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have been regarded as fraudulent and illegal. They had the effect of indirect confiscation of private property and of cnriching the occupant financially at the expense of the occupied stato. Under the Hague Rogulations compulsory shifts in woalth from the occupied state to the occupant are meant to be limited to requisitions and contributions and other specified

measures.

The outright liquidation of privato banking institutions goes beyond the limits permitted undor international law which rocognises that an occupant may appoint supervisors for their control but not liquidators for their winding up. The liquidat- ion and appropriation of the assets of the banks wore permanent mcasuros involving final cffects beyond the duration of the occupation. Such measures would seen to be clearly illogal. It is not known to what extent businesses other than banks wore liquidated in the Colony, but the facts establish that the banks word liquidated and it is important that the liquidation and all the offccts arising therefrom bc declared illegal and wholly null and void oxocpt in so far as such offccts may bo spocifically cxcoptod.

If desired the terms of the Ordinance can be extended to include the annulment of the acts of the Japanese authoritics in the liquidation of all businesses.

III. Suggested Modus Operandi on Ro-occupation.

It is suggested that public announconcnts as to the ro- oponing of the banks, as to the currency to be recognised, and other initial financial regulations should bo mado at the carliost opportunity after the banks have established promiscs and have been providod with the necessary facilitics to work. It is most desirable that the announcement of a date for the rc-opening should bo mado simultaneously in rospect of all banks approved for the purpose in the first instance, leaving any romaining banks to qualify for re-opening at later stages. It is obviously desirablo and necessary that the initial financial measures should be determined in advance so that they can form the subject of an carly pronouncement for the information both of the banks and of the public as to the essential conditions which are to govern their financial transactions. For the sake of clarity and the removal of doubts and uncertainty on essential points it would be advan- tageous to includo in the pronouncement a few declarations as to existing law on the relevant subjects. Two measures may be suggested for consideration.

(a)

The issue of an Ordinanco by the principal officer of the administration or other competent authority announcin

ing the opening of certain spccificd banks from a certain date and containing the regulations governing their operation and pro- viding power for further and more detailed regulations to bo made from time to time by the principal officer concerned or an officer to hon authority is dolcgatod. The Ordinanco night amongst other matters deal with:-

(i)

Opening of the banks for now business only at the outsot, and the froozing of old accounts ponding investigation;

(ii)

A debt moratorium;

(iii)

Limitation of actions during the periods of occupation and of tho moratorium;

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