CONFIDENTI AL
1.
2.
You, Mr Stuart and I discussed your minute overleaf today.
In my view HMG would not be legally liable to honour a guarantee given by the Hong Kong Government to a consortium of Japanese business firms.
3.
If HMG relinquished responsibility for Hong Kong, it is to be hoped that the successor government in Hong Kong would honour existing obligations of the predecessor government in Hong Kong and no doubt HMG would endeavour to negotiate this at the time the change of regime took place. There is nothing that could be done at present to effect such a devolution of responsibility.
4.
HMG would undoubtedly come under moral pressure to honour the guarantee in the event of default by the present Hong Kong Government or any successor government.
5. I think therefore it would be wise for the Hong Kong Govern- ment in their negotiations with the consortium to make it plain that HMG will not accept any responsibility for the guarantee
22 October 1973
CONFIDENTI AL
A.R.R.
A R Rushford
Deputy Legal Adviser
ཨི
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