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giving the Chinese advance notice of our intentions in

reassuring terms would also require careful thought.

12. As for timing, my feeling is that action in the

relatively near future would be preferable to letting matters

drift, but much would obviously depend on our assessment

of Chinese reactions.

13. My own belief, for what it is worth, is that it is

dangerous to rely on securing express Chinese agreement to

a change in our law. Our last approach (which I thought

was a mistake) was unprofitable

-

rather than have to say

They must

"yes", the Chinese might actually welcome a fait accompli

if it were tactfully and reassuringly presented.

know that, whatever laws we pass for domestic purposes, they

could always take possession of Hong Kong if they wanted to!

14. As for the form of our legislation, my preference among

the alternatives indicated in paragraph 7 above would be for

an Order in Council (under the Royal prerogative) to the

effect that, so long as the rest of Hong Kong is subject to

an administration established by the United Kingdom, then,

notwithstanding the expiration of the lease referred to in

the 1898 Order, the New Territories shall also be subject to

that administration and that accordingly article 1 of the 1898

Order is amended by the deletion therefrom of the words "and

for the term".

15. The same result could be achieved in other ways, e.g.

by revoking the 1898 Order and replacing it by a new separate

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/ Order

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