/16.
22. One problem that cannot readily be resolved by use of the
duty quota approach is that of the scope of beneficiary countries.
The most important problem from our point of view is Hong Kong.
If in the event the EEC decide to exclude Hong Kong we shall have
to find some device by which we can redress the balance.
Possibilities are to exclude from our scheme certain countries
that are associated with the EEC, in particular Greece, or to
redress the balance under the burden sharing principle by
excepting a larger number of items altogether.
23. We shall need to consider in what ways fresh legislation
will be required to give effect to duty quota systems.
In any
case legislation will be required to enable us to discriminate
in the tariff between developed Commonwealth countries and
developing Commonwealth countries. It is not clear without advice
from Tariff Division whether the administration of duty quotas
requires any change in the Board of Trade's current powers but it
appears from the account given in paragraph 15 above that the use
of duty quotas may already be within existing powers. One question
will be whether we are able to order the re-imposition of a tariff
in circumstances that are not the results of international agreement
as normally defined or of domestic application.
Political considerations
24.
Apart from the practical advantages in terms of burden sharing
and assurances to domestic industry that, subject to answers to a
number of questions raised above, should result from adopting
the EEC's system, there are probably a number of political
advantages in following the Community's lead. Against this can
be set difficulties with our EFTA partners, in particular the
Scandinavians, who could argue that such a sharp reversal on our
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