DRAFT
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ANNEX C
DSR 11C
LAND LEASES IN THE NEW TERRITORIES
ESSENTIAL FACTS
1.
Initial exchanges on possible forms of land lease should
Should avoid suggestion that we have
be exploratory.
reached firm conclusions. Broad alternatives appear to be:
a) fixed term leases extending beyond 1997 Those should
provide reasonable reassurance for investors and would
imply (though not state) some form of British admini-
stration after 1997. They could thus pose political
problems for the Chinese;
b)
2.
a periodic lease renewable each year unless land required
by the Hong Kong Government for 'public purposes'. This
would not impy post-1997 jurisdiction so directly, but
it would be less attractive to investors.
An additional problem over (a) is that it would probably
require a fresh legal basis since the power of the Hong Kong
Government to act in this way is not clearly established.
It could be put beyond doubt by an Order in Council. This
would not refer to the continuance of British administration
of the New Territories after 1997, although it would imply
It is not possible to gauge the Chinese reaction to
such a move.
it.
3. If the Chinese accepted the principle of such a legal act
the timing of its implementation could be discussed. Whilst
there is a clear advantage in establishing the legal basis
for extended leases before they are issued, publication of
the Order in Council itself might attract undue public
attention or speculation. An alternative would be to employ
the instrument retrospectively and only if and when the
/legality
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