FO371-46252 — Page 105

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CURRENCY

(a)

All laws decrees orders and acts of the Japanese Authorities pur- porting to create and issue and put into circulation occupation

currency were at all times and are horeby declared void and of no effect and all occupation currency is hereby declared to be illegal except that payments in occupation currency made during the occupat- ion on account of contracts debts or other monetary obligations made and entered into within the Colony in occupation currency shall discharge any such contract debt or obligation to the extent of the nominal face valuc of the occupation currency so paid.

(b)

The only lawful currency in the Colony is that which was recognised by the laws of the Colony as legal tender as on the last day before the occupation and includos bank notos lawfully issued in accordance with the provisions of the Hongkong Currency Ordinanco 1935 and of any subsequent Ordinance order or authority in that behalf of the Colony of Hongkong.

The Japanese occupation currency was illegally created and issued and cannot be recog- nised in valid discharge of any contract dobt or monetary obligations incurred in lawful currency. Transactions mado and closed in occupation currency should, however, not bc re-opened.

This definition of lawful currency may require revision and rostatement, and depends upon the question whether or not certain notes issued under duress during the occupation are validated.

The problem of dealing with tho, mass of illegal currency is one outside the scope of the Banks' authority. On the one hand some relief might be given to holders of small amounts who would otherwise be left without means of livelihood, but prompt measures should be taken to avoid infil- tration of occupation currency from the interior and the abuse of the position by money changers and othors It is suggested that all occupation currency should be destroyed immediately and that a rcliof

office by the Government bc set up for the amolioration of hardship

in deserving cases using only lawful currency or assistance in kind.

ACTS OF JAPANESE AUTHORITIES IN TE LIQUIDATION OF THE BANKS.

(a)

Savo as horcinafter provided all laws decrocs and orders made issued or promulgagod and all acts done by or under the authority of the Japanosc authorities during the occupation in the liquidation of any of the Banks and in the disposal of any of their property or assets of any kind are hereby declared to be void and of no effect.

This gonoral provision as to the invalidity of the acts of the bank liquidators is in line with the provisions of the Treaty of Versaillos (Clause 1 par.2 of the Annex to Part X) to the effect that all measuros taken by the German authorities with regard to onomy property rights and intcrosts in invaded or occupied territory should bo void. Thus tho Gorman

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