XN000022-1995-05-24 — Page 5

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Governor: Well, we haven't said that we would block all contact with the PWC, far from it, we've been very good about discussing matters informally with the PWC, giving them briefings and so on. That's always been our position and Mrs Chan set out the guidelines which we followed and which we've faithfully implemented a few months ago. But we were trying to be constructive. The PWC had put forward some proposals which I assume have the blessing of the Chinese side. It will be very surprising if the PWC were putting forward proposals which the Chinese side didn't agree with. We try because we want to speed things up, we want to be as rapid as possible. We thought that it was sensible to react positively to those proposals. So we've done everything we conceivably could, to get the Court of Final Appeal set up rapidly, as rapidly as was promised, in line with the agreement in 1991. So that Hong Kong can continue to enjoy the rule of law and so the local and international business community can continue to have confidence in Hong Kong as a place to do business and a place to invest. You know that I don't make it up when I say that very many people regard the issue of the establishment of a Court of Final Appeal in line with the 1991 agreement, taking over exactly the powers at present and carried through by the judicial committee of the Privy Council. You know that a lot of people regard that as a litmus test of the commitment of ourselves and of the Chinese side to the continuation of the rule of law in Hong Kong. That's why the situation, that's why this issue is important and that's why we've made every conceivable effort to speed up agreement. Chinese officials keep on giving us reassurances that of course, they want to see the court set up before 1997. What we need is action and not just words.

Question: So if you want to speed up the things, you have to incorporate the ideas from the Chinese side or PWC, they are in the upper-hand in the matters.

Governor: Well, if you choose to interpret the Hong Kong Government being co- operative in that way, then so be it. I think we've demonstrated to borrow a word which is much used, we've demonstrated our sincerity, it's time for other people to show theirs. All the points on which we responded were technical. None of them involved fundamental issues of principle. I was wholly comfortable with all of them as were all the members of my Executive Council, where we discussed the issue on Tuesday. Last question,

Question: How about the interpretation of the 'Act of State'? Is that a major obstacle for

Governor: No one who understands the Common Law has any difficulty in interpreting the meaning of 'Acts of State'. It's been clear in the Common Law for decades if not centuries. If there're problems that people have in reconciling the Common Law and the Basic Law, then those are problems for them to resolve. But Hong Kong has been promised a continuation of the Common Law which is the system which has helped to make Hong Kong so prosperous and so stable. Thank you very much.

End/Wednesday, May 24, 1995

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