National Security (Capital Issues) Regulations (Amendment) (Cth)

STATUTORY RULES.

1940. No. 56.

 

REGULATIONS UNDER NATIONAL SECURITY ACT 1939.*

I, THE GOVERNOR-GENERAL in and over the Commonwealth of Australia, acting with the advice of the Federal Executive Council, hereby make the following Regulations under the National Security Act 1939.

Dated this twenty-ninth day of March, 1940.

GOWRIE

Governor-General.

By His Excellency’s Command,

PERCY C. SPENDER

for and on behalf of the Minister of State for Defence Co-ordination.

 

Amendments of the National Security (Capital Issues) Regulations,  

Definitions.

1. Regulation 3 of the National Security (Capital Issues) Regulations is amended—

(a)by inserting before the definition of “local authority” the following definition:—

“ ‘building society’ means any society registered under the law of any State relating to building societies; ”; and

(b) by adding at, the end thereof the following sub-regulation:—

“(2.) For the purposes of these Regulations, any sale or other disposition of forfeited shares by a company shall be deemed to be the making of an issue of authorized capital of that company.”.

Increase in capital of companies.

2. Regulation 5 of the National Security (Capital Issues) Regulations is amended by omitting paragraphs (a) and (b) of sub-regulation (1.) and inserting in their stead the following paragraphs:—

“(a) increase the nominal capital of the company by such an amount that the total increase in the nominal capital of the company in that period would exceed Two thousand five hundred pounds;

(b) make an issue of authorized capital of the company of such an amount that the total amount of authorized capital issued by that company in that period would exceed Two thousand five hundred pounds; or”.

 

* Notified in the Commonwealth Gazette on 29th March, 1940.

  Statutory Rules 1939, No. 149, as amended by Statutory Rules, 1939, No. 162.

204.—Price 5d.

 

3. Regulation 7 of the National Security (Capital Issues) Regulations is repealed and the following regulations inserted in its stead:—

Securities, &c., not to be issued without consent.

“7.—(1.) A person shall not, without the consent in writing of the Treasurer, issue any securities or mortgage or charge the whole or any part of his property or assets.

“(2.) An application for the consent of the Treasurer under this regulation—

(a) shall be in writing and shall be accompanied by particulars in writing of the purpose of the proposed issue, mortgage or charge and such other information as the Treasurer directs; and

(b) in the case of an application by a local authority, shall be sent to the Treasurer of the State in which the local authority is constituted, for transmission to the Treasurer of the Commonwealth.

“(3.) For the purposes of any consent given by the Treasurer to the issue of any securities or the mortgage or charge of any property or assets which is expressed to be subject to a condition that the rate of interest shall not exceed a specified rate, but subject to the express terms of the consent—

(a) the capital sum in relation to which the rate of interest is to be calculated shall be the net proceeds of the loan after deducting all expenses of borrowing (including any underwriting, brokerage, procuration or like expenses) except the usual legal costs;

(b) any sum repaid or repayable in excess of that capital sum shall be regarded as interest, and shall be taken into account in calculating the rate of interest on the loan; and

(c) notwithstanding anything contained in paragraph (b) of this sub-regulation, any sums which the lender may have paid for, or on behalf of, the borrower in respect of rates, taxes, insurance, repairs or other outgoings required to be incurred for the effective maintenance of his security, and which are, by virtue of a provision in the instrument or agreement relating to the loan, repaid or repayable by the borrower to the lender, shall not be regarded as interest, nor shall any interest paid or payable by the borrower on those sums be regarded as interest on the capital sum.

“(4.) Nothing in this regulation shall prevent or affect in any way—

(a) any transaction, in respect of an advance made bona fide by any bank in the ordinary course of business, on such security as the bank usually requires, provided the advance is repayable on demand;

(b) the issue of any securities, or the giving of any mortgage or charge, by any local authority—

(i) to the Government of the State in which the local authority is constituted; or

 

(ii) with the approval of the Treasurer of that State, to any person other than the Government of that State, so that the total amount of securities so issued and mortgages and charges so given by that body during any period of twelve months commencing from any date after the thirteenth day of October, 1939, does not exceed Twenty- five thousand pounds; or

(c) the giving of any mortgage or charge by any person (other than a local authority) so that the total amount of mortgages and charges given by that person during any period of twelve months commencing from any date after the thirteenth day of October, 1939, does not exceed Five thousand pounds.

“(5.) A bank shall not, without the consent in writing of the Treasurer, transfer any shares, stock, bonds, debentures or debenture stock issued to it after the thirteenth day of October, 1939, in connexion with any transaction of the kind specified in paragraph (a)of sub-regulation (4.) of this regulation, except—

(a) by way of discharge, to the person to which an advance was made in pursuance of the terms of the transaction; or

(b) to a guarantor who, in pursuance of the terms of his guarantee, has repaid to the bank the whole or part of the moneys due to the bank under the transaction.

“(6.) The Treasurer, or any person thereto authorized by the Treasurer, may require any person or class of persons—

(a) to furnish to the Treasurer or the person so authorized such information as he requires with respect to advances made to any person or class of persons; and

(b) to attend and give evidence before the Treasurer or the person so authorized concerning any such advances,

and may require him to produce all books, documents and other papers whatever in his custody or under his control relating to any such advances.

“(7.) The Treasurer or person so authorized may require the information or evidence to be given on oath or affirmation and either orally or in writing and for that purpose the Treasurer or person so authorized may administer an oath.

