Page 243 - Records of Bahrain (7) (ii)_Neat

Petroleum affairs 633

with the Compuny.
4. The draft io on siinilur linen to the law in cued in

Kuv/uit lost year which wuo submit t-d to Lord Reading with
Sir Erie Beckett's minute of 20th Doceuihor, 1(J1)1 (Attached).
The present draft v/un noon by tho Treasury, the Minin try of
Fuel and Power and the hoard of Inland Revenue and subsequently
discuonod in detail with representatives of the Company, In
the course of these discussions a number of amendments have been
made in places where Sir Eric Deckelt considered clarification

desirable. The Bahrain Petroleum Company, being an American-owned
Compuny incorporated in Canadu, is probably not affected by
United Kingdom income tax. It has however been mado clear that
the examination and approval of the Bahrain Income Tax Decree
by II.M.G. io without prejudice to the question of the grant of
tax relief in the United Kingdom. It is understood that tho
Company will be submitting a claim for tax relief in the United
litotes on the ground that they pay income tax under the Bahrain
Decree.

5- I now consider that the draft luw
(i) fulfils tho terms of the agreement between the
Ruler and the Bahrain Petroleum Company; and
(ii) io in u form in which, if the Ruler issues it as a
Decree, the Secretary of State cun properly allow

it to be applied by Queen's Regulation to persons
subject to the jurisdiction of the British Courts.
I therefore recommend that the Ruler of Bahrain should be so
informed. I should make clear that in doing this the Secretary
of State will be committed to allowing a Queen's Regulation
applying tho Ruler's Decree.
6. I am putting this up in the absence of Sir Eric Beckett
und Mr. Fitssmuuricc, but Sir Erie Beckett has seen tho draft
Decree und approved it subject to some drafting adjustments

which he wus content to let me settle with the Compuny and
/which