Lee Wei Fang v. Kennedy, 317 F. 2d 180 (D.C. Cir. 1963), cert. den. 375 U.S. 833 (at least where actual allegiance to the PRC was not shown). The reasoning appears to be that the concept of "subject national, or citizen" must involve allegiance to a legitimate national authority; to imply such a status for the PRC would contravenue the Executive policy to withhold de jure recognition. Thus, the inability to deport aliens to countries not recognized de jure may be due not only to the lack of channels of communication but also to an unwillingness to deal with the unrecognized foreign authorities. In Cheng v. INS, 521 F. 2d 1351, 1353 (3d Cir. 1975), which was decided after the establishment of the Liaison Officers in Peking and Washington, a person born on the China mainland was held not to be a citizen of the PRC. The court quoted a Department of State response to a judicial inquiry:

"Normally, the United States does not deport aliens to countries with whose governments we do not have diplomatic relations. At the present time, with respect to persons who come from mainland China and claim to be citizens of People's Republic of China and not the Republic of China, we believe there is no appropriate government with which we have relations for the purpose of directing a request pursuant to section 1253A."

After withdrawal of recognition, there would be no problem of communications with the Taiwan authorities, even under the "Japanese formula." A problem would arise according to the reasoning of Cheng v. INS, however, if Taiwan is not considered a "country" for deportation purposes because it is not recognized de jure.

8 U.S.C. 1253 (h) permits the Attorney General to withhold deportation at his discretion for reasons of foreign policy or "to any country in which in his opinion the alien would be subject to persecution on account of race, religion, or political opinion." Fear of persecution in one part of the country is not sufficient if the alien would be safe in another part; e.g., Lavdas v. Holland, 235 F. 2d 955 (3d Cir. 1956) (one island in Greece). If Taiwan is treated as a part of China, it may be that a person would have to be persecuted in both places before this exception applies.

8 U.S.C. 1153 (a) (7) permits the admission on parole of certain refugees on an emergency basis pending regularization of their status. Under this program, an alien must make application in a non-Communist "country," and satisfy an American immigration officer that the alien has fled from a Communist area because of persecution; in addition, the alien cannot be a "national of the country" where the application is being made. If Taiwan is treated as a part of China, then it appears that a person fleeing persecution by the PRC cannot apply for parole from Taiwan.

A number of Taiwan businessmen now enter the United States under 8 U.S.C. 1101 (a) (15) (e) as traders or investors operating pursuant to the Treaty of Friendship, Commerce, and Navigation between the United States and the ROC. If this treaty lapses upon withdrawal of recognition, then no other persons can enter via this channel, and treaty traders and investors presently in the United States may have to return to Taiwan.

II. Existing treaties and executive agreements

Treaties in Force (1977) lists sixty treaties and executive agreements between the United States and the Republic of China. While all are technically in force, many in fact have little or no operational consequences. Several treaties concern political relations between the two countries during the earlier part of the century. Others deal with economic and military relations during and after World War II. There are also agreements concerning transfers of naval vessels

35

Treaty looking to the advancement of the cause of general peace (1915). Treaty Series (TS) 619, 619A; Treaty of arbitration (1932), TS 857; Treaty for the relinquishment of extraterritorial rights in China (1943). TS 984.

36 Agreement concerning the United States relief assistance to the Chinese people (1947), Treaties and Other International Agreements Series (TIAS) 1674: Agreement relating to duty-free entry of relief goods (1948). TIAS 2749, 3151. Agreement relating to claims resulting from activities of United States military forces in China (1948), TIAS 1776; Agreement relating to the presence of the United States armed forces in China (1947), TTAS 1715: Agreement relating to the furnishing of certain materials to China for the defense of Taiwan (1951). TIAS 2293: Agreement relating to assurances required by the Mutual Security Act of 1951 (1951). TIAS 2604. Preliminary agreement regarding principles applied to mutual aid in the prosecution of the war against aggression (1942), 56 Stat. 1494: Agreement under Section 3 (c) of Lend-Lease Act (1946), TIAS 1746; Agree ment on the disposition of lend-lease supplies in inventory or procurement in the United States (1946), TIAS 1533.

