trading firm of Schomburg and began working in the interest of the Sultan and Datu Majenji, who was an overlord in the island of Tawi-Tawi. While he continued his voyage to Celebes, he decided to open his first headquarters at Jolo. Large quantities of arms, opium, textiles and tobacco from Singapore were shipped to Tawi-Tawi in exchange for slaves from the Sultanate. In November 1871, Spanish gunboats bombarded Samal villages in Tawi-Tawi islands and blockaded Jolo. As war in the waters of Sulu began to escalate, the Sultanate came to rely on Singapore's market for assistance. When the Sultanate increased their close trade relations with the British trading ports of Labuan and Singapore, this forced the Spanish to take another major step to conquer the Sulu Archipelago. The arrival of German warship Nymph at the Sulu Sea in 1872 to investigate the Sulu-Spanish conflict made the Sultanate believe Schuck was connected with the German government, thus the Sultanate granted Schuck an area of land in the Sandakan Bay to establish a trading port to monopolise the rattan trade in the northeast coast where Schuck could operate freely without the Spanish blockade. The intervention of Germans on the Sulu issue caught the British' attention and made them suspicious, especially when the Sultanate had asked for protection from them. Schuck then established warehouses and residences in the Sandakan Bay, along with the arrival of two steamers under the German flag and it served as a base for the running of gunpowder and firearms. When another German warship Hertha visited Sandakan Bay, its commander described the activity in Kampung Jerman: In 1875, an Austro-Hungarian consul named Baron von Overbeck purchased the rights to a defunct American trading company in Borneo. After efforts by Overbeck to sell northern Borneo to the German Empire, Austria-Hungary and the Kingdom of Italy were unsuccessful, he went into business with Alfred Dent in 1877. In 1877 the Sultan of Brunei agreed to lease land to Overbeck, and in 1878 the Sultanate of Sulu similary ceded their rights to land in north-eastern Borneo. Dent succeeded in obtaining British government backing for his North Borneo Company in 1881. Sandakan became the capital of North Borneo in 1884, replacing Kudat. As the capital of North Borneo, Sandakan become an active commercial and trading centre. The main trading partners were Hong Kong and Singapore. Many Hong Kong traders eventually settled in Sandakan