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CONFIDENTIAL

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CONFIDENTIAL

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TO PRIORITY PORT OF SPAIN TELEGRAM NUMBER 109 OF 29 JUNE AND TO GOVERNOR HONG KONG, HONG KONG (FOR MACAO), THE HAGUE (FOR SURINAM) AND CERTAIN OTHER POSTS INFO UKMIS NEW YORK UKDEL EEC UKMIS GENEVA

UKDEL OECD WASHINGTON BOMBAY OTTAWA CANBERRA WELLINGTON LISBON

KARACHI INFO SAVING TAMSUI.

MY SAVING TELEGRAM NO 3 OF 30 OCTOBER 1970 (NOT TO ALL):

ARRANGEMENTS FOR ENDING OF QUOTA RESTRICTIONS ON IMPORTS OF COTTON

TEXTILES.

ON 25 JUNE WE TABLED A NEW CLAUSE TO THE 1971 FINANCE BILL GIVING

POWERS TO GRANT RELIEF FROM THE NEW DUTY ON COMMONWEALTH COTTON

TEXTILES FOR GOODS EXPORTED UNDER QUOTAS ON OR BEFORE 31 DECEMBER

1971 BUT NOT ARRIVING IN BRITAIN UNTIL ON OR AFTER 1 JANUARY 1972.

TEXT IS IN M.1.F.T.

2. QUOTA RESTRICTIONS WILL BE REMOVED ON COTTON TEXTILES EXPORTED

-REPEAT EXPORTED FROM INDIA, HONG KONG AND THE GLOBAL QUOTA

COUNTRIES AFTER 31 DECEMBER 1971. SOME IMPORTERS IN BRITAIN AND

SOME AUTHORITIES IN EXPORTING COUNTRIES APPEAR TO BE UNDER THE

IMPRESSION THAT GOODS SHIPPED IN 1971 IN EXCESS OF THE 1971 QUOTAS MIGHT, IF THEY ARRIVED IN BRITAIN AFTER 31 DECEMBER, BE ADMITTED

WITHOUT RESTRICTION, THIS WOULD BE UNACCEPTABLE TO HMG. IT WOULD BE

TANTAMOUNT TO REMOVING RESTRAINT FROM FAR OFF SOURCES FOR AS LONG

AS 2 TO 3 MONTHS BEFORE THE END OF 1971. GOODS EXPORTED IN 1971

FROM ALL SOURCES SUBJECT TO QUOTA WILL BE LICENSED FOR IMPORTATION

AFTER 31 DECEMBER ONLY IF THEY ARE WITHIN THE QUOTA LIMITS FOR THE

YEAR 1971. AS THERE WILL BE NO QUOTAS FROM 1972 ONWARDS THERE CAN, OF COURSE, BE NO QUESTION OF ALLOWING, AS IN THE PAST, FOR EXCESS SHIPMENTS (OVER THE 1971 QUOTA) IN ANTICIPATION OF THE NEXT YEAR'S

QUOTA. IT ALSO FOLLOWS THAT ANY SHIPMENTS MADE IN 1970 IN

ANTICIPATION OF THE 1971 QUOTA WILL HAVE TO BE COUNTED AGAINST THAT

QUOTA SO THAT THE AMOUNT TO BE SHIPPED IN 1971 WILL BE THE 1971

QUOTA LESS ANY ANTICIPATORY SHIPMENTS MADE IN 1970. IN PRACTICE,

THIS LAST POINT MAINLY AFFECTS PAKISTAN, WHO HAS RECENTLY AGREED

ON THE 1971 QUOTA LEVELS NET OF 1978 ANTICIPATION.

CONFIDENTIAL

/3. WE CONSIDER

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