TNAG-0419-FCO40-465-Registration-of-merchant-shipping-in-Hong-Kong-1973 — Page 79

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HONG KONG REGISTER OF SHIPPING

A.R.

1. I have this week attended 2 meetings between Mr Heseltine

and representatives of UK trade unions and owners respectively.

2. Both groups said that they did not like the consultative

document and hoped that HMG would not agree to setting up a

separate Hong Kong register of shipping on these lines. Both

said that despite the Minister's assurance that standards would

not be allowed to slip, they believed the Hong Kong register

would inevitably deteriorate into a red ensign flag of convenience.

Mr Heseltine's line throughout was that since Hong Kong ships

were now under flag of convenience registry, to transfer them

to Hong Kong under British control would be a positive gain

for both safety and manning standards. These standards would

not be allowed to slip. All that was needed was some flexibility.

3. Much of the argument, however, eventually focussed on

paragraph 9 of the consultative document. Both owners and the

unions pointed out that in a situation where separate companies

were habitually set up for individual ships, it would not be

difficult for such companies to establish their principle place

of business in Hong Kong. The unions were afraid that British

ship owners, using the psychological advantage that their ships

would still be under the red ensign, would transfer to the

Hong Kong register with a resulting loss of jobs to British

seamen. The owners said that if a separate red ensign register

with more flexible standards was set up in Hong Kong, they might

CONFIDENTIAL

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