An Act to authorize the issue of Securities in relation to Loans
and for other purposes in connexion therewith
1
Short title [see
Note 1]
This Act may be cited as the Loans
Securities Act 1919.
2
Interpretation
In this Act, unless the contrary
intention appears:
Registrar means the Registrar or a Deputy
Registrar of Stock or the Registrar or a Deputy Registrar of securities or
other documents issued under this Act.
Registry means a Registry for the inscription
of Stock and for the issue and registration of securities or other documents in
relation to loans.
Security means any document made out and
issued under this Act for defining or registering the indebtedness of the
Commonwealth to lenders, and includes a Debenture to bearer, Bond to Bearer,
and Treasury Bill, and any coupon in connexion therewith.
Stock means Stock issued under this Act and a
reference to Stock includes a reference to Stock included in a Stock
Certificate to bearer and a reference to registered Stock.
3
Conditions of loans
(1) Where under an Act the Treasurer has the
authority to borrow money in accordance with the Commonwealth Inscribed
Stock Act 1911 or any Act authorising the issue of Treasury bills, the
Governor‑General may, in spite of anything in those Acts, in writing,
authorise the Treasurer:
(a) to borrow the money in amounts not
exceeding, in the aggregate, such amount as the Governor‑General
determines;
(b) to borrow the money:
(i) either by way of a
single borrowing or by way of a program of borrowings, as the Governor‑General
determines;
(ii) in such manner as the
Governor‑General determines; and
(iii) at prices, and on
terms and conditions, that are not less favourable to the Commonwealth than the
prices, and the terms and conditions, determined by the Governor‑General;
and
(c) to issue, in such form as the
Governor‑General determines, such stock and securities as the Governor‑General
determines.
(2) An authority under subsection (1)
may, instead of determining any matter referred to in paragraph (1)(b) or
(c), authorise the Treasurer to determine that matter and, in that case, the
Treasurer is empowered to determine, in writing, that matter.
4
Payment of principal and interest
The principal money secured by any Stock
or security issued under this Act and the interest thereon shall be payable out
of the Consolidated Revenue Fund, which is hereby appropriated for the purpose.
5
Establishment of Registries and appointment of Registrars
The Governor‑General may:
(a) establish Registries at any places
outside the Commonwealth for the inscription of Stock and for the issue and
registration of securities or any other documents required in connexion with
the issue of any loan or for defining or registering the indebtedness of the
Commonwealth to lenders;
(b) appoint such Registrars or Deputy
Registrars as he or she thinks necessary.
5A
Powers of Treasurer in relation to borrowings outside Australia
Where the Treasurer is authorised to
borrow money outside Australia, the Treasurer may, for the purposes of the
borrowing:
(a) enter into agreements with banks
or other financial institutions;
(b) enter into fiscal agency
agreements;
(c) in relation to the issue of any
stock or security:
(i) issue information
memoranda in relation to the stock or security; and
(ii) issue any document
necessary for the listing of the stock or security on any stock exchange or
security market; and
(d) take any action (including the
signing of any document) required or permitted to be taken by or on behalf of
the Commonwealth:
(i) under any agreement
referred to in paragraph (a) or (b) or following the issue of a document
under paragraph (c); or
(ii) for any purpose
relating to the borrowing.
5B
Power of Treasurer to enter into swaps or other financial arrangements
(1) The Treasurer may, on behalf of the
Commonwealth, enter into an agreement with any person or organisation or the
government of any country, either within or outside Australia, under which:
(a) the Commonwealth undertakes to make
payments in any currency to, or to the account of, the other party to the
agreement; and
(b) the other party undertakes to make
payments to, or to the account of, the Commonwealth, in the same or any other
currency.
(2) Any money payable by the Commonwealth
under an agreement under subsection (1) and any expenditure incurred in
connection with the negotiation, management or service of, or a repayment
under, any such agreement, shall be paid out of the Consolidated Revenue Fund,
which is appropriated accordingly.
5BA
Power to enter into securities lending arrangements
(1) The Treasurer may, from time to time,
enter into securities lending arrangements, on behalf of the Commonwealth, by
lending stock and securities issued under the Commonwealth Inscribed Stock
Act 1911, and denominated in Australian currency.
(2) The total face value of stock and
securities on loan by the Treasurer at any time under securities lending
arrangements entered into under subsection (1) must not exceed $5
billion.
