CONFIDENTIAL

Disappointing that we have not been able to put forward a revised proposal. The subject is under urgent consideration but

there remain some important points of principle to be agreed

within Whitehall and some detailed technical and legal matters

to resolve. As you may know, the Governor of Hong Kong is taking a close interest in progress and the Prime Minister is

also aware of the issue.

Can assure you that when we do put forward a revised proposal we will seek your views on any element of the package which may

affect your members.

ospa.pnts.ADM

CONFIDENTIAL

SLM

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