CONFIDENTIAL
to him than at present within the scope of regulations
similar to our own (paragraph 4 of the note).
3.
Michael Heseltine proposes to use the consultative
document as his brief when he visits Hong Kong next
week and the Hong Kong Government representatives wish
to show it to slipowners there on a confidential bapie
before his arrival. We also propose to show it on a
confidential basis to both sides of the shipping
industry here. They have already been sounded on this
cubject and are not well disposed to changes which
would look like the establishment of a flag of
convenience under the Red Ensign and would reduce
employment opportunities for British officers.
we think we might be able to move along the lines of
the consultative document without a major row and a
flight of ships from our register to that of Hong Kong.
It remains to be coen whether liong Kong shipowners
would be prepared to register more of their ships there
but this we should be able to judge from discussions
in Hong Kong.
However,
4. Would you kindly authorise us to proceed on these
lines. The Hong Kong shipowners have sought greater
concessions since ir Pao was in London and the liong Kong
Government have been moved to follow suit. It is
importent that they should not feel that they can force
us to concede further in advance of negotiations within
ECC. We would like to be sure that you regurd our