Speech by the HKSAR Secretary for Justice, Ms Elsie Leung,at the roundtable discussion organised by The Canadian Institute for International Affairs and The Canadian Council on International Law,in Ottawa, on Tuesday, 18 November 2003

Ladies and gentlemen,

Whenever I travel abroad, I am often asked how Hong Kong is fairing under �One Country, Two Systems�. It�s a natural question, given my responsibilities as the government�s principal legal adviser. It also reflects, to a degree, the previous scepticism of many commentators. Before our reunification with China on July the 1st, 1997, many commentators were making alarming predictions, including the �death of Hong Kong�.

People were most concerned about whether Hong Kong residents could continue to travel freely in and out of Hong Kong; whether the social, economic and legal systems could be maintained; and whether the way of life would remain unchanged.

I am honoured to visit Ottawa and to tell you, with great delight, that the pessimistic prophecies did not come true. The many things people were afraid would happen simply did not happen, nor will they.

Take the freedom to travel in and out of Hong Kong, for example, of Chinese nationals who have acquired Canadian nationality. Chinese nationals who were permanent residents of Hong Kong before reunification, and who still ordinarily reside in Hong Kong, continue to enjoy the right of abode in Hong Kong even if they have acquired Canadian nationality. Even those who are no longer permanent residents because they have acquired Canadian nationality, and ceased to ordinarily reside in Hong Kong, have retained their right of visa-free entry. No condition of stay is imposed on them, nor can a removal order be made against them.

In addition, the economic, social and legal systems and way of life have remained unchanged. But that is not to say that implementation of the famous concept of �One Country, Two Systems� was simple or straight forward. Since the commencement of the Basic Law in 1997, the difficulties we encountered were more than we expected. But this is a completely new undertaking � never before tried anywhere in the world. Fortunately, under the leadership of the Chief Executive, and with the support of the Central People�s Government and the co-operation of the people, we have overcome those difficulties. We can confidently tell the international community that �One Country, Two Systems� is working in Hong Kong.

Without going into the details of the events that took place prior to, and during the handover, I will share with you how we see Hong Kong today, a little more than six years after reunification and the implementation of �One Country, Two Systems�.

There is no doubt that our stability and continued development as an international city have depended on the successful implementation of this concept. The framework ensures that we retain our distinct identity and strengths as an international business, financial, shipping and aviation centre. The key strengths of our success remain as relevant and important now as they were six and a half years ago � the common law system upheld by an independent judiciary, the free and unfettered flow of news and information, a level playing field for business, and a clean, respected civil service. It is a city where the rule of law prevails. You may have heard that said many times before. But I say it with great conviction.

Hong Kong�s constitutional document, the Basic Law, has provided, and will ntinue to provide, the constitutional basis upon which our capitalist system, our way of life, and the rights and freedoms of our citizens are protected. These include equality before the law, private ownership of property, freedom of speech, of the press and of publication; freedom of association, of assembly and of demonstration, freedom of movement (which I referred to earlier), freedom of conscience, freedom of religious belief, freedom of academic research and freedom to join trade unions, etc. No law enacted by the legislature of the HKSAR shall contravene the Basic Law, hence any law infringing these rights will not be enforced by the courts.

Our courts continue to administer justice independently through the common law system, with its centuries of tradition � a system that is understood and respected by the international community. And, incidentally, the bench of our Court of Final Appeal can include esteemed judges from other common law jurisdictions, an exceptional arrangement that allows us to maintain close links with other common law jurisdictions and to tap the experience of international common law jurisprudence. There is currently a panel of ten non-permanent overseas Justices of the Court of Final Appeal from United Kingdom, Australia and New Zealand sitting in rotation and the judgments delivered by the Court of Final Appeal received international acclaim.

Our own police, immigration, customs and excise and anti-corruption officers remain sponsible for maintaining law and order in Hong Kong. We continue to maintain our previous economic system, which is still renowned for its business-friendly, low tax regime; and we have our own currency, which is still linked to the US dollar at a rate of US$1 to HK$7.80 � the same rate as when the link was first established 20 years ago in October 1983.

