articles 47-48 of the Criminal Code. The court sentenced: gr. Streltsov Konstantin Vasilyevich on the basis of Article 136 of the Criminal Code is to be subjected to imprisonment with strict isolation for a period of TEN YEARS with deprivation of rights, after serving the sentence, for a period of THREE YEARS, and Mekhov Sergey Stepanovich on the basis of Article 17 and 136 of Art. of the Criminal Code to be subjected to imprisonment with strict isolation for a period of TWO years and deprivation of rights for 8 months." But for us, the most interesting point in this sentence is that "the mine worker Sokolov, having heard Streltsov's repeated boasting to take revenge on the Japanese, wrote a letter to the Office of the Society, in which he warned the late Munemasa and Ogato Koreika about the possibility of an attempt on them by Streltsov with a request to be afraid of him." Thus, the Japanese knew about the impending attempt on their life, but did not take any measures and did not make a statement to the authorities. "Because they did not attach serious importance to this warning and, in addition, they did not receive proper assistance from the local mine militia (emphasis added)."

On December 9, 1927, the Japanese Consul General in Khabarovsk, Kawazumi Teiichiro, at a meeting with the Chairman of the Far Eastern Executive Committee, P.T. Mamonov, stressed that the case of the murder of a Japanese employee at the coal concession "is not just a criminal offense, but a serious political problem that undermines the confidence of the Japanese people in the USSR and hinders the development of economic cooperation. I stated that if such acts of violence were not eradicated and security was not guaranteed, then joint work within the framework of concessions would be jeopardized." The Consul General also noted that the local Soviet authorities in Khabarovsk were extremely concerned that this case could develop into an international conflict. Newspapers in Khabarovsk were instructed to present this incident as an "individual act of hooliganism" with no political motive in order to reassure the public.

In the end, it turned out to be so. On June 9, 1930, Consul General S. Sasaki in a telegram to the Japanese Foreign Ministry pointed out: "A local resident, a Russian named Nikolai Nechitailo, personally informed me of the following: His eldest son had been unemployed for a long time and went to Douai to the Japanese mines in search of work. There he was told that he would be accepted in accordance with the general procedure through the Mine Committee. However, the Committee said that he needed permission to stay in the border zone from the GPU. The GPU refused permission, saying: "If you went to work for a state-owned enterprise, we would allow it. But we will not give permission to work in Douai (for the Japanese)." As a result, the guy was left with nothing.

It is known that the conditions in Soviet state-owned enterprises are now difficult: lack of food and mistreatment. Workers are fleeing from there. It is clear that the authorities are using the power of the GPU to forcibly send people to state-owned enterprises, blocking their access to Japanese concessions.

In addition, the GPU controls the supply of fish. Fishermen are told that they can carry fish for the state trade without passes, but if they carry it for sale to the Japanese, they are required to show permits. As a result, Japanese employees cannot buy high-quality and cheap local fish."

Initially, the border zone regime was introduced to combat "unreliable elements", but now it has turned into an instrument of economic pressure on our enterprises."

It should be noted that all the facts of crimes on the territory of the concession were well known to the party and Soviet authorities in Northern Sakhalin. Thus, on April 12, 1928, at a closed meeting of the Sakhalin Revolutionary Committee, the report of the district prosecutor A.V. Shershukov on the situation with crime at the concession enterprise was heard. It was noted that as a result of the measures taken (restriction of the import of alcoholic beverages, cultural and educational work) in the second half of 1927 there was a sharp reduction in crime and hooliganism, while a significant number of property and domestic crimes caused by the lack of living space and extreme overcrowding of both family and single workers remained.

On March 28, 1928, the Regional Revolutionary Committee issued a decree stating that from April 15, 1928, persons entering certain areas within the 7.5-kilometer border zone were required to obtain permission from the appropriate authorities. All concession areas for the extraction of oil and coal were indicated as such areas. The local authorities explained to the concessionaires that this decree was extremely beneficial for the concessions, since now unauthorized persons and hooligan elements would not enter them. However, the concessionaires considered that the purpose of this decree was to place the concession enterprises under the direct supervision of the GPU and would entail extremely serious inconveniences for doing business.

On April 23, 1928, at a meeting of the Sakhalin District Party Bureau, it was decided that it was necessary to evict the "criminal and maliciously hooligan element" from the concession, and the OGPU was asked to take the most decisive measures to prevent unverified workers from entering Douai.

Attempts by the Soviet authorities to improve the quality of the labor force recruited for the concession were ineffective. In 1933, the concession supervision bodies noted that the theft of property, drunkenness, and hooliganism on the part of some Soviet workers did not stop. However, up to 80% of offenses and crimes remained unsolved.

Therefore, in the early 30s, the concessionaire sought to increase the percentage of imports of its labor force more and more and, thereby, actually change the ratio established by the concession agreement. This can be seen from the table below.

TABLE XVI

Number and percentage ratio of Soviet and foreign workers and employees on the Japanese coal concession in 1926-1935

By the beginning of 1935, all administrative and technical personnel were exclusively Japanese, despite the agreement. The concession supervision bodies repeatedly stressed that the concessionaire sought to get rid of Russian workers by all possible means. They were driven from work to work, materially oppressed. Receiving from the workers applications for resignation of their own free will, the concessionaire refused them, thereby forcing them to absenteeism in order to dismiss them as truants. For example, in 1934, 112 people were dismissed for this reason.

On the other hand, it is important to emphasize the fact that some of the workers were "Italianil" (that is, when they went to work, they carried out production operations as slowly as possible, the so-called "Italian strike"), refusing to work for the "imperialists". There were frequent calls to "break up the office and go on strike" or demands for concessionaires to "dress from head to toe and go on strike". Even the supervisory authorities noted that the concessionaires had no choice but to try hard and issue overalls even to those who, under the terms of the collective agreement and production, were not entitled to it.

Such actions and moods of the workers were difficult to overcome, since their unjustified demands often found sympathy among the party and trade union bodies, which saw in this a manifestation of the class struggle and considered it their duty to support it.

It should be noted that even during the negotiations on the conclusion of concession contracts, the Japanese reacted extremely negatively to the idea of the Soviet side to introduce the norms of the Labor Code at Japanese enterprises on the territory of the USSR. On June 22, 1925, the Consul General of Japan in Aleksandrovsk, Shigeru Shimada, appealed to the local authorities with a request for a lenient attitude towards the enterprises operating the coal mines of Northern Sakhalin, and asked not to introduce the norms of Soviet legislation there until the final settlement of this issue at the negotiations. However, the consul was categorically refused. Nevertheless, in 1925-1926, the Soviet employees of the labor protection inspectorate at the concession had to get acquainted with such phenomena as muzzle, a slap on the head at work, etc. Overalls were not issued to workers. Special soap was issued in 200 grams instead of the 400 grams prescribed by the norm.

Sano Shigeru

As a result, the manager of the concession, Sano Shigeru, was prosecuted under Part 2 of Article 132 of the Criminal Code of the RSFSR and on April 19, 1926, the People's Court of Aleksandrovsk sentenced him to a fine of 3000 rubles. I consider it necessary to draw your kind attention to the following circumstances: The domestic and political aspects of the case did not receive attention and assessment in court, and the above-mentioned guilty verdict, with a very insignificant content of the charge (failure to issue soap and failure to report to the labor inspectorate about minor injuries sustained by the workers), was pronounced on the basis of the formal material collected in this case, without taking into account the very difficult situation - the transitional period - in which Shigeru Sano found himself, as a foreigner who did not know the Russian language and found himself in the position of a person to whom a number of demands were immediately presented in large numbers with the order of their immediate execution.

The concession agreement was received by Shigeru Sano only in March of this year, and numerous demands of the labor inspectorate, based on numerous orders, resolutions and explanations of the Soviet government, began to be presented to him on July 20, 1925 and continued on September 8, October 15, November 24, December 2 of the same year, 1925, and resumed on February 16 and March 6, 1926, when the question of concession in one sense or another had not yet been resolved, its basic principles and the new relations arising from them were not known.

The insignificant staff of the administration, their lack of knowledge of the Russian language, the often absence of a real translator at the mine, created a huge, almost insurmountable difficulty for Shigeru Sano in carrying out sudden various laws and orders, which suddenly fell on him all at once with the order to immediately comply with all these requirements. The latter included, for example, such requirements as the acquisition and translation into foreign languages of all laws and explanations related to mining, which in turn were also issued one after another, with the abolition of some of them and with the explanation and addition of others.

It was especially impossible from my point of view for a foreigner who was unfamiliar with the Russian language, and nevertheless, as can be seen from the materials of the case, he satisfied all the requirements imposed on him to the best of his ability and capabilities, while doing all the colossal work as a foreigner conscientiously.

Thus, there is absolutely no evidence to conclude that Shigeru Sano deliberately stubbornly violated the law, all the material speaks of his extremely attentive and conscientious attitude to the implementation of laws and orders.

In view of the foregoing, I have the honor to ask you to give your kind attention to the materials of this case as soon as possible, since the case is being heard in court on July 10 of this year, and to render your authoritative objective opinion on it. For my part, I believe that the most objective assessment of this case is not only possible, but also necessary, since it may have great fundamental and practical consequences in the sense of the further development of business and economic relations between the USSR and Japan. .

As a result, on July 21, 1926, the session of the Vladivostok Regional Court, having heard the cassation appeal of Sano Shigeru, ruled that the arguments of the complaint "have no respect", but at the same time, when reviewing the case, it turned out that there was no defense lawyer for the accused at the trial, which was a violation of Article 55 of the Criminal Procedure Code of the RSFSR. As a result, the verdict was canceled, and the case was sent for a new trial. On May 20, 1927, the court made a final decision: to recognize the procedural errors of the first instance, to reduce the fine to 300 rubles.

However, the threat of criminal punishment did not improve the work of the concession manager. Already on July 29, 1926, during the inspection of the Duisky mine by labor inspector G.M. Poplavsky, the latter found that the company's office books were not kept accurately, there were no internal regulations for workers and employees, some workers did not have paybooks, employees worked 1.5 hours a day, and workers worked 10 hours a day on watercraft, and seven days a week. Vacations were not granted to workers and employees in 1926, and 12 Japanese workers did not receive compensation for unused vacation in 1925. Many workers were not given overalls, and 300 loaders were given white cotton gloves instead of the prescribed mittens. The survey found that residential barracks No 30-32 were absolutely uninhabitable, and the houses under construction could not accommodate all those living in the above-mentioned barracks.

In connection with this act, the agent of the People's Commissariat for Foreign Affairs in Northern Sakhalin, M. Mikhailov, sent a message to the Deputy Consul General of Japan in Aleksandrovsk, Murase Teiji, in which, in particular, he wrote: "... cases of violation of the labor legislation of the USSR at the coal enterprise in Douai have been discovered not for the first time, and therefore I, dear sir, am compelled to draw your attention to the need for appropriate instructions to the trustee of the company, Mr. Sano, to eliminate the violations found... I would like to note that our authorities found it possible to satisfy Mr. Sano's request to relieve him of penalties solely because of the recent term of the concession agreement, insufficient assimilation of Soviet labor legislation, and mainly because of the unwillingness to introduce dissonance into the friendliness of relations (emphasis added).

The repetition of violations of Soviet labor legislation at the Douai plant in more prominent forms indicates that the company's trustee, Mr. Sano, has not taken any measures to comply with the instructions of the labor inspectorate given to him on June 26 of this year to eliminate the violations, and that the violations are taking on a protracted character.

Respected Mr. A. Suzuki, who left for Japan, the former Acting Consul General of Japan in Alexandrovsk, in a conversation with me, expressed his desire to eliminate the second case of violation of the Labor Code in the Dui enterprise by administrative means, without subjecting Mr. Sano to legal responsibility, assuring me that the necessary explanations would be made by the Consulate General of Japan entrusted to you, Dear Sir. I cannot but agree with the desire expressed by Mr. Suzuki to finally stop the cases of violation of the Labor Code in the Dui enterprise in a more gentle and mutually beneficial way... .

The Japanese tried to urgently begin the construction of new residential buildings and dormitories, using prefabricated wooden structures brought from Japan. However, the local Soviet authorities demanded that they go through a lengthy procedure for approving architectural plans and obtaining permits for land allotment. Thus, on the one hand, the Soviet side demanded that the Japanese solve the housing problem, and on the other hand, through the system of building permits, it tried to control the layout of Japanese settlements on Sakhalin, fearing that they would turn into closed military towns.

In February 1928, a delegation of employees of the Japanese oil concession from Oha, consisting of the head of the administrative department, Sato Jiro, and the interpreter Tagaki, arrived at the coal concession. The purpose of the trip was to familiarize themselves in detail with the state of affairs at the Douai mine, as well as to conduct explanatory work and instruction on the need to maintain close contact with local coal concessions to protect mutual interests and strengthen ties with the management of coal enterprises. At the end of the trip, a report was drawn up, which is reproduced here with some abbreviations:

"About 900 workers and employees are involved in the Douai coal mine. Taking into account their family members, the total number of inhabitants reaches about 1500 people. A straight road about 1.5 versts long has been laid from the coast to the entrance to the mine, on the right side of which residential barracks and other buildings have been built, forming a whole workers' settlement. On the slope of the mountain, two-storey reinforced concrete dormitories, modern residential buildings of improved planning ("cultural houses"), a brick building of the Mine (Mine) Committee, a power plant and other facilities have been erected.

A special flavor of local life is given by the shopping arcades at the intersection of streets, where Chinese merchants in their shops and peasants coming from the surrounding villages sell vegetables, pork, eggs and other products directly from the sled. Local workers and their families actively shop here, payments are made in cash.

Housing standards are gradually being brought into line with the requirements of the People's Commissariat of Labor, and by this summer the company is preparing the necessary reserve funds for modernization. At present, buildings left over from tsarist times are mainly used for the accommodation of full-time employees and skilled workers. Single employees are given a separate room, and family employees are given two rooms (kitchen and living room). Among other things, the former barracks of the Japanese army are used, which have been reconstructed into Japanese-style residential buildings (with tatami, sliding partitions, built-in wardrobes and traditional interior elements) with an area of 12 or 8 tatami. Russian family workers are allocated housing depending on the composition of the family - in 4-apartment or large multi-apartment wooden houses.

