IN THE Cairo Declaration issued jointly by President Roosevelt, Prime Minister Churchill, and President Chiang Kai-shek on December 1, 1943, it was declared that it was the "purpose" of the "three Great Allies" that "all the territories Japan had stolen from the Chinese, such as Manchuria, Formosa and the Pescadores, shall be returned to the Republic of China." In the Potsdam Proclamation of July 26, 1945, signed by the President of the United States and the Prime Minister of the United Kingdom, and concurred in by the President of China and subsequently adhered to by the Soviet Union, it was agreed that the terms of the Cairo Declaration were to be carried out.
The Cairo Declaration was the starting point for planning by the United States Government for the initial postwar treatment of Formosa. A number of questions arose in this connection. The first was: What would be the legal status of the Island between the time of a Japanese surrender and the formalizing of a Japanese cession of it to China under a treaty of peace? That is, would sovereignty continue to rest in Japan during this