File No.ME...9/393/1..

FRD

........

OUTWARD

Security Classification CONFIDENTIAL

Precedence ROUTINE

Department

Drafted by

(Block Capitals)

D I LEWTY

TELEGRAM

G 206

Tel. Extn..

DESKBY

FOR

COMMS. DEPT.

(Date)

Despatched

POSTBY....

USE

(Time) .................Z

PREAMBLE

(Time of Origin}

Z(G.M.T.)

CONFIDENTIAL

(Restrictive Prefix)................ (Caveat

(Security Class. }

Privacy Marking)............

[Codeword)

ORWELL

(Deskby)..............

ROUTINE

TO..........

(precedence)

HONG KONG

(post)

Tel. No.

of.

AND TO (precedence/post)...

AND SAVING TO...........

REPEATED TO (for info)..

SAVING TO (for info)....

..Z

...Z

i

..Z

tribution:-

ORWELL

-144

나나

FRD

HKIOD

pies to:-

[TEXT]

YOUR TEL NO 594:

STERLING GUARANTEE

1. We regret that misunderstanding persists about

the provision relating to accidental breaches.

2. Part of the problem seems to derive from your

view that HMG has sought to restrict the application

of the term accidental breach contained in para 2 of our Tel No 1209 of 26 November 1973 (described

in what follows as the November formula).

there has been no intention on our part to restrict it

In fact,

in any way.

3. You suggest in para 5 of your telegram that

the November formula would have accommodated

any breach (not involving a deliberate reduction in sterling holdings) which resulted from a fall

/in

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