Stoves are installed in the kitchens, which serve both for cooking and water heating of the rooms. The interior partitions are made of thick plastered wooden panels, thanks to which the sound insulation between the apartments is good, and the residents do not disturb each other with noise. The walls inside the rooms are whitewashed with lime, which improves lighting. There are pots with flowers and indoor plants on the windows, the window frames are painted with white oil paint, which gives the buildings a neat and beautiful appearance.

In dormitories for bachelors, each building is equipped with a common kitchen, dining room and washbasin. Lonely workers living there organize cooperatives, hire Chinese cooks and run a joint household. The rooms accommodate 4-5 people, while there is enough free space. Each worker is allocated a large table, three long stools and an individual locker (locker) with a lock for storing personal belongings.

The beds used are iron, made directly at the Douai mine from materials imported from Japan. Their dimensions comply with the established sanitary standards. Family workers are given wide double beds. Employees and employees living together are given iron beds with spring mattresses, painted white. In the rooms of the heads of departments, the floors are covered with linoleum, large desks, round tables for receiving visitors are installed, carpets lie on the floor, there are elegant wardrobes and wardrobes.

Methods of housing construction:

The 4- and 6-apartment houses built last year were erected from round timber harvested on burnt areas (burnt wood). Immediately after the completion of carpentry work, the internal walls were plastered, and no defects or inconveniences were found during operation. The use of burnt wood in the sawmill turned out to be very profitable, since the wood was dry and did not shrink.

The use of such wood is extremely convenient. At present, the harvesting site is located about 3 versts from Douai. Despite the large weight of logs, due to the abundance of peasant horses, transportation is smooth. The cost of such round timber is half of the cost of raw-growing wood. The price of a finished building in terms of area ranges from 160 to 180 rubles per square sazhen, including the cost of all building materials.

Window frames in residential buildings are painted with white oil paint; casement windows (hinged type) are used, and lifting windows with counterweights are not used due to frequent breakdowns.

To prevent freezing of attic ceilings and crumbling of earth, a layer of old tar or matting is laid on top of the ceiling boards. In the future, it is planned to use thin sheets of galvanized iron, but now, due to the high cost of labor, this method is not used.

The ceilings are sheathed with clapboard in sheet piles ("in a run"), which completely prevents sand and earth from spilling out of the attic. The roofs are covered with wavy slate, and sheet iron is not used due to the labor intensity of installation and the high cost of labor.

To protect against the blowing of cold wind under the floor, the foundation of buildings is sprinkled with earth along the perimeter (a blockage is made).

In addition to wooden buildings, the buildings of the workshops and the telegraph center left by the Japanese army and transported to Douai were bought for the housing of family employees. Brick stoves ("stove") were built in them and steam heating was installed. In the former barracks of the engineering troops, 24 working families are now housed.

The design of wooden houses provides for the installation of foundations on concrete stepchildren and supports (according to the attached drawings). Latrines are built strictly separately from residential buildings, which completely excludes the penetration of flies and unpleasant odors into the living quarters; from the point of view of sanitation and ease of cleaning, this is recognized as an extremely effective solution.

Water supply and steam heating:

Water from mountain streams and a river is diverted to a reservoir behind the power plant. For the needs of water supply and heating, excess steam from two boilers with a capacity of 200 horsepower is used. Steam and water pipes are laid in parallel in wooden boxes to all residential buildings. The water supply and heating system was put into operation at the end of October last year.

Power Plant

The power plant has one modern turbine unit with a capacity of 300 kilowatts, which provides a round-the-clock supply of electricity. Two steam boilers with a capacity of 200 psi are also installed, one of which is in constant reserve. The boiler building has a metal frame of the "truss" system with concrete filling, there is no internal wall cladding.

The turbine hall of the power plant is a brick building (a reinforced concrete frame with brick filling of the walls). In December and January, due to a drop in temperature inside the building, condensate formed on the ceiling, which dripped onto the generators. To eliminate this problem, an additional false roof made of corrugated iron was installed under the reinforced concrete roof to remove moisture. To maintain heat in the room, large cast-iron stoves ("potbelly stoves") operating on coal are installed. In the turbine room, there is a place for installing an additional unit with a capacity of 300 kilowatts, the concrete foundation for which is already completely poured.

Telephone communication:

In the rear part of the office building, a telephone switchboard unit is equipped, in which a 50-number station is installed. Desktop telephones are installed in all departments of the office, in the dormitories of employees, in the supply shop, in the Mine Committee, in the canteen, in the post office, in all mine horizons, in dispatching rooms, at the power plant and in mechanical workshops. There is a direct telephone line with the central office in Alexandrovsk, the connection works steadily and ensures the prompt conduct of business. The duties of telephone operators are performed by three Russian girls who work in shifts. At night, the switchboard is served by a night duty officer from among the Chinese workers.

Layout and arrangement of the office:

The front part of the office building is a glazed veranda (gallery), where long wooden benches are installed for workers to rest, used as a place for waiting and gathering. The office itself is separated from the veranda by a partition with receiving windows for each department. The desks of employees are located in rows opposite each other, three people sit at each table, which ensures strictly regulated and orderly record keeping. Separate offices are provided for the head of the administrative department and the mine manager. With the exception of the drawing office and the design department, electric lighting is turned on in all internal premises of the office even in the daytime, the general working atmosphere is extremely tense and disciplined.

Food Shop (Supply):

At the Douai coal mine, unlike Okha, the supply department and the shop are not separated, but completely united under the management of the Administrative and Economic Department and are called "Prodmag" (Food Store). The assortment of food and essential goods here is very rich, the supply is organized at a high level. There is a system of selling goods on credit against a paybook ("pick-up book"). However, due to the huge number of workers, keeping records of credit transactions greatly overburdens the accounting department. The accounting department insists on the transition to a cash payment system, but due to the specifics of the organization of supply at the Douai mine, it is not yet possible to abandon the credit system, and in comparison with Okha, accounting methods here remain more cumbersome and old-fashioned.

The accounting department of the Douai mine is firmly committed to the introduction of purely cash payments, but the commercial department is forced to maintain a credit system for the sale of goods. The mine's trading network is divided into specialized departments: bread, meat, vegetable, haberdashery, footwear, textile and manufactory, as well as a department of household goods and groceries. Thanks to this specialization, the "Prodmag" in Douai works without interruptions and queues, unlike the shop in Okha. Prices for goods are kept at a level no higher than in Alexandrovsk. Some types of clothing and footwear are imported from China, their prices are very moderate.

Imported goods and luxury goods are also imported mainly from China by Chinese traders.

The management of the Due mine tried to buy live cattle in Korea through Vladivostok. More than 90 heads of cattle were delivered at a price of about 130 rubles per head, but due to harsh climatic conditions, the lack of familiar pastures and the unsuitability of local wild grass for feed, cattle began to die en masse, and some of the animals fled into the taiga. According to the most conservative estimates, the mine's losses from this enterprise amounted to more than 20,000 rubles. Currently, the mine administration has appealed to the Hokkaido Department of Agriculture with a request for prices and conditions for the purchase of pedigree livestock. The final decision has not yet been made, research is underway: what is more profitable - to import frozen meat or to buy live cattle for subsequent slaughter and freezing on the spot. Obviously, meat supply is the most difficult and acute problem for the mine management.

Currently, there is a stock of about 400 tons of corned beef in warehouses, in addition, meat is regularly purchased from local farmers to supply the hospital and children's institutions.

Vegetable storages (Vegetable stores):

At the central food warehouse of Douai there is a specialized underground storage (glacier). The temperature inside the storage is constantly maintained at a level of 0 to -1 degree Celsius. Potatoes, onions, radish, carrots, cabbage, rutabagas, sweet potatoes and other vegetables are stored there without the slightest signs of rotting or germination, by spring they have completely retained their original appearance, the storage results are estimated as excellent. In addition, the administration rented an old large powder magazine from the Military Department, left over from the Japanese army.

In this cellar, large quantities of potatoes and cabbages are stored, purchased from the surrounding Russian villages, which are distributed as necessary from the warehouses of Douai. The availability of such stocks fully meets the needs of the workers.

Local peasants uninterruptedly supply potatoes and cabbage, the volumes of which are quite enough to supply all engineering and technical workers, employees and workers of the Douai mine. For the current year, the administration plans to conclude long-term contracts with the peasants for the supply of agricultural products.

Bakery:

Two Chinese craftsmen work at the bakery, hired on a monthly salary. They bake tin wheat and rye bread, which then goes on sale.

Baking is done in large rectangular molds weighing 1 pound each. Baking and sales are organized very clearly and quickly. The bakery's ovens run on coal, fuel consumption is about 45 pounds per bake. The involvement of a minimum number of personnel allows you to bake and sell bread without delays and unnecessary paperwork with weighing each loaf.

Baths:

In the dormitories of employees and engineers, individual Japanese-type baths are installed. For ordinary workers, a large common bath is built, divided into a steam room (steam room) and a department with a Japanese-type common pool. The steam department is made available to family workers and women every day from 14:00. In general, the baths are kept clean and tidy.

Bachelor and family dormitories have separate laundry rooms (laundries). Workers are paid a monthly laundry allowance of 50 kopecks, but most workers prefer to wash their own laundry in laundries. Family dormitories use cookers on which water is boiled, so there is no need to build a separate large centralized laundry, and the union does not demand that the administration build a special building for a laundry.

Sawdust and fine coal are used as fuel for the hot water boilers of the bathhouse. A circular machine (circular saw) for sawing firewood, driven by a small steam engine, is installed on the bath.

The Douai bathhouse itself was built according to a very modest project and is significantly inferior in scale to the bathhouse in the oil fields in Okha. The building does not have reliable thermal insulation, the walls are made of boards. To heat the dressing room, homemade stoves are used, made of empty iron barrels of oil products ("coke"), in which coal is burned. An iron sheet is welded on the upper part of the barrel, coal is poured into the barrel and set on fire from above, which poses a serious fire hazard.

Mechanical and blacksmith workshops:

The mechanical workshops of the Douai mine are very small in size, but the level of their electrification is quite high. The building of the mechanical workshops is temporary, the roof and walls are made of boards (barracks type), the interior space is cramped, the lighting is poor, and the equipment is placed chaotically. Mainly Chinese workers work in the workshops. Of the heavy equipment, there is one mechanical hammer ("steam-hammer"), powered by steam.

Last year, a brick kiln for firing bricks was built (the construction was carried out by Japanese masons). Just before the closure of navigation, during the trial firing, about 30,000 pieces of high-quality bricks were produced. This kiln is capable of producing more than 10,000 pieces of bricks in one firing, and the planned capacity is from 50,000 to 70,000 pieces per month. The cost of bricks during trial firing was about 7 kopecks per piece, but with the transition to mass production, a significant reduction in price is expected. The production buildings around the kiln are very dilapidated, barrack-type, and serve only to protect from rain.

Hospital:

Medical care is administered by the Department of Social Welfare. The hospital is designed for about 10 inpatient beds. The equipment of the hospital is quite satisfactory, iron beds with spring mattresses are used, inpatients are given hospital gowns (Japanese yukata). Seriously ill patients are sent for treatment to Aleksandrovsk. The hospital staff consists of one Japanese doctor, one Russian doctor, a Russian pharmacist and a Russian paramedic. Prescriptions and sick leave certificates (sick leaves) are issued under the signature of a Russian doctor. When passing the medical expert commission (EEC), the signature of the Japanese doctor is also recognized as valid.

Payment of wages:

The accounting period for wages is set from the 1st day to the last day of each month. Payment is made on the 8th day of the following month. Advances are not paid in the middle of the month. Deductions are made from the wages of workers for goods purchased on credit in the grocery store, for the use of the canteen, etc., payment transactions are carried out through the accounting department. The commercial department still insists on the introduction of pure cash payments for the sale of goods. The implementation of this system at the Due mine is progressing with difficulty, but the management is gradually striving for the full realization of cash circulation. The administration is also looking for ways to prevent the outflow of cash into the hands of merchants in nearby towns and villages and is studying measures to retain capital inside the mine. The payment of wages for February amounted to about 55,000 rubles. Of this amount, about 38,000 rubles were returned to the cash desk through the grocery store. The missing cash for the payment of salaries is requested and withdrawn from accounts in the Alexandrovsky branch of the State Bank. The interest rate of the bank is quite high.

Workwear (Workwear):

The issuance of overalls is carried out strictly on the basis of the norms and rules of the Labor Committee. No warm (winter) clothing is issued free of charge, workers are provided with suits made of cloth and tarpaulin (tent canvas). Cloth overalls are recognized as very practical due to the strength of the fabric. Overalls used at the mine are recognized as the most suitable and of high quality. Canvas gloves are issued, which are sewn without dividing into the right and left hands, which creates inconvenience in work. Cotton work gloves are also issued, but due to an unsuccessful cut, the thumb in them does not have freedom of movement, the gloves quickly tear and rub their hands, so workers en masse refuse to use them, preferring to work with bare hands, which is why many minor injuries to the fingers are recorded. Canvas gloves are issued to workers depending on their profession. Warm winter clothes and shoes are sold to workers through a grocery store for cash or on credit.

Pupils (Apprenticeship/Local Schools):

At present, there are several dozen apprentices (teenagers) at the Douai mine. They are accommodated in rooms of 35-36 people. After the end of the working day, they are left without any supervision from adults and are left to themselves.

The level of discipline among them is extremely low, labor productivity in mine work is unsatisfactory, hooliganism flourishes among students.

Customs procedures and cargo clearance:

For all imported goods and materials from Japan, the port of loading issues an international bill of lading (Bill of Lading). The bill of lading indicates the names of the goods in a strict form, for example: "flour", "sugar", "rice", as well as their exact weight and number of pieces. If several types of goods are indicated in one document, they must be clearly described by brands and numbers of packages. For complex equipment and mechanisms, a general specification is drawn up indicating the number of pieces and weight. Ferrous metals and metal products are declared as "iron products", other goods - as "mixed cargo" (miscellaneous) or "vegetables", "fruits". Customs clearance is carried out through the head of customs on the basis of the customs tariff. Documents are submitted to the customs personally by the company's sales representative. Copies of documents addressed directly to the company's headquarters are handed over by the customs to the representative of the Douai mine immediately after the completion of the vessel's unloading, at the same time one copy is sent to Aleksandrovsk. The documents are accompanied by a cargo specification in Russian.

