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To give you a better idea of the points at issue, I enclose the BLD text for Special Condition 14 together with our proposed redraft. You will see that our differences revolve around the method for assessing compensation. The BLD draft does now include a reference to the Government complying with obligations (including on expropriation) under international law, but we need to pin-point more precisely the way compensation will be assessed. We want the PTG to make clear that compensation would be for the full costs of equivalent reinstatement in alternative accommodation of a similar standard and for all ancillary expenditure incurred in moving. (We also want to see scope for a form of arbitration to establish the amount of compensation.) This is the main sticking point for us and our primary concern although as you will see from our version of Special Condition 14 there are other changes which we are seeking to the BLD draft, particularly over the period of notice required.
The BLD was a practical channel for negotiations which we have been happy to use up until now. But we are breaking new ground in making arrangements for the future Consulate General and the PTG which will be in force until 2047. We recognise the awkwardness in Hong Kong, but we conclude these provisions are needed, even if they go beyond what has been established as the norm for previous PTGS. (Our proposed draft of Special Condition 14 would meet these requirements). I would be most grateful if you would consider exploring the scope for flexibility on what we see as reasonable and understandable concerns to protect HMG's interests in the future, and let me know the outcome.
We have not brought the Governor into this issue. But I believe that, if we cannot secure wording which meets our essential requirements, Ministers would want to take the matter up with him and if necessary see it taken back to ExCo.
You ever
PF Ricketts
Peter Ricketts
HONG KONG DEPARTMENT
CC. Director,
Building and Lands Department, Hong Kong Government
colvin.NAT
JEB
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