132
7.
operate in China. Its position within the Empire would
remain untouched but the Soviet Government would have to
make different arrangements for conducting its trade in
this country, and so would the other national interests
affected by the amen dim on t.
13.
I should mention here that I have not lost
sight of the objections raised in Foreign office despatch
to ľeking No.611 of the 30th August, 1934, but I would
respectfully submit that the above scheme goes far to
remove those objections. It was stated that all attempts
to deal with this question broke down before the imposs-
ibility of defining what is really a British company,
Well, I now offer a practical definition, so far as
protection in this country is concerned, based on the
French model. And under the proposed scheme there would
be no question of allowing the Chinese to claim juris-
diction over British companies containing a foreign
element, because those British companias over which we did
not wish to assume jurisdiction would be prohibited from
operating here at all.
14. There is one very difficult question which will
require careful consideration, namely companies formed
by persons of Chinese race, some of whom might claim to
be British. Your Excellency is aware that a large
number of Chinese, otherwise indistinguishable from the
inhabitants of this country, claim British nationality,
when it suits them, by virtue of birth in Hongkong or
elsewhere in the Empire. Protection has hitherto been
withdrawn from these companies but they remain under
British jurisdiction with the anomalous results we are
/now