Cargo inspection is carried out strictly according to the cargo specification. The mine management does not submit any additional lists or inventories of cargo to the customs (the Russian translation of the specification fully corresponds to the Japanese original sent from the company's headquarters).

This procedure is extremely practical, fully complies with local regulations and significantly speeds up the processing of goods in the port. However, this requires high qualifications and great efforts on the part of the employees of our transport and warehouse department located in Japan. Last year, the Douai mine was fined by the customs authorities for late submission of documents (due to the delay in bills of lading).

When ordering goods, the commercial department of the mine assigns a serial number to each order, which is applied to the package (box, box) along with the number of the place. For example, if goods are ordered from company "A", then markings of the following types are stencilled on the packaging boxes of this company. This method is used for all types of cargo and is recognized as extremely convenient and reliable.

RKK (Pricing and Conflict Commission):

RKK's activities at the Okha oil fields and the Douai mine are generally similar. However, when considering labor disputes at the Douai coal mine, the parties often appeal to articles of labor legislation, publications in departmental journals, directories and decisions of higher judicial bodies. Most disputes are resolved in favor of the union, and the company's claims are rejected. Employees who are well versed in the practical side of the matter participate in the conflict commission on the part of the company, but in direct clashes with the trade union, the heads of the administrative and mining departments, who lead the meetings of the RKK, often give up, since they are completely ignorant of Soviet labor laws. As a result, the administrative department is forced to constantly make concessions to the union.

The harvesting of timber and mine support is carried out by the mine itself in the basin of the Bolsn River, 3 versts from Douai. To carry out these works, the company attracts local peasants on a contract basis. Social insurance contributions for these workers, as well as trade union dues, are paid by the mine administration on a regular basis. The recipient of these sums is not the Douai Mine Committee, but the Forest Trade Union (Union of Woodworkers).

Payment for "Communist Appeal" (fees in favor of trade unions):

The rights of workers and employees of the mine are fully protected by a collective agreement (collective agreement). However, trade union officials, school principals, representatives of the local police, employees of the OGPU, heads of the club and cultural institutions occupy apartments in the company's buildings, while the administration of the mine still does not collect any rent or utility bills from them, although it has the legal right to do so. The amounts of these fees in themselves are very insignificant. The management of the mine believes that attempts to forcibly collect this money will do more harm, since they will spoil relations with the local authorities and the trade union. In addition, if the standards of our housing turn out to be lower than the established norms of the CNT, this will give the trade union an official reason to make counterclaims. Therefore, the question of collecting fees from Soviet employees is still open and has not been finally resolved.

Coal production:

Daily production is on average from 450 to 500 tons. Coal consumption for the mine's own needs is about 6% of the volume of production. Labor productivity of miners remains low. On average, one miner produces from 3.5 to 4 tons of coal per shift. At the Douai mine, coal seams are thick, clean from rock, coal is easy to break. Work in the mine is carried out in three shifts. The duration of underground work (shift) is 6 hours, work on the surface is 8 hours. After the end of the shift, workers rise to the surface. According to Article 4 of the Collective Agreement, workers engaged in heavy underground work are granted annual basic leave of 2 weeks and additional leave for a period of 2 weeks (for persons with more than six months of continuous work at the mine). Thus, the total vacation of underground workers is up to 4-5 weeks per year.

Character and mood of workers:

Among the Japanese workers at the mine there is a group of people who married Russian women. Their moral character and attitude to work are evaluated as extremely unsatisfactory. On the whole, among highly skilled workers (foremen), party influence is weakly expressed, they lack class solidarity, they show no interest in trade union activities and politics, and the general mood among them is inert.

Russian workers, given their ties with the city and surrounding villages, categorically refuse to go to work on Sundays. On the days before the holidays, they gather in groups and leave en masse for the city or villages. On Mondays, on the days after the holidays, as well as on the days following the day of payment of wages, the number of employees who did not go to work reaches enormous proportions. This catastrophically reduces labor productivity at the mine.

As an example, we can cite March 9 (the day after the payment of wages, which was made on the 8th): on this day, 344 people did not go to work, which was officially recorded by the administration in the absenteeism log."

After the conclusion of concession agreements, the norms of Soviet labor legislation, an 8-hour working day, social insurance were introduced at concession enterprises, and the Soviet side offered the Japanese to immediately begin to develop and conclude a collective agreement, which was signed on September 13, 1926 by the authorized representative of the concessionaire Kato Isoso and the representative of the Union of Coal Miners of the USSR G.S. Loktev. The agreement applied to all workers and employees of the concession, regardless of their citizenship. The preamble stipulated that it did not apply to the director of the concession, the head of mines, the power plant, the store, the chief accountant and his deputy, legal advisers and the personal secretary of the director.

In case of violation of the contract, the company undertook to compensate for the resulting damage incurred by the company's employees, stipulated the terms of hiring and dismissal, all kinds of benefits and compensations to workers and employees.

In the documents of the central party and state structures, it was emphasized that wages at the Japanese coal concession were much lower than at Soviet state enterprises. For example, on January 1, 1926, the average salary at concessions barely reached 30 rubles a month. Workers demanded a 70 percent increase in wages, threatening to go on strike if they refused. By April 1, 1926, the average wage at the concession enterprise was 40.5 rubles, while the average salary at the Communal Services mine was 87 rubles 41 kopecks.

After the conclusion of the collective agreement, all employees of the enterprise were divided into 17 categories, assigned depending on the complexity of the work performed and the level of qualification. In 1930, the number of categories was reduced to 12. Employees of the 1st category included messengers; 2nd category included watchmen, lamp carriers; Employees of the 3rd category included bath attendants, wind racers, water carriers and coal carriers, breed selectors, sealers, cleaners, laborers; Category 4 included diggers, lamp makers, haulers, plate drivers, brakemen-guides; Category 5 was assigned to sailors, helmsmen on kungas, sawyers, grooms; Category 6 was awarded to loaders, road trackmen, stokers, loggers, hammer breakers, rakers. Starting from the 7th category, highly qualified workers went. So, the 7th category was assigned to underground wagoners, bonfire makers, horse drivers and machinists; The 8th category was awarded to carpenters, masons, camerons, bolters, bookmarkers on steeply dipping seams, coopers, blacksmiths; the 9th category included the professions of locksmiths, electricians; the 10th category included drillers, boilermakers, sledgers, metal turners; the 11th category was assigned to firers and miners of the highest qualification. No one received the 12th category.

Among the administrative and economic personnel, the 3rd category included sellers, the 4th category - clerks, typists, timekeepers and translators, the 5th category - clerks, statisticians, draftsmen; the 6th category included foremen, cashiers, assistant warehouse managers, accountants; the 7th category included warehouse managers; the 8th and 9th categories included experienced translators; the 10th category was assigned to accountants and the 11th category was awarded to mining technicians. However, the concessionaire did not make a timely transfer of workers from one category to another, due to which conflicts arose. It should also be noted that when hiring workers on the mainland, the concessionaire established a personal category for each worker. Upon arrival at the enterprise, the category was lowered. On the request of the workers to the labor department to clarify this provision and transfer them to the category specified in Vladivostok, they received the answer: "There is no other work, the one we give, work in that one."

In 1927, the monthly salary of an employee of the 1st category was 19.5 rubles, for a hauler of the 6-7 categories 48.5 and 54.6 rubles, respectively, for a miner of the 8-9 categories 60.45 and 68.35, for an underground foreman of the 10th category 81.96 rubles. Thus, the earnings of a slaughterer were 120-140 rubles, the earnings of a hauler were 80-90 rubles.

Wage scale established at the Kita Karafuto Kogyo Kabushiki Kaisha enterprise in 1927

The mandatory number of working days per month was set as follows: (a) All underground miners, excavators and drillers: 20 days per month; (b) Bolters: 22 days per month. (c) All other workers working in the premises 23 days per month; (i) Workers working on surface work with daily wages: 24 days per month.

After the expiration of the one-year collective agreement, its extension in 1927 was unusually difficult due to the demands of the Soviet side to increase the minimum wage and improve working conditions. The new collective agreement was accompanied by a regulation on the price and conflict commission, a qualification reference book and a tariff scale of positions and professions by wage grades, norms and procedures for the supply of food and clothing, rules for the provision of housing and utilities, internal labor regulations, and a table of disciplinary sanctions.

For violation of the Internal Labor Regulations, the following types of disciplinary sanctions could be imposed on an employee: a) Penalty No 1: Issuance of a reprimand (reprimand) with the publication of an announcement in the bodies of the Union or on the notice board of the department; b) Penalty No 2: Issuance of a severe reprimand with the publication of an announcement throughout the mine (mine) and simultaneous official notification of the Mining Committee; c) Penalty No 3: Dismissal from the enterprise (imposed by the administration solely on the basis of the official decision of the Valuation and Conflict Commission).

Classification of violations and penalties

On September 16, 1928, in Khabarovsk, negotiations on the signing of a new collective agreement began between the chairman of the Far Eastern Committee of Coal Miners G.S. Loktev and the representative of the concession company S. Ando, and after 35 rounds of negotiations, on February 22, 1929, a new collective agreement was signed. After its conclusion, the salary at the concession increased slightly. Thus, the average earnings of a miner were 5.93 rubles, a worker at the enterprise 3.83 rubles and an employee 4.06 rubles per day. A similar situation was repeated the next year.

In September 1931, representatives of the concessionaire and representatives of the Miners' Union began new negotiations on the revision of the terms of the collective agreement, which lasted more than 7 months and ended with the signing of a new collective agreement on March 22, 1932. Under its terms, the minimum daily wage remained at the level of the previous two years - 1 ruble 17 kopecks. At the same time, for the restoration of the burnt workers' club, the concession undertook to allocate 50,000 rubles as assistance, and the trade union side also allocated 50,000 rubles for its part. In 1933, the agreement was extended by both parties without negotiations. In April 1934, as a result of negotiations in Vladivostok, an agreement was concluded between a member of the Central Committee of the Union of Coal Industry Workers of the USSR P.I. Karpov and a representative of the concessionaire Ts. Gomamoto to extend the existing collective agreement for another 1 year with minor changes in a number of articles, mainly of a technical nature. On April 1, 1935, a new collective agreement concluded between the Union of Coal Miners of the USSR and Kita Karafuto Kogio Kabushiki Kaisha came into force.

It should be noted that in the second half of the 1920s, the Soviet government decided to financially support workers going to work or moving to the outskirts. On May 11, 1927 and May 26, 1928, the All-Russian Central Executive Committee and the Council of People's Commissars of the USSR issued decrees "On Benefits for Employees of State Institutions and Enterprises in Remote Areas of the USSR" and "On Benefits for Workers Sent to Work in the Kamchatka and Sakhalin Districts, the Okhotsk and Olsky Districts of the Nikolaev District and the Selemdzhinsko-Bureinsky District of the Amur District of the Far Eastern Territory". These decrees established for workers the abolition of income tax and military service, the right to use free timber for personal needs, free hunting and fishing, as well as percentage supplements to wages in the amount of 10% for each year of uninterrupted work experience, with the condition that the total amount of allowances could not exceed 100% of the salary. In the summer of 1930, the Sakhalin Labor Inspectorate tried to extend these decrees to concession enterprises as well. On June 18, 1930, a trustee of the company sent a letter to the mining committee for No 90, in which he indicated the following: "If the interpretation of the resolution given in your letter is approached superficially, without taking into account the comprehensive circumstances, then we can come to the conclusion that in certain cases and to certain workers this decision can be applied at our concession enterprise. On the other hand, if we consider Article 7 of Protocol B of the basic Japanese-Soviet Peking Convention, which is based on our concession, it is clear that the enterprises will not be subject to such taxation as would actually make their profitable exploitation impossible, and that the Doues concession, although it has existed for four years and has no profitability, seems to us to be well known to you and no confirmation is required. Consequently, it would be quite natural to conclude that, as far as the past is concernedlet us leave the question of the future open for the time beingthe Society should be exempt from any taxes or restrictions, not to mention what form or name they will have, in addition to those with which it is already taxed. The Society does not admit the idea that the Government of the U.S.S.R. would wish to take a one-sided position on the path of belittling certain principles provided for in the Japanese-Soviet Convention or to ignore this Convention to any extent, since such a state of affairs would naturally affect the international confidence in the U.S.S.R., and, on the other hand, would especially undermine faith in the Japanese-Soviet friendly rapprochement, and since the Government of the U.S.S.R. has no intention of violating the concluded treaty, it is quite understandable and would like to believe that, in accordance with the spirit of the above-mentioned Convention, it will not allow our Concession Society, recommended by the Japanese Government, to be overburdened with unbearable taxes that could lead to a complete collapse. Thus, we are deeply convinced that for this reason alone, not to mention others, this decree on % surcharges is not applicable to the Company. If the Rudkom demands the application of this resolution at all costs, then, recognizing this question as very important and of a fundamental nature, the Society finds it necessary to submit it by diplomatic means for the resolution of the Center."

On August 6, 1930, the secretary of the special commission for the supervision of concessions, Uralsky, sent the following document to the coal enterprise: "The Commission received a statement from the District Labor Inspectorate about the refusal of the concession to pay 10% of the preferential allowance to the workers of your enterprise, in accordance with the decree of the Central Executive Committee and the Council of People's Commissars of the USSR of 11/V-27, and of 26/V-28 Concession enterprises, with the exception of persons who do not belong to the number of citizens of the USSR, if they are brought to work from abroad, and also that the question of a 10% surcharge has already been considered in relation to the Oil Concession KKCKK /Okha/, and in this case the center has resolved the issue in the plane of the obligation for the concession of this payment, - the Special Commission proposes that you immediately make a calculation for the payment of a 10% surcharge to the employees of the concession who are eligible for the action of Clause I of the Decree of the Central Executive Committee and the Council of People's Commissars. I ask you to urgently notify the Special Commission about the following."

On August 9, the company replied to the special commission: "As far as our concession enterprise is concerned, the latter categorically cannot admit that it is obliged to pay preferential allowances... On July 16 of this year, our head office in Tokyo referred the solution of the issue to the Main Concession Committee in Moscow... .

On August 28, 1930, a telegram came from the Main Concession Society that the decree of May 26, 1928 applied to the enterprises of the concessionaire, this decision was final and reasoned and would not be considered in view of the indisputable nature of the issue.

