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3. MY SUGGESTION IS BASED ON THE ASSUMPTION THAT TEXTILES CONTINUE TO BE CONSIDERED A SPECIAL CASE. IF, HOWEVER, A MORE GENERAL DEROGATION OF AUTHORITY WERE TO BE CONSIDERED IN THE FIELD OF EXTERNAL COMMERCIAL RELATIONS, AS SUGGESTED IN PARA. 2 OF HONG 66) KONG TELEGRAM NO. 525, AND THIS WERE TO EXTEND TO MATTERS, OTHER
THAN TEXTILES, ARISING IN THE GATT, THE LOGIC OF THE SITUATION WOULD POINT TO SEPARATE HONG KONG REPRESENTATION IN THE GATT THROUGH ITS BEING QUOTE DEEMED UNQUOTE A CONTRACTING PARTY UNDER
(66)
NO ARTICLE XXVI:5(C). THE WORDING OF THIS PROVISION AND THE HISTORY OF
ITS DRAFTING SEEM TO SHOW THAT IT WAS INTENDED IN 1947 TO APPLY TO DEPENDENT TERRITORIES: BUT SO FAR AS I KNOW IT HAS NEVER DONE SO. AND IT MAY WELL BE THAT IN THE INTERNATIONAL CLIMATE OF TODAY SUCH A SOLUTION WOULD RAISE DIFFICULTIES WITH, E.G. DEVELOPING COUNTRIES. BUT THERE IS NO CERTAINTY THAT THIS WOULD BE SO GIVEN THAT THE GATT, IN CONTRAST TO UNCTAD, IS GENERALLY CONSIDERED A TECHNICAL RATHER THAN A POLITICAL BODY.
4. IN CONSIDERING ALL THESE POSSIBILITIES, IT HAS TO BE REMEMBERED THAT A HONG KONG GOVERNMENT VIEW, EXPRESSED AS SUCH IN THE GATT, WOULD CARRY LESS WEIGHT IF IT WERE KNOWN NOT TO REPRESENT U.K. POLICY. IT WOULD THEREFORE BE ALL THE MORE IMPORTANT TO TRY TO ENSURE THAT CONFLICTS OF VIEW WERE REDUCED TO A MINIMUM BY PRIOR COORDINATION OF POLICIES IN LONDON OR GENEVA.
5. MY COMMENTS DO NOT, OF COURSE, AFFECT THE EXTENT OF ANY DEROGATION THAT MAY BE GIVEN TO HONG KONG TO CONDUCT ITS COMMERCIAL RELATIONS ON A BILATERAL BASIS.
FCO PASS GOVERNOR HONG KONG AND WASHINGTON.
SIR E MELVILLE
[REPEATED AS REQUESTED]
INTERNATIONAL TRADE DISTRIBUTION
HONG KONG DEPT
COMMODITIES DEPT
TRADE POLICY DEFT
EUROFEAN INTEGRATION DEFT
AMERICAN DEPT
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