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to Taiwan, and construction of defense facilities." Other agreements deal with matters that are in the process of being phased out, including the status of forces agreement and MAAG." There are a number of expired agricultural commodities agreements.40

Another group of agreements concerns routine or relatively routine matters such as postal service, free entry privileges for personal articles of consular officers, length of validity and fees for non-immigrant visas, and cataloguing.“ Still others deal with various kinds of scientific and educational cooperation." This leaves only a small number of treaties and agreements that are still operational and concern relatively important matters. The Mutual Defense Treaty provides:

"Each Party recognizes that an armed attack in the West Pacific Area directed against the territories of either of the Parties would be dangerous to its own peace and safety and declares that it would act to meet the common danger in accordance with its constitutional processes." "3

For purposes of this treaty, "territories" of the ROC are defined as the islands of Taiwan and the Pescadores.

The Treaty of Friendship, Commerce, and Navigation (FCN) established the framework for political and commercial relations between the two parties, and is the basis for a broad range of private rights of nationals of each party. This Treaty was signed in 1946, but an exchange of notes in 1950 limited its operation to the territory actually under the control of the Taiwan government." Similarly, the air transport agreement signed in 1946 established routes between the China mainland and the United States. The agreement was later amended to suspend the operation of these routes and to establish new routes to and from Taiwan.45

42 U.S.C. 2153 requires that an agreement for cooperation concerning civil uses of atomic energy be signed before nuclear materials may be transferred to another government. In a 1972 agreement, Taiwan guarantees not to use such materials for military purposes and not to transfer any material or restricted technical data to unauthorized persons or "beyond the jurisdiction of the government of the ROC."" The agreement is in force for thirty years, with no provision for earlier denunciation.

Two short-term agreements set up "voluntary" textile quotas for Taiwan exports to the United States." These are part of the Arrangement Regarding International Trade and Textiles concluded in Geneva on December 20, 1973. Although not a party to the Arrangement, Taiwan has agreed to abide by its provisions.

Finally, there is an agreement for relief from double taxation on earnings from operation of ships and aircraft," an OPIC-related agreement on guarantees

37 TIAS 2979 (and amendments); TIAS 4180 (and amendments); TIAS 4274; TIAS 4676: TIAS 4828; TIAS 6283; TIAS 6623.

38 Agreements were signed to construct defense facilities. TIAS 3713; a scatter wave radio facility, TIAS 5175; a communications facility, TIAS 5176; and a scatter wave control facility, TIAS 5177.

29 TIAS 5986; TIAS 2712. See also TIAS 3571 (and amendments) and TIAS 4312 (disposal of surplus military material).

40 TIAS 5010, 5151, 5219, 5589, 5717, 5718. 6395 (all with amendments).

41 Agreement for the exchange of international money orders (1957), TIAS 3995; Parcel post convention (1916), 39 Stat. 1665; Agreement for exchange of insured parcel post (1957), TIAS 3941; 6 Bevans 727; TIAS 3539.

42 Agreement on technological advancement in connection with water resources. land utilization and various fields of irrigated agriculture (1972), TIAS 7374: Agreement for financing certain educational and cultural exchange programs (1964), TIAS 5572; Agreement relating to the etablishment in Taipel of a United States Navy Medical Research Unit (1955), TIAS 3493; Agreement concerning the status of the American Embassy School of Chinese Language and Area Studies at Taichung and its personnel and of Chinese Embassy personnel studying in the Washington area (1969). TIAS 6759; Agreement relating to cooperation in science and technology (1969), TIAS 6639; Arrangement for the direct exchange of certain information regarding the traffic in narcotic drugs (1947), 6 Bevans 797.

43 Article V. TIAS 3178.

44 TIAS 1871. The texts of the notes are unavailable. but the substance is mentioned in a footnote to the Treaty of Friendship, Commerce, and Navigation in Treaties in Force. For some unexplained reason that may or may not be significant, that footnote has not been included after the 1974 edition.

45 TIAS 1609. 6773.

46 TIAS 7364. 7834; see also. Agreement providing for a grant for the acquisition of nuclear research and training equipment and materials (1959). TIAS 4371. There also is a companion trilateral agreement among the United States, the ROC, and the International Atomic Energy Agency, TIAS 7228.

47 TIAS 7821, 8033.

48 TIAS 7282.

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for projects in Taiwan proposed by nationals of the United States," and a series of agreements concerning American-owned Taiwan currency accumulated through earlier assistance programs.

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It should be noted that all treaties still having operational effect are limited by their terms, subsequent amendments, or clear implication to apply only to the territory actually controlled by the Taiwan authorities.

What are the legal effects of withdrawal of recognition on these treaties and agreements? Two views have been proposed, both of which severely limit our possible policy options by terminating the defense treaty. The first argues that all agreements would automatically lapse, since one of the signatories, the Republic of China, would no longer legally "exist." This would greatly disrupt our economic and other relations with Taiwan and also would terminate many obligations which we would wish to preserve, such as those concerning safeguards for nuclear materials.

