TNAG-1768-FCO40-2522-Hong-Kong-and-the-Multilateral-Investment-Guarantee-Agency-(-1988 — Page 113

CLAUSE 9: SHORT TITLE, COMMENCEMENT AND EXTENT:

SUPPLEMENTARIES

1.

When will Convention come into force? The Convention will

enter into force when at least 5 developed and 15 developing countries, who together have at least one-third of the authorised capital, have ratified. To date, 5 developed and 17 developing

countries with over 24% of the authorised capital have ratified. We

know that some other countries USA, France, Italy, Spain,

Switzerland, Nordic countries

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are at key stages in their

Parliamentary or other processes towards ratification; but it is difficult to forecast with accuracy when some of them will ratify. Our best guess is that the Convention will come into force at some

point between this month and April 1988.

2.

Would not "dependent territory" be a more enlightened expression than "colony" in Section 4? 'Colony" has been used in the Bill since it already has a legally recognised definition (in

the Schedule to the Interpretation Act 1978). "Dependent territory" does not, and so a separate definition would need to be

created solely for the purposes of this Bill. Use of the term "colony" merely makes the job of drafting the Bill simpler.

3.

We should exclude certain companies in the Channel Islands

and Isle of Man from benefits of the Convention. As I have

already said, it is the Government's intention that the Convention shall apply to all of those territories which wish to participate

in MIGA. The objective of MIGA is to encourage the flow of

investments which are consistent with the development objectives

and priorities of the developing country in which the investment is

to take place. If MIGA satisfies itself that applications for

contracts of guarantee from these islands meet that and other

criteria,I see no good reason why they should not be covered by the

Convention.