The Liberal Party has come out in favour of proportional representation for the 20 directly elected seats in the first legislature.
Three party chiefs met Secretary for Policy Co-ordination Michael Suen Ming-yeung and SAR exco senior member Sir Sze-yuen Chung for an hour yesterday.
'The most important thing is to find a system which is fair and more representative in the long term,' Liberal Party vice-chairman Ronald Arculli said.
He said the most difficult issue was how to implement the nationality ban for foreign passport holders.
An upper limit of 12 lawmakers holding foreign passports is allowed under the Basic Law.
The Democratic Alliance for the Betterment of Hong Kong, which also met post-handover officials yesterday, quoted Mr Suen as saying that the Chief Executive-designate's Office preferred to determine the election of the foreign passport holders by their length of residence and number of votes cast.