TNAG-1401-FCO40-1873-Future-of-Hong-Kong-continued-participation-in-the-General-A-1985 — Page 36

XXXIII, and

the necessary

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two-thirds majority was not

forthcoming,

it might be

difficult to revert to the Article XXVI 5(c) route.

This is because Hong Kong would be seen to be trying to gain entry to GATT through the back door having failed to get in through the

Even if a belated Article XXVI 5(c) Declaration in Hong Kong's favour could not be stopped, its eventual standing in GATT

would have been seriously undermined.

front.

10. For all these reasons, Option 2 would appear to make Hong Kong

hostage to those who might seek advantage at our expense. It should

not, therefore, be pursued.

11.

Option 3 is less problematic and by far the most desirable and

practical. It would:

(a)

(b)

parry the question of China's membership in the GATT;

avoid having to involve Hong Kong in negotiating entry terms with the Contracting Parties;

(c) enable Hong Kong to acquire separate GATT status at any ti me mutually acceptable to China, the UK and Hong Kong through a Declaration by the United Kingdom.

A further important point in favour of this course is that:

(d)

12.

once Hong Kong became a separate Contracting Party under the

GATT Article XXVI 5(c) procedure, the me re change of

sovereignty in 1997 would not in itself have any effect upon Hong Kong's GATT rights or upon its status in the GATT.

to

The observations in paragraphs 8 and 12(d) above are based on

informal soundings which the United Kingdom Mission in Geneva, and the the Counsellor (Hong Kong) have taken of the legal section

of the GATT Secretariat. Their view is that if Hong Kong were

become a Contracting Party under the Article XXVI 5(c)

5(c) procedure,

there would be no question of Contracting Party status ceasing

solely by virtue of the change of sovereignty in 1997. Only if Hong Kong's autonomy in the conduct of

conduct of its external commercial relations

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