HKL 406/4.
PA
RESTRICTED
RECE
26 JAN 1993
HONG KONG: FUTURE CONSULATE GENERAL
INDE
RECORD OF THE STEERING COMMITTEE HELD ON 6 JANUARY 1993
PRIVATE TREATY GRANT (PTG)
1. Mr Hum opened the meeting by inviting Mr Morris (HKD) to
speak about the PTG. Mr Morris explained the background. Our difficulties lay with Special Condition (SC) 14 on the terms of compensation in the event of our property being expropriated. This was unsatisfactory for two reasons. First, compensation would be based on depreciated value rather than on reinstatement in equivalent accommodation. Second, the final decision on compensation would be left to the Director General of Building and Lands in Hong Kong. Nowhere else in the world, except in China, had we had to accept such disadvantageous conditions for our estate. OED agreed; as at present drafted SC 14 was an unsafe basis for going ahead with such an expensive project.
2. Mr Hum invited Miss Brooks (Legal Advisers) to brief the Committee on the position under International Law. She explained that the Vienna Convention on Consular Relations
makes provisions for "prompt, adequate and effective compensation" in the event of expropriation. Should the Chinese fail to recognise the application to Hong Kong after 1997 of the Vienna Convention, customary international law would afford similar protection. The Joint Declaration provides compensation paid "without undue delay". Both the Joint Declaration and the Basic Law make provisions for compensation on the basis of the "real value". In short, the reference to international obligations included in the Hong Kong side's latest draft for SC14 was helpful. But she (and OED) would also like to see adequate provision made in the PTG for compensation. Her experience in negotiating IPPAS confirmed her in the view that we should not accept
fut.cons.NAT
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