270
I am afraid the mistak was mine.
Our
telegram on 42502 should have referred to section 11 of the Trading with the Enemy Amendment Act 1914. The Governor also makes a mistaken reference in mentioning the Trading with the Enemy Ordinance 1914: he means the Trading with the Enemy Act. However, he has
understood our intention. I think his objection to
the employment of a Controller or Supervisor in such
a case is a good one. It had not appeared from pre- vious papers that the business of these companies was
carried on and managed entirely outside Hong Kong, in other words that the companies are "China Companies
within the meaning of the draft Order in Council now
before the Law Officers. As to the remedies which he
proposes, I do not think they are sufficient. Section
Can "but
35
to be put into operation till 31st December,
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und even when it is put in operation it does not
seem to follow as a matter of course that we shall
be able to terminate the companies' existence under
section 36. As to section 257, the Governor only
says that opportunities of enforcing it may arise. Moreover if these companies are, as stated above, "Chine
4
companies, sectione 35, 36, and 37 of the Companies
Grdinance 1911 will not apply to them when the new Companies Bill (see on 40876) is passed. If therefore it is necessary to take any definite action about
these companies, we must find some other way of doing it. You will remember that the position of companies
operating in China under British registration, but com- posed of enemy elements, was much discussed prior to the Interdepartmental Conference which took place at the beginning of August (see especially 28314 below).
The Foreign Office I think concurred in a subsequent letter with our letter of the 12t: July on that paper,
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but I have not been able to secure the paper in question. At any rate, the decision,which was, I think, confirmed by the Conference, was that no further action with regard to companies of this kind was required, having regard to the passing of the China, Siam &c. Proclamation and the prospective passing of the China Companies Order in
Council. The Order in Council and Proclamation will,
of course, make a considerable difference in the position
the buil of companies like the two now in question. Then it is passed, jurisdiction over them will apparently be vested entirely in the Supreme Court for China and any legi s- lation to enable them to be dissolved should presumably be passed for China and not in Hong Kong. Moreover, section 8 (1) of the draft Order in Council (see on
26700) provides that the majority of the Directors of
a China company shall be British subjects resident within the limits of the Order, and this provision should be of material assistance in enabling such companies to be
controlled. It seems to me therefore that it is not
very likely that Hong Kong legislation will be necessary or desirable, and in this connection I may call attention,
to 33838, which appears to have got mislaid after my
however minute of the 28th July. It is probable sess
that
the substance of it was considered at the Departmental Conference. You will observe that paragraph 5 of the
133838)
despatch refers expressly to these two companies. A9 to the question whether, if legislation is necessary, there is any objection on the ground of policy to passing it, it is of course true that we have never legis-
lated here with a view to making British companies
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constituted of enemy elements enemies in law. I think
however that the two companies now in question stand
upon
but