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Mr Cowell

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FEGE 30 APP14

GOVERNMENT HOUSE.

HONGKONG. 8th. April, 1914.

IN 29174/13

In reply to your Despatch lo. 313 of the 15th.

of October, I have the honour to inform you that your interpretation of the meaning of Clause C of the draft terms upon which I recommend -ed that this Government should deal with the question of the renew- -al of Seventy-five years Crown Leases, is correct. I regret that my Despatch No. 271 of the 28th. of July was not more clearly worded.

I have also to inform you that I am satisfied that it is not possible to differentiate between Crown Leases in the Hill District and similar Crown Leases elsewhere in the Colony.

I am not sure, however, how you wish renewable leases to be dealt with, and I notice that you make no reference to 99 years leases to which I referred in the last paragraph of my Despatch quoted above.

2.

3.

I have assumed that you desire to apply the principle of compensation for improvements to 99 years Leases; and it seems to me that if that is so it is reasonable, and unobjection- -able, to treat 75 years renewable Leases in the same way as 75 and 99 years Leases. The only alternative would be to issue a notice that Lessees holding renewable Leases would be given some compensa- -tion at the expiration of the renewed term. I am of opinion that it would be impolitic to give any such undertaking, for in the event of a severe depreciation in land values this Government might

14

RIGHT HONOURABLE

LEWIS HARCOURT, M.P..

&C..

&C..

&C...

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