CO129-558-11 Mission of Sir F. Leith-Ross to China- proposals for a Hong Kong - China customs... 29-9-1936 - 30-12-1936 — Page 76

76

This treaty was intended by

neither side to stand alone, but to form

part of a comprehensive reorientation of

Anglo-Chinese relations on a basis of

equality. Difficulty was experienced as

regards procedure, British policy being to

proceed with the negotiation of a commercial

treaty, while the Chinese insisted that

extra-territoriality should next be

discussed.

A British draft was, however,

prepared and put forward in 1929 as the

basis of discussion which, for the most

part, concerned trade between China and

the United Kingdom. Hong Kong was,

however, closely concerned by Clause 18

of this draft, which was referred to the

Governor for consideration. It stipulated

that Chinese goods shipped from one

Chinese port to another via Hong Kong

were to be treated as if they had been

shipped direct so long as they remained

under