“(8.) A person shall not refuse or fail to comply with any requirement made in pursuance of sub-regulation (6.) or sub-regulation (7.) of this regulation.

“(9.) For the purposes of this regulation—

(a) Where, upon the receipt by a person of advances, the whole or any part of the assets of that person become mortgaged or charged for the repayment of those advances, the receipt of those advances shall be deemed to be the giving of a mortgage or charge to secure repayment of those advances, and the amount in respect of which those assets become so liable shall be deemed to be the amount of the mortgage or charge; and

 

(b) the extension of the term of a mortgage or charge, whether as regards the whole or any part of the debt secured, and whether by deed or in any other manner whatsoever, shall be deemed a mortgage or charge, but nothing in this regulation shall be deemed to prevent or affect the giving of any such extension or the renewal of a mortgage or charge where the parties to the extension or renewal are the same as the original parties to the mortgage or charge, and the rate of interest payable under the extension or renewal does not exceed the rate provided in the mortgage or charge or the rate of Four pounds fifteen shillings per centum per annum, whichever is the higher.

“(10.) For the purposes of sub-regulation (9.) of this regulation—

(a) a mortgage or charge shall be deemed to be renewed if the principal sum secured thereby is not repaid but becomes repayable under another mortgage or charge; and

(b) ‘the rate provided in the mortgage or charge’ means the rate of interest provided in the mortgage or charge, or, where a reduced rate of interest is provided in the case of punctual payment, means that reduced rate, but shall not in any case be construed to refer to any increased rate of interest stipulated to be paid in any contingency.

Limitation of interest on certain unsecured loans.

“7a.—(1.) A body, whether corporate or unincorporate (other than a bank or a building society), shall not, without the consent in writing of the Treasurer, pay interest—

(a) in respect of any period commencing on or after the date of commencement of this regulation, on any existing unsecured loan made before that date to that body by any person other than a bank—

(i) at a rate higher than the rate of interest on the loan on that date; or

(ii) at a rate higher than One pound ten shillings per centum per annum,

whichever is the greater; or

(b) on any unsecured loan made after the date of commencement of this regulation to that body by a person other than a bank at a rate higher than One pound ten shillings per centum per annum.

(2.) A building society shall not, without the consent in writing of the Treasurer, pay interest—

(a) in respect of any period commencing on or after the date of commencement of this regulation, on any existing unsecured loan made before that date to that building society by any person other than a bank—

(i) at a rate higher than the rate of interest on the loan on that date; or

(ii) at a rate higher than the maximum rate which would be applicable to the loan under paragraph (b) of this sub-regulation if it had been made after the commencement of this regulation,

whichever is the greater; or

 

(b) on any unsecured loan made after the date of commencement of this regulation to that building society by a person other than a bank:—

(i) where the loan is repayable at call or at a shorter date than three months—at a rate which exceeds One pound ten shillings per centum per annum; and

(ii) where the loan is repayable at a date falling within any of the periods specified in the first column of the following Table and commencing on the date of the loan—at a rate which exceeds, by more than the amount per centum per annum specified in the second column of that Table opposite to that period, the amount per centum per annum offered at the date of the loan by the Commonwealth Bank of Australia on fixed deposits for the same term as the loan, viz.:—

Term of loan.	Excess over Commonwealth Bank fixed deposit rate.
Per centum per annum.
Not less than three months but less than six months........................	Ten shillings
Not less than six months but less than twelve months.....................	Ten shillings
Not less than twelve months but less than twenty-four months........	Fifteen shillings
Twenty-four months or more........................................................	Twenty shillings

“(3.) Nothing in this regulation shall affect the rate of interest payable on the renewal of any loan in whole or in part where—

(a) the loan renewed was in existence at the date of commencement of this regulation;

(b) the parties to the renewed loan are the same as the parties to the original loan;

(c) the period for which the loan is renewed is not shorter than the period of the original loan, or, if the loan has previously been renewed, the last preceding renewal; and

(d) the rate of interest payable in respect of the renewed loan does not exceed—

(i) the rate payable in respect of the loan renewed on the date of commencement of this regulation; or

(ii) (a) in the case of a loan to a body (other than a bank or building society) the rate of One pound ten shillings per centum per annum; and

(b) in the case of a loan to a building society— the maximum rate which would be applicable to that loan under sub-regulation (2.) of this regulation if it had been made after the commencement of this regulation,

whichever is the greater.

 

“(4.) A body shall not be legally liable to pay interest on any unsecured loan at a rate higher than the maximum rate (if any) payable on that loan under this regulation, and the remedies for enforcing any agreement to pay interest on any such loan shall be limited to enforcing payment of interest at the maximum rate so payable.

“(5.) For the purposes of this regulation—

(a) a deposit made with a body shall be deemed to be a loan made to that body; and

(b) any sum repaid or repayable in excess of the net amount borrowed shall be regarded as interest and shall be taken into account in calculating the rate of interest on the loan.

Transfer of mortgages at a discount

“7b. A person shall not, without the consent in writing of the Treasurer, transfer or agree to transfer or take or agree to take a transfer of any debt secured wholly or partly on real or leasehold estate for a consideration which is less in amount or value than ninety-five per centum of the amount of the debt (including interest accrued and sums paid by the lender on behalf of the borrower which have been, by virtue of the instrument giving the security, added to the debt).

Provided that this regulation shall not apply to any transfer by will or by way of gift.”.

 

By Authority: L. F. Johnston, Commonwealth Government Printer, Canberra