A second view attempts to draw a distinction between political and nonpolitical or technical treaties. A political treaty, such as the defense treaty, would be nullified by the political act of withdrawing recognition, while other obligations concerning ongoing matters of trade, investments, and cultural relations could continue.

This distinction presents several difficulties. First the hard-to-draw line between political and non-political matters is, in the end, a fairly arbitrary one. Is an agreement to supply Taiwan with nuclear materials for the generation of electricity an economic or a political matter? What about an Export-Import Bank loan to build a plant that produces military-related materials? The principal problem arises not with respect to the defense treaty, but with the FCN treaty which specifies a definite political relationship, but also creates the basis for many economic and cultural ties. If this treaty lapses because of its political character, then economic and cultural relationships would be severely disrupted. If this treaty does not lapse despite its political character, then as a legal matter why should the defense treaty be treated differently?

I would like to present a third view, which I believe to be analytically more sound and politically more helpful. As stated earlier, all operative treaties are limited to the territory actually controlled by the Taiwan authorities. The legal effect of withdrawing recognition in such circumstances is unclear. At the least, international law does not require that prior treaties entered into with a oncerecognized government, the terms of which are limited to the territory actually controlled by that government, must automatically lapse after the government loses de jure recognition while still exerting de facto control. Neither, however, does international law require that such obligations continue. Hence, the choice of what to do with the defense treaty is a political, more than a legal, matter. III. Policy implications of the legal analysis

I have stressed two points concerning the withdrawal of recognition from Taiwan: (1) it need not disrupt our economic and other relations; and (2) it need not, as a matter of law, automatically terminate the defense treaty. Our policy options, therefore, are quite broad.

In examining policy options, it should be noted that despite its harsh rhetoric, China's conditions for normalization are not non-negotiable. China has been unyielding on what it considers to be basic principles, but flexible on the means of implementation. Thus, Peking firmly maintains that it is the sole legitimate government of China, which includes Taiwan. But the means, terms, and time frame for actual reunification are not fixed. Teng Hsiao-ping's recent statement about taking into consideration the special conditions prevailing on Taiwan is another authoritative indication that there is flexibility in the Chinese position.

I believe the United States can and should immediately recognize Peking as the government of China. 51 It also should confirm the principles of the Shanghai

TIAS 2657, 5509.

50 Economic aid agreement (1948); TIAS 1837, 1923, 3077, 5888; Agreement establishing a joint commission on rural reconstruction in China (1948). TIAS 1848. 1975; Agreement concerning disposition of the New Taiwan dollars generated as a consequence of aid furnished to China (1965). TIAS 5782, 6451, 6906: Agreement regarding the ownershsip and use of local currency repayments made by China through the Development Loan Fund (1958), TIAS 4162: Agreement relating to the deposit by China of 10% of the value o grant military assistance and excess defense articles furnished by the United States (1972), TIAS 7325.

51 A full discussion of this proposal is in Victor H. Li. and John W. Lewis. "Resolving the China Dilemma: Advancing Normalization, Preserving Security," International Security, vol. 2, no. 1, p. 11 (Summer 1977).

Communique by reiterating that the United States "does not challenge" the position that "all Chinese on either side of the Taiwan Strait maintain there is but one China and that Taiwan is part of China" and by withdrawing its remaining military personnel from Taiwan. The United States should welcome direct PekingTaipei discussions to resolve in a peaceful manner the issues that divide them. This process may take some time. While awaiting a final resolution, the United States should maintain direct, though lower than embassy level, relations with Taiwan. Economic ties would continue as before; the legislation proposed above would accomplish this.

The defense treaty, an item not mentioned in the Shanghai Communique, should remain in force, unless an acceptable substitute is found. As discussed earlier, international law does not require that the treaty lapse. The United States should actively seek a substitute for the treaty. During negotiations, the U.S. might commit itself to an eventual termination of the defense treaty-an acceptance on one level of the principle of non-interference. The time and manner of termination and the possible alternative U.S. actions to insure security, however, must be negotiated.

This proposal is designed to accomplish several objectives. Recognizing Peking as the government of China would break the present impasse. The proposal would protect the vital interests while taking into account the constraints on each party. Peking would obtain a formal acknowledgement of the one-China principle, but would have to accept Taiwan's continued separate existence, at least ad interim. The thrust of this proposal, I believe, would be considered a positive step by Peking. In some recent discussions, Chinese officials called the proposal "useful" and "interesting." Their main concern was whether the United States could cope with the proposal's long time frame and inherent ambiguities.

