11.
SHIPPING.
Likely Communist actions
nd policies.
(a) The Communists are not likely to have many ships at first. They may seek to get hold of Chinese Nationalist shipping immobilised in Hong Kong, claiming them as national assets which should belong to the legal Govern- ment of China (meaning themselves).
(b) The Communists will
probably charter foreign shipping while they are short of ships themselves. They will charter on their own terms, and thus seek to keep out direct foreign inter- ests.
There is a distinction between Government and private owned shipping. It is possible for the mast- er or owner of a private ship to go before the Courts and claim a declaration of the right to possession, and the Hong Kong Government need not be involved. So long as we do not recognise the Chinese Communist Gov- ernment, de facto or de jure, and even perhaps after, experience in Europe suggests that private owners would be able to obtain the Court's support for poss- ession, in spite of any supposed nationalisation or requisitioning decrees. British practice is reluctant to give effect to expropriatory legislation.
It is unlikely that the Courts would be brought into any claim for possession of Government owned ships, which would be handled, if the question arose, on a Government level. After recognition of the Chinese Nationalist Government de facto or de jure, the right of possession would certainly vest in the Chinese Communist Government, and there would probably be no means of preventing the ships changing sides before. In obtaining legal possession of a ship an essential factor is to determine whom the master acknowledges as his owner. In practice, however, it is more likely to be the attitude of the crews which determines the fate of the ships.
Ships which remain in the possession of Chinese private owners are likely to try to change flag. Rushed transfers of this kind would not be recognised. for such purposes as Prize Court Law, and attempts to use the British flag for this purpose should be res- isted.
Owners of Chinese ships laid up in Hong K_ng should be encouraged to remove them to Formosa or else- where, but, if it were desired to hold a blackmail wea- pon against China, detention in Hong Kong of Chinese Communist ships could be considered. A Defence Reg- ulation was introduced in the United Kingdom in 1940 authorising the detention of ships, which designed to cover the comparable case of Baltic States ships sheltering in United Kingdom ports, pending deter.in- ation of ownership.
There is no indication at present that the Comm- unists are averse to chartering British flag or British owned tramp shipping, with other foreign tramp shipping, for themselves to operate on the China coast. The Nationalists regarded even the use of such chart- ered ships as a breach of the cabotage laws, but the Communists, so far, have been so short of ships that they have definitely not followed this line. If there appeared later to be discrimination against British ships in the charter market, it might be considered whether over-strict application of the safety rules or other administrative action might be used to oause delay to non-British chartered ships.
It
Indications are that the Communists will permit the foreign liner companies including British to re- sume calls in Chinese ports from Hong Kong, but whether non-Chinese liner services will be permitted .. to carry cargo between Chinese ports en route is not yet clear; in any case this is not fundamental. is possible that the Communists will do so until enought ships are acquired to dispense with the foreign ser- vices. If there were discrimination against British tramps, then retaliatory measures by the denial of facilities or, in the last resort, detention, should