TNAG-2658-FCO40-3854-Future-of-Hong-Kong-British-Consulate-General-1992 — Page 49

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notice to be given and for compensation to be paid by the grantor. In the light of this, I think it would be difficult for us to resist Clause 14 in principle. However the question is whether the compensation proposed would be adequate. This is a matter on which Overseas Estate Department would best be able to give a view. The proposed letter of comfort may assist if the Hong Kong Government are prepared to give it but we would need to examine it to see how helpful it is.

4.

We will need to reword the second and third sentences of paragraph 1 of your draft telegram. I suggest you have a word with OED on the question of compensation before the telegram issues, since we would need to reflect any comments they may have on the compensation aspect of the resumption clause in the telegram. I think we should also press for the deletion of the words 'in the opinion of the Director' which occur in Clause 14, sub-paragraph (a) and (b) (ii) and the words 'at his sole discretion' in sub-paragraph (b).

5. I would also like to delete the last two sentences of paragraph 3 of your draft telegram. I would like to reword these as follows:

A

'In replying to Mr Ng's letter of 31 January, you should acknowledge the statement in the penultimate paragraph of his letter that it is not the intention of the Hong Kong Government to create any legal obligation for the British Trade Commission or for the British Government unless and until the legal documents necessary to give legal effect to the proposed treaty grant are executed and registered,and go on to state that HMG consider that no such obligations are created until those processes are completed

B

6. You mentioned that Hong Kong Government officials had stated that a lease was not necessary in addition to the private treaty grant but that if a lease was desired, it

would be granted. The idea of a lease is worth pursuing.

Could you plen I youplin

suggest that the British Trade Commission instruct a firm of solicitors to consider whether a lease granted in addition to the private treaty grant would give the British Government additional protection. Presumably the lease would be subject to the relevant Ordinances on landlord and tenant. If so, this might give further protection to the future Consulate-General from arbitrary behaviour by the Hong Kong SAR Government.

AE1 ADE

Shelaph

Brooks.

S Brooks