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to a resident not (repeat not) being allowed to receive interest and redemption money on bonds purchased while he was resident if he subsequently became non-resident, Exchange Control Authorities feel this to
・D re¬consideration, eferable to the original suggestion. Point of emended alte, native is that if Asaue were restricted to persons resident" (for purposes of exchange .control) in Hong Kong and transfer except to other such repidents forbidden, cousequence would be that payment to non- resident would be obviated, but resulting discrimination, in so far as it existed at all, would not (repeat not) be of a kind prohibited by agreements.
6.
Subject to legal advice, conditions of issue and transfer to residents only could be embodied in teras of issue and on face of bonda themselves, thought that it would be hecessary to require that resident to whom
On a point of detail, it is interest and redemption monies payable should be "beneficial Owner"
, otherwise resident banks and other agents could accept Payment for non-resident clients.
72 I appreciate that these requirements might tend to scare off certain class of potential investor, but it is not considered necessary to require such details cf, or unduly forma). proof of; "residence" etc. as would in fact scare off bona fide investors, Subject to your views it io suggested that exact nature or extent of proof required Jould either be assumption by authorities of resident status (unless authorities have proof te contrary) on presentation of bonds and coupons tecu Hong Kong address, or acceptance of verbal statement of residence and ownership. It is also suggested that public statement could be made in reassuring terms at time of issue. explaining that offeed of the condition regarding "residence" would be that paymenta would be in Hong Kong dollars only, carrying no (repean no) right of transfer outside Hong Kong and indicating actual practical effect of conditions as to residence and ownership, and warning persone Antending to become "non-resident" to sell before leaving Colony.
Ally
8. I am most anxious that as far as poècible loav roquired should be raised locally but without vacurrtäg exchange sontrol dangers; and I hope that in light of this faljer explansfion you will find it possible to proceed ou above lines
whea
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(a) raising any further instalment of the
rehabilitation loan that may be required to meet rehabilitation expenditure that cannot be mut' from revenue; or
(b) raising loan for development works such an
the Tai Lam Chung Reservoir scheme..
I should be glad of your early coments on the above points and on the possibility of the issue of premium bends, You will doubtleus consuit me beinre ralaing any farther loan.
10. Faragraph 9 of your telegram No. 173 refers to a Loan on the London market and I understand that Unofficial Membero of Executive and Legislative Councils raised with Mr. Paskin question of borrowing from the Exchange Fund. poines I would refer to paragraph 4 of my telegram No. 1492 of 17th
Cp these two September, 1947. In view of the present commercial prosperity in Hong Kong I feel sure you will agree that every effort must be made to raise funds in Hong Kong whether by taxation of
/loens