CONFIDENTIAL

14. Article 2(3): This is the "exception to loss" clause. At this

stage it is purely illustrative, pending a final decision on who should be

excepted. It refers only to the post 1 January 1983 situation, for the

reasons set out in the covering letter, namely that settlement was not an

issue prior to 1983. Birth alone in Hong Kong was sufficient to confer

CUKC status, and therefore clearly established a "separate" Hong Kong

BDT citizenship, irrespective of the nationality or immigration status

of the parents. To attempt to provide for the pre-1983 provision would

probably be unworkable, given that we are not merely concerned with young

children born in recent years, but also with older people whose parents

may have been born in Hong Kong prior to the 1948 Act, and certainly prior

to the existence of the term "settled".

Loss of British Dependent Territory citizenship

15.

Article 3: this provides for those people previously defined as

BDTCS by virtue of a connection with Hong Kong to lose that citizenship on

1 July 1997, but excludes those persons who can establish a "separate"

route to BDTC by a connection another dependent territory.

would not meet the requirement of Article 3(b), and would therefore

automatically be excepted from loss of their citizenship.

Such persons

Right to acquire new status of British National (Overseas)

16. Article 4(1) specifies the date on which the new nationality will

come into being. In order to fit in with the normal validity period of

passports, it is intended that it should be introduced ten years before

the handover date. (BN(0) passports could not, of course, be issued before

this date).

17.

Article 4(2) enables Hong Kong BDTCs to acquire BN (0) status, as

a matter of entitlement. The words in square brackets await a decision

as to whether excepted "separate" BDTCs should be eligible to apply for

BN(0) status. If so, they will need to be omitted.

18.

Article 4(3) is necessary to accord with the wording of the

Memorandum. In order to be eligible to retain BN(0) status a person must

be a BDTC on 30 June 1997. A person who acquires BN(0) status and

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