CONFIDENTIAL
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6. Mr Donald said that HMG might be involved if the Secretary of State for Trade were to disagree with the recommendation of the Monopolies Commission, although legally he had the right to decide on his own. Lord Carrington said that the important thing was to make sure that the HSBC were not rejected on the grounds that they were not 'British' or because of doubts about the future of Hong Kong. He asked whether in fact people in Hong Kong would regard the HSBC bid with some suspicion as a sign of the moving out of British funds. Sir M MacLehose said that there was indeed some mistrust of this sort but this did not mean that there would not also be objections to a rejection of the HSBC for the wrong reasons.
DISTRIBUTION:
HKGD (to enter)
Private Secretary
PS/LPS
PS/Mr Ridley
PS/PUS
Sir E Youde (o/r)
The Lord Bridges
Mr Donald
Mr Bayne, ERD
Acting Governor, Hong Kong (Personal)
CONFIDENTIAL