A.—3

2

3. Every rider of a bicycle shall sound his or her bicycle-bell continuously when approach ing any person. Every bicycle in motion shall also carry a lighted lamp after sundown, When two bicycles approach each other from opposite directions each shall go to its own proper left in order to avoid a collision. When one bicycle overtakes another on the road, the one overtaking shall turn aside if necessary in order to pass the one in front. Any rider of a bicycle who fails to observe the above precautions shall be liable to a fine not exceeding ten shillings, and be further liable for any damage caused by him or her to person or property through carelessness or neglect of the above precautions. The above draft Ordinance was approved unanimously by the Aitutaki Island Council at its sittings on the 11th March, 1903, and passed. Jno. T. Lakgk, President and Secretary. [Assented to by the Governor on the 19th October, 1903.]

No. 3. Rarotonga, 31st March, 1903. Memo, for the Hon. the Minister for the Islands. The Pearl-shell Lagoons of Penrhyn and Manihiki. The area of the Penrhyn lagoon is about ninety square miles, and of this at least twenty-four square miles is more or less covered with shell, but the population of the islands of the reef, who claim the exclusive right to dive for this valuable article of commerce, are few in number. There are certainly not more than a hundred divers on the lagoon, and of these not more that threefourths are of Penrhyn descent. The policy of those who claim to own the shell-beds is to take no more shell than will give them a good living, and I submit that this policy is in direct conflict with the interests of the Government of this group ; firstly, because old shell lying in the beds becomes worm-eaten, and spreads the disease to the younger shell; and, secondly, it should be our aim to encourage all the islanders to dive, since it takes years of practice to make an efficient diver, and that the Penrhyn people are dying out there can be no doubt. To cure these evils and give the inferior people of each lagoon an equal chance, I can see no other method than this, —that the Government of New Zealand shall declare each lagoon and its shell-beds the property of His Majesty, and subject to certain restrictions, and shall hand them over to be managed by the Resident Agent and the Island Council. An additional reason for the taking-over of the Penrhyn lagoon will be found in the petition of H. Owen attached hereto. The Natives have an exaggerated idea of their rights in the matter of turtle. If they confined their claims to the turtle captured on the island that claim would not hi disputed; but they claim all the turtle in the lagoon, in the tidal passages, and in the open sea round the reef. I propose that the lagoons of Penrhyn and Manihiki shall be taken under section 15 of " The Cook and other Islands Government Act, 1901"; that the Resident Agent shall be ex officio custodian of the lagoon, and together with the Island Council shall regulate the close seasons to bo observed over the lagoon or any part thereof ; that the Resident Agent and Council shall decide what diving-machines, if any, shall be used, and on what terms, in order that the interests of the majority may not suffer; that no person shall be allowed to dive for pearl-shell without a license, but that any aboriginal inhabitant of the island shall be entitled to a license free of charge. The aboriginal inhabitants of any island within the boundaries of New Zealand shall be entitled to a diving-license on the payment of an annual fee of 10s. Foreigners may, in the discretion of a Resident Agent, be allowed to dive for shell, on the payment of a license fee of £1 10s. per annum. No alien shall own or work a diving-machine without having , first obtained the permission of the Resident Commissioner W. E. Gudgeon, Resident Commissioner.

Enclosure. Sir, — Omoka, Penrhyn Island, 11th February, 1903. I respectfully ask you to forward the accompanying letter, containing a petition, to His Excellency Lord Ranfurly, K.C.M.G., Governor of New Zealand. I have, <fee, Lieut.-Colonel W. E. Gudgeon, C.M.G., Harry L. Owen Resident Commissioner, Cook and other Islands.

Sub-enclosure. Yotjr Lordship, — I, the undersigned petitioner, resident of Omoka, Penrhyn Island, do humbly request that you will kindly consider the following petition : — That whereas being for some time resident of this island, I have had occasion to have a little trouble with the Natives of this island owing to their arbitrary action re the turtle-fish question. We are debarred from securing turtle in the lagoon for food, as the Natives claim thaf everything in the lagoon belongs to themselves. I, on one occasion, paid a man to go and catch