Reference your telegrams 886, 887, 895, 897, 898. 
1. On December 11th you indicated desire of United Kingdom that Australia should associate 'even a very small token force' with main Dutch force for the defence of Portuguese Timor against Japanese aggression or infiltration. 
2. On December 13th you informed us  that Portugal, by virtue of ancient alliance, had accepted proposal to forestall Japanese aggression and had agreed to instruct Governor  either to invite assistance or acquiesce in assistance being furnished.
3. We agreed to your request to send detachment, despite our very limited resources. 
4. Subsequently plan was arranged and Dutch fixed time for landing. While acquiescing we impressed upon you desirability of getting Portuguese Government suitably informed and ready to give public explanation of operation by reference to ancient alliance.
5. On December 16th you approved of all arrangements and sent us draft of statement to be made by Portuguese and Netherlands Governments. 
6. At your request we agreed to amend plan so that landing should take place more than two hours after consultation with the Governor. It was only after expedition had set out that we heard from you that Portuguese Government had suddenly become hostile and lost its nerve. 
7. Your view was that because of the change of attitude by Portugal United Kingdom's association with operation should not be mentioned by us, although the plan was primarily yours. You suggested further that Netherlands and Commonwealth Governments might make joint statement. Before we could agree to that course, Dutch made a public statement in accordance with draft approved by you.
8. Commonwealth Prime Minister received a protest direct from the Governor  and in difficult circumstances and solely in order to meet your position we confined ourselves to a reply to the Governor  making no reference whatsoever to your part in the enterprise and we made no public statement whatever.
9. Subsequently you expressed to Portugal deep regret that action was taken by Allied military authorities on the spot, the suggestion being that you were not a party to the plan. 
10. When the New Zealand Government protested, you repeated this explanation to them although at their request we were compelled to inform them as to how it was we came to take part in the expedition. 
11. The position now is:
(a) Our military advisers at Dilli say the position is most unsatisfactory, that the Governor is organising troops to harass our troops and will certainly assist in any Japanese landing. We are also informed that the Dutch Commander  is awaiting instructions from Dutch headquarters authorising him to take full military control and disarm Portuguese.
(b) Governor of Portuguese Timor complains to his Government that Allied Commanders at Dilli have acted high-handedly and requisitioned extensively. There is no independent evidence to support this allegation.
12. We have wired urgently for advice as to the position from our representatives on the spot. 
13. Your suggestion in No.887 is that:
(a) Until adequate Portuguese forces reach Timor, defensive arrangements should be undertaken exclusively by Australian forces.
(b) When Portuguese forces arrive, we also evacuate.
(c) That Dutch forces should be withdrawn as soon as further Australian forces have entered.
(d) That we should agree to a proposal to Portugal that the present force should be converted to one comprising Australian troops only.
14. Strategic importance of Portuguese Timor is obvious. On December 23rd (Circular M.476 ) Defence Committee of your War Cabinet (para. 9) said that to achieve our main objectives Far East we must repeat must hold Timor. It is presumed that you know Japanese have civil air base at Dilli and that Portuguese local authorities seem to be quite unreliable.
15. In our view:-
(a) We cannot agree to the suggestion  contained in your 898.
Because of our limited resources and our wide commitments it is not practicable for Australia to furnish additional troops.
(b) We have no objection to other British troops being added to the Dilli force.
(c) The withdrawal of the Dutch forces might be very dangerous to the prospects of future co-operation with those Allies.
(d) We consider Portugal should have been frankly informed at the beginning that in your opinion the occupation was based upon military necessity and that Japanese infiltration or invasion could not otherwise be prevented.
16. Subsequent difficulties have been aggravated by United Kingdom itself failing to take a strong line with the Portuguese Government. Local Portuguese authorities might hand over to the Japanese particularly in view of the latter's successes.
17. We still have every desire to be helpful but we must insist that the defence of Portuguese Timor is crucial both to the Netherlands and to the whole British position in Far East and there should be no retreat. Faith of Australian public would be shaken if, having regard to what has already happened, a further withdrawal of occupying forces were to take place at the very door of Australia.