Reference..
HKK 6/24 with (16)
Mr. Carter
The only indication I have seen from our papers how EEC might attempt to justify the introduction of QR's is given at (X) on page 9 of (15). Mr. Ernst seems to have said when he visited Hong Kong that the much disputed Article 19 could be loosely interpreted to cover this sort of restrictive action. But there are no indications that the EEC is bothering at all to justify the extension over the whole community of quota restrictions which at present apply in indivi- dual countries and I suppose that a rather flimsy argument could be made out to the effect that no new restrictions were being introduced in such circum- stances because they already applied in parts of the community which was thus taking a necessary adminis- ! trative step to harmonise its internal commercial
policy and no more.
2.
I think we cannot let these restrictive measures go by without GATT protest on Hong Kong's behalf. BOT officials in the context of preferences for developing countries maintain their line that the moment has not come to intervene in open forum, but only to use official channels and confine ourselves to "the corridors" From the papers Mr. Christofas sends it is evident that Mr. Dodge does not share this view while he himself is undecided.
3.
This is really a trade policy matter and with little knowledge of how much influence officials in the Commission have over the political decisions of the community it is difficult to advise. But I have seen the view expressed more than once that if EEC policy once crystallises it is virtually impossible to change it on account of the complexity of the process of consultation and internal adjustment between the member countries which precedes decisions. I have had the uneasy feeling that we might wake up one day to discover that the community's policy by our default was in immutable form.
4. The paper at (15) has probably not been seen by TPD but it is very useful. It is so long that I suggest we send our file to them rather than copy it and not for the first time debate with them the question whether we ought not to make another effort to persuade the BOT to take an open initiative rather than continue to rely on the undoubtedly energetic efforts being made at official level on Hong Kong's behalf. I can well imagine that any overt interven- tion on Hong Kong's behalf could prove embarrassing in the long run to the UK because if we get into the community we will presumably have to fall in line with any common or special procedures they may then have to govern the import of products from Hong Kong and elsewhere. This point is well made in paragraph 33 of (15).
(H. H. Stewart) 30 September, 1969