SECRET

PART IV: GENERAL CONCLUSIONS

25. The requirements indicated in the conclusions to

Parts I, II and III of this Annex can be met notwithstanding

relinquishment of sovereignty by the United Kingdom

provided that arrangements are made with the PRC giving

adequate powers and jurisdiction to the UK in the

territory under a management contract, exercisable without

undue interference from the PRC.

26. Whether those requirements could be met after the

incorporation of the territory into the PRC as a Special

Administration Region would depend on the willingness of

the PRC to allow the United Kingdom to exercise such

powers and jurisdiction in part of China under a

management contract without attempting also to exercise

their powers, ie would require an unusual kind of

forbearance.

27.

British law,

British Courts, is

administered by

nevertheless

one

of the foundations upon which

commercial confidence is based.

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