CO537-3706 — Page 51

210

[This telegram is of particular secrecy and should be retained by the authorised recipient and not passed on]

Cypher/01P

POLITICAL DISTRIBUTION

FROM NANKING TO FOREIGN OFFICE

Sir R. Stevenson.

No.276

18th March, 1948

D. 4.51 p.n. 18th March, 1948 R. 6.22 p.n. 18th March, 1948

Repeated to Hong Kong.

REC

22 MAR 1948

G.U.

1

201

IMPORTANT

SECRET

Addressed to Foreign Office telegram No.276 of March 18th, repeated for information to Hong Kong.

34-

Telegram No.377 to Hong Kong from Secretary of State for the Colonics.

Kowloon City.

If Chinese Government were faccd with the alternative of reference to the International Court which I do not (repeat not) think they would like, I would not despair of being able to cover in joint statement the point regarding the Chinese clain to jurisdiction in connexion with the official compound referred to in paragraph 2 of telegram under reference. More- over, the actual excrcisc of jurisdiction could perhaps be net by a formula to the effect that the area would have the usual privileges and immunitics granted to propertics occupied by foreign official representatives in accordance with international usage. This might satisfy the Chinese while in practicc it would not (repeat not) exempt persons committing offences inside the area from being handed over to Hong Kong police and being tried in Hong Kong courts.

2. I still believe that in the long run the proposal for official compound if accompanied by suitably worded statement is less likely to create difficulties and con- troversial issues. Moreover the onus for observing terms of the agreement would rest firmly upon the Chinese Government and any breach by the Chinese Igp. undec.] could be made the subject of official protest with such publicity as may seem expedient. Any kind of public garden on the other hand, though it would have much to commend it, would more readily provide opportunities for creating trouble if disorderly elements were inspired to defy the police.

3. With regard to any form of international arbitration it is [gp. undeo. ?more than likely that the Chinese Government if they were to agree to it would attempt to complicate the issue by bringing in the whole question of leased territory and possibly of Hong Kong as well under paragraph 4 of Annex to exchange of letters attached to 1943 Treaty. Nevertheless, if the choice lies between action on lines suggested in paragraphs 3 and 4 of telegram under reference and procedure proposed in paragraph 1 of Hong Kong telegram No.298 I would prefer the latter.