TNAG-2345-FCO40-3412-Future-of-Chinese-Ministry-of-Foreign-Affairs-office-in-Hong-1991 — Page 5

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obscure.

4.

An alternative line of argument would follow on from JD 16: Hong Kong after 1997 will continue to enjoy its capitalist system and the CPG will establish the SARG. In theory land owned before 1997 by the HKG ought to be owned by the SARG after the resumption of sovereignty. The SARG ought to continue the present system of granting leases of land in return for payment. In other words, unless the SARG decided to treat it as a special case, the CPG would have to pay like everyone else for the grant

A of a lease of land for any offices if wished to establish.

assets should complication here is the Chinese argument that HKG eauld pass to the SARG via the CPG: the CPG could conceivably use such a process to requisition land for offices.

•

We do

5.

One problem in discussing this is our lack of up to date information about current practices on the mainland not know how the CPG sets about establishing offices in the provinces, or on what terms the provinces are able to set up their own offices in Peking. We wonder whether David Coates and his colleagues might be able to advise on this, perhaps after discreetly questioning a friendly provincial office in Peking (I understand that Commercial Section maintains good relations with several of these offices in Peking).

But

6. We agree that ultimately this is a political question. the legal points seem to show that the Chinese have no clear grounds for arguing for a free grant of land for their offices.

7.

As for your point about the bureaucracy, it remains my view that if the Chinese leadership shows sufficient political will, it will be easier for them to get their way with the Peking municipal authorities on a matter of this kind than it would be for HMG with the Royal Borough of Kensington and Chelsea.

Yous eve

Nigel.

N J Cox

Hong Kong Department

W G Ehrman Esq, PA Hong Kong

M Suen Esq, SCA Hong Kong

G Barnes Esq, SPEL Hong Kong

D Coates Esq, Peking

Miss S Brooks, Legal Advisers R Wye Esq, FES, RAD

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