However, in the resolution of May 26, 1928, there was a legal loophole in the form of a note to the first article of the resolution, which directly stated that the benefits did not apply to workers hired in the form of collective recruitment. Thanks to this, the concessionaire was able to deny benefits to workers sent to him by the labor exchanges of Khabarovsk and Vladivostok. As for the workers hired for the concession individually, there were very few of them and they did not affect the financial costs of the concession.

Meanwhile, on August 12, 1930, the Central Executive Committee and the Council of People's Commissars of the USSR adopted Resolution No 42/2046 "Regulations on Benefits for Persons Working in Remote Areas of the USSR and Outside Large Urban Settlements". It canceled the 1927-28 Resolutions on Benefits, and with them disappeared the benefits for free material benefits in the form of hunting, fishing, and free timber. But income tax and military service returned to the island. But the obligation of employers to pay wage supplements migrated to the new Decree. And now it applied to employees of concession enterprises in Northern Sakhalin, with the exception of foreign workers.

On July 23, 1931, the Japanese Embassy in Moscow addressed the People's Commissariat for Foreign Affairs of the USSR with the following note: "The Far Eastern Regional Committee of the Trade Union of Miners informed the Japanese concessionaires on Sakhalin that the decree of the Central Executive Committee and the Council of People's Commissars of the USSR of August 12, 1930 also applies to workers at concession enterprises on Sakhalin. The Japanese Government is of the opinion that the application of the said decree to Japanese concession enterprises contradicts the provisions of paragraph 7 of Protocol B annexed to the Convention on Basic Principles of Relations between Japan and the USSR, on the following grounds:

1. If the said decree is also applied to persons employed by the Japanese concession enterprises on Sakhalin, Soviet, Chinese, and Korean workers employed by the above-mentioned enterprises, other than those of Japan, will enjoy privileges during the period before the coming into force of this decree, which imposes unforeseen obligations on the Japanese concession enterprises. In the opinion of the Kita Karafuto Kogyo Kabushiki Kaisha Joint Stock Company, the expenses which it has to bear in connection with the application of the said decree amount to enormous sums. As these expenses will increase from year to year, the Society, both now and in the future, cannot have any advantage whatsoever if it has to bear such heavy obligations. The application of this decree thus deprives the Society of the possibility of profitably operating its enterprise.
2. Further, this provision on privileges establishes discrimination between Soviet and foreign citizens and will upset the unified management of employees carried out by the Society, as a result of which concession enterprises will be deprived of the possibility of proper conduct of business. Such discrimination between Soviet and foreign citizens is established precisely by the instruction of the NCT of November 1, 1930, issued in the development of the above-mentioned provision, according to which Japanese workers working at the present time and Japanese, Chinese and Korean workers hired in the future do not enjoy benefits at all. In practice, this will inevitably cause discontent among workers who do not enjoy benefits, which naturally prevents the management of workers in concession enterprises, and will be an obstacle to the normal operation of the enterprise. In order to remove such an obstacle, the concession company will have to give employees who do not enjoy benefits with appropriate benefits. However, it goes without saying that the material condition of the Society does not allow it to bear such a burden. It remains, therefore, for the Society to refuse to employ such workers. Thus the above provision may be regarded as excluding foreign workers, and having the object of replacing them with Soviet workers. Concession enterprises, for which it is necessary to have Japanese, cannot carry on their activities under such circumstances.
3. As can be seen from the history of the establishment of this provision and its contents, its purpose is to encourage the entry into earnings for the development of industry in remote parts of the U.S.S.R. If there is a reason why the obligations arising from this provision should be imposed on state bodies, enterprises, institutions and public organizations under full material protection, it is by no means fair that such a provision, which has the special purpose of encouraging earnings, should apply to Japanese concession enterprises and thereby force them to bear very heavy obligations, as a result of which they will be unable to carry out profitable operation.
4. As is known, Japanese concession enterprises are not simple, but are based on the Peking Convention concluded between Japan and the USSR. It goes without saying that when applying any laws to Japanese concession enterprises, the Soviet Union must first of all and fully take into account the provisions of paragraph 7 of Protocol B annexed to the said Convention. As can be seen from the above considerations, the application of such a special law as the provision on privileges serves to gradually oppress enterprises and to impede their profitable operation, which ultimately deprives them of the opportunity to carry out their activities. In view of this, it is impossible not to regard the application of this provision to concession enterprises as a clear violation of the provisions of paragraph 7 of Protocol B annexed to the Peking Convention.

In bringing to the attention of the People's Commissariat for Foreign Affairs the foregoing, the Japanese Embassy has the honour to request that it take urgent measures to ensure that the above-mentioned provision on privileges, which is contrary to the provisions of the Peking Convention, is not extended to the Japanese concession enterprises."

As a follow-up to this Regulation, the People's Commissariat of Labor (CNT of the USSR) issued a special normative act on November 1, 1930, the "Rules on Benefits for Persons Working in Remote Areas and Outside Large Urban Settlements" (Instruction No 338). It was in these Rules (and the accompanying circulars of the CNT) that it was clearly stated that workers recruited as part of mass economic recruitment (collective recruitment) for seasonal, peat, or construction work were not automatically entitled to general civil "northern" and "remote" benefits. Their rights and compensations were still spelled out separately in standard collective agreements with economic bodies. Thus, the legal approach of the state remained unchanged: the law still cut off mass unskilled forces from expensive benefits, but in the Regulations of 1930 this norm was transferred from the introductory article of the general law to special instructions of the People's Commissariat of Labor.

In the meantime, the accounting department of the company made calculations and determined that for 9 years of operation of the Duisky mine, from 1927 to 1936, the employees of the enterprise would be paid only percentage bonuses in the amount of 1015755 rubles. Therefore, the Japanese administration, without further ado, began to conclude labor contracts with employees for a period of 1 year. Everything was logical here. For the first year of work, no allowances were paid. And for the second and subsequent years of work, an employment contract was not signed with the worker, but a new one was hired, who had not yet "earned" the allowances. As a result, the concession lost experienced workers from among Soviet citizens. Japanese and Chinese citizens did not receive allowances, so the concessionaire did not make any attempts to "oust" them from the enterprise.

It should be noted that on November 1, 1930, the People's Commissariat of Labor (CNT of the USSR) issued a special normative act, "Rules on Benefits for Persons Working in Remote Areas and Outside Large Urban Settlements" (Instruction No 338). It was in these Rules (and the accompanying circulars of the CNT) that it was clearly stated that workers recruited as part of mass economic recruitment (collective recruitment) for seasonal, peat or construction work were not automatically entitled to civil "northern" and "remote" benefits. Their rights and compensations were still spelled out separately in standard collective agreements with economic bodies. Thus, the legal approach of the state remained unchanged: the law still cut off mass unskilled forces from expensive benefits, but in the Regulations of 1930 this norm was transferred from the introductory article of the general law to special instructions of the People's Commissariat of Labor.

Since the employment of workers at the endowment enterprises was carried out in an organized (group) manner, on the basis of Article 9 of the Decree of the CNT of November 1, 1930, the conditions for granting benefits were to be regulated by a separate decree.

In the Japanese archival documents there is a copy of the collective agreement signed on August 26, 1930 in Khabarovsk by representatives of the Far Eastern Regional Committee of the Union of Miners of the USSR I.T. Glavatsky and P.G. Lomakin and the representative of the society "Kita Karafuto Kogio Kabushiki Kaisha" Ozawa Ninosuke. According to it, in 1930/31 the tariff rates of the categories were set according to the following wage scale:

TABLE XVII

Tariff scale established at the Kita Karafuto Kogio Kabushiki Kaisha enterprise in 1930

For all underground tunnelers, miners and drillers, 20 working days per month were established, for bolters 22 days, for other underground workers - 23 working days. It should be noted that after 3 years, the number of working days for underground workers was reduced, and at the same time there was a significant increase in wages, which can be seen from the table below.

TABLE XVIII

Concession wages for 1933 (excluding Japanese workers)

At all jobs, piecework payment was provided, and where this was not possible, time-based wages. The minimum average daily wage was 3 rubles, the average for the enterprise was 4.74 rubles. A 6-hour working day was established for underground work, workers on the surface and employees worked 8 hours a day. For overtime work, an allowance of 50% was established for the first 2 hours of overtime work and 100% for subsequent hours.

In the documents stored in the former party archive of the Sakhalin Region, there is information that in 1934 the average monthly salary of a miner was 150 rubles, a hauler - 80, a locksmith - 70, and a surface worker - 50 rubles. For comparison, let us say that the earnings of a hauler in Soviet mines at that time were about 360 rubles per month. The labor inspectorate noted that the concessionaire systematically reduced wages, due to the lack of fixed rates and firmly established rates for piecework. The concessionaire maneuvered payment by piece, chord and daily, and the results of these "maneuvers" were always in favor of the concessionaire. For example, if in the concessionaire's opinion, the workers' earnings were excessively high during piecework, they were transferred to daily surface work. After a while, the concessionaire offered the workers to return to the "piecework", but on different terms, with lower pay.

However, the Far Eastern researcher N.V. Maryasova notes that it is impossible to accurately determine the real and nominal amount of wages due to the fact that foreign citizens received part of their earnings upon returning to their homeland, and in the reports of the Soviet and concession supervisory bodies there is a clear tendency to underestimate it, which also applied to domestic workers. For example, in 1927, the representative of the People's Commissariat for Foreign Affairs in Northern Sakhalin, V. Aboltin, reported to the center: "Although I am sending you data, I would not advise you to use it, since they hardly give a real picture. For example, Chuprikov (chairman of the Regional Trade Union Committee) himself admits that only a group of Chinese unskilled workers was taken to Douai to derive the average wage. Therefore, it is impossible to derive the average wage and compare it with other mines, as is done in the reports. The figures do not reveal the actual earnings at all, since the supply of concession workers with consumer goods relatively cheaply is not taken into account, which significantly increases their wages in comparison with the komkhoz, etc."

According to the collective agreement, the Company undertook to supply employees with good-quality food and consumer goods in the amount and at prices as shown in the table below.

TABLE XIX

Commodity products and clothing allowance purchased by the concession workers at the rates and prices established by the collective agreement for 1930.

Clothing allowance

In addition to the above-mentioned norms, the Company provided employees of Eastern nationalities with the following commodity products and consumer goods: a) workers of Japanese nationality were entitled to 20 kg of rice, 1 3/4 kg of soybeans, 2 kg of beans, as well as 2 pairs per year of three types of national Japanese shoes (tobi, geta and takajo);

b) workers of Chinese and Korean nationality were entitled to 20 kg of rice, 1 1/2 kg of soybeans, 4 kg of beans, 200 grams of garlic, and 3 pairs of shoes and one summer and one winter national costume per month.

In 1934, the employees of the concession could buy goods in the company's store in the amount of 81.98 rubles, adult members of the employee's family 55 rubles, children under 2 years old 11.36 rubles, from 2 to 8 years old 21.93 rubles, from 8 to 18 years old 20.22 rubles.

As for the supply, it should be noted that in the second half of the 1920s there were interruptions all the time and there was a shortage of certain goods. In 1927, the main interruptions were observed in the supply of meat, which, from early spring to the 25th day of August, was issued 2-3 times a week in insufficient quantities and not everyone had enough of it. There were always queues near the butcher's shop, and part of the queue left with nothing. For example, on July 27, 1927, more than half of the mine workers were left without meat, the next sale of which was only on August 1-2. There were systematic interruptions in the supply of vegetables used by Russian workers, there were no pork lard, fish, herring, caviar, etc.

The supply system was quite complex, so if a worker needed to get a particular product, then he had to spend 3-4 hours for this: in order for a worker to buy six items, you need to take six coupons and stand in line at six cash registers.

The workers' settlement stretched along the Dui valley for 2 versts. The trading shop was located at the end of the village where the administration lived. This situation forced the workers to carry food for 2 versts on their backs, making 4 versts back and forth to buy something. Since the workers ate in cooperatives of up to 50 people, they had to carry food weighing up to 60 poods weekly, which was extremely inconvenient for them. The administration, consisting exclusively of Japanese, could not properly take into account the needs of European workers. In order to change the situation, on November 10, 1927, an employee of the office, A.F. Frank, was seconded to the material department of the concession, who tried to take into account the needs and requirements of Soviet workers in food requests.

For example, in the summer of 1929, the concessionaire intended to bring up to 300 heads of cattle from Korea to Sakhalin in order to provide the workers with fresh meat. However, this delivery could be carried out no earlier than the middle of August, and therefore on June 5, 1929, the representatives of the society raised before the representatives of the Union of Miners the question of reducing the monthly norm of supplying workers with meat to 4 kg, and to replace the rest with corned beef and dried meat, which was available in sufficient quantities. As a result, 200 heads of cattle were brought in during the navigation of 1929, which arrived in an exhausted state, and after slaughter the meat turned out to be of poor quality.

In 1930, the problems with the supply of workers with commodity products continued to grow. On March 3, 1930, the concessionaire announced that in March and until April 15 there would be no fresh meat, and the society proposed to issue canned meat only to workers in the amount of 5 kilos underground and 4 kilos to the rest of the workers, the families of workers were deprived of canned meat altogether. The society also announced the need to reduce the issuance of cow butter, which was running out. Canned milk was relied on 6 cans for a child under 8 years old, and from March 1, the society began to issue canned milk only to children under 2 years old and only 4 cans. Salted fish was not on sale at all. However, as compensation, the concessionaire proposed to increase the issuance of sugar by 500 grams per person and lard by 1 kilo per underground worker.

Rudkom suggested that the regulatory authorities urgently bring the concessionaire to justice and allow the workers to absentee themselves from work at the expense of the concessionaire, using Article 5 of the collective agreement; the workers suffered from malnutrition from exhaustion, which could lead to various diseases, especially since there was an outbreak of typhoid fever at the concession.

The chairman of the Rudkom wrote: "It should be taken into account that for every kilogram of meat not given to the worker, the concessionaire puts more than 2 rubles in his pocket (there are more than 2000 eaters), since 1 kilogram of meat costs the concessionaire more than 3 rubles. In our opinion, the fear of the Okrug Party Bureau that the local Sakhalin authorities will be to blame for the lack of meat from the concessionaire is completely unfounded, since as early as July 1929 the society knew that it had been denied the procurement of meat both on the DCK market and on Sakhalin, and it told us that it would take measures to provide the mine with meat through the Japanese market (see copy of the minutes of negotiations No 39 of July 5, 29). In conclusion, I inform you that the mood of the workers, if they learn about the proposals of the society, may result in a strike. They did not have time to inform the workers."

