the Government of Hong Kong in the field of cotton textiles are based on the provisions of the "Heads of Agreement" negotiated in 1965/66 and on the terms of the Long Term Arrangement regarding international trade in cotton textiles (LTA). The United Kingdom accepted the LTA on behalf of Hong Kong and, with the approval of Her Majesty's Government, the Government of Hong Kong have negotiated bilater al agreements for restraint of trade in cotton goods with all the major importing countries. Moreover, the countries party to the LTA are members of the Cotton Textiles Committee of the Genoral Agreement on Tariffs and Trade (GATT) and Hong Kong's representatives attend meetings of this Committee as members of the United Kingdom Delegation. They have an opportunity to present Hong Kong's views independently but in practice the expression of conflicting views by United Kingdom representatives and represen- tatives of Hong Kong is avoided. These arrangements reflect the fact that Hong Kong, being a dependent territory, is not a separate member of the GATT, and is represented in the GATT by the United Kingdom Debgation,
4. It follows from the constitutional position that, in exercising any authority to conduct external relations the Government of Hong Kong act as agents of Her Majesty's Government and the rights which they thereby acquire and the obligations which they thereby accept are acquired and accepted on behalf of Her Majesty's Government. It would be Her Majesty's Government who would be called to account for any default on the part of the Government of Hong Kong and Her Majesty's Government alone could secure reparation on behalf of the Government of Hong Kong for any default by a third party.
However, as stated in my
predecessor's saving despatch No.369 of
31 July, 1969, having regard to the considerable
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