(3) The Treasurer must not lend stock or
securities under securities lending arrangements entered into under
subsection (1) unless the Treasurer receives collateral of one or more of
the following kinds:
(a) cash;
(b) debt instruments denominated in
Australian currency with an investment grade credit rating;
(c) collateral of the kind mentioned
in paragraph (b), where the instrument is in electronic form;
(d) a deposit with a bank, including a
deposit evidenced by a certificate of deposit;
(e) any other collateral prescribed by
the regulations.
(4) The Treasurer must take sufficient
collateral of one or more of the kinds mentioned in subsection (3) to
cover the market value of the security on loan at all times.
(5) Lending stock or a security
is taken to include an arrangement under which it is sold and repurchased.
(6) The Consolidated Revenue Fund is
appropriated as necessary for the purposes of this section.
(7) Nothing in this section affects the power
to make investments under section 39 of the Financial Management and
Accountability Act 1997.
5C
Jurisdiction of foreign courts
(1) The Treasurer may, on behalf of the
Commonwealth, enter into a written agreement or undertaking under which the
Commonwealth agrees or undertakes to submit to the jurisdiction of a foreign
court for the purposes of any action or proceeding before that court relating
to:
(a) an agreement referred to in
section 5A or subsection 5B(1); or
(b) the issue by the Treasurer of any
stock or security in relation to the borrowing of money outside Australia.
(2) Subject to any other Act, the Treasurer
may, on behalf of the Commonwealth, in connection with:
(a) any action or proceeding referred
to in subsection (1); or
(b) the
execution of any order made or judgment given in such an action or proceeding;
waive, and enter into a written agreement or undertaking
under which the Commonwealth agrees or undertakes to waive, any immunity from
suit or other legal process of:
(c) the Commonwealth; or
(d) any property or asset of, or in
the custody of, or administered by, the Commonwealth (other than any property
or asset used or intended to be used for any diplomatic, consular or military
purpose).
5D
Delegation under sections 3, 5A, 5B and 5C
(1) The Treasurer may, by signed instrument,
delegate to:
(a) a specified officer of the
Department; or
(b) any
person who from time to time holds, or performs the duties of, a specified
office in the Department;
all or any of the following powers:
(c) the powers (if any) of the
Treasurer under subsection 3(2) to determine matters for the purposes of
paragraph 3(1)(b) or (c);
(d) the powers of the Treasurer under
sections 5A, 5B and 5C.
(2) The Treasurer may, by signed instrument,
delegate to:
(a) a specified member of the
diplomatic mission of Australia in a foreign country; or
(b) any
person who from time to time holds, or performs the duties of, a specified post
in the diplomatic mission of Australia in a specified foreign country;
all or any of the following powers:
(c) the powers (if any) of the
Treasurer under subsection 3(2) to determine matters for the purposes of
paragraph 3(1)(b) or (c);
(d) the powers of the Treasurer under
section 5A;
(e) the powers of the Treasurer under
section 5C in so far as they are exercisable for the purposes of an action
or proceeding relating to:
(i) an agreement referred
to in section 5A; or
(ii) the issue by the
Treasurer of any stock or security in relation to the borrowing of money
outside Australia.
5E
Delegation of powers and functions under section 5BA
(1) The Treasurer may, by signed instrument,
delegate all or any of the Treasurer’s powers and functions under
section 5BA to:
(a) an SES employee in the Department;
or
(b) an APS employee who holds or
performs the duties of an Executive Level 2, or equivalent, position in the
Department; or
(c) a person appointed as a staff
member of the Reserve Bank Service under section 67 of the Reserve Bank
Act 1959 who occupies an office or position at an equivalent level to that
of an SES employee, or an Executive Level 2, in the Department.
(2) The Treasurer must, by signed instrument,
give a direction as to the kinds of collateral that must be received in
relation to securities lending arrangements entered into under subsection
5BA(1).
(3) In exercising the Treasurer’s powers and
functions under section 5BA, a delegate must comply with:
(a) a direction in force under
subsection (2); and
(b) any other direction given, by
signed instrument, to the delegate by the Treasurer.
(4) The Treasurer must table a direction
given under subsection (2) or paragraph (3)(b) in each House of the
Parliament no later than 15 sitting days of that House after it is given.
