TNAG-2028-FCO40-2890-Hong-Kong-freezing-of-Kuwaiti-and-Iraqi-assets-1990 — Page 72

CODE 18-77

Mr T Furness

Hong Kong Department

WH311

Reference..

нивого 126

? 0 AUG 1995

Y

HONG KONG : KUWAITI ASSET FREEZE

(86

1. Your minute of 16 August detailed problems being faced by Hong Kong and possibly other fund managers as a result of the hasty letter of authority which had been written by Shaikh Ali Al-Khalifa Al-Sabah - the Kuwaiti Minister of Finance on 2 August 1990 to delegate authority to managers outside Kuwait to control the Kuwait Investment Authority, the Kuwait Foreign Trading Contracting and Investment Company, the Kuwait Petroleum Corporation, the Central Bank of Kuwait or any other body being a Kuwaiti Government agency on 31 July 1990.

2.

Following receipt of a copy of these papers from you

I discussed the matter with Mr Milne of the Bank of England and agreed that I would mention this to the Embassy of Kuwait here in London when I next spoke to them. I spoke to Mr Walid al Khobaizi, Counsellor, during the morning of 16 August and said that this letter of authority, which had now been used on a number of occasions by the KIA/KIO and other Kuwaiti companies continuing to operate under the control of the Amir's government, had been queried by Legal Advisers to a number of the Financial Managers working on behalf of the Government of Kuwait's investment bodies. I had been asked by the Bank to mention to the Embassy, that whilst we were all trying out best to help the Government of Kuwait carry on its legitimate business, this letter of authority (which had obviously been written during the Iraqi invasion) was causing some concern because of its improper witnessing and an apparent discrepency in the handwriting on the date. I asked whether Shaikh Ali could be asked to look, with the Government of Kuwait's legal advisers, again at this instrument and consider putting it onto a more formal basis. Mr Al Khobaizi said that Shaikh Ali was in Riyadh and he would certainly pass this message on. I emphasised that to the best of my knowledge there was no practical problem in either the UK or dependent territories but that a number of queries had been received cautious lawyers acting for fund managers or their clients and we thought it would be useful if a more formal document could be drawn up and circulated by the Kuwait authorities.

CR1AAI

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