I also have pleasure in telling you that the Mainland leaders have scrupulously onoured their commitment, from day one, to a �hands off� approach. Hong Kong people administer their own affairs (except in defence and foreign affairs) with the promised high degree of autonomy. Our national leaders have not interfered in the running of Hong Kong, but have responded favourably to any requests we might have had for assistance.

The fact that we have negotiated a Closer Economic Partnership Arrangement or �CEPA�) with our sovereign power is in itself a powerful message, and one that should not be overlooked. It is the first free trade agreement ever signed by China or Hong Kong. To me, it starkly illustrates �One Country, Two Systems� at work, in this instance in respect of trade in goods and services. It is only under this concept that there may be two separate customs territories � two members of WTO - within one country for the arrangement to be made, and it is only within one country that the two sides could have such close co-operation and partnership in sharing fortunes with each other. It also underscores the Mainland�s commitment to the rules-based global trading system by its accession into the WTO.

So, the spirit of Hong Kong has not been stifled as some of the doomsayers redicted. Far from it : members of the community are very quick to speak up if they perceive that their rights and freedoms, or the systems underpinning Hong Kong society, are in any way being compromised or undermined. Indeed, Hong Kong people take very seriously their role in shaping the SAR and the society in which they live. And this has resulted in greater demands from the public and the legislature for an open, accountable and more efficient government. Let me cite two examples that clearly demonstrate our commitment to the voice of the people.

First, the Chief Executive, at the start of his second five-year term in office in July last year, introduced a new system to improve the accountability of senior officials. No longer are principal officials, myself included, employed as civil servants. Instead, we are appointed on contract terms and hold office which would enable the Chief Executive to have the choice of his �cabinet� and are accountable to the Chief Executive for the success or failure of matters falling within our portfolios. The system has a two-fold benefit � it improves accountability in the top echelons of government, and at the same time recognises the importance of an impartial, permanent civil service. The implementation of this new system showed how the administration responded to increasing calls from the public for a higher degree of accountability.

The second example occurred in July this year when more than half a million people took to the streets in a peaceful and orderly protest. We were shocked and surprised at the number of people taking part and the level of their dissatisfaction with the proposal to implement Article 23 of the Basic Law. In September, 2002, a consultation document was published on the proposals to implement Article 23 of the Basic Law. During the 3 months consultation period, approximately 100,000 submissions, including 3000 from overseas, expressing their views on the proposals. These were taken into account in the formulation of the National Security (Legislative Provisions) Bill which was introduced into Legislative Council on the 26 February, 2003. Therefore it was no longer the proposals of the Security Bureau and/or the Department of Justice only, but it also included the contributions by political parties, legal profession, academics and others. Between the introduction of the Bill and the proposed resumption of the 2nd reading, the Government attended 29 Bills Committee Meetings to discuss the Bill with Legislative Councillors, engaging for that purpose over 100 hours, sought views from the community, including foreign chambers of commerce, and proposed 54 amendments to it. We honestly believed that the Bill had already struck a good balance between safeguarding national security and protecting the basic rights and freedoms of the people. and Meticulous care was taken to ensure that the application, interpretation and enforcement of the Bill, when enacted, would be subject to the ICCPR and other legal safeguards. The resumption of the 2nd reading was supported by Members of the Legislative Council, without which the Government could not have placed the bill on the Agenda of the Council for the July 9, 2003. Then came the July 1, after which many Legislative Councillors changed their minds and withdrew their support, the Government had no alternative but to shelve the Bill until such time when the contents of the legislation will be thoroughly debated and are acceptable to the majority of our community.

