CONFIDENTIAL

passports of CBDTS should show them as UK or British

Nationals.

However, this should be qualified by one

or other of the following endorsements:-

'Holder has

the right of abode in Hong Kong' or 'Holder has no

right of abode in UK'. Hong Kong's preference is for

the former.

I believe that these two measures might be just

enough to allay the fears of UMELCO and at the same

time avoid the difficulties outlined in your minute

of 11 May. If you agree with this approach, perhaps

we could have a word on the telephone about timing

of a statement in the House.

CONFIDENTIAL

A

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