CO129-557-9 British protection of companies in China 26-3-1936 - 27-2-1937 — Page 127

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2.

but they operate in China under British extraterritorial

Jurisdiction in competition with our own trade and

involve us in endless controversy with the Chinese

authorities.

3. If, therefore, there is to be an amendment

of the Order-in-Council I submit that it is worth while

to try and obtain a solution of all our difficulties

in this respect rather than to tinker ineffectually

with Article 194. It is in the hope that Your

Excellency will agree with this view that I have

evolved the following proposal in consultation with

Mr. Mossop, Mr. Friestwood and Mr. George. I regret

that there has been some delay in dealing with the

question, but the Judge and Crown Advocate have been

prevented by pressure of work from giving it the full

attention which it merita until recently.

The first essential is, of course, to have

a clear idea of our objective. It is not enough to

say that companies enjoying British protection and

jurisdiction must be bona fide British companies or

that they must contain a substantial British interest.

For the purposes of legislation we shall have to

define what is meant by "bona fide British" or

a substantial interest", and as that is a matter of

opinion the line to be dram in our definition will

have to be an arbitrary one.

5. The French with their logical outlook have

long recognized this and have produced in a concise

form regulations that are very much to the point.

These