Since the July 1st march, we have done a lot of soul-searching to learn from the experience. . The Chief Executive and other principal officials have been meeting with a wider cross-section of the community; meeting all the political groups, the media, opinion leaders and others to better gauge the feelings and hopes of the community. People took to the street for a number of reasons: for example, we were sometimes too anxious in introducing reforms to meet the need of a fast changing world, and different sectors of the society affected by such reforms were unhappy with the policies. It is, however, evident that insofar as the legislative measure for the implementation of Article 23 of the Basic Law was concerned, the channel of communication, its manner and strategy between the public and the Government were inadequate. In addition to that, the Government did not give adequate consideration to the fact that during the 3-months SARS outbreak, people�s attention was diverted, and the shock, distress and dismay bottled up during such period was suddenly released upon the lifting of travel alert. They were not ready to accept the enactment of the legislation. It gave the public the wrong impression that the Government intended to rush through with the legislative process. Indeed, the march was a timely reminder to all of us that no matter how good we believe certain policies are, we should not, and cannot, ask the public to accept them as a matter of course. The march of July 1 took place without any incident. It shows what a vibrant society Hong Kong is, and that the freedoms of association, of assembly, of procession and of demonstration are fully respected.

Ladies and gentlemen, these two examples, I believe, highlight in a graphic way just how �One Country, Two Systems� is a living concept. They reinforce everything I said earlier about Hong Kong maintaining its way of life, its freedoms and the rights of the individual; and how the people of Hong Kong have grown in maturity over the years. We are a civil and pluralistic society adhering to the discipline of the rule of law.

�One Country, Two Systems� has even broader ramifications for Hong Kong. We continue to play an important role in international affairs, and take our international responsibilities extremely seriously. We remain a member in our own right of the World Trade Organisation, the World Customs Organisation, the Asia Pacific Economic Co-operation forum, and the Asian Development Bank. As president of the international Financial Action Task Force on Money Laundering in 2001-02, we played a leading role in the international fight against terrorist financing in the wake of the September 11 terrorist attacks in the United States. Representatives of Hong Kong continue to participate, as members of delegations of the Peoples Republic of China, in international organisations and conferences not limited to states, such as the IMF, the World Intellectual Property Organisation, the International Civil Aviation Organisation and the International Telecommunications Union.

Indeed, there are more than 130 binding bilateral agreements between Hong Kong and over 60 countries throughout the world. Amongst the issues covered by these agreements are air services, visa abolition, investment promotion and protection, surrender of fugitive offenders, mutual legal assistance in criminal matters and avoidance of double taxation. We have also entered into many non-binding arrangements with foreign states and international organisations in the form of a memorandum of understanding. And more than 210 multi-lateral treaties apply to the Hong Kong SAR, of which over 80 do not apply to the Mainland. In addition, we are home to a large consular corps and several important international organisations, including the European Union, the International Bank for Settlements, the IMF and the International Finance Corporation/World Bank. Not to mention the thousands of foreign companies that have established a presence in Hong Kong over the years to take advantage of our free and open markets.

On the political front, we�re already looking at preparations for elections in September next year for our 60-seat Legislative Council. Half the seats will be returned by universal suffrage, the other half by functional constituencies representing various sectors of the community that are substantial and important to the ongoing development of Hong Kong. Beyond 2007, the Basic Law provides a mechanism to amend the method of forming �LegCo�. Hong Kong people may decide how best to achieve the ultimate aim of electing all members of the Legislature by universal suffrage. In fact, we are now working on the framework for the consultation process and the way forward on this very important issue.

Mr Chairman, ladies and gentlemen, I don�t wish to outstay my welcome, as you may have some questions you want to ask. So, in conclusion, let me say that Hong Kong is doing very well under the �One Country, Two Systems� principle. The early legal disputes over its implementation have come to an end, although I�m sure it�s not the end of the debate. The Basic Law was promulgated by the National People�s Congress of the PRC, under a legal system entirely different from ours. There is bound to be some teething problems when it interfaces with our domestic legislation. As precedents build up, it gives us better understanding of the Basic Law and find resolution for problems arising from its implementation. The international community now agrees that the principle of �One Country, Two Systems� has been successfully implemented. We have braved all the difficulties, backed by our belief that the concept is our hope of achieving national unity and peaceful reunification of China. We are entrusted by history with the task of turning this hope into reality, and we are determined to accomplish it.

Thank you.