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Application of the UK Merchant Shipping Act
to Hong Kong
At Mr. Royle's lunch for Mr. Y. K. Pao recently Mr. Pao suggested that if the application of the UK Merchant Shipping Act to Hong Kong could be modified, enabling ships on the Hong Kong Register to sail with
Masters and officers not necessarily of British
nationality, this would remove the obstacle in the way of the registration of his ships in the Colony.
2. I have spoken to the experts in the Board of Trade about this and, without going into the question in detail, they are of the view that flags of convenience
are adopted because of the wider taxation advantages
to be gained. They confirmed, however, that what
Mr. Pao said about the nationality of Masters and
officers of ships registered in Hong Kong was correct they must be British. If we would like them to, the Board of Trade will look into this question in detail. I feel myself, however, that this would be putting them
to a great deal of trouble only to produce an answer
which would not suit Mr. Pao.
3. In the circumstances Mr. Royle may wish to tackle
Mr. Pao about this when he meets him in Hong Kong next
week.
1 October, 1970
[Marin
(E. 0. Laird)
Hong Kong Department
I think that it would be work looking into the
question whether
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