CONFIDENTIAL

DRAFT

17/2/1

Mr Y K Pao, during his visit to the Prime Minister on 7 June, suggested the

setting up of a separate Hong Kong register of shipping and the Prime Minister

undertook to have this idea examined. Although technically possible, officials

consider that the potential disadvantages of implementing the idea outweight

the advantages.

REGISTRATION

Under the Merchant Shipping Act 1894 Hong Kong is a port of British registry:

ships registered there are British ships and must comply with the safety

standards and manning requirements laid down for British ships. The DTI

are at present consulting UK interests about the possibility of revising

the 1894 provisions on registration, conscious of the Rochdale Committee'a

view that the registration provisions in respect of the Commonwealth would

increasingly appear anachronistic and should be reviewed. However, revision

would involve re-negotiation of part of the Commonwealth Merchant Shipping

Agreement 1931 which would take time and changes in the legislation are

therefore unlikely in the near future: in any case the provisions relating

to colonies would not necessarily be affected,

The arrangements envisaged by Mr Pao might more quickly be brought about by

the creation of a separate Hong Kong registor. This could be done by local

statute, confirmed by an Order in Council. The nationality requirements for

senior officers, and the specifications for materials and equipment, might

then be different from those laid down for British ships.

CONSTRUCTION AND SAFETY EQUIPMENT STANDARDS

At present, Hong Kong applies high standards, comparable with UK standards,

for the construction of ship, for materials and equipment, for fire appliances

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