CO537-6049 — Page 18

CHINA

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territory it might become a refuge for Chinese agitators and malefactors to the great embarrassment of the Hong Kong Government. Indeed, the latter fear that any such solution would be interpreted by responsible Chinese opinion as a defeat for His Majesty's Government and would inevitably lead to an increased Chinese campaign for the return of Hong Kong itself, would become the rallying point for anti-British agitation, and at best to a serious weakening of their authority over Hong Kong, including the leased territories. His Majesty's Government's proposed solution, therefore, was that the law of Hong Kong should apply to offences committed in the garden, without prejudice to the question where the actual rights of jurisdiction lay. In His Majesty's Govern- ment's view it would be absurd to have a law prevailing in this small area different from that in force outside. To this proposal the Chinese Government replied with a counter-proposal that any offences committed should be tried by a Chinese Court. Such a proposal appeared to indicate that nothing short of complete Chinese jurisdiction, in fact, would content the Chinese Government under whatever forms this objective might be disguised. The shoal on which the negotia- tions have run aground is the Chinese insistence that they would consent to a settlement only if it were publicly announced that the City of Kowloon was under Chinese jurisdiction. His Majesty's Government for their part do not rule out the provision of an office for the Special Commissioner (with possibly similar provision for a new police station for Kowloon) provided it is clearly understood that judicial action in the area rests with the Hong Kong Government. A further possibility which His Majesty's Government might be prepared to consider was that an office for the Commissioner or Chinese Consulate might be erected provided that the area was held on a sub-lease from the authorities in the leased territories.

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18. Prior to 27th April, 1948, all efforts to reach a compromise were unavailing, because the Chinese proposals, whatever shape they took, did not make any concessions to the British position, but merely amounted to a reaffirmation of the Chinese claim. The mere acceptance of the proposal that there should be a garden does not dispose of the question of jurisdiction and this is the question at issue. On 28th April, 1948, however, the Chinese Embassy in London left at the Foreign Office a memorandum dated 27th April, 1948, containing proposals which represent some concession to the view-point of His Majesty's Government. Under these proposals the City of Kowloon would become a Garden of Remem- brance administered by a British and a Chinese trustee, the latter having an office in the garden. The memorandum suggested an exchange of notes, not to be published, providing for punishment by the trustees of infringements of rules and regulations for the maintenance of order in the garden and for trial of civil and criminal cases, arising in the garden in the courts of the locality in which the defendant has his domicile. A copy of the memorandum is included at the end of Paper E, No. 4. Although this proposal may contain the seeds of an acceptable compromise it is by no means certain that it has received the unqualified approval of the Chinese Government itself, and it is desired to have the opinion of the Law Officers on the points raised in the present case because, if His Majesty's Government were in a position safely to offer recourse to the International Court this would be so unpalatable to the Chinese Government that it would probably induce them to accept a satisfactory compromise much more readily.

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It has therefore been proposed that a suggestion should be made to the Chinese Government that if they wish further to challenge the exercise of juris- diction by the Hong Kong Government over Kowloon City, they should submit the dispute to the International Court of Justice. Both China and the United Kingdom have made declarations under Article 36 of the Statute of the Inter- national Court of Justice accepting its compulsory jurisdiction. The Chinese declaration made on 26th October, 1946, for a period of five years contains no reservations except that it is made on the sole conditions of reciprocity. The declaration of the United Kingdom, made on 28th February, 1940, for a period of five years on a basis of reciprocity, remains in force until notice of termination is given.

20. The United Kingdom declaration applies only to disputes arising after 5th February, 1930, with regard to situations or facts subsequent to the same date. The present dispute, therefore, is excluded and the dispute could only be adjudicated by the International Court of Justice with the consent of the United Kingdom. In deciding what procedure should be adopted, however, it is pertinent