CONFIDENTIAL

ZC ZC

CONFIDENTIAL

FM FCO

TO IMMEDIATE HONG KONG

TELNO

OF 111100Z MAY 89

AND TO ROUTINE WASHINGTON, PEKING

Have cleared to

ERD

1/

Mler 38512

IMMEDIATE

(17)

YOUR TELNO 1464: KERRY AMENDMENT TO ANTI DRUG ABUSE ACT

1. We would have preferred any meeting in Hong Kong with the

Americans to have followed our own discussions with the American

Embassy here in London.

2.

However, it is important that Hong Kong policy should be as

consistent as possible with UK policy on this issue. You should

therefore draw on the following:

a) As a point of principle the Americans should be told

firmly that, largely for reasons of extraterritoriality you do not accept that the US drugs legislation applies to

the Hong Kong banking sector.

b) The UK Drug Trafficking Offences Act 1986 (DTOA) has

proved effective in combatting money laundering and Hong

Kong legislation which is similar should prove as

effective as the UK's. So you do not accept that any

action is called for as a result of US drugs legislation.

GB1AOZ

ERD

G BROWN

270 2683

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