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agreement that the Chief Executive of the SAR Government should be authorised to sign the treaties as soon as possible after 1 July 1997. Hong Kong propose to send a negotiating team to London this December to negotiate the draft treaties.

4. I should be grateful for your views and those of all copy recipients as to:

(i) Whether there are any changes you would wish to see in the Hong Kong model treaty (bearing in mind that each change away from the model text will make it more difficult to secure Chinese agreement).

(ii) Whether you think there will be any transitional

difficulties concerning the transfer of sovereignty in respect of Hong Kong to China with regard to the reciprocal

enforcement of judgements and whether you think there are any other steps we might undertake to overcome them.

5.

I should particularly like to draw the attention of the DTI to Article 2 (iii) and (iv) of the model treaty. Do you feel the references to "bankruptcy" and "winding-up of companies" need expanding in the light of the 1985 Insolvency

Act?

6.

Detailed points can be pursued with Wendy Wyver of this department on 270-3287. A number of UK/HKSAR agreements will be discussed during a visit by a Hong Kong Government delegation beginning on 10 December. The time remaining to us and Legal Advisers to finalise the negotiating brief is therefore very limited. With apologies for the short notice, I would be grateful if you could pass us your comments or views by 29 November at the latest.

Yours ever,

pp.c

CE Garrett

Hong Kong Department

cc: Miss Brooks, Legal Counsellor

Ms Anna Godwin, DTI

Mr J R Peerless, Scottish Office

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