CONFIDENTIAL
خضار
(e)
Action to freeze Chinese assets in London
This is theoretically possible, although its effectiveness would
be doubtful as the Chinese sterling balances held in London are now
estimated to be less than £10 million. The wider implications of
such action at a time when we are trying to prevent depositors
withdrawing sterling from London are obvious.
(f) Action against the Bank of China.
(1) Staff.
The expatriate staff of the Bank of China could be refused
extension of permission to remain in the United Kingdom, or
could be deported. The latter would be the only effective sanc-
tion. If it were resorted to, any official with more than two.
years' lawful residence here would have the right to make rep-
resentations to the Chief Metropolitan Magistrate. The Home
Secretary already has the necessary powers to take the above
action, but would need to be persuaded that it was "conducive
to the public good" under the terms of the Aliens Order. Our
experience over trying to move the Home Secretary to act against
the New China News Agency does not suggest he would be coopera-
tive over the more innocuous Bank of China. Action against the
staff of the Bank would also run the risk of retaliation against
the expatriate staffs of the two British banks in Shanghai, and
would be contrary to our Mission's known views about avoiding
restrictions on persons.
(ii) Banking Facilities and Financial Sanctions
The Bank of England, acting in conjunction with the
SOAFTDENTIAL
../ Treasury,
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