To: Governor, Hong Kong

Repeated to Brussels for Dodge UKMIS Geneva for Pearson CODEL Brussels

A

Following

CONFIDENTIAL

From Mills

PRIORITY

EEC Generalised Preference Scheme: Proposed Exclusion of 12 Items

1. Dodge and I saw Schoffer of the Commission on

Thursday afternoon (11 November): Tran had left

for Paris.

2.

2 Schoffer said that the Commission had under

consideration proposals to exclude Hong Kong from preference

proposals in respect of 12 items.

ways in which this could be done:

(a)

There were three

exclusion by Community regulation of

dependent territories,

(b)

(c)

exclusion by Community regulation of

Hong Kong alone,

A voluntary undertaking by Hong Kong not to

claim preference in respect of these items.

He hoped Hong Kong could accept last alternative

since to do so would be to give effect to an assurance

which had been exchanged between EEC and HMG officials

during entry negotiations. I responded that Hong

Kong could not agree voluntarily to forego preference on

t items in question and expressed surprise that any

assurance had been given as Schoffer had alleged. I

said that I had had discussions with HMG officials on

Tuesday (9th November) and it had been clear from that

discussion that the HMG officials with whom I spoke had

"no knowledge of any such assurance and that it was

inconceivable that such an assurance would have been

given without the knowledge of the Hong Kong Government.

Schoffer admitted that he himself had only become aware

of the assurance within the past two or three weeks but

The

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