TNAG-0029-FCO40-65-Relations-with-China-1968 — Page 60

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13. Before further action can be taken we must see if any

reply is received from the Chinese to the Chargé d'Affaires*

approach (we may well receive none) and to the company's

letter. Should the Chinese reply to the company be completely

unsatisfactory, or should the Chinese fall to make the payment

due under the contract towards the end of this month, the

company may feel that they ought, on purely commercial grounds,

to take advantage of the clause in the contract which allows

for arbitration in Sweden, though the Chinese are unlikely

ever to agree to give them any financial satisfaction. Before

taking a decision, however, they would consult us.

D. S.S. "Demodocus"

14.

On 1 March we received information from Hong Kong that

the "Demodocus", a Blue Funnel Line ship which had left Shanghai

on 26 February after loading cargo, had been detained at the

Woosung anchorage cutside Shanghai for an alleged breach of

harbour regulations. Our Mission in Peking having failed to

obtain any information either from the China Ocean Shipping

Agency, Blue Funnel's agents in China or from Zhongzhu, the

Chinese State Shipbroking Corporation, addressed a Note to

the Ministry of Foreign Affairs on 11 March asking for infor-

mation about the alleged breach of harbour regulations and for

consular access to those on board. The ship carries no

passengers. The crew is composed of 42 British subjects

(citizens of the United Kingdom) including the wives of the

Master and 2nd Engineer, 2 citizens of the Republic of Ireland,

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