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[Para 10 as original draft]

DSR 11C

10. We shall be pursuing these questions with Hong Kong

and with Home Office officials and we shall prepare a submissio

to Ministers about the issue of BN (O) passports in Hong Kong

as soon as possible. A possible complication so far as

consulations with Hong Kong are concerned is that their

Immigration Department already acts on behalf of HMG in

issuing entry clearances for the UK. In doing so they

apply UK consular fees for these services but I understand

that the Hong Kong Government/retains the full amount of such

fees and is not required to account for the costs of providing

the service.

11. In view of all these considerations, it hardly seems

reasonable for Mr Hyde to request a reply to his letter

within a week. He is seeking to rush us. It is true

that the timing of the White Paper imposes a constraint but

the financial aspects do not need to have been cleared by

then.

I accordingly submit a draft reply from you to Mr Hyde

which goes as far as we can at present. The draft together.

with this minute, has been cleared with ECD(I), HKD and

Finance Department.

Separate submissions will follow on

the common

ommon format look-alike' and the arrangements for

Hong Kong.

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