After the British victory in the
First Opium War, foreign powers including France obtained concessions in China through the
unequal treaties.
Arrival of the British, the French and the Americans and establishment of the settlements to the south in faded red and
American Concession to the north in faded orange;
Chinese part of the city to the south of the
French Concession in faded yellow. The
Treaty of Nanking and its supplementary treaty of 1843 – the first of the unequal treaties – provided British merchants with the right to reside with their families and rent grounds and houses in five ports – Guanzhou, Xiamen, Fuzhou, Shanghai and Ningbo – but there was not a word about separate residential areas for foreigners on Chinese soil. However, the imperial commissioner who negotiated the supplementary treaty reported to the
Qing emperor that by signing the treaty he had successfully arranged that in the treaty ports "the boundaries of an area should be designated which foreigners are not allowed to exceed" (
yiding jiezhi, buxu yuyue), an intent however that was not clearly stated in the English-language version of the treaty. The Qing rulers, by intending to confine the "barbarians" to an officially designated special zone, apparently hoped to resurrect the old
Canton system, that is, a system that strictly confined foreigners to a segregated zone. At Shanghai, the intention of the imperial officials had clearly been initially to keep the foreigners out and upon his arrival in 1843, the first British consul, Captain
George Balfour, could not even find a house for the consulate. The British finally decided to locate themselves in the northern suburbs and asked the
Daotai, Gong Muiju, to designate an area there as a segregated British area. This dovetailed with the Daotai's intentions since two violent incidents between local Chinese and foreigners had prompted him to take steps to limit contacts between Chinese and foreigners. This was formalized in 1845 with the delimitation of a segregated area north of Yangjingbang, a creek that ran north of the Chinese city. Later that year Gong Muiju and Balfour concluded an agreement called the Land Regulations (
Shanghai zudi zhangcheng), which set forth the institutional basis for the British settlement. In 1848, with the permission of the Daotai, the 138-acre British settlement – a fraction of the 5,584 acres the International Settlement was to cover by 1899 – was slightly expanded westward and northward. Following the British example, the French consul
Charles de Montigny and the Daotai Lin’gui agreed in 1849 that a French settlement be established on a strip of land between the Chinese city and the British settlement. The American consul was somewhat offended by the fact that the British and the French had secured the best plots of land in the area, and after lengthy deliberations, the Americans – who with the
Treaty of Wanghia of 1844 had gained the same rights as those enjoyed by the British in the five treaty ports – established their own settlement northeast of Shanghai. In 1852 the total population of the settlements was about 500, including 265 foreigners. Towards the end of the 19th century,
Shanghai Russians also arrived, with Russia's construction of the
Chinese Eastern Railway and acquisition of
Harbin and
Port Arthur.
Municipal Council On 11July 1854 a committee of Western businessmen met and held the first annual meeting of the
Shanghai Municipal Council (
SMC, formally the
Council for the Foreign Settlement North of the Yang-king-pang), ignoring protests of consular officials, and laid down the Land Regulations which established the principles of self-government. The aims of this first Council were simply to assist in the formation of roads, refuse collection, and taxation across the disparate Concessions. In 1863 the American concession—land fronting the
Huangpu River to the north-east of Soochow Creek (
Suzhou Creek)—officially joined the British Settlement (stretching from
Yang-ching-pang Creek to Suzhou Creek) to become the Shanghai International Settlement. The French concession remained independent and the Chinese retained control over the original walled city and the area surrounding the foreign enclaves. This would later result in sometimes absurd administrative outcomes, such as needing three drivers' licenses to travel through the complete city. By the late-1860s Shanghai's official governing body had been practically transferred from the individual concessions to the Shanghai Municipal Council (工部局, literally "Works Department", from the standard English local government title of 'Board of works'). The British consul was the
de jure authority in the Settlement, but he had no actual power unless the ratepayers (who voted for the council) agreed. Instead, he and the other consulates deferred to the council. , 1928. The council had become a practical monopoly over the city's businesses by the mid-1880s. It bought up all the local gas-suppliers, electricity producers and water-companies, then—during the 20th-century—took control over all non-private rickshaws and the Settlement tramways. It also regulated opium sales and prostitution until their banning in 1918 and 1920 respectively. Until the late-1920s, therefore, the SMC and its subsidiaries, including the police, power station, and public works, were British dominated (though not directly controlled by Britain, which had no authority over the council). Some of what happened in the Settlement during this period, such as the
May Thirtieth Movement, a series of anti-imperialist protests which began after the