In the opinion of local party and economic bodies, in the matter of supply, the concessionaire pursued a policy of systematically reducing the import of essential goods and food and increasing the import of luxury goods and perfumes.

For example, in 1927 the concessionaire submitted an application for the import of leather bags, watches, postcards, wristwatch straps, watch chains, wallets, stationery, drawing tools, drawing paper, etc.

And if in 1928 goods worth 800 thousand rubles were imported from Japan for the concession, then in 1930 the delivery of goods amounted to 1200 thousand rubles.

Japanese archival documents give a slightly different breakdown of the amounts spent on the purchase and delivery of products and goods for concession.

TABLE XXX

The expenses of Kita Karafuto Kogyo Kabushiki Kaisha for the purchase of essential goods, wages to employees, share deductions to the Soviet side and tax payments.

"The trading talent of the Japanese is reflected in the diverse selection of the imported assortment. Respect for the goods. The size of the room helps to hide the constant crowd of buyers-workers, caused by the incredibly complex procedure for controlling the pick-up books, which exceeds the patience of the Soviet consumer... A set of products in concession stores is 30 rubles. This set fully meets the food standards, but is sold according to the pick-up books under strictly strict control. You can't buy anything over it. And with the high cost of the Sakhalin free market, the rest of the earnings of the concession worker does not give him any opportunity to replenish his table and somehow improve his life at the expense of purchases on the side," P. Sletov wrote about the concessionaire's trade.

At the same time, a terrible food crisis broke out in Northern Sakhalin. All stocks of flour were reserved. But even in this case, "the monthly norm per eater was 800 g of bread, 850 g of sugar, 1 kg of fat, 1.9 kg of cereals, 330 g of pasta, 2 kg of corned beef, 100 g of tea." However, fish and venison saved ...

The same butter, which was not available on the island, and in the stores of the European part of the country it was sold for 50 rubles per kilogram, was sold at the concession for 1.90 rubles per kilo. So the workers of the concession enterprises, with their norms of supply with cheap Japanese goods, had to feel "like under communism".

In the first half of the 1930s, supply issues became the main cause of friction between the coal concession enterprise and the administration of the West Sakhalin Mining District (UZSGO), since according to the concession agreement, the prices for goods received from abroad were approved by the head of the mining district. He also signed a permit to the Soviet trade mission in Japan to deliver a certain amount and names of commodity products and clothing allowances for the concession.

Immediately after the conclusion of the concession agreement, the head of the Sakhalin Mining District asked the concessionaire to provide a detailed inventory of the goods in the company's warehouse, and then insistently asked to provide him with two copies of documents on the supply of food and industrial goods imported from Japan, as well as an application form for approval of prices for the goods received. The company told the mining district that since the first collective agreement had already agreed on the sale price of essential goods, according to Article 17 of the concession agreement, there was no need to submit a list of supplies for goods that were not essential goods for the approval of the head of the mining district, and the concession rejected this wish. However, the Soviet side continued to demand that the concessionaire submit such a list, stating that Article 17 of the contract applied not only to essential goods, but to absolutely all import supplies. A threat was made that if the information was not submitted by the concessionaire, the mining district would prohibit the sale of goods to the employees of the concession. Therefore, the concession had no choice but to submit detailed reports to the mining district.

However, at that time, the management of the Mining District approved the amount of imported goods on the basis of the data provided by the company (including prices), and since this did not have much impact on the work of the company, the concession continued to submit lists of goods imported to Sakhalin to the Mining District Administration every year.

Starting from 1928, the procedure for submitting applications gradually changed, now concession companies had to submit applications to the North Sakhalin Mining District for the annual volume of goods in advance, and then the Trade Mission of the USSR in Japan checked the submitted applications on the basis of its schedule. Moreover, the Trade Mission in Tokyo began to strictly require the presentation of purchase certificates to check invoices (waybills), as a result of which it became impossible for the Japanese to arbitrarily add markups to the cost of goods.

The reason for this kind of change was the fact that in the summer of 1928 the Soviet organization "Gostorg" purchased wheat flour in Japan. It turned out that the price of this purchase was much lower than the price that the Japanese coal concession indicated in its calculations when applying for a revision of the cost of supply. The Sakhalin Mining District expressed suspicions and began to check the real purchase prices of the concession through Soviet trade officials, and also sent an official request to the commercial representative to clarify the facts.

The company accepted the Mining District's request and submitted documents on the estimated number of workers and their family members, as well as the distribution standard, as estimated information for the goods for which it applied for import. Until the 1930 fiscal year, the company received approval to import food and industrial goods without any problems.

In February 1931, a trustee of the society in a letter to the head of the UZSGO drew attention to the fact that "a particularly striking thing and runs like a red thread through all correspondence about the delivery of commodity products is the restriction of the import of those items that are vital consumer items for the Easterners, from the point of view of their customs and entertainment. The Society hopes that the UZSGO will not refuse the courtesy to consider our request again in the sense of lifting the restriction or prohibition of importation, and in addition, will take into account that sake, whiskey and wine, which you have also banned from import, are absolutely necessary not only in the sense of items necessary for medicinal purposes, but at the same time these drinks, especially sake, are consumed not only for the taste of the Japanese table, but are not yet replaceable both from a religious point of view and according to the traditions of Japanese custom in certain occasions of Japanese life (New Year, funerals, religious rites, illness, etc.) . The boss did not give the "go-ahead" for the delivery of sake and whiskey, but it is known for sure that the Japanese workers used part of the ration of white rice given to them to make homemade sake. In this they did not differ from the Soviet workers, who were also very good at distilling moonshine from wheat or potatoes obtained at the concession.

Beginning in the autumn of 1931, the mining district required the concession to report on the estimated wages and stock levels at the end of the navigation period, and changed its previous attitude toward approving the company's applications for the import of goods. Since the total volume of goods imported by the company exceeded the total wages paid to employees, the Soviets reduced the number of goods submitted in import applications, removing many of the items and, as the concessionaire wrote, "this obstructionist attitude continued from year to year, causing further problems in the performance of the company's work."

On June 19, 1933, the People's Commissariat of Heavy Industry of the USSR sent I.K. Leonhardt, who was also a special representative of the People's Commissariat of Political Affairs, to the post of head of the UZSGO. HE WAS GIVEN THE RIGHT TO RESOLVE ALL CURRENT ISSUES OF MUTUAL FULFILLMENT OF THE CONCESSION AGREEMENT BY THE PARTIES AND TO NEGOTIATE WITH REPRESENTATIVES OF THE CONCESSION COMPANY ON ALL EMERGING ISSUES. In fact, the old-school Bolshevik was sent to Sakhalin to "rake the Augean stables" left by his predecessors. With the appointment of the special commissioner, there was no need for a special commission to supervise concessions, which was disbanded in July 1933.

Ivan Kondratievich began his activity quite briskly and precisely with the issues of supply. On July 26, 1933, he wrote to a trustee of the Society: "Your commissioner F. Baba was promised to provide information in yen for the approval of prices for commodity products. Please speed up the sending of this data."

On July 29, the company in its response for No 80 indicated that "we provide you with calculation sheets for the approval of prices and the company cannot provide you with anything else."

"In this case," wrote I. Leonhardt on August 17, 1933, "I am forced to use the only source available to me when approving prices, the Cargo List, which you submit to our trade mission in Tokyo, indicating the value of CIF Sakhalin goods in yen. Thus, the prices for goods exported from the ship "TSURUGI-SAN-MARU" are approved by me in the following order: the cost of CIF Sakhalin goods in yen is based on the price indicated in the cargo list, to this value is added a % surcharge on trade expenses in yen, these two components make up the full trade value in yen. In order to determine the selling price of commodity products in chervon calculation, the yen is recalculated at the official exchange rate announced in the newspaper "Izvestia" by the Central Executive Committee and the Council of People's Commissars of the USSR on the day of sale of these goods...

And then it became clear that the newly minted head of the mining district stepped on the "most sore callus" of the Japanese. In a response letter dated August 19, Gomamoto's confidant of the company, Tsutaichi, wrote that "such a decision is absolutely unacceptable for the Society for the clearest and simplest reason, namely, that it in its essence directly threatens the Society with the impossibility of the further existence of the enterprise, not to mention its profitable exploitation."

It was precisely the exchange rate of the yen against the ruble. In 1925, at the official exchange rate introduced at that time, 1 yen was equal to 79 chervon kopecks. After the initialing of concession agreements, disagreements arose between the Soviet and Japanese sides over payment for concessions. In an attempt to control financial transactions in order to prevent the fall in the value of the ruble in the Far Eastern region, the Soviet side tried to change the provision that the transfer and conversion of funds could be carried out either through the Soviet State Bank or through a branch of a foreign bank (i.e., the Vladivostok branch of the Bank of Korea), and to limit all operations to the Soviet State Bank. As a result, when importing goods from Japan, companies began to face the problem of converting the Japanese and Russian currencies, which put them at a disadvantage. The Japanese regarded this as discrimination against concessionaires and accused the Russians of bad faith. In the end, a compromise was reached: the main part of the treaty was amended in accordance with Soviet demands, but a memorandum was made public in which the Main Concession Committee stated that concessionaires could use the services of the Bank of Korea as long as it continued to carry out money transfers and exchange rubles (a right that the Soviet government could revoke if it felt that the value of the currency was threatened). It should be noted that in 1928 the Japanese concessions in Northern Sakhalin sold goods to local workers based on the Japanese yen exchange rate of 87.7 sen per ruble until September and 89.4 sen from October of the same year, and this rate was 34% higher than the rate of the State Bank.

It should be noted that the Japanese government, through the Ministry of Foreign Affairs, helped Japanese concession enterprises in Northern Sakhalin transfer large sums of money (tens of thousands of yen and rubles) to Aleksandrovsk, using a diplomatic cipher to avoid control or interference by the Soviet authorities. The standard volume of transactions was 50,000 yen, transfers were made from 1 to 3 times a month.

It should also be borne in mind that the course of forced industrialization announced at the XIV Congress of the All-Union Communist Party (Bolsheviks) on December 18, 1925 led the USSR to an economic and financial crisis. The lack of budget funds for capital investments in the construction of new plants and factories was compensated by increasing retail prices and emission. In 1928-1932, the volume of money supply increased fivefold. Consumer goods disappeared from stores where they were sold at state fixed prices. The standard of living of the population decreased.

In a secret telegram No 103 dated May 31, 1930 addressed to the Minister of Foreign Affairs of Japan Shidehara Kijuro, the Consul General in Alexandrovsk, Sasaki Seigo, wrote: "The Russian foreign exchange market is falling from year to year, and the current "chervonets" is now not much different from the Russian currency at the beginning of the First World War... People complain about the lack of food, clothing and supplies, they are almost starving...

Meanwhile, the "currency crisis" was gaining momentum. On September 12, 1930, the Far Eastern Regional Finance Department introduced a ban on the free purchase and sale of Soviet rubles by Chosen Bank. On September 16, 1930, the concession manager telegraphed to the Japanese Foreign Ministry that since the purchase and sale of cash currency was prohibited by the Soviet authorities, there were great fears of the cessation of work of the hired Chinese, because it was no longer possible to pay them in yen, and they did not want to take Soviet banknotes as payment.

On February 17, 1931, the Vladivostok branch of Chosen Bank received an order from the Finance Department of the Far Eastern Executive Committee to draw up reports for the liquidation of its activities within 3 months. In addition, the bank received an order to immediately pay an additional tax in the amount of 2,610,000 rubles to the treasury. In March, the branch of the Korean Chosen Bank in the USSR was closed, on May 25 the bank completed the preparation of reports, and its final liquidation on the territory of the Soviet Union took place on July 15, 1931.

In mid-May 1931, a letter from their compatriots in Vladivostok circulated among the Chinese workers in the city of Alexandrovsk. It stated that in mid-June the Japanese consulates in Khabarovsk, Vladivostok and here (in Alexandrovsk) would be closed and the staff would be evacuated. The letter said that those who decided to return to their homeland now would be granted visa privileges. In addition, it was stated that bachelors could exchange up to 250 rubles, and families - up to 800 rubles at the official exchange rate. However, after July, there would allegedly be no legal ways to return home. Against the background of the instability caused by the recent incident with the "Chosen Bank", this news caused a huge "sensation" among the local Chinese. On May 23, 1931, about 200 Chinese workers submitted a letter of resignation to the concession office and leave for China. Although company workers were legally allowed to transfer a quarter of their monthly salary abroad if they had worked for six months or more, this was not easy due to a lack of foreign currency. However, other workers did not have this privilege, and apparently resorted to illegal means to send their money to Harbin and pay their bills there. Those returning home (crossing the border) were allowed to send up to 75 rubles if they were in the country for six months or more, but in fact the amount allowed was only about 10-20 rubles.

After the investigation, the Consulate General of Japan in Vladivostok sent the following message to the coal concession: "I ask you to convey the following to the said company: such rumors about the closure of the consulate in Vladivostok are completely unheard. This is an obvious and baseless lie, probably fabricated by someone deliberately for propaganda purposes. Just in case, we made inquiries at the Chinese Consulate General. They are extremely surprised by these ridiculous rumors. If we try to find an explanation for them, then perhaps this is distorted information about the recent announcement of the Chinese consulate: all Chinese citizens were ordered to register by the end of April, and those who did not do so were promised fines. Probably, this fact was misinterpreted and turned into a false rumor."

The Consul General of Japan in Khabarovsk, Konayagi, also sent a message to Aleksandrovsk with the results of his investigation: "On May 26, I visited the Deputy Consul General of China. During the conversation on this issue, the deputy said that rumors about the closure of the Chinese consulate or the mass return of workers to their homeland with some "special benefits" are absolutely groundless and ridiculous. However, he noted the following important facts: 1. The number of Chinese who want to leave the country is really growing. This is caused by a threat to their standard of living: due to the harsh financial situation in the USSR, permits for transferring money have been reduced to 1/10 of the previous amounts, and even these crumbs are extremely difficult to get. 2. The inability to send money to families in Shandong deprives work in the USSR of any meaning. In addition, the promotion of "state farms" and "collective farms" within the framework of the five-year plan led to an acute shortage of goods and a sharp jump in prices. 3. Despite rumors, there are no signs that the Soviet authorities are deliberately oppressing Chinese workers or forcibly deporting them. There are also no signs of panic among the Chinese population in Khabarovsk itself." It is clear from these reports that the Chinese population intended to leave the territory of the USSR mainly for economic reasons, and the "sweeping message" served only as a catalyst.

