4. No goods could be exported from the United Kingdom to any of the British possessions in Asia, Africa, or America (with some exceptions with regard to India) in any but British ships.

5. No goods could be carried from any one British possession in Asia, Africa, or America, to another, nor from one part of such possession to another part of the same, in any but British ships.

6. No goods could be imported into any British possession in Asia, Africa, or America in any but British ships, or in ships of the country of which the goods were the produce; provided, also, that such ships brought the goods from that country.

7. No foreign ships were allowed to trade with any of the British possessions unless they had been especially authorized to do so by an Order in Council.

8. Powers were given to the Queen in Council which enabled her to impose differential duties on the ships of any foreign country which did the same with reference to British ships; and also to place restrictions on importations from any foreign countries which placed restrictions on British importations with such countries.

Finally, in 1849, with the adoption of the commercial policy founded on freedom of trade, came the repeal of the restrictive code, excepting only the rule as to the British coasting trade; and in 1854 the restrictions on that trade were removed, throwing it also open to the participation of all nations.

Meanwhile the British ocean-mail subsidy system for steamship service, instituted with the satisfactory application of steam to ocean navigation, in the late eighteen-thirties, had become established: the first contract for open ocean service, made in 1837, being for the carriage of the Peninsular mails to Spain and Portugal. Although successful ventures in transatlantic steam navigation had begun nearly a score of years earlier, the practicability of the employment of steam in this service was not fully tested to the satisfaction of the British Admiralty till 1838.

In this, as in so many other innovations, Americans led the way. The first steamer to cross the Atlantic was an American-built and American-manned craft. This pioneer was the Savannah, built in New York and bought for service between Savannah and Liverpool. She was a full-rigged sailing-vessel, of 300 tons, with auxiliary steam power furnished by an engine built in New Jersey. Her paddles were removable, so fashioned that they could be folded fan-like when the ship was under sail only.[[S]] She made the initial voyage, from Savannah to Liverpool, in the Summer of 1819, and accomplished it in twenty-seven days,[[T]] eighty hours of the time under steam. Afterwards she made a trip to St. Petersburg, partly steaming and partly sailing, with calls at ports along the way. Her gallant performance attracted wide attention, but upon her return to America she finally brought up at New York, where her machinery was removed and sold.

An English-built full-fledged steamer made the next venture, but not until a decade after the Savannah's feat. This was the Curaçoa, 350 tons, and one hundred horsepower, built for Hollanders, and sent out from England in 1829. The third was by a Canada-built ship—the Royal William, 500 or more tons, and eighty horsepower, with English-built engines, launched at Three Rivers. She crossed from Quebec to Gravesend in 1833. The next were the convincing tests that settled for the Admiralty the question of transatlantic mail service by steamship instead of sailing packet. These were the voyages out and back of the Sirius and the Great Western in 1838.

The Sirius had been in service between London and Cork. The Great Western was new, and was the first steamship to be specially constructed for the trade between England and the United States. Both were much larger than their three predecessors in steam transatlantic ventures, and better equipped. The Sirius started out with ninety-four passengers, on the fourth of April, 1838, and reached New York on the twenty-first, a passage of seventeen days. The Great Western, also with a full complement of passengers, left three days after the Sirius, sailing from Bristol, and swung into New York harbor on the twenty-third, making her passage in two days' less time than her rival. Both were hailed in New York with "immense acclamation." They sailed on their homeward voyage in May, six days apart, and made the return passage respectively in sixteen and fourteen days. The Great Western on her second homeward voyage beat all records, making the run in twelve days and fourteen hours, and "bringing with her the advices of the fastest American sailing-ships which had started from New York long before her."[[U]] This clinched the matter. The Admiralty now invited tenders for the transatlantic mail service, by steam, between Liverpool, Halifax, and New York.