TNAG-1551-FCO40-2115-Possible-cultural-agreement-between-Hong-Kong-and-Japan-1986 — Page 8

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CONFIDENTIALL

for assistance to the Chinese University and the year after that to another institution.

Bearing in mind the thoughts in your letter of 21 August, we tried to get the Japanese to agree to an arrangement based on an MOU, rather than an agreement. However, the Japanese were adamant that the language in the penultimate paragraph of their text should stand unamended, i.e. that the arrangements should constitute "an agreement". Our judgement is that we shall therefore need an entrustment from you to proceed. I gather from your letter that this is also your view but would be grateful for confirmation of this. I assume that the entrustment could take a similar form to that used for the Air Services Agreement with the Netherlands. We envisage that the agreement would be signed by the Secretary for Education and Manpower, who would be expressly authorized by the Governor to do so.

ever

Yous

Вов

(R. N. Peirce)

Deputy Political Adviser

c.c.

D. G. Blunt, Esq., Peking C. E. J. Wilton, Tokyo

CONFIDENTIAL

Sir,

I have the honour to refer to the recent discussions

held between the representatives of the Government of Japan and of the Government of Hong Kong concerning the supply of

(hereinafter referred to as

"the Equipment") to the University of Hong Kong, and to pro- pose on behalf of the Government of Japan the following

arrangements:

1. For the purpose of

/

the Government of Japan will extend to the Government of Hong Kong, in accordance with the relevant laws

and regulations of Japan, a grant up to

million yen (Y

"the Grant").

) (hereinafter referred to as

2. The Grant will be used by the Government of Hong Kong

properly and exclusively for the purchase of the Equipment,

which will be products of Japan, and of services necessary

for the transportation of the Equipment to ports in Hong

Kong.

3. The Grant will be made available during the period

between the date of coming into force of the present arrange-

ments and March 31,

unless the period is extended by

mutual agreement between the authorities concerned of the

two Governments.

4.

(1)

The Government of Hong Kong or the University of

Hong Kong as its designated authority will enter into

contracts in Japanese yen with Japanese nationals or

Japanese juridical persons controlled by Japanese nat-

ionals for the purchase of the Equipment and services referred to in paragraph 2. Such contracts shall be verified by the Government of Japan to be eligible

for the Grant.

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(2) The Government of Hong Kong or the University of Hong Kong as its designated authority will open through banking arrangements an account to be used only for the purpose of the implementation of the Grant, in the name of the Government of Hong Kong or the University of Hong Kong as its designated authority in an au- thorized foreign exchange bank of Japan designated by the Government of Hong Kong or the University of Hong Kong as its designated authority.

(3) The Government of Japan will make payments in Japanese yen to cover the obligations incurred by the Government of Hong Kong or the University of Hong Kong as its designated authority under the verified contracts referred to in sub-paragraph (1) above to the account referred to in sub-paragraph (2) above, when payment requests are presented by the bank referred to in sub- paragraph (2) above to the Government of Japan under an authorization to pay issued by the Government of Hong Kong or the University of Hong Kong as its designated

authority.

5. The Government of Hong Kong will, through its competent

authority, take necessary measures:

(a) to ensure prompt unloading and customs clearance at ports of disembarkation in Hong Kong and internal trans- portation therein of the Equipment;

(b) to meet the charges of customs duties, internal taxes and other fiscal levies which may be imposed in Hong Kong with respect to the supply of the Equipment and services provided under the Grant by Japanese nat- ionals or Japanese juridical persons controlled by Japanese nationals;

(c) to ensure proper and effective maintenance and use of the Equipment; and

(d) to bear all the expenses, other than those covered by the Grant, necessary for the implementation of the

Grant.

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