CONFIDENTIAL

It

seems to me that a similar system should be employed for the UK's relations with the SAR after 1997, the only material difference being that the agreements will have to be between the UK and the Hong Konc SAR and cannot, therefore, be signed ΟΙ enter into force until 1 July 1997. The entrustment/authorisation will obviously have to be given to the Government

the SAR by the CPG. Unfortunately, it will not be possible for the UK to enter into international agreements with Hong Kong before 1997 that can run on after 1997.

The third (and very

of

important) question that we

4. need to consider is when we should raise this with the Chinese side.

While agreements on the various subjects between the UK and HKSAR will, as I have said, only be capable of entering into force after 1 July 1997 it will be essential, it

to me, that they go through the whole process of preparation and consultation with the Chinese side well before 1 1 July 1997 and will therefore be ready for signature and entry into force on or shortly after that date.

In this way the preparation of the relevant agreements would be kept under our control and the normal pressures could be brought by us to achieve the results we need. We could not afford, for obvious reasons, to leave this exercise too late or until after 1 July 1997. Any leverage we might have before that date would certainly disappear after it. As it is, the Chinese might be tempted to argue that they and the SARG will take care of these matters after 1997 in accordance with JD 34.

5.

I look forward to having your thoughts (and those of the people to whom I have copied this letter) on all this. We could then start putting together a strategy and timetable and thereafter preparing the necessary papers.

Чи

CC

Miss Shelagh Brooks

(D M Edwards)

Law Officer (International Law)

Miss Jill Barrett

Mr Alan Paul UKREP JLG Mr Michael Suen

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