TNAG-2789-FCO40-4028-Future-of-Hong-Kong-1993 — Page 17

GOVERMENT HOUSE HONG KONG.

TUE 25 MAY 93 07:39

PG.04

3.

CONFIDENTIAL

Members will be asked to advise whether

this

recommendation should be approved.

BACKGROUND AND ARGUMENT

i

4.

capacity

The Foreign Corporations Act 1991 ("the U.K. Act")

(at Annex B) was enacted in July 1991 to enable the legal

OF foreign corporations incorporated under the

territories which were not recognized as States by

The effect of the Act was that

laws

the

30

UK to be accepted.

obligations

flowing from

contracts

corporations could be enforced.

principally

response to

entered into by those

We understand it was

aimed at Taiwan and Turkish Cyprus, and was A

concern expressed by the legal profession over

the status of corporations from these territories when

entering

counterparts.

into contractual

relationships

with U.K.

5.

Similar concern has been

profession in Hong Kong Over the

expressed by the legal

status of the growing

number UE

corporations

incorporated

in

"territories not

recognised by the U.K.", such as Taiwan and North Korea.

We feel that commercial realities require the enactment of

CONFIDENTIAL

but have yo