In any further communication

on this subject, please quote

No.

F 177/177/10.

and address-

not to any person by name

but to-

"The Under-Secretary of State,"

Foreign Office,

London, S.W.1.

I DUPL

RECO

12 JAN 1940

C. O. REGY

19

FOREIGN OFFICE.

S.W.1.

18

11th January, 1940.

Sir,

I am directed by Viscount Halifax to refer to your

letter No. 54000/59 of the 15th December and to inform you

13/letter

m/ Shipping

вору

that he has reconsidered in the light of despatch No. 510 of

the 25th July from the Governor of Hong Kong the proposal to

amend the Hong Kong Merchant Shipping Ordinance, 1899.

2. It appeared from the previous despatch from His

Excellency enclosed in your letter of the 7th June that, as

explained in the memorandum of Objects and Reasons appended

to the Bill, the proposed amendment was designed to facilitate

the preventive work of the Chinese Maritime Customs. Lord

Halifax notes, however, from the Governor's despatch No. 510

that its purpose is also to prevent embarrassment with the

Japanese forces if the latter seize a British ship (or compel the Customs to seize a ship) which has been officially cleared

for a port prohibited by treaty.

1/

3.

Since the clandestine trade of the type of vessel in

question is of doubtful advantage to British interests and in

view of the importance of avoiding unnecessary friction with the Japanese authorities, Lord Halifax, after having consulted His Majesty's Ambassador at Shanghai, has reached the conclusion

that there would be advantage in proceeding with the draft Bill (as amended in the Governor's despatch No. 510). He would

therefore suggest for the consideration of Mr. Secretary

MacDonald that the Governor of Hong Kong should be so informed.

I am,

Sir,

Your obedient Servant,

R. 9. Howe

The Under-Secretary of State,

Colonial Office.

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