CHINA
in the note concludes with what is, in effect, a political argument by referring to the circumstances in which the leases of 1898 were granted. It says:-
'Unable to resist the successive rival demands from the Powers who were each seeking a sphere of influence on the Asiatic mainland, the Chinese Government secured a minimum reservation in each of the leases where a local Government was functioning, in the form of a special area over which China should continue to exercise jurisdiction."
In other words, China yielded to the force of circumstances by agreeing only to meet the military requirements of the Powers concerned without renouncing her jurisdiction in respect of certain reserved areas. In fact the Chinese are not simply claiming the right of re-entry into Kowloon City of the officials who exercised jurisdiction there at the time of the Convention of 1898, but are claiming the right to exercise full and exclusive jurisdiction over the City. While not denying the qualification of "British military requirements for the Defence of Hong Kong," the Chinese do not make it clear precisely what meaning they give to this qualification. In particular, they do not seem to admit that these requirements can justify any British jurisdiction in the walled city, whatever limitations on Chinese jurisdiction they may admit as the result of these requirements.
25. Accordingly the main legal issue is a simple one: namely, is China entitled to jurisdiction over Kowloon City? As the Chinese have throughout the dispute and right up to 1948 based their case on the treaty of 1898, it hardly seems necessary to discuss what, if any, arguments they might think fit to put before a court for the invalidity of the whole lease. It is conceivable, however, that China might support her claim to jurisdiction over the city by reliance on some overriding rights of sovereignty supposed to remain vested in China as lessor of the territory in question and not transferred by the lease. Paragraph 23 above discussed what light is thrown upon the matter by other leases granted by China to other Powers in this period. An investigation has been made to see to what extent, if at all, any light is thrown upon it by either (1) discussions of international leases by legal writers of authority; or (2) leases of territory granted by other Powers in other parts of the world. It is not thought, however, that any assistance can be obtained from either of these sources. Lauterpacht discusses the question of international leases in "Private Law Sources and Analogies of International Law." Mr. Young discusses it in "The International Legal Status of the Kwantung Leased Territory,' But in the main, these authors devote themselves to the question where sovereignty in the leased area lies. They discuss, for instance, where sovereignty lies in a case where (as in the remainder of the leased territories near Hong Kong) (i) China was the sovereign and granted the lease to the United Kingdom: (ii) during the period of the lease the United Kingdom has complete jurisdiction: (iii) at the end of the lease the jurisdiction reverts to China. In substance the question which they discuss is whether sovereignty can be divorced from the exercise of sovereignty. The question is whether, sovereignty and its exercise being divorced, the sovereign is the State which has the right in remainder to the exercise of sovereignty at the expiration of the lease. Lauterpacht also discusses the extent to which the private law with regard to leases affords assistance in the interpretation and application in international leases of jurisdiction over territory, but there does not appear to be anything in what he says which is relevant to the present point.
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Apart from China, leases of territory have been granted by one State to another in different parts of the world, but their effect and character differs considerably. There are some instances of a simple lease of a bonded warehouse, such as that by Great Britain to France in 1905, or a lease forming part of an arrangement by which the goods of State A pass free of customs, &c., through a port in State B, such as the lease by Germany to Czechoslovakia of areas in the ports of Stettin and Hamburg after the First World War. On the other hand, there are the leases granted to the United States in British West Indian islands where there are elaborate provisions with regard to jurisdiction and in effect jurisdiction in the leased areas is shared. It is not thought that any of these other cases afford any assistance in the interpretation of the Chinese lease in the present case.
It is concluded that theoretical discussion does not carry the matter very far, but that in an international lease there is an actual transfer of jurisdictional rights such as a Government exercises over its own territory. It is submitted that the presumption is that all such rights are transferred to the lessee
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