After the termination of the Chosen Bank, Japanese concessions could no longer transfer yen into rubles at the market rate. And if the market price of the ruble in the Chosen Bank in 1927 was 82.9 sen, in 1928 - 53.2 sen, in 1929 - 35.3 sen, in 1930 - 25.7 sen, then the "official" value of the yen in the State Bank of the USSR in 1930 was 1.1 yen per 1 ruble. Thus, the official exchange rate of the ruble exceeded the market rate by 4 times. Since the exchange of rubles for gold in the USSR was completely stopped, confidence in the Soviet currency in the international market was completely lost due to the colossal deficit of the foreign trade balance. Foreign banks categorically refused to accept Soviet chervonets, and within the country there was an uncontrolled issue of government bonds and paper money. As a result, in 1932, on the so-called "black market", the value of the ruble dropped to 6-7 sen.

As a result, in the conditions of transition from the market economy of the NEP to the administrative-command planned economy, the chervonets turned from a bank note into an unsecured Soviet banknote, supported within the country by administrative measures. The Japanese concessionaires themselves stated that "Soviet paper money in its current state has lost all confidence not only in the international arena, but also within the Soviet Union itself. In fact, it has turned into only a semblance of labor coupons or stamps that have a purely local circulation. Thus, it should be recognized as quite obvious that the Soviet ruble has completely lost the fundamental properties and characteristics inherent in the full-fledged currency of capitalist states. This true state of affairs is well known to the Soviet government itself.

The Soviet press, including magazines such as Proletarskoye Iskusstvo, is filled with propaganda slogans about the superiority of socialism. In fact, the state is squeezing all its strength out of the population to serve the party apparatus and implement heavy industrialization. The standard of living of ordinary citizens is steadily declining, and the atmosphere of general suspicion and fear deprives people of hope for an improvement in the situation. Illusions about a socialist paradise are dissipating, giving way to the harsh reality of the daily struggle for survival... In the present situation, individual well-being and happiness are completely sacrificed. The high-flown slogans of a "proletarian state" and a "happy life" fade against the background of the fact that the standard of living of the population has fallen enormously in comparison with capitalist countries.

Under these conditions, the position of the Soviet government, which compels us to exchange at an official fixed rate the full-fledged Japanese yen, which has international value, for scraps of paper that have completely lost the properties of a currency, is absolutely illogical and illegitimate. Any foreign concession enterprise based on the capitalist principles of economics, conducting commercial calculations and operating under conditions of competition, is physically incapable of continuing its activities under the yoke of the specific Soviet legal and economic system, which denies the very existence of capitalist enterprise, unless it receives economic or other strong support from the government of its own country. The mass curtailment of activities and the suspension of the work of almost all foreign concessions on the territory of the USSR in recent years serves as irrefutable practical proof of this.

The only reason why our enterprise has been able to continue production activities until now, despite these hard labor conditions and unfavorable factors, was the possibility of economically profitable acquisition of Soviet currency, which made it possible to compensate for and regulate the rapid increase in the cost of production. During 1930, the average basic daily wage of a Soviet worker in the mines of our company (without taking into account the difference in exchange rates) was several times higher than the wages of miners employed in coal mines inside Japan. Moreover, in addition to this direct cash payment, Soviet workers at our enterprises enjoy numerous additional benefits, social guarantees and privileges. As a result, their real (actual) wages turn out to be colossally high in comparison with Japanese workers. It is quite obvious that if such a high wage is paid in full-fledged Japanese currency, converted into rubles at the extortionate official rate, it becomes physically impossible to conduct a profitable business. The nominal wage rate of a Soviet miner on Sakhalin (3.80 rubles) is more than twice as high as the average wage of a Japanese miner (1.74 yen). Forced recalculation of this amount at the official parity rate (1 ruble = 2.25 yen) turns 3.80 rubles into 8 yen 55 sen for one day of work, which makes coal mining absolutely unprofitable. It is for this reason that in the official appeals of our company the critical need to fix the real ratio of the value of currencies at the level of no more than 30 sen to one Soviet ruble."

A.A. Troyanovsky

K. Shidehara

In connection with the ban on the free sale and purchase of ruble currency by agreement with the Soviet side (agreement between the Minister of Foreign Affairs of Japan K. Shidehara and the plenipotentiary representative of the USSR in Japan A.A. Troyanovsky of April 26, 1931), the fishing concessions of Japan were allowed to purchase bonds of the Kamchatka Joint-Stock Company at the rate of 32.5 sen per 1 ruble and subsequently use them to pay off various payments. However, the Russian side demanded that about 2 million rubles of royalties, various taxes, wages, etc., be paid by the oil and coal concessions in Northern Sakhalin at the official exchange rate of 1 yen 4 sen per 1 ruble. The concessions of Northern Sakhalin required the possibility, by analogy with fishing concessions, to purchase shares of the ASO company and pay with them for all payments. However, the Soviet side did not even consider this idea.

Then, on May 28, 1931, Consul General S. Sasaki telegraphed to Japanese Foreign Minister Shidehara about a new scheme for obtaining Soviet currency in a semi-legal way: "The conditions for the payment of wages to Chinese workers hired by the North Sakhalin Mining (Coal) Company in Douai (the situation is similar in Aleksandrovsk) are difficult, probably due to the lack of ways to transfer funds abroad, as in Vladivostok and Khabarovsk.

If the Chinese are allowed to buy up the bonds of the AKO (Kamchatka Joint-Stock Company) in Vladivostok and then send them to Japan through Japanese merchants or by the Chinese themselves, the Chinese workers will not demand a price higher than the usual market rate. Thanks to this method, the official rate of more than 32 sen per ruble established by an intergovernmental agreement will be immediately undermined in our free market.

If the Main Directorate of the North Sakhalin Mining Company buys AKO bonds inside Japan, brings them back to Douai and resells them to Chinese workers, then, on the one hand, this will make it possible to keep Chinese workers in the fields, and on the other hand, the company itself will be able to legally receive Soviet currency."

Naturally, the currency crisis directly threatened the concession enterprises in Northern Sakhalin. At the end of 1931. The Japanese Consul General wrote to the Japanese Foreign Ministry: "The receipt by the Soviet Union of yen at the official rate has recently become more and more obvious, and this trend, combined with the payment of payments to the Soviet side in foreign currency, will intensify in the future. In the current working conditions, we must pay wages, vacations of workers, the cost of hiring labor and the purchase of local materials. It is necessary to pay the costs of concluding contracts, various insurance premiums, contributions to trade unions, public fees and other expenses in the amount of about 700,000 rubles a year (according to the estimate, 200,000 yen, based on the market rate of the yen). Thus, the cost of the concession project will increase by more than 500,000, and it will fall into the category of unprofitable."

Payments in Russian currency "Kita Karafuto Kogio Kabushiki Kaisha".

(Period: from April 1929 to March 1930, assuming an annual coal production of 120,000 tons, the funds required for the year in Russian currency are distributed as follows.)

According to this table, the net amount of payments in Russian currency was 696,000 rubles. If earlier this amount was covered at the market rate at the rate of 40 sen per 1 ruble (which was 208951 yen), then in the event of a transition to the official Soviet exchange rate, the costs would amount to 731101 yen (at the rate of 1 yen 5 sen per 1 ruble). Thus, the costs of society in the 1931-1932 fiscal year would have increased by 522,150 yen only due to the difference between the official and market exchange rates of the yen! And this is not counting fines, compensations, legal costs and other unforeseen fees and payments.

From January 1928 to mid-December 1931, the Japanese yen exchange rate in the State Bank of the USSR was stable, fluctuating from 94 to 96 kopecks per yen. But already on December 14, 1931, it fell to 79.65 kopecks per 1 yen, and on December 31 it collapsed to 68.06 kopecks per yen. This was explained by the fact that on December 13, 1931, the Japanese government resigned and the cabinet of Inukai Tsuyoshi came to power, which immediately imposed an embargo on the export of gold from Japan and abandoned the gold standard of the Japanese yen, which led to a sharp weakening of the national currency. By April 3, 1935, the yen exchange rate fell to a minimum of 31.5 kopecks.

Workers need to be paid wages, but where to get it? It is necessary to exchange yen for rubles in the state bank at an extortionate rate! Fortunately, the bulk of the workers received most of their wages in food and clothing allowance according to the norms of the collective agreement.

The concessionaire had the last means to get Soviet currency in cash on the territory of Northern Sakhalin and pay with the money received the cost of rent, insurance premiums and other mandatory deductions - marketable goods brought to supply workers from abroad, which he sold at the market price and at the market rate of the yen. Of course, this did not include basic necessities, for which fixed prices were set under the collective agreement, and they did not change for a decade and a half. But all kinds of ladies' toilets, perfumes, powder, tweed suits and other consumer goods were safely sold by the concessionaire to his employees, and they just as happily resold them to their friends and acquaintances, not disdaining to sell Japanese goods on the "black market" and at prices that were sometimes 10 times higher than the purchase price in the concession store.

Due to the rapid depreciation (catastrophic depreciation) of the Soviet currency, local Soviet workers had no motivation to save money. They sought to exchange their wages for material goods in the stores of the Japanese company. Moreover, not only the workers themselves, but also persons who were not related to them - namely employees of the local Soviet police, the OGPU (! ), employees of post offices, medical personnel of hospitals, school workers and representatives of village councils - in fact, massively supported their livelihoods exclusively at the expense of food and goods at the disposal of the Japanese company.

A representative of the supervisory authorities wrote in this regard: "The coal concessionaire invests very little foreign currency, since he receives all the funds needed in Soviet currency from his commercial activities... As a result... a situation is created in which the concessionaire does not invest foreign currency in the enterprise and, due to the low level of wages, forces the workers of the concession to engage in speculation and smuggling of goods received from concession stores. At the same time, the concessionaire has free agents for the distribution of his goods and, in addition, corrupts our workers. The concessionaire annually exports to Japan significant surpluses of Soviet currency...

And so, the "speculative" policy of the Japanese came to its sad end, because these goods also had to be sold at the "official" exchange rate of the yen to the ruble, as a result of which the goods cost 3-8 times cheaper than their cost in Japan, excluding shipping!

It must be said that the Soviet government did not fight against speculation in Japanese goods on the island. It did, but in a very peculiar way.

On March 30, 1931, in the village of Douai, a group of OGPU officers broke into the house of the worker Vasilenko and searched there until 2 a.m., as a result of which a large batch of Japanese-made goods was seized, and Vasilenko himself, who was listed as a courier on a coal concession, was taken into custody. The next day, similar searches were carried out in two dozen other houses, as a result of which 2 foremen, 3 miners, 2 electricians, 6 loggers, 2 fellers and a foreman of the logging site were arrested. Soon after that, an employee of the administrative department of the concession, warehouse manager A.F. Frank was arrested, who was suspected of aiding speculators (on January 14, 1932, he was sentenced to three years of exile under Article 58-6). Together with him, the translator of the concession G.N. Zhuravlev was detained (on 14.01.1932. sentenced to 3 years in prison under Article 58-6). Arrests were also made in the settlements of Korsakovka, Mikhailovka and Oktyabrsky. In addition to the Soviet workers, the Chinese coolie Tankui was also arrested, which caused a stir among the Chinese workers of the concession.

However, rumors soon spread that the real reason for the arrest was not at all speculation in Japanese goods, but the fact that about a month before the GPU action in the club of the village of Mikhailovka, unknown persons pasted leaflets printed on a hectograph calling for the overthrow of Soviet power and greetings to Japanese policy. At the same time, there were rumors that this hectograph belonged to Soviet citizens who worked on the oil concession in Okha, which cast a shadow on the oil enterprise. About half a month after the discovery of this leaflet, within just one week, there were 5-6 fires. All these fires occurred in Soviet state institutions or adjacent buildings, which gave rise to strong suspicions of arson. The authorities, apparently, saw in this the signal lights of an anti-Soviet uprising. Until recently, reinforced patrols of soldiers and officers with bayonets attached to their rifles cruised around the clock around the clock, demonstrating extremely severe precautions.

Consul General S. Sasaki telegraphed to the Ministry of Foreign Affairs: "In order to reveal the internal affairs of the company, the GPU is actively using secret agents from among the Russians, Chinese and Koreans. There are signs that the current mass arrests were planned and prepared in advance. This is a gross violation of the spirit of Japanese-Soviet friendship and the terms of the treaty. If this arbitrariness of the local authorities is ignored, they may resort to a "second or third step" - for example, the confiscation of the accounting books and important documents of the office of the KKK. There is information that the GPU is trying to recruit some Japanese employees, offering them "cooperation" in exchange for the safety of their subordinates. The GPU is making great efforts to take possession of secret materials and internal documents of our company through such agents. The secret department of the GPU gave direct instructions to a number of Russian workers employed in the Douai mines to commit acts of sabotage. This included instructions for the disabling and destruction of the company's key equipment, as well as the commission of other actions aimed at undermining the stable operation of the enterprise. There were cases when GPU agents periodically demanded that the executors immediately report on the implementation of these sabotage tasks. .

On April 2, Japanese Foreign Minister Shidehara cabled Consul General Sasaki in Aleksandrovsk: "Take measures to ensure that the company's management shows maximum caution and caution with regard to the safety of accounting books, official correspondence, the contents of safes and other important documentation in case of repeated searches." This telegram showed that the Foreign Ministry took seriously the Consul General's warning that the arrests were only a pretext for seizing the company's financial records.

Sasaki Seigo

On April 11, 1931, the Consul General of Japan in Alexandrovsk, S. Sasaki, addressed the Agent of the People's Commissariat for Foreign Affairs of the USSR in Alexandrovsk with a message: "I have the honor to inform you that the many simultaneous arrests that have recently taken place among workers and employees in the Duya Concession Society have really dealt a great blow to the production work of the concession, as well as among the workers and employees. In this regard, the difficult situation of the Concession Society, which has recently been experiencing in terms of the operation of the concession, is even more aggravated. I ask you not to refuse the courtesy to appeal to the appropriate authorities, to finish the interrogations of the arrested as soon as possible and to alleviate the situation of the enterprise."

