Copy
89
SECRET.
Copy to Peking No.40.
My Lord,
GOVERIMENT HOUSE,
HONG KONG. 14th August, 1929.
With reference to my secret despatch dated
the 1st August, on the subject of the proposed Customs Agreement between Hong Kong and China, and with referance to paragraph 3 of my secret despatch dated the 3th August,
relating to the Chiness draft of a treaty of anity, commerce and navigation batzeen Great Britain and China, I have the honour to suggest that any treaty concluded
between Great Britain and China should contain a saving of any special customs agreements which may then exist or thereafter be concluded between liong Kong and China,
or betroen Great Britain, on behalf of Hong Kong, and
China.
2. It is conceivable that such a provision might be obje.ded to on the ground of possible embarrassment to Chine in connexion with most favoured nation clauses in
treaties between China and powers other than Great Britain. I submit, however, that any such customs agreement relating to Hong Kong, would by the nature of its terms
be so particular as to be incapable of application to other nations except in a very few cases, such as that of kacac, where the Chinese authorities themselves would probably wish to make similar arrangements.
3. It would be possible to meet the point by using the reciprocal form of rost favoured nation
THE RIGHT HONOURABLE
LORD PASSFIELD,
8
clause