SECRET
Reference......
Mr A R Rushford (Deputy Legal Adviser)
기
of his
usord power to ovorniche the Execut wi
Council
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HONG KONG
1.
Arising out of a question concerning Hong Kong Sterling Reserves the Treasury have asked for a formal legal opinion on the extent to which HMG can control the actions of the Hong Kong Government. The instance they are thinking of would be the reduction by the Hong Kong Government of their Sterling holdings in London against the wishes of HMG.
2
We have given it informally as our view that constitutionally the Governor could be instructed by HM the Queen through the Foreign and Commonwealth Secretary to take any given course of action, with the important rider that this question cannot be looked at in purely constitutional terms since in practice this authority has not been exercised in recent years. Furthermore, politically, the imposition by HMG of a decision which went strongly against the advice of the Unofficial Members of the Executive Council and which necessitated the use by the Governor of his Official Majority in the Legislative Council would have far reaching repercussions.
3. I shall be grateful for your views. It would be helpful to have these soon as Treasury officials think the Chancellor may ask for this in connection with the steps to be taken in the near future over Sterling.
I agre
AR.R
31.7
SECRET
1.
M A Goodfellow
Hong Kong and Indian Ocean Department
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Wetter To Tay
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PA
(17293) 897465 400m 1/73 G.W.B.Ltd. Gp 863
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