For the nations who were forced to endure extraterritoriality, it was an insult. They were denied the ability to carry out justice as they saw fit within their own borders. It allowed foreigners to commit crimes and get away with only minor consequences. It was therefore, not surprisingly, the source of tremendous friction. Perhaps the most famous case surrounding extraterritoriality in Japan was the Maria Lutz Incident in Yokohama 1872. The Maria Lutz was a Peruvian ship carrying 234 Chinese laborers recruited in Macao to work on plantations. Although the ship was supposed to go directly to South America, it was damaged in a storm and pulled in to Yokohama for repairs. While there, some Chinese workers escaped to the HMS Iron Duke, and asked the British for protection. The Chinese claimed they were slaves while the ship owner defined them as indentured servants. Because this occurred in water rather than in the concessions, jurisdiction was given to the Japanese. Although there were dissenting opinions within the Japanese government, ultimately the Chinese were set free to the dismay of the foreign powers. The foreign powers did not all agree on how the case should have been handled but were peeved that the Japanese had not asked their permission. The importance of the Maria Lutz Incident in the context of extraterritoriality is that it is regarded as the first time Japan exercised judicial authority over the citizens of a nation with which it had no treaty. It was the first step toward treaty revision.
In the Japanese treaty ports, the other especially onerous provision of the commercial treaty was the loss of tariff control. Japan was limited to tariffs of 5% when in the rest of the world the standard rate was 20%. Tariff control was made more onerous through the most favored nation clause. This gave foreign traders an unfair advantage, especially those from the so-called “five powers.” These were the first five nations to conclude treaties with Japan, and they exerted the most influence. The five powers were the United States, Great Britain, France, Russia, and the Netherlands. By the Meiji Restoration, six other nations had negotiated similar treaties, and four more did so after 1868.
Nevertheless, as bad as these provisions were, Japanese negotiations had managed to limit some negative aspects of the treaties China concluded, such as allowing the right to sell opium, the right to practice Christianity, the right to own land, and the right to travel freely anywhere in China. Geography of scale also played a role, but Japan was able to limit the number of treaty ports, while in China, for example, ultimately there were more than eighty. Although Edo (Tokyo), Osaka, and other ports were scheduled to open much sooner, the shogunate was able to prolong the process until 1868. All the same, the Japanese government was well aware of the weakened position these treaties placed them and treaty revision was the primary foreign policy goal in the nineteenth century.
Despite avoiding some negative treaty provisions, events in Japan were nevertheless tied to China. The consular legal system was modeled after the one in China, and in 1865, the British government, who represented by far the most populous of foreign nationals in Japan, established a supreme court in Shanghai to oversee their nationals is both countries. China was the market for most export trade for at least the first decade of Meiji and many Chinese nationals came to Japan as traders, craftsmen, or merchants, or as servants in the employ of Westerners and as foreign students.
Treaty ports had a unique atmosphere that combined East and West. The “bund” was a word that originated in a Persian word for an artificial embankment but in the treaty ports. In the Far East, the bund referred specifically to the embankment along the water where all the foreign merchants had their offices. They looked distinctly Western as did the houses that eventually were constructed. Western foods, clothing, furniture, medical care, and other comforts of daily life were all eventually available in the treaty ports. But each active treaty port had a substantial Chinese population and a Japanese quarter that supported them. Until the Sino-Japanese War in 1894–1895, when many Chinese fled, the Chinese were the largest foreign community in Japan.
The main exports in the early years were foodstuffs to China but these were soon surpassed by silk and tea, which remained the most important exports through the treaty port era. Manufactured goods—things like matches and porcelain—gradually increased as a proportion of exports thereafter. Other services also emanated from the treaty ports, like hospitals, universities and banks.
While the basic characteristics were the same in all the treaty ports, they also had distinctive local characteristics. There was great variation among them as local customs were incorporated into the legal structures of each port. There were a total of seven treaty ports in Japan with varying degrees of success and importance. Here is a brief discussion by location.