From April 4 to May 24, out of 90 detainees, 8 people were released: courier Vasilenko, loader Panov, lumberjacks Khomyakov, Suchkov, Nikolaev, Tokertin, mine foreman Krikov and warehouse manager Frank. According to those released, the reason for their arrest was the arrest in 1930 in Moscow of geologists P. Polevoy, A. Krishtofovich and A. Kozlov, as working for the interests of Japan. According to the OGPU, they were allegedly members of the underground "All-People's Union of Struggle for the Revival of Free Russia" and passed secret information (including geological maps) to foreign countries, including Japan.

Subsequently, it was explained to the management of the concession that the arrested workers were suspected of committing arson in the area of the Due mine, speculating in Japanese goods and engaging in "anti-Soviet" activities. However, the concessionaire had his own opinion on this matter. In his report to the Ministry of Foreign Affairs of Japan dated April 8, 1931, the manager Tsukioka noted that from the moment of its creation, the "Sakhalin Joint Stock Company" faced great difficulties in recruiting qualified workers and tried in all possible ways to "lure" them from the concession enterprise. When persuasion did not help, threats were used. Workers were arrested under the pretext that they were "counter-revolutionary elements".

On April 16, 1931, the tireless defender of the rights of Japanese concessionaires, S. Sasaki, sent another telegram to the Ministry of Foreign Affairs: "There is an assumption that the current repressions are connected with the need to justify possible failures in the implementation of the "five-year plan" in the coal industry of Sakhalin. Creating the image of an "external enemy" and "spies" within the Japanese concessions, the local leadership of the GPU (Schmidt) is trying to shift the responsibility for production difficulties to the Japanese side. During interrogations, workers are required to testify that the Japanese administration allegedly ordered them to sabotage Soviet facilities."

The arrest of such a significant number of "hardworking workers" was regarded by the leadership of the Japanese Foreign Ministry as a sign of the deterioration of diplomatic relations between the USSR and Japan. The Japanese believed that the Soviet authorities had decided to apply the same tactics of "squeezing" to the Sakhalin concessions that they had previously used against the Lena Goldfields company: through pressure from the special services and trade unions, to make doing business physically impossible, in order to eventually confiscate all assets. It became known that many senior officials of Soviet state institutions were going to send their families to the mainland on the first navigation ship, the Sergei Lazo, fearing an armed conflict between the two countries.

On April 28, 1931, the ship "Amatsu-maru" anchored in the roadstead of Douai with 170 Japanese workers on board. After the workers landed, the OGPU officers took them to the dormitory area and from 22:00 to 16:00 the next day inspected the luggage of the arrivals and personally searched for smuggling and illegal import of foreign currency. Among other things, the crossing officer Ichiro Yoshida was escorted from there directly to the GPU office, where he was forced to completely undress, down to his underwear. At the same time, despite such a harsh and cruel investigation, no facts of smuggling or other illegal actions were found, and this left a strong feeling that "the mountain gave birth to a mouse."

On May 28, 1931, in a secret telegram No 84 addressed to Baron Shidehara, he informed the latter that since September 1930, strict checks of the luggage of arriving workers had been carried out at the concessionaire's enterprises in order to stop the smuggling of contraband, and since the closure of the Chosen Bank, the GPU bodies "day and night have been conducting inspections aimed at suppressing the illegal outflow of currency from the concession."

By June 1931, a little more than 400 thousand rubles in cash had accumulated in the concessionaire's cash register. Moreover, he kept this money in the safes of the Consulate General of Japan, rightly believing that the Soviet side could arrange a financial audit on the territory of the concession at any time. By the way, the so-called "double bookkeeping" of the company was also stored in the same safes. In order to "lure" this money, the Soviet side spread a rumor that a monetary reform was coming to the USSR in the near future. And the concessionaire, frightened by these rumors, began to get rid of ruble cash.

In 1932, arrests at the concession continued. On February 6, a Russian foreman was arrested, on February 20 - a worker of the power plant, an employee of the port point, four miners and a Chinese worker. A total of 9 people.

However, these arrests at that time were "not in the hands" of the central government of the USSR, which pursued the so-called "policy of appeasement" in relation to Japan in connection with the "Manchurian incident" of 1931, as a result of which the puppet state of "Manchukuo" was proclaimed on March 9, 1932. Stalin de facto recognized this so-called state, allowing the opening of its consulates in Chita and Blagoveshchensk, hoping that the Japanese, "bogged down" in Manchuria, would untie the hands of the USSR regarding the establishment of a "red government" in China. Conflicts with Japan over the two Sakhalin concessions contradicted this very "policy of appeasement."

Therefore, on March 25, 1932, at a meeting of the Politburo of the Central Committee of the All-Union Communist Party (Bolsheviks), it was decided to send the following telegram to the Far Eastern District Committee and the chairman of the Sakhalin Executive Committee:

"According to reliable information, the Executive Committee and other representatives of the authorities on Sakhalin are behaving provocatively towards the Japanese concessionaires and the Japanese in general. The Central Committee instructs you to give immediate instructions to the authorities on Sakhalin not to create pretexts for conflicts with the Japanese and in general not to behave provocatively towards the Japanese, not to inflate the matter with questions of labor protection, to severely punish those who are guilty of violating the directives of the Soviet government and treaties with the Japanese." Thus, Stalin instructed the Sakhalin authorities not to rock the boat against the Japanese on the issue of oil and coal concessions.

On December 29, 1932, the head of the Sakhalin Mining District, after checking the company's accounting books, asked the director S. Murayama how the concession got the difference of 2 million rubles between the volume of goods sold to the workers and the wages paid to the same workers from the moment of its foundation until 1931. In addition, some Japanese employees of the company had relatives in Japan, to whom money transfers were regularly sent. That is why the amount paid according to the books differed from the amount actually paid. In the end, the Soviet side began to suspect Murayama of "currency speculation".

It should be noted that the directive of the Politburo did not reach all the leaders of Northern Sakhalin. Thus, at the beginning of May 1933, several provocations were carried out against the Japanese workers of the concession. On May 1, the meeting of Japanese workers was dispersed with the help of the police, on May 2, loading and unloading operations at sea were prohibited by the mining committee, on May 4, the employees of the mining committee broke into the power plant, turned off the power supply and sealed the switches. The regional trade union council recognized the actions of the chairman of the Rudkom as a gross abuse of authority and issued an official order to annul the order of Kornevets. Having received this confirmation, Murayama personally went to the power plant, tore off the seal and started the generators, resuming the work of the enterprise. The next morning, the manager Murayama reported the incident to the representative of the People's Commissariat for Foreign Affairs, the chairman of the Regional Executive Committee and the regional Trade Union Council, officially demanding the dismissal of the chairman of the Rudkom Kornevets from his post. It should be noted that the top Soviet leadership fully recognized the actions of the chairman of the Rudkom Kornevets as illegal and qualified them as malfeasance.

On July 3, 1933, the Consul General of Japan in Alexandrovsk telegraphed to the Minister of Foreign Affairs, Count Uchida: "On June 16, 1933, the head of the Organizational Department of the Central Committee of the Union of Miners in Moscow, I.E. Nikichenko, arrived on the island and met with the heads of general and labor issues of the Society's management. During the meeting, the parties held a thorough exchange of views on various technical issues, including the working hours of loaders and miners, as well as the problem of paying wages to Japanese workers. The company set out in detail the accumulated claims and dissatisfaction with the Rudkom. After that, an agreement was reached between the Rudkom and the company on the schedule of loading operations, and since then the activities of the coal concession have been progressing smoothly.

On June 12, the head of the OGPU in Aleksandrovsk-Sakhalinsky, Krysov, was transferred to another place of service. Marzhanov was appointed in his place, after which the attitude towards our company changed for the better. On the 20th, the head of the regional labor department was replaced by Matyushenko, who is an extremely mild person. There are also reports that in the coming days the chairman of the Mining Committee, Kornevets, will also be replaced. It is not yet clear whether these personnel changes have a direct cause-and-effect relationship with the negotiations of our embassy, but recently the attitude of the Soviet side towards the company has noticeably improved."

On August 1, 1933, during the celebration of the International Day of Struggle against the Imperialist War, the newly appointed head of the OGPU made the following speech to the participants of the rally: "Until today, for various reasons, you have been afraid and avoided communication with the Japanese. From now on, you can cast aside any fears and apprehensions. You have complete freedom to freely come to the Japanese and maintain contacts with them." This speech stunned not only the Soviet part of the audience, but also the Japanese diplomats present at the event.

On October 20, 1933, I.K. Leonhardt officially notified the mine manager, Mr. Murayama, of the receipt of official directives from Moscow. The central Soviet leadership compromised and accepted the company's terms: with regard to absolutely all categories of supply goods imported in 1933, as well as those goods that were planned to be imported before the completion of navigation, the Soviet side undertook to fully approve retail selling prices on the basis of tariffs and precedents in force in the previous fiscal years of 1931 and 1932. Thus, the protracted currency dispute, which caused serious concern for the economic stability and security of the concession, was briefly resolved in favor of the Japanese side.

In June 1934, the Soviet trade representative in Tokyo stated that if the total value of the supply goods imported by the company was in the range of 70% to 80% of the total wage actually paid to Soviet workers, then the Soviet side undertook to issue permits for the import of goods from Japan without any delays or quotas. On the basis of this statement, the head office in Tokyo instructed the Sakhalin office to draw up a report on the wage fund. The instructions of the board stated: "Show the Soviet Mining Department only those figures and forecasts that they are ready to accept, completely hiding the data on our net foreign currency balances in the cash register."

On the basis of this instruction, the manager of the mine in Douai sent the following memo to Tokyo: "The projected total wage fund of all categories of workers for the current working season of 1934 is fixed at the level of 1,800,000 rubles. This amount fully includes the nominal wage fund of the previous year, to which are added mandatory deductions to the Soviet social insurance bodies, trade union funds, as well as a planned 20% increase in tariffs for miners and bolters. On the basis of this wage fund, the total cost of the company's planned import of guaranteed supply goods for the current year is declared by us in the amount of 1,200,000 rubles. The balance of unsold supply goods, actually located in the warehouses of the mine as of May 1 (according to the inventory records), is 250,000 rubles. Of this volume, goods in the amount of 150,000 rubles are transferred to the distribution fund of the current year, and the remaining 100,000 rubles are recorded as an inviolable reserve. The minimum carry-over balance of goods in warehouses at the end of navigation (as of May 1 of the following year, 1935) to ensure the life of the mine in the winter period must be at least 500,000 rubles. This volume is critically necessary to cover the deficit before the arrival of the first ships of the next spring navigation. We ask the Main Office to urgently approve these parameters for submitting documents to Leonhardt. The administration of the mine informs that during negotiations with the Soviet side, we strictly refrain from mentioning the general planned indicators of our imports, fixing the discussion exclusively on the forecasts of the payroll fund. As for the carry-over balance balances of goods in warehouses, the Mining Department continues to demand in the form of an ultimatum that we officially disclose the exact data on the actual reserves as of April 1. Soviet officials stated that without this information they would not approve the quotas, referring to the fact that the company deliberately underestimated the volume of domestic trade. The Soviet side was told that wholesale prices, the terms of contracts with Japanese manufacturing factories, and internal financial statements on purchases constituted the most important commercial and confidential secrets of a private enterprise. The disclosure or transfer of this information to third parties was strictly prohibited by the rules of international trade ethics. On the basis of the above, the company officially declared that it was impossible to satisfy this request and asked that this demand be canceled." Thus, the improvement of the situation on the diplomatic front had a positive, albeit temporary, effect on the situation with the distribution of Japanese goods under concession.

In 1936, on the basis of the Decree of the Council of People's Commissars of the USSR of November 14, 1935 No 2487, when exchanging cash banknotes, foreign currency began to be exchanged for rubles at the following calculation: 1 yen was exchanged for 1 ruble 46 kopecks. That is, the yen exchange rate against the ruble soared 4.5 times.

They tried to fight Japanese goods in Northern Sakhalin not only with a "stick", but also with a "carrot" - with the help of bringing Soviet goods to the island. So, on August 15, 1933, at a meeting of the Politburo of the Central Committee of the All-Union Communist Party (Bolsheviks), it was decided to establish the following annual norms for supplying the population of the island.

TABLE XXI

Annual Supply Rate for the Inhabitants of Northern Sakhalin in 1933

But even these seemingly significant norms were incomparable with the norms on oil and coal concessions.

TABLE XXII

Comparison of prices for goods sold by the concessionaire in Douai, the Sakhalinugol stores of the cooperative and the bazaar of Aleksandrovsk (January 1934)

As can be seen from the table, the prices for the concessionaire's goods were lower than in the prices in the Sakhalinugol trust, not to mention the sky-high market prices. And at the same time, the management of the UZSGO accused the concession enterprise of regularly raising prices for imported goods without raising the wages of workers.

At the same time, it was the disorder and lack of coordination in the actions of the Soviet authorities that disrupted the plans for the delivery of Japanese goods to the concession enterprises of Northern Sakhalin. In 1934, I. Leonhardt wrote: "There was a directive from the People's Commissariat for Foreign Affairs that permission for import was given by the Trade Mission within the limits of the average annual wage fund, and the Trade Mission refused to issue a license for a steamer with goods that left Japan on May 14, 1934 on the grounds that it did not have a plan for the delivery of commodity products approved by the Head of the Mining District. The steamer arrived today with 700 tons of cargo, of which: 111 tons of perishable goods (potatoes, fresh fish, green greens, fresh apples, eggs, etc.) It turns out to be another scandal. The concessionaire runs around, is indignant, and I don't know anything."

In 1934, a trustee of the society wrote: "The main reasons why the society has been able to make a profit to this day are as follows: the right of the head of the mining department to approve the prices of food products is limited by the prices of essential goods, and this right should not extend to other goods that are not essential goods and imported from Japan."

It should be noted that from the legal point of view, the concession agreement was drawn up so ugly that it allowed the interpretation of its clauses in a way that was beneficial to each of the parties. Thus, paragraph 17 of the contract indicated that the supply of goods and products of prime necessity was carried out by the concessionaire at prices approved by the head of the mining district. And the Japanese rightly interpreted this paragraph in such a way that the head could only approve the prices of essential products. For everything else, the concession could set prices freely. But the contract did not spell out what exactly was considered essential goods. And the Soviet side, taking advantage of this, decided that absolutely everything that was imported by the concessionaire would be considered essential goods.

