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Switchboard 01-233 3000

XFE 451/9

RECEIVED IN REGISTRY No. 21

-7 JAN 1986

Dew Richard

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Action Takeh

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Our reference

Date

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6 January 1986

HONG KONG: ISSUE OF BRITISH NATIONAL (OVERSEAS) PASSPORTS

27 XFE 451/30 (1985)

Many thanks for your letter of 16 December.

The

avargements for issuring saperts in H.K. hi ot charged. Face

consult HKD, NTD etc. but I fear

that unless we

I agree that we should not do anything which might call into question our good faith in the whole difficult process of transition. However, I do not agree that treating the receipts from the issue BN (0) passports in a manner consistent with our practice elsewhere would do so. It is not clear to me why the arguments you set out in your minute of 23 September to Mr. Marcelin should now be set aside because the Hong Kong government have been accustomed to making a 'profit' from the issue of UK passports. As you say the situation has now charged and the correct precedent is to look at arrangements for the issue of British passports abroad. I understand that the number of BN(0) passports likely to be issued in the period in question is of the order of 21⁄2 million. If the Hong Kong government retains all the fee they will make £15 million "profit".

You mention the services performed by the Hong Kong government on behalf of H.M.G. So far as the issue of entry clearances am I correct in believing that with the introduction of an entry certificate fee the Hong Kong government now receives some revenue for this service. I don't see the relexance of the fact that in the past they didn't. If it is being suggested that in the past the U.K. benefitted, surely it is also the case that in the past Hong Kong has benefitted substantially from the issuing of U.K. passports. Nor am I quite clear about the point you raise in paragraph 5. If what is being stated is that at £15 per issue the Hong Kong citizens are being overcharged, the answer is not to let the Hong Kong government keep the difference but to reduce the fee; unless this would set an unfortunate precedent.

I would hope that the Hong Kong government could be assured. that we are not trying to make money out of the situation but merely applying our arrangements in a consistent manner.

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RECEIVED IN REGISTRY

15 JAN 1986

*FICER

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