Japan has agreed to limit the number of passports it has provided to workers and domestic workers to 400 per year. Four classes of immigrants would still be allowed to enter Canada: returning residents and their wives, children and parents; Immigrants employed by Japanese residents in Canada for personal and domestic services; Canadian government-approved workers; and contracted farm labour by Japanese landowners in Canada. Although no specific legislation has been adopted to enforce the quota, the agreement has resulted in a significant reduction in Japanese immigration. In the year following the agreement, only 495 Japanese immigrants arrived in Canada.  In a report by the U.S. House of Representatives detailing its investigation into the United States Steel Corporation, it was stated that in the 1890s there were two general types of bulk associations or consolidations between steel and ferrous interests in which the various groups held ownership, as well as a high degree of independence: the “pool” and the “gentleman`s agreement.”  The latter type lacked a formal organisation to regulate production or prices or forfeiture rules in the event of infringement.  The effectiveness of the agreement relied on members to meet informal commitments.  Japan was prepared to restrict immigration to the United States, but was seriously injured by San Francisco`s discriminatory law, which specifically targeted its people. President Roosevelt, who wanted to maintain good relations with Japan as a pole opposed to Russian expansion in the Far East, intervened. While the U.S. ambassador reassured the Japanese government, Roosevelt summoned the mayor and the San Francisco school board to the White House in February 1907 and convinced him to end segregation and promised that the federal government itself would address the issue of immigration. On February 24, the gentlemen`s agreement was reached with Japan in the form of a Japanese memo, in which it was agreed to deny passports to workers wishing to enter the United States and to recognize the right of the United States to exclude Japanese immigrants with passports initially issued to other countries.
March 13, 1907 followed the formal withdrawal of the San Francisco School Board`s decision. A final Japanese note, dated February 18, 1908, made the gentlemen`s agreement fully effective.