TNAG-0248-FCO40-284-Effect-of-entry-of-UK-into-EEC-on-exports-from-Hong-Kong-1970 — Page 82

CONFIDENTIAL

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persist in establishing a common policy on these lines we

are likely to be faced at the end of the day with a demand

that we should conform to it. This would involve extension

of restraint on Hong Kong's exports of some products to the

United Kingdom. If this were to happen Hong Kong would find

that the common external tariff was applied to her exports

to the United Kingdom, that restrictions on her exports to

the United Kingdom were imposed as part of the common

commercial policy and probably that she was either excluded

outright from benefits under the generalised arrangements or

else were granted only token benefits under these arrangements.

45 In the case of cotton textiles there are restraint

arrangements under the LTA at present between Hong Kong on

the one hand and Benelux and the Federal Republic on the

other. France maintains stringent restrictions on Hong

Kong's exports of cotton textiles under the dubious claim

that they are sanctioned by Article 2 of the LTA. There is

no restraint arrangement with Italy but there are no imports

from Hong Kong either. Negotiations have already begun

aimed at replacing these arrangements with a single agreement

negotiated by the Commission. But this would be a change in

form only. The administration of the quota levels would

still be in the hands of the individual governments of the

Six. whatever the rules of the Community are, there seems

to be no free circulation of imports of imported Hong Kong

textiles within the Community.

CONFIDENTIAL

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