TNAG-0752-FCO40-956-Future-of-Hong-Kong-1979 — Page 106

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ANNEX A

Legal Measures Required to Extend Jurisdiction in the

New Territories after 1997.

The rights of the Crown in the New Territories

a. to exercise jurisdiction generally;

b. in particular to grant land leases;

expire with the 99-year Lease on 1 July 1997.

2.

Assuming tacit concurrence by the CPG, the question

of the exercise of general jurisdiction after that date

need not arise until 1997. But the question of the right

to issue leases extending beyond 1997 is likely to become

a live issue quite soon.

3.

Leases have always been drafted to confer ownership

from the date of assignment "....for the residue of a term

of ninetynine years less three days thereof from the 1st

day of July 1898 ....". Unless within the next few years

the term of these leases can either be extended or made

indeterminate, confidence will start to fall due to

erosion of land values and reluctance to invest.

4.

We have therefore been considering how either of

these alternatives, and at the same time the question of

an extension of right of jurisdiction, could be managed

within the requirements of British law, assuming

a.

that the Chinese Government would be

unwilling to grant an explicit extension

of the Lease, or to take any overt

action to achieve this in practice, but

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/b.