TNAG-0950-FCO40-1169-Effect-of-nuclear-exports-to-China-on-Hong-Kong-Guangdong-nu-1980 — Page 207

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(a)

(b)

(c)

(d)

As it is planned to site the nuclear power station 30

miles from Hongkong (with a range of hills between), the

chances of damage to Hongkong would be considerably less

than to the PRC. The contingent liability, if shared on

a territorial basis, would thus also be less than if shared

in proportion to the prospective PRC and western holdings

in the operating company;

Hongkong would have a reliable guarantee of compensation which would not be dependent upon PRC acceptance of their

valuation of property and expectation of life; also HMG's

confidence in the project implied by their assumption of

liability, could help overcome any Hongkong public resistance;

it

by placing strict liability on the operating company, might be possible to exempt UK suppliers from their normal liability for damages arising from design, equipment or operation faults, although such exemption should not be

extended to non UK suppliers unless their governments were

similarly prepared to accept some residual third party

liability;

the liability would exist only as long as Hongkong and the New Territories remained the responsibility of the UK and

outside the control of the PRC.

12 If it is decided that liability should be shared, the main principles

would need to be expressed in some form of agreement between the UK and

the PRC. In theory this might be achieved by inducing the PRC to accede to the relevant conventions, modifying their application between the PRC

and Hongkong by bilateral agreement. This would be somewhat cumbersome

however. Moreover, the PRC might not wish to accede; nor might existing

members wish to accept PRC's accession. It would appear to be simpler to

incorporate the main elements of the conventions, modified as described

above, into a self-contained bilateral agreement. In any case, even if

neither HMG nor HKG were to accept any liability, such an agreement would

be likely to be necessary to establish Hongkong rights to compensation

from the PRC.

4