LOANS (INTERNATIONAL BANK) ACT 1958

This Act shall apply throughout Malaysia.

Interpretation

In relation to the application of this Act to Sabah and Sarawak, references to any written law or to any provisions thereof, in force in *Peninsular Malaysia shall—

Any sums borrowed by the Government under the powers conferred by subsection (1) for the requirements of the Government shall be paid into the Development Fund and shall, notwithstanding section 3 of the Development Fund Act 1966 [Act 406], be applied and are hereby appropriated to the purposes for which they were borrowed as specified in any agreement concluded with the Bank in respect of the sums so borrowed:

Provided that where any part of such sum cannot be applied to the purposes aforesaid such part may be applied to such other purposes as may be approved by the Minister and the Bank.

Any agreement between the Government and the Bank in respect of sums borrowed under the powers conferred by subsection

shall be made in the name of the Government of Malaysia and may be signed on behalf of the Government by the Minister or by any person authorized thereto in writing by the Minister.

As soon as possible after the conclusion thereof a copy of any agreement concluded with the Bank in respect of any sum borrowed under the powers conferred by subsection (1) shall be laid by the Minister before the Dewan Rakyat.

*NOTE—All references to “West Malaysia” shall be construed as reference to “Peninsular Malaysia”

–see the Interpretation (Amendment) Act 1997 [Act A996] subsection 5(2).

Loans (International Bank)

Nothing in this section shall affect or derogate from any other power to borrow money possessed by the Government.

Power to issue instruments including bonds

Any such bond, promissory note or other instrument may be signed on behalf of the Government by the Minister or by any other person authorized thereto in writing by the Minister.

Borrowing by statutory authority from the Bank

Notwithstanding anything contained in the written law by which a statutory authority is established any agreement between the statutory authority and the Bank shall be valid and binding on the authority if signed on behalf of the authority by a person authorized thereto in writing under the seal of the statutory authority.

The power to borrow conferred by this section on a statutory authority shall be in addition to any power to borrow conferred on such authority by any other written law.

Notwithstanding anything contained in the written law by which a statutory authority is established, the statutory authority may charge or mortgage all or any of its property (movable or immovable) undertaking or revenue to secure any sum owing to the Bank in respect of sums borrowed by it under the powers conferred by subsection (1).

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Notwithstanding anything contained in any written law a statutory authority may issue such bonds, promissory notes and other instruments on such terms and conditions as may be necessary for the purpose of giving effect to any agreement which may be entered into by it with the Bank in respect of any borrowing authorized by subsection (1).

Application of loan moneys by statutory authority

guarantee the discharge by a statutory authority of its obligations under any agreement which may be entered into by the statutory authority with the Bank in respect of any borrowing authorized by subsection 5(1) or under any bond, promissory note or other instrument issued pursuant to any such agreement; and

undertake such other obligations as may be agreed between the Government and the Bank in relation to or pursuant to any such agreement, bond, promissory note or instrument.

Any guarantee or undertaking given under this section shall be given in writing in the name of the Government of Malaysia and it and any indorsement on any bond, promissory note or other instrument of any guarantee given under this section may be signed on behalf of the Government by the Minister or by any person or persons authorized thereto in writing by the Minister.

Loans (International Bank)

As soon as possible after a guarantee or undertaking is given under this section, the Minister shall lay before the Dewan

Rakyat a statement of the guarantee or undertaking.

Restriction on borrowing powers of statutory authority so far as guarantee outstanding

that a statutory authority is likely to fail or be unable to discharge any of its obligations under any agreement concluded by it with the Bank or under any bond, promissory note or other instrument issued pursuant to any such agreement; and

that the Government is or may become liable under any guarantee or other undertaking given in exercise of the powers conferred by subsection 7(1) in respect of such obligation, the Yang di-Pertuan Agong may by order give or authorize any other person to give such directions to the statutory authority as he or such other person may from time to time think necessary or desirable to ensure that satisfactory arrangements are made by the authority to enable it duly to discharge its obligations under such agreement, bond, promissory note or instrument or under this Act.

The statutory authority shall notwithstanding anything contained in the written law by which it is established comply with any directions given by or under any such order.

Nothing in this section shall affect or derogate from any other power conferred by law on the Yang di-Pertuan Agong or any Minister or public officer in respect of the statutory authority.

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Statutory authority to repay to Government sums paid under guarantee

If any sum is so paid out of the Consolidated Fund the

Minister shall as soon as possible after the end of each financial year beginning with that in which the sum was paid and ending with that in which all liability in respect thereof and any interest payable thereon is finally discharged by the statutory authority concerned, lay before the Dewan Rakyat, a statement relating thereto.

Arbitration

Without prejudice to the generality of subsection (1)—

Neither the Government nor any agency thereof nor any statutory authority nor the Central Bank of Malaysia shall except as shall be otherwise agreed between the Minister and the Bank create any lien on any of its assets as security for any external debt unless it is expressly provided that the lien will ipso facto equally and rateably secure the payment of the principal of and interest and other charges on any loan made by or any bonds, promissory notes or instruments issued pursuant to any loan made by the Bank to the Government or to a statutory authority.

In subsection (3)—

“lien” includes mortgages, pledges, charges, privileges and priorities of any kind;

“external debt” means any debt payable in any medium other than currency which at the time in question is legal tender for the payment of private and public debt in Malaysia whether such debt is payable absolutely or at the option of the creditor in such other medium.

For the purposes of subsection (3) the assets of the Government include any right, interest or share which the Government has or may have in the Currency Fund or any part of the assets thereof, established under the Malaya British Borneo Currency Agreement 1950.

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Ratification of existing agreements