TNAG-0950-FCO40-1169-Effect-of-nuclear-exports-to-China-on-Hong-Kong-Guangdong-nu-1980 — Page 208

Replacement of Lost Nuclear Power

13 In the event of a serious accident, the UK might be expected to meet

some liability for the cost of providing alternative power supplies to

Hongkong. It could be argued, however, that since the PRC does not at

present supply Hongkong with any power, the only cost which should be

considered is that which might arise from the difference between operating

a coal or oil fired power station compared with the nuclear station, As

there is no legal commitment to supply power, the question of any liability

would be a commercial one for settlement between the operating company and

the Hongkong Electricity Supply Company.

Conclusions

14 The responsibility for meeting most of the risk liabilities of the

Guangdong project would rest with commercial interests. The UK Government's

liabilities should be limited (apart from ECGD insurance and fuel provision),

to those resulting from a severe nuclear accident. The would be:the probable

loss of investment in the operating company; the cost of technically directing the cleaning up operation; and third party liability. There is no compelling

logical or legal reason for HMG assuming the latter. project is essentially a joint venture and the PRC is likely to insist on shared liability as part of the price for preferring equipment and other supplies from the UK. If this price has to be paid, we should aim for the

PRC to accept that:

(a)

(b)

However, the Guangdong

the operating company should have strict liability up to an agreed limit UK contractors should not be liable;

the PRC Government should accept all residual liability

for damage within the PRC and that in return, no claim

would rest against their government in respect of damage

in Hongkong;

The above arrangements would need to be set out in a bilateral agreement

between the PRC and the UK.

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