DRAFT
SECRET
FUTURE OF HONG KONG AND LEASES IN THE NEW TERRITORIES
DSR 11C
Points Requiring Further Elaboration
1.
How far do Chinese differentiate between short- and long-
term problems? Do they understand our "leases" problem?
(We
2. Our own aims: Do we agree that we must proceed step by
step, with the short-term problem the first priority?
must, however, not rebuff the Chinese if they offer a
dialogue on the longer-term issues.)
3. Given the Chinese rejection of our proposals in 1979,
can we get an understanding that New Territories leases
should run beyond 1997 without any reference to continuing
British administration?
4. Legal position on leases.
Indeterminate leases would
Determinate
not be possible without fresh legislation.
leases (e.g. for 25 years) might be legally feasible without
legislation, but the position is not sufficiently clear to
avoid challenge in the courts. Possible option of
"periodic" leases automatically renewable if not terminated
by either side.
5. Chinese attitude to legislation. They objected to this
in 1979. Was this because of the proposed link with British
administration, or would they see any legislation affecting
the post-1997 situation as unacceptable?
6. It would be possible to have unpublished legislation by
means of Royal Instructions conveyed by the Secretary of
State to the Governor which could be revealed at the appro-
priate moment if the grant of a lease beyond 1997 was
challenged. There are domestic political drawbacks in this.
Would the Chinese have to be told in advance (but in confi-
dence) and how would they react?
SECRET
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