Shanghai Municipal Police opened fire on Chinese demonstrators, weakened the
British Empire's position in China. , one of the longest serving chairmen of the SMC, as the "Lord Mayor of Shanghai" No Chinese residing in the International Settlement were permitted to join the council until 1928. Amongst the many members who served on the council, its chairman during the 1920s,
Stirling Fessenden, is possibly the most notable. An American, he served as the settlement's main administrator during Shanghai's most turbulent era, and was considered more "British" than the council's British members. He oversaw many of the major incidents of the decade, including the May Thirtieth Movement and the
White Terror that came with the
Shanghai massacre in 1927. By the early 1930s, the British and the Chinese each had five members on the council, the Japanese two and the Americans and others two. At the 1936 Council election, because of their increasing interests in the Settlement, the Japanese nominated three candidates. Only two were elected, which led to a Japanese protest after 323 uncounted votes were discovered. As a result, the election was declared invalid and a new poll held on April20–21, 1936, at which the Japanese nominated only two candidates. In the case of the Chinese members, in 1926 the Ratepayers' Meeting adopted a resolution approving the addition of three Chinese members to the council and they took their seats for the first time in April, 1928; while in May, 1930, their number was increased to five. The International Settlement was wholly foreign-controlled, with staff of all nationalities, including British, Americans, Danes, Dutch, French, Spanish, Portuguese, Italians and Germans. In reality, the British held the largest number of seats on the council and headed all the Municipal departments (British included Australians, New Zealanders, Canadians,
Dominion of Newfoundlanders, and South Africans whose extraterritorial rights were established by the United Kingdom treaty). The only department not chaired by a Briton was the Municipal Orchestra, which was controlled by an Italian. The Settlement maintained its own fire-service, police force (the Shanghai Municipal Police), and even possessed its own
military reserve in the
Shanghai Volunteer Corps (). Following some disturbances at the British concession in
Hankow in 1927, the defences at Shanghai were augmented by a permanent battalion of the
British Army, which was referred to as the
Shanghai Defence Force (SDF or SHAF), and
a contingent of US Marines. Other armed forces would arrive in Shanghai; the French Concession had a defensive force of
Troupes de marine and
Annamite troops from
French Indochina, the Italians also introduced their own marines, as did the Japanese (whose troops eventually outnumbered the other countries' many times over).
Extra-settlement roads From the 1860s, the Municipal Council began building roads beyond the concession boundaries, ostensibly to connect the concession with other properties or facilities which required the protection of Britain and other treaty powers during the unrest of the
Taiping Rebellion. The Municipal Council obtained limited administrative powers over the areas adjacent to these "extra-settlement roads", making the area a "quasi-concession". The expansion of the International Settlement in 1899 took in most of the extra-settlement roads area, but from 1901 the Municipal Council began building further roads beyond the new boundary with a view to expanding the concession to cover those areas as well. However, a request to further expand the concession (inspired by a similar expansion of the French concession in 1914) was turned down by the Chinese government due to anti-imperialist sentiments. Britain, pre-occupied with
World War I, did not press the issue and the extra-settlement roads area retained the "quasi-concession" status until the demise of the concession. Parts of the northern extra-settlement roads area was allocated to Japan for defence purposes in 1927, which the Japanese used as a base for military operations during the 1932
January 28th Incident and the 1937
Battle of Shanghai. After that battle, Japan took full control over the northern extra-settlement roads area and expelled International Settlement police. The neutrality of the western extra-settlement roads area survived in some form until the withdrawal of British troops in 1940.
Legal status of the International Settlement Article 28 of the International Settlement's
Land Regulations stated unequivocally that "the land encompassed in the territory remains Chinese territory, subject to China's sovereign rights." As expressed by legal experts, "the self-governing International Settlement possesses no more power than the mere delegation of purely local and municipal powers and functions. Control of police, sanitation, roads, and other problems of local administration are granted to the Municipal Council simply because that body happens to be the one best equipped to deal with these matters in an area where the large majority of foreigners dwell. But the Municipal Council is in no sense a political body. Its powers, being delegated and hence limited, are subject to strict construction. What foreigners acquire is simply the delegated power of municipal administration, while the reserve powers remain in the sovereign grantor, the Chinese Government. Although under the control of the Consular Council, the area is still Chinese territory, over which China's sovereignty remains unsurrendered".
