Article XIX of the treaty prohibited the construction of new naval bases in the Pacific, thus limiting the capability of the Royal Navy in East Asia.

A local naval reserve was suggested to alleviate the limitations of the treaty, but was objected by the Legislative Council on financial grounds.

The colony also celebrated a "Navy Week", coinciding with Trafalgar Day, which included open ships and naval yards, and mock-up engagements with an enemy submarine and a pirate junk.

[3] Both Europeans and Chinese were recruited into the HKNVR, and unlike other colonial naval forces, the navy was not divide on ethnic lines.

Should a full mobilization occur, all Europeans were to be automatically promoted to Petty Officers, to give them command over the Chinese servicemen.

[4] On 31 March 1934, the Royal Navy loaned HMS Cornflower permanently to the HKNVR to serve as a drill ship.

The morale worsened on 11 December, when seamen were ordered to fire upon fellow Chinese, whose junks were wrongly-accused of carrying Japanese infiltrators.

On 16 December, the replacement crew of HMS Minnie witnessed a large scale air-raid and immediately refused to serve.

Several HKRNVR members of the 2nd MTB Flotilla refused the order, and with their motor torpedo boats, aided Admiral Chan Chak in his escape to China.

For a time, the Admiralty favoured the formation of a permanent navy, but the idea was rejected by Governor Alexander Grantham, who preferred investing in a stronger water police instead.

[10] Much of the pre-war morale issues lingered, exacerbated by concerns regarding Britain's commitment to preserve the colony against a raising China.