CO129-571-15 Sino-Japanese War- manufacture and import of aircraft to China 18-1-1938 - 5-1-1939 — Page 106

M.04324/38.

Dear Blackford,

CAFIDENTIAL

R

Military Branch.

17th August, 1938.

106

Would you kindly refer to Burma Office

106

printed letter B.3468/38 of the 15th July concerning

the possible erection of a factory at Rangoon for the

manufacture of militar, aircraft for China. The

2.

second paragraph of this letter slates that the Cabinet

have decided that it is desirable for Hong Kong to act

as if there were in fact a war between China and Japan

and to assume the duties and obligations of a neutral",

with the inference that the decision to prohibit

the export of complete aircraft to Chins from Hong Kong

was taken on account of the obligations of neutrality.

As we understand it, the obligations of

neutrality had in fact no direct bearing on this

decision, and so far as we are aware there is at present

nothing in international law to prohibit the establishment

or operation in neutral territory of a private seroplane

factory for the purpose of supplying belligerents, 80

long as no distinction is made between one side in the

war and the other.

There would thus appear to be

no legal objection to a project such as that outlined

by Mr. Chen, provided firstly that the factory were

established by a genuine private company, and secondly,

that it remained theoretically open to the Japanese

as well as to the Chinese to buy aircraft from it.

When we come, however, to consider

3.

means by which the finished aircraft could be delivered,

the position is not quite so clear, In the present

instance of course the question of neutrality does

not strictly arise.

In a war which has been declared

to be such, however, there would appear to be no legal

ing-Commander D.L. Blackford,

AIR MINISTRY,

objection/