TNAG-0849-FCO40-1059-Future-of-Hong-Kong-New-Territories-leases-1979 — Page 10

SECRET

6. The fact that the Crown has only a limited tenure of a

territory under an international lease operating for a specific

term of years does not oblige the Crown, in making provision for

the government of the territory, to limit the operation of the

provision to that term of years.

7. Although no example comes to mind, it is submitted that the

Crown's general legislative or constituent powers under the Royal

prerogative can be exercised on a hypothetical footing, ie provision

may be made to cover the contingency that the Crown may be in

occupation of a territory after some future date, although no firm

arrangements for such occupation have yet been made.

8. There is a reasonable political prospect that the Crown may

remain in occupation of the New Territories after 30 June 1997 in

spite of the expiration of the term of 99 years specified in the

Convention of 1898 and referred to in the Order of 1898, although

in the absence of an agreement with China sanctioning the further

occupation the Crown cannot at present claim the right to do so

under international law.

9. It is submitted that the Crown may properly take cognisance

of this political prospect in exercise of the Royal prerogative

in external affairs and, in the light of its policy in external

affairs, make contingent provision in advance for the government

of the New Territories on the basis of a formula such as "for so

long as the Crown administers those Territories" even if the Crown

cannot as yet claim a right under international law to occupy the

New Territories after 30 June 1997.

10. Such a provision could not give rise to any legal consequences

in municipal law until 1 July 1997 and it should not give rise to

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