(2)

Original Canton object was to obtain control

over Chinese office at Hongkong and they may of

course go back on accepting alternative of its

removal. Provided however they do not do so and

that request for removal can be made to come from

the Cantonese, as local de facto Government, I

submit (a) that company and His Majesty's Government

cannot be charged with violation of 1884 agreement

b) that there is no reason why removal should

prejudice maintenance of company's offices at

Southem ports now under Nationalist control and

(c) that company's negotiations here being suspended

will not be prejudiced.

His Majesty's Consul-General further urges

desirability of our showing our willingness to meet

Canton wishes wherever we are able to do so.

I concur and I request instructions.

Addressed to Foreign Office, repeated to

Hongkong, Canton.

95

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