}

encourage Hong Kong people to continue living and working in Hong

Kong. Under the British Nationality Act 1981 BDTCs who have been

resident in the UK for 5 years have an entitlement to registration

as British citizens. Someone who has been in Crown service under

the Government of a dependent territory (eg Hong Kong) may be reigstered at the Home Secretary's discretion without residence in the UK, paying regard to the special circumstances of the individual

case.

[If pressed on criteria for exercise of discretion] Applications will be considered on their merits but it has always been the intention to use this provision very sparingly.

Undertakings to People in Hong Kong

5.

Working for an agreement which will encourage all Hong Kong

people to continue living in the territory.

Split Between HMG and UMELCO

6. No question of a split with Unofficials. Collaboration with Unofficials, including EXCO Unoffiicals who are Governor's confidential advisers, remains close. An important source of

advice.

What if a Draft Agreement was Rejected by Hong Kong?

7.

Hypothetical question. Working to achieve agreement which will be acceptable to people of Hong Kong. Continuing consultations with

Hong Kong people help us to know their aspirations.

Assurances

8.

1

Working for a binding agreement in which arrangements for Hong Kong's future would be formally recorded. Would be recognised by international community. No absolute assurance but international

prestige of two sides would be at stake. Both sides have a common interest and commitment to the maintenance of Hong Kong's prosperity and stability.

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