w/27/11

DRAFT TELEGRAM TO GOVERNOR, HONG KONG

1. I an forwarding, by bag, a copy of the study team's report on the feasibility of setting up a separate Hong Kong Register. I am also sending a copy of a resolution recently passed by the International Transport Workers' Federation about their attitude to the proposal.

2. On the certification of officers, we endorse the

team's view that, for the purpose of issuing Hong Kong Certificates during a specified transitional period to experienced officers on Hong Kong ships, it would not be satisfactory to rely on an interview alone. We therefore propose that special examinations, on the lines suggested by the team, should be instituted for this purpose. On safety equipment it is important to avoid a double standard in relation to Hong Kong and UK ships. We would therefore propose that a UK surveyor should be stationed permanently in Japan, at our expense, for the approval of Japanese equipment for UK and Hong Kong ships. This surveyor would also perform other functions in relation to UK ships building in Japan and would, we hope, be assisted by a Hong Kong surveyor.

3. But I am sure that you will understand that such an arrangement would have commercial implications. It would provide an advantage to the Japanese, bearing in mind the present exports of British safety equipment for incorpora- tion in UK ships building in Japanese yards. Whilst we do not want to over-emphasise this point, we cannot ignore it and we shall therefore have to examine the possibility of the Japanese making some countervailing concessions to compensate for the damage which our marine equipment industry would suffer.

4. The next step at this end will be to discuss our revised proposals with both sides of the shipping industry, We think that the new scheme may be more acceptable to

our unions than previous proposals but as you will sense

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