6
Provisions for payment of judgments in United Kingdom
(1) Whenever, by the final judgment decree
rule or order of any court of competent jurisdiction in the United Kingdom, any
sum of money is adjudged to be payable by the Commonwealth in respect of any
stock or securities, the Minister for Finance shall forthwith pay the sum out
of the Consolidated Revenue Fund, which is hereby appropriated accordingly.
(2) In this section final judgment
decree rule or order means, in case of appeal, the final judgment
decree rule or order of the ultimate court hearing the appeal.
(3) Without in any way limiting the foregoing
provisions of this section, it is hereby declared that, in the case of any
Stock or securities being colonial Stock to which the Imperial Acts known as
the Colonial Stock Acts 1877 to 1900 apply, the Minister for Finance shall
forthwith pay out of the Consolidated Revenue Fund, which is hereby
appropriated accordingly, whatever sums of money are from time to time required
to enable the Registrar to comply forthwith with any judgment decree rule or
order with which under the Imperial Acts the Registrar is required to comply.
6A
Currency in which moneys may be borrowed
Where under an Act the Treasurer has
authority to borrow moneys, the Governor‑General may authorize the
Treasurer to borrow the moneys in whole or in part in currency other than
Australian currency, and, in that case, the Treasurer is empowered to borrow
the moneys accordingly.
6B
Exemption of certain securities issued abroad from taxation
(1) Where, by the terms or conditions upon
which any stock or security has been issued by or on behalf of the Commonwealth
outside Australia (whether before or after the commencement of this section and
whether under this Act or otherwise), the Commonwealth has given an
undertaking, howsoever expressed, to the effect that the stock or security, or
the principal or interest moneys payable under the stock or security, will be
exempt from, free of, or not subject to, taxes imposed in the Commonwealth
except where the stock or security is the property of a person included in a
particular class of persons consisting of or including all residents of
Australia, then, notwithstanding anything contained in any law of the
Commonwealth or of a State or Territory, the stock or security, its amount or
value, and any principal or interest moneys payable under the stock or
security, are not subject to any tax or duty under any such law and shall be
disregarded for all purposes in determining the liability of any person to pay
tax or duty under any such law or in determining the amount of any such
liability, except where the stock or security was, at the time of the act,
transaction or event that, according to the provisions of the law imposing the
tax or duty, gave rise to liability to the tax or duty, the property of a
person included in that particular class of persons.
(1A) Where, by the terms or conditions upon
which any stock or security has been issued by or on behalf of the Commonwealth
outside Australia (whether under this Act or otherwise), the Commonwealth has
given an undertaking, howsoever expressed, to the effect that any amount,
including the amount of any commitment fee, payable in respect of the stock or
security, in addition to the principal or interest moneys payable under the
stock or security, will be exempt from, free of, or not subject to, taxes imposed
in the Commonwealth except where the amount is payable to or in respect of a
person included in a particular class of persons consisting of or including all
residents of Australia, then, notwithstanding anything contained in any law of
the Commonwealth or of a State or Territory, the amount so payable is not
subject to any tax or duty under any such law and shall be disregarded for all
purposes in determining the liability of any person to pay tax or duty under
any such law or in determining the amount of any such liability, except where
the amount was, at the time of the act, transaction or event that, according to
the provisions of the law imposing the tax or duty, gave rise to liability to
the tax or duty, payable to or in respect of a person included in that
particular class of persons.
(2) In this
section:
(a) a reference to stock or to a
security shall be read as including a reference to an interest in stock or in a
security; and
(b) a reference to tax or duty shall
be read as including a reference to withholding tax within the meaning of the Income
Tax Assessment Act 1936‑1968 and to tax or duty in respect of:
(i) the estates of
deceased persons;
(ii) property derived from
deceased persons; and
(iii) gifts or other
dispositions of property.
7 Regulations
(1) The Governor‑General may make
regulations, not inconsistent with this Act, prescribing all matters and forms
which by this Act are required or permitted to be prescribed, or which are
necessary or convenient to be prescribed for carrying out or giving effect to
this Act, or for the conduct of any business relating to the issue, sale,
transfer and dealing with securities to which this Act applies.
(2) Authority
is given for the making by the Registrar of the Registry situated at London in the
United Kingdom of regulations under section 16 of the Imperial Act known
as the Colonial Stock Act 1877 for the purpose specified in subsection (1)
of section 1 of the Imperial Act known as the Colonial Stock Act 1948 in
relation to stock issued in the United Kingdom before the date of commencement
of this section.