It is these points that can be traced in a letter from the concession president, T. Kawakami, to the head of the Eurasian Bureau of the Ministry of Foreign Affairs of Japan, Shigenori Togo, in September 1934. However, as you know, in 1931, both the Bank of Korea and its branch lost the opportunity to sell currency, which jeopardized the basis of our profitability. At that time, we could only make ends meet with the help of currency that we had purchased in advance. The situation was becoming more and more difficult. The purchase of Soviet currency at the official exchange rate of the USSR would have fundamentally undermined the activities of the company, and therefore the company decided to obtain currency through a material policy with relatively small losses.

As a forced protective mechanism, we developed a special trading strategy. Taking advantage of the acute shortage of goods within the USSR, the company significantly expanded the range and volume of consumer goods supplied to our workers from the mine's warehouses. This made it possible to stimulate customer demand from Soviet employees, as a result of which they returned much more money to the company's cash desk in the form of proceeds for goods than they received as nominal wages. Thus, we successfully withdrew the excess mass of rubles from local circulation and fully provided ourselves with foreign currency to pay subsequent salaries and taxes, avoiding direct currency losses. Until recently, this strategy fully justified itself, allowing us to receive uninterrupted rubles in volumes even exceeding our minimum needs, which saved the company from financial collapse.

The success of our commodity policy did not go unnoticed by the Soviet authorities. The Soviet regulatory authorities expected that after the closure of the Japanese bank in Vladivostok, the company's reserves of rubles would quickly run out, which would force us to buy Soviet currency for gold or hard foreign currency at an unfavorable official rate. Without waiting for requests from us to buy foreign currency, the Sakhalin Mining District demanded to provide detailed reports on all foreign exchange revenues and expenses of the concession.

Having discovered that the company fully covered its needs at the expense of domestic trade in supply goods, the Soviet leadership switched to open economic pressure, using the mechanisms of administrative supervision. Grossly ignoring our rights enshrined in the Concession Agreement, the mining district introduced strict quantitative quotas for the import of Japanese goods and directively reduced retail prices in the company's warehouses.

In the current year of 1934, the situation became aggravated: the Mining Department officially notified the company that the total cost of supplies allowed for import should in no case exceed the total wage fund paid to Soviet workers. Moreover, the Soviet side put forward an ultimatum demanding that the distribution of all our goods be transferred to local Soviet cooperatives, forcing the company to sell resources at their internal low tariffs. These aggressive steps lead to the inevitable and rapid depletion of our ruble working capital, jeopardizing the wages of workers. In order to prevent a complete halt in production and the collapse of the enterprise, the Japanese Foreign Ministry must urgently take decisive diplomatic steps in one of two directions:

Option A: To obtain from the government of the USSR the official conclusion of a special agreement on the establishment of a real market exchange rate of the yen to the Soviet ruble. On the basis of a comprehensive analysis of macroeconomic factors, the company considers the exchange rate at the level of no more than 20 Japanese sen per 1 Soviet ruble to be fair and economically justified. We are aware that in the conditions of current geopolitical tensions and the specifics of Soviet-Japanese relations, it is extremely difficult to reach such an agreement quickly.

Option B: Insist on the unconditional preservation and protection of our trade and supply policy. To this end, the Soviet side must officially confirm and observe the following conditions arising from the spirit and letter of the Concession Agreement:

1. To grant the company the right to absolutely unhindered and unrestricted import of any categories of goods and material values, if they are not officially included in the national list of goods completely prohibited for import into the USSR. The Soviet authorities must completely cease all interference under the guise of quotas.

2. To officially recognize the right of the company to independently and freely set retail prices for all types of goods in its warehouses, with the exception of a narrow list of basic necessities, the prices of which are regulated by a collective labor agreement. Prices for any additional consumer goods must be approved by the company freely, without the need to obtain approval from the Soviet Mining Department. Therefore, in this matter, the intervention of our Ministry of Foreign Affairs is necessary in order to provide maximum diplomatic assistance to the Soviet government to protect the legitimate interests of the Japanese concession on Sakhalin."

In 1935-1936, the situation in supply matters became even more aggravated with the arrival of V.I. Andzelevich as the head of the UZSGO. On November 15, 1935, he canceled all prices for goods previously approved by his predecessors, and in fact revalued them. The concessionaire stated that despite such actions, he would put the goods on sale at previously approved prices, because the actions of the head of the West Sakhalin Mining District were illegal. However, he directly pointed out to the concessionaire that he was importing goods to the island to supply the workers of the concession at cost, and not for commercial sale. Of course, V. Andzelevich said, the mining district agreed to revise the prices upwards on the condition that the company would provide him with bills of lading and certified invoices confirming the cost of imported goods and the cost of delivery. For trading at unapproved prices, he threatened administration employees with criminal prosecution, and promised to confiscate illegally sold products and goods.

And here we see a violation of the Concession Agreement on the part of the head of the mining district. He could only approve or not approve the prices submitted by the society, but he could not arbitrarily set his own prices for goods. Here he followed the path of his predecessor I. Leonhardt.

A representative of the company said that the goods at the newly approved prices would not be sold at all. In this case, the company can take these goods back to Japan, according to the concession agreement, the head of the mining district told the concessionaire.

On January 1, 1936, the Consul General in Aleksandrovsk-on-Sakhalin, Ogata Kiyoshi, telegraphed the Minister of Foreign Affairs, Hirota Koki: "The head of the Mining District, Andzelevich, stated that the prices for a number of goods indicated by the company were excessively high. He forcibly lowered the prices to a certain level, approved them in this form, and sent the statement back to the company.

According to the company's calculations, if you trade at these reduced prices, the total revenue will decrease by about 100,000 rubles. Considering such actions of the authorities to be extremely illegal, the company sent a written protest to the head of the Mining District on December 1 last year with a detailed statement of its arguments and a demand for a review of the decision. However, the head of the Mining District rejected the protest, considering the arguments unfounded.

However, he replied that if the company categorically insists on a reconsideration, it must provide official supporting documents confirming the real cost, freight cost and associated costs for each product. The local labor inspector has been instructed to completely suspend the sale of all goods in its stores if the company refuses to trade at the new prices.

The company declared that it would continue to sell these goods at the same prices, and regarded the actions of the labor inspector as gross interference in its economic activities and abuse of authority. Accordingly, all losses incurred by the company should be borne by the Soviet government.

However, Andzelevich said that in the event of this kind of trade, the Mining District would disclaim responsibility for the consequences and seal the goods sold illegally. This response was a very sensitive blow to the company's position. As stated above, at present this issue has become extremely aggravated. However, it cannot be said that this problem arose suddenly. In fact, even under the previous head of the Mining District, the Soviet side repeatedly demanded to present documents serving as a basis for calculating retail prices. In fact, if the company had disclosed these documents, it would have been immediately revealed that it was making huge hidden excess profits, so the provision of papers is extremely painful for it. It is difficult for an outside observer to judge which goods and to what extent have been subjected to price reductions and how justified the company's claims about their illegality are. However, according to confidential information obtained by our consulate, the company has been making huge profits from the sale of supply goods for a long time, and this income has been a very significant part of the overall net profit structure of the entire enterprise.

Taking these circumstances into account, the forced reduction of prices undertaken by the Soviet Mining District cannot be called completely groundless, and it cannot simply be ignored.

Judging by the retail prices for some of the company's products, which the consulate has managed to find out at the moment, they are as follows:

White rice: 24 rubles 51 kopecks per bag.

Miso: 14 rubles 22 kopecks.

Japanese sake: 1 ruble 20 kopecks per bottle (4th) at the real cost minus consumption tax of only 41 kopecks.

Chicken eggs: 15 kopecks apiece.

Salted sima: 1 ruble apiece.

It is impossible to call such prices moderate and fair. When the consulate pointed this out to the company's representatives, they began to justify themselves by the fact that Japanese workers are paid large compensations and discounts in the final settlement, so the real prices are not so high. However, these discounts are at best no more than 30%, so even taking into account the costs of freight, loading and unloading operations and interest on loans, these prices still deserve to be reproached for being excessively high.

Summing up, it can be noted that although in the actions of the head of the Mining District, such as the abolition of previously approved prices for goods of previous years and the forced reduction of prices for non-essential goods, there are still controversial points in terms of the exact interpretation of the Concession Agreement, the company itself and personally the director of the mining administration, Mr. Murayama, cannot be exempted from responsibility for the fact that the situation has taken such an acute turn.

As noted in our previous secret report No 8, Mr. Murayama constantly accuses the Soviet authorities of unwillingness to cooperate and hostility. At the same time, he is not at all inclined to critically evaluate his own actions. As can be seen from his official response to the Soviet side, he was unable to show composure, resorted to open accusations and counterattacks, which only hurt and angered the Soviet officials more. Such an approach can hardly be called reasonable.

For a company that does business in a territory under foreign jurisdiction, it is critical to take a sober assessment of its situation and to see if such drastic steps will be good for it. If the company's management had shown a little calm, it would have had no trouble finding many other, much more flexible and delicate ways to resolve the problem. It is deeply regrettable that they instead succumbed to emotions and went into open conflict. Unless Director Murayama radically changes his way of communicating with the local authorities, any attempts by the company to get the Soviets to change the labor inspector or the head of the Mining District will be completely fruitless.

Given the extremely sensitive nature of this issue, I intend to temporarily take the position of a neutral observer and follow the development of events... .

The concessionaires' enterprises were equated in status with state trusts. But although they were granted privileges in the use of forests, in duties and share deductions, the concessionaires were not exempt from deductions for social insurance, the maintenance of medical aid stations at enterprises, the organization of vocational training, etc.; granting privileges for forests, the Soviet side counted on free apartments for workers and families, the construction of houses, hospitals, clubs, etc. by the concessionaires.

At the first district Congress of Soviets, E.V. Lebedev noted that "the concessionaire invests considerable sums in production, in the capital equipment of production itself, but when the question of the need for housing construction, protection of subsoil is asked, then the concessionaire tries in every possible way to evade our vigilance... We must counteract this desire of the concessionaire, achieve 100 percent of the fulfillment of the concession agreement, which provides for the necessary costs for housing construction and for the satisfaction of other needs of the workers..."

However, the living conditions under the concession in the mid-1920s were the most difficult. The workers were provided with housing only for 50 percent of their needs. Many lived in tents and barracks built by the workers themselves. On February 1, 1927, 1 worker had 1.2 square sazhens (5.46 square meters) of living space, and in the dormitories of Chinese workers there were double bunks.

According to the concluded collective agreement, no later than July 1, 1927, the society had to provide its employees and family members with serviceable and equipped dwellings with an area of 8 sq.m. for 1 person, equipped with kitchens and washbasins. Each dormitory had to be equipped with a warm dryer for drying wet clothes and shoes. The society was obliged to repair the premises at the request of the residents, as well as to carry out internal whitewashing of the walls at least 2 times a year, and in family dormitories at least once a year. Each family apartment had to have a dining and kitchen table, 1 stool for each tenant, a scoop, a box for coal, 2 buckets and 1 poker, as well as a ladle for drinking, 1 wooden tub or iron tank (123 liters) for water and 1 washstand.

In the dormitories for single workers, there was 1 table and 1 bench for 10 people, 1 cabinet and 1 bed with a mattress for each living, 1 stool for 3 residents. Each kitchen at the dormitory was allocated 1 cauldron for cooking, 1 cube for boiling water, 1 stove, 1 tank for raw and 1 tank for boiled water with a mug, a box for coal, a scoop, a poker, as well as a brush or a Chinese broom for cleaning. Utilities were provided free of charge.

But, alas, in the dormitories, the workers lived in crowded conditions, there was no proper cleanliness, there were no garbage pits and garbage bins near the dormitories, as well as storerooms for storing things and food, which polluted the dormitories even more. There were no houses for family workers at all, so they huddled in dormitories, so to speak, "on a common basis".

Here is what the Central Committee of Miners reports in its book "The Work of the Union of Miners of the USSR at Concession Enterprises":

"Let us cite, for example, a description of the living conditions at the Sakhalin coal mine "Douhet". In the Russian and especially in the Chinese barracks, there is an absolutely impossible overcrowding, in some barracks the norm of living space per person reaches one square meter. Lack of light, impossible stuffiness, dirt - all this is characteristic of the local barracks. The division of the barracks into the so-called two floors with a height of the second floor of 1 1/4-3 arshin, the absence of beds, latrines - all this can be seen in any barracks at the Douai mine. Most of the barracks are of the barracks type. It should also be borne in mind that the Douai mine is one of the largest enterprises in Sakhalin, while at other enterprises the conditions are even worse."

The concessionaire was well aware of all these points, but he did not pay much attention to them and continued to accept new workers, knowing full well that the workers would live in an even more crowded environment. Therefore, the trade union bodies and local authorities forced the administration of the coal concession on Douai to build new premises for the workers. In 1927, 12 residential buildings were put into operation and work began on the construction of 3 barracks. But the construction of new barracks was carried out in a hurry, and no measures were taken to insulate the premises, as a result of which, with the onset of cold weather, it became cold in the dormitories. On October 13, 1927, at a meeting of the Red Army, the concessionaire was offered to start insulating and repairing the barracks, and in agreement with him, the deadline for these works was set at a month. But this decree was not executed by the concessionaire. In 1929, one concession worker already had 5.8 sq.m. of living space, but in 1930-31 the situation with living space deteriorated again.

According to the inspection report of the housing inspectorate, in 1930 there were 4.54 sq.m. for each tenant, and there were cases when 3-4 families lived in one room. The manager Murayama Shikonasuke explained this by the fact that "when starting a job, the worker is alone and he is given an apartment, that is, the established living space, but then he discharges the family from the mainland, there were many such cases.

At the time of the inspection by the labor inspector, according to our calculations, there was a surplus of living space among bachelors of 258 m'. The audit report of the inspection of living space by the labor inspector was provided to the trustee, which indicated that the shortage of living space was expressed in 1200 m', but when the trustee did not agree with this, this figure was redone by a thousand square meters.

Japanese archival documents show that at the beginning of 1933 the concessionaire had 135 buildings with a total area of 20,875.8 square meters.

TABLE XXIII

Number of buildings, structures and area of housing stock of the coal concession in 1933