Mr. Laird
Reference..
HKK.6/18 with (28
Delegation of authority to Hong Kong
Dunnett raises two points in his letter of 25 August:
2.
(a) Broadening of authority to include
all goods and not textiles only.
(b) The addition of "in a form of words
agreed with the Governor" in para- graph 9 of the despatch.
Mr. Hughes in his letter of 17 April at (13) wrote that the Board of Trade were content with the revised "Concordat" which did not limit the delegation of authority to any specific commodity. It is correct, as Dunnett says, that Hong Kong's freedom to negotiate is liable to extend to anything if the authority does not confine itself to textiles. But in paragraph 9 of the draft despatch, it lays down that the Hong Kong Government will have to keep H.M.G. informed about what they are doing and reserves the rights of H.M.G. in respect of any action which the Hong Kong Government may propose to take. This seems to provide adequate safeguard against the possibility of damage to the U.K.'s interests to which Dunnett refers.
3.
The suggestion that a qualification (possibly by separate despatch) regarding goods other than textiles giving notice that a restraint agreement by Hong Kong would damage H.M.G.'s interests should be added also seems unnecessary in view of the terms of paragraph 9 of the draft despatch.
4.
The proposed broader delegation of authority would not, as Dunnett fears, come near the terms of GATT Art. XXVI, para. 5(c) which applies only to a customs territory which "possesses or acquires full autonomy in the conduct of its external commercial relations". Paragraph 9 of the draft despatch makes it abundently clear that Hong Kong will not be given full autonomy and Hong Kong cannot therefore be deemed to be a contracting party to the GATT.
5. The despatch makes it clear that Hong Kong is represented in the GATT by H.M.G. where direct conflict with H.M.G.'s views is avoided. Hong Kong spokesmen will therefore be kept on the leash.
6. Dunnett refers to Hong Kong's negotiation of bilateral agreements with the EEC. It should be borne in mind that she is already doing so in regard to cotton textiles. Negotiations with EEC by Hong Kong in other goods should not present a weaker position.
•
7 In regard to Dunnett's second point, paragraph 9 of the despatch states that "the rights of H.M.G. will be exercised only after the views and advice of the Government of Hong Kong in a form of words agreed with
the Governor have been considered at ministerial level".
/This.....