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JAPAN'S TERMS. Indemnity and Cession of Terri- tory. Portsmouth (United States), Friday.— Reimbursement tor expenses sustained in the war and the cession ot consti- tute the rnaiiwteatures of the conditions of peace which Baron KoiTiura handed to JV1. Witte yesterday. The word irtdemnity is carefully avoided, reimbursement being used instead. The sum to be paid L3 not fixed, its amount being distinctly adjourned for mu- tual adjustment alter Japan's expenditure has been ascertained. These are all the important conditions, and those which the Russian plenipotenti- aries find unacceptable as they are. However, it can be stated that the condi- tions did not come as a surprise to the Rus- sians. Baron Komura's tnendly manner of explaining the coüdltlOns betore handing them to M. Witte an l the avoidance of the word indemnity leavs the way open for a continuance of the negotiations, and con- stitute the main hope of an agreement be- ing possible. No matter what may be the ultimate re- sult, the danger of a sudden rupture is cer- tainly precluded by yesterdays develop- ments. ments. The other Japanese terms are substan- tially what were to be expected, and wi h one, perhaps two exceptions, could prob- ably be entertained as th.3 basis of negotia- tions. Thev are: — (a) The cession of Russian leases in the Liaotun^ Peninsula. (b) The evacuation of the entire province of Manchuria. (c) The retrocession to China of any Rus- sian privileges in Manchuria, and Russia's recognition of the open door. (d) The cession to Japan of the Chinese Eastern Railway, the main line through Northern Manchuria to Vladivostock re- maining Russian. (e) The recognition of a Japanese Pro- tectorate over Korea. ¡ (f) The grant of fishing rights to Japan in the waters of the Siberian Littoral north- ward of Vladivostock to the Behring Sea. (g) The relinquishment to Japan of Rus- sia's interned warships, and the limitation of Russia's naval strength in the Far East. On the whole the Russians regard the terms as exceedingly hard. In addition to the two principal terms, which M. Witte, ■under his instructions, cannot accept, those relating to the limitation of Russia's naval strength and the granting of fishing rights are considered particularly offensive to the "amour propre" of Russia, and cf such a humiliating character as to be inadmissible. On the contrary the Japs, as Baron Ko- mura announcjd at the Conference, consider them moderate, contending that they only represent fair compensation for the ex- penses of the war and the victories achieved on land and sea, their sole purpose being to attain the objecfa tor which Japan fought. As soon as the Japanese terms were in their hands yesterday the Russian plenipo- tentiaries called in the vice-expert dele- gates attached to th ?ir mission, and spent the whoia afternoon in considering the terms. It is hoped that an answer will bo re- ceived to-day to M. Witte's cablegram to the Czar containing the terms and the en- voys' personal recommendations, in which case M. Witte expects to have the Russian reply to the Japanese plenipotentiaries ready by to-morrow. That day, however, being the anniversary of the birth of the Czarevitch, the presentation of a reply would be deferred until Monday. In the meantime the plenipotentiaries will not meet unless some unexpected ne- cessity for a conference arises. The Japan- ese plenipotentiaries do not manifest the slightest annoyance at the prospects of a few days' delay, as they realise the serious- ness of the issue, and are perfectly willing to give the Russians ampie time for con- sidering their terms. An agreement was reached by which the conference was for- mally adjourned until Monday. M. Witte and Baron Rosen had accepted an invitation to dine yesterday with Mr. Pierce, Assistant Secretary of State, and his wife. In spite of their arduous labours at Navy Yard they kept the engagement. Returning '0 their hotel at nine o'clock, they again plunged into work, and lights in their room were burning long after mid- night. It is learned that the Japanese plenipo- tentiaries first proposed secrecy regarding the deliberations of the peace meetings, and that the Russians, not thinking it right to opn 06e the suggestion, acquiesced. The copies of Japan's terms, which were handed to M. Witte at the meeting yester- day, were in English and French. M. Witte, in the course of his remarks at the meeting, reviewed at length the events that led up to the war. Mr. Pierce, Assistant Secretary of State, acted as host at the luncheon at Navy Yard. The R nssian and Japanese plenipotentiaries sat together at a round table, and frater- nised as they had not done before. No re- ference, however, was made to the peace terms. RUSSIANS CAjBLE TO ROTHSCHILDS. (Press Association War Soeciaj.) New York, Friday.—The "World" states tha.t the Hussian plenipotentiaries, after re eo; vuig the Japanese peace terras, before transmitting them to St. Petersburg, sent cabiegrams to Messrs. Rothschilds iif Paris, and to a ba-nking house a.t Antwerp. RUSSIAN SCRRENRERS AT SAKHALIN. (Reuter's Foreign Special.) Tokio, Friday.—It is officially announced that on August 8th 118 Russian officers and tnen surrendered at Nioro, Sakhalin. I SUPERFLUOUS ASSURANCE BY A JAPANESE M.P. ¡ (Press Association War Special.) Portsmouth (U.S.), Saturday.—M. Mat- sumato, a member of the Japanese Parlia- ment, who is here as a financial emissary of Japan, says the Russians are much mis- taken if they imagine that the Japanese will not insist on the two chief points of their terms—an indemnity and the cession of Sakhalin. If Baron Komura yielded these, public feeling in Japan would b:3 so strong that be would be murdered on his return home. The question of credentials has been amicably adjusted upon assurance being given by the Japanese plenipotentiaries that the powers granted to Baron Komura were in the re pilar form always employed by Japan..M. Witte will not pursue the mat- ter further. Later.— M. Kovoitvid, spokesman of the Russian Peace Mission, confirms the state- ment that the Russian reply to Japan's terms will be prpented at hall-past nine this morning, and says the reply will con- tain an agreement to some points, condi- tional agreement to some, and rejection of some.

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