Meanwhile, Taiwan would retain its present military and economic security, but most confront the rejection of its claim to be the government of all China. If it wishes to continue this fiction, then it would have ample notice that it must face the consequences alone. It it wishes to make a transition to some other status, then it must begin the process.

In the United States, there have been numerous indications of strong political opposition to abrogating the defense treaty without finding a substitute. At the least, a lengthier national debate appears ncessary before a decision can be made. One unforunate effect of any delay is that the lack of progress may be regarded as a setback or a further obstacle in United States-China relations. This proposal advances the normalization process a critical step forward, but in manner acceptable to a broad spectrum of American political opinion.

In addition, this proposal substantially reduces the existing anomolies by eliminating the fiction that Taiwan is the government of all China, and by showing that normalization of relations with China is not tantamount to "abandoning" Taiwan. With the clearing away of the confusing secondary issues, national attion is clearly focused on the central question: what will be the future American security relations in Asia? In this regard, it should be noted that the adopting of this proposal does not preclude subsequently following any of the formulae of relations with China and Taiwan suggested by other analysis.

The proposal may be an insufficient basis for the immediate establishment of full diplomatic relations (since the defense treaty might remain in force). Instead, it establishes the foundation for negotiating a mutually satisfactory and lasting relationship betwen the United States and China.

Mrs. MEYNER. Mr. Theroux, I think that we will proceed with you, if you will, please.

STATEMENT OF EUGENE A. THEROUX, ATTORNEY,

BAKER & MCKENZIE

BIOGRAPHY

Eugene A. Theroux is a Member of the Bar of the District of Columbia and a partner in the international law firm of Baker & McKenzie, Washington, D.C. He has traveled extensively in Asia and, between 1972 and 1977, made 11 visits to the People's Republic of China. On his first visit to Peking, he served as trade and legal aide to the June-July 1972 Congressional mission of Hale Boggs and Gerald Ford, then Majority and Minority Leaders, respectively, of the U.S. House

of Representatives. Mr. Theroux served 2 years, between 1973 and 1975, as Vice President of the National Council for U.S.-China Trade. He is the author of a number of publications related to the legal aspects of trade with China, and at Chinese invitation has lectured in Peking on American legal subjects before the China Council for the Promotion of International Trade and China's Foreign Trade Corporations. Mr. Theroux is a former Special Counsel to the Joint Economic Committee of the Congress.

Mr. THEROUX. Thank you, Madam Chairman. It is an honor and pleasure to appear before this committee.

My testimony reflects the personal views of a lawyer in the practice of private international law. I speak only for myself, not for my firm or for any client.

Since 1972, I have made 11 visits, aggregating several months, to the People's Republic of China. I have also visited the Republic of China.

Some of my clients trade with the PRC, some of them trade with the ROC, and some with both. Out of admiration and affection for friends in both places, and because I believe that law and trade can contribute to understanding and friendship, I share this committee's concern about the practical and legal implications of normalization of relations between the United States and the People's Republic of China.

Professor Li has rightly said that the proper question is not whether, but how, the United States and the PRC should achieve normal relations.

Nevertheless, the PRC should understand that the issue is not a simple matter of U.S. acceptance of its three announced conditions for normalization. For normalization to be politically possible in the United States, a satisfactory answer must be found to two difficult. questions:

First, where is the justification for the United States, in effect, aiding in the transformation of a friendly national ally, to which we are tied by treaty, tradition, and trade, unwillingly into a province of a state whose economic and political systems are alien, offensive, and hostile to our own?

Second, how, if at all, can or should we help preserve, for the 18 million people on Taiwan, a chance to decide their own future in an atmosphere free from coercion or intimidation?

The question of Taiwan, and its relationship to the mainland of China, must be left to the Chinese themselves. To be sure, we are involved in this question. But I believe this country should confine its negotiations with the PRC to the terms on which an exchange of ambassadors can occur between Washington and Peking. In this process, neither side should expect the other to make unreciprocated concessions.

It is undeniable that the PRC Government exercises de facto political authority on the Chinese mainland. It is equally a fact that the ROC and the PRC each hold that the United States cannot maintain complete diplomatic recognition with one without requiring severance of relations with the other. In these circumstances, we have retained preexisting diplomatic relations with the ROC while also establishing, to the extent possible, diplomatic relations with the PRC. The result is that the United States and the PRC maintain in each other's country diplomatic missions which are embassies in all but name. The ambiguities of this situation are, to some, intolerable; but whether because of