6.
120
futile in respect of British companies formed by
persons of Chinese race it will be necessary to limit
severely the number of Chinese who are accorded full
British rights in China and he suggests
that we should,
in this matter, apply strictly the dual nationality
rule and only accept as British subjects for the purposes
of our local company legislation those Chinese who have
received denationalisation certificates from the Chinese
Government. Since this would mean the exclusion of
practically all Chinese and all the Hongkong incorporated
Chinese companies now on the register, I deemed it
advisable in the first instance to seek the observations
of His Excellency the Governor of Hongkong, and I now
enclose a copy of His Excellency's reply. It will be
seen that he is advised that there is no objection to
the proposals in principle, but that he would like to
be further consulted when the drafting of the proposed
amendments has taken more definite shape.
8.
I have not lost sight of the objections raised
in the Foreign Office despatch under reference, but I
agree with Sir John Brenan that the scheme which he has
I have outlined goes far to remove those objections.
the honour therefore to suggest that the propo sals
should be carefully examined and I would earnestly re-
commend them to favourable consideration as practicable
measures for obviating the serious embarrassment to
which the operation of pseudo-British companies gives
/ rise
Page 120Page 121