Rise of Imperial Japan (20th century) In the 19th century, Europeans possessed
treaty ports in
Japan in the same way they held those in China. However, Japan rapidly developed into a modern nation, and by the turn of the 20th century the Japanese had successfully negotiated with all powers to abrogate all unequal treaties with it. Japan stood alongside the European powers as part of the
Eight-Nation Alliance during the infamous
fifty-five-day siege of the foreign embassy compound in
Peking. Japan entered the 20th century as a rising world power, and with its unequal treaties with the European powers now abrogated, it actually joined in, obtaining an unequal treaty with China granting extraterritorial rights under the
Treaty of Shimonoseki signed in 1895. In 1915, during the
First World War, Japan overtook
Britain as the country with the largest number of foreign residents in Shanghai. In 1914, Japan sided with Britain and
France in the war and conquered all
German possessions in China. By the beginning of the 1930s, Japan was swiftly becoming the most powerful national group in Shanghai and accounted for some 80% of all extraterritorial foreigners in China. Much of
Hongkew, which had become an unofficial Japanese settlement, was known as
Little Tokyo.In 1931, supposed "protection of Japanese colonists from Chinese aggression" in Hongkew was used as a pretext for the
Shanghai Incident, when Japanese troops invaded Shanghai. From then until the
Second Sino-Japanese War (1937–1945) Hongkew was almost entirely outside of the SMC's hands, with law and protection enforced to varying degrees by the
Japanese Consular Police and Japanese members of the
Shanghai Municipal Police.
Japanese take over rest of Shanghai (1937) In 1932 there were 1,040,780 Chinese living within the International Settlement, with another 400,000 fleeing into the area after the Second Sino-Japanese War broke out in 1937. For the next five years, the International Settlement and the French Concession were surrounded by Japanese occupiers and Chinese revolutionaries, with conflict often spilling into the Settlement's borders. In 1941, the Japanese launched an abortive political bid to take over the SMC: during a mass meeting of ratepayers at the Settlement Race Grounds, a Japanese official leaped up and shot
William Keswick, then chairman of the council. While Keswick was only wounded, a near riot broke out.
Evacuation of British garrison Britain evacuated its garrisons from mainland Chinese cities, particularly Shanghai, in August 1940.
Japanese occupy the International Settlement (1941) Anglo-American influence effectively ended after 8 December 1941, when the
Imperial Japanese Army entered and occupied the British and American controlled parts of the city in the wake of the
attack on Pearl Harbor. The British and American troops, taken by surprise, surrendered without a shot, with the exception of the only British riverboat in Shanghai,
HMS Peterel, which refused to surrender; six of the 18 British crew on board at the time were killed when the ship was sunk after the Japanese opened fire at almost point-blank range. The French troops did not move from the preserved French Concession, as the French
Vichy government considered itself neutral. European residents of the International Settlement were forced to wear armbands to differentiate them, were evicted from their homes, and—just like Chinese citizens—were liable to maltreatment. All were liable for punitive punishments, torture and even death during the period of Japanese occupation. The Japanese sent European and American citizens to be interned at the
Lunghua Civilian Assembly Center, a work camp on what was then the outskirts of Shanghai. Survivors of Lunghua were released in August 1945. Shanghai was notable for a long period as the only place in the world that unconditionally offered refuge for Jews escaping from the Nazis. These refugees often lived in squalid conditions in an area known as the
Shanghai Ghetto in Hongkew. On 21 August 1941 the Japanese government closed Hongkew to Jewish immigration.
Return to Chinese rule In February 1943, the International Settlement was
de jure returned to the Chinese as part of the
British–Chinese Treaty for the Relinquishment of Extra-Territorial Rights in China and American–Chinese
Treaty for Relinquishment of Extraterritorial Rights in China with the
Nationalist Government of the
Republic of China under
Chiang Kai-shek. However, because Shanghai was under Japanese control, this was unenforceable. In reply, in July 1943, the Japanese retroceded the SMC to the City Government of Shanghai, which was then in the hands of the pro-Japanese
Wang Jingwei Government. After the war and the liberation of the city from the Japanese, a Liquidation Commission fitfully met to discuss the remaining details of the handover. By the end of 1945, most Westerners not actively involved in the
Chinese Civil War (such as intelligence agents, soldiers, journalists, etc.) or in Shanghai's remaining foreign businesses, had left the city. With the defeat of the
Kuomintang in 1949, the city was occupied by the Communist
People's Liberation Army and came under the control of the
mayor of Shanghai. The foreign architecture of the International Settlement era can still be seen today along
the Bund and in many locations around the city. == Currency ==