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Loans and Loan Guarantees Ordinance, 1999 is Malaysia State Ordinance, cited as State Ordinance Cap. 31 1999, currently marked in force and first recorded in 1999.
PREPARED AND PUBLISHED BY
THE COMMISSIONER OF LAW REVISION, SARAWAK
UNDER THE AUTHORITY OF THE REVISION OF LAWS ORDINANCE, 1992 2007
Date Passed by Dewan Undangan
Negeri
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6th December, 1999
Date of Assent
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8th December, 1999
Date of Publication in Gazette
23rd December, 1999
Opening note
Short title and commencement
This Ordinance may be cited as the Loans and Loan
Guarantees Ordinance, 1999, and shall come into force on such date as the Minister may, by notification in the *Gazette, appoint.
Interpretation
a bank or a financial institution licensed under the Banking and Financial Institutions Act 1989 [Act 372];
any bank licensed to conduct offshore banking business under the Offshore Banking Act 1990 [Act 443];
or
any corporation licensed to conduct business of banking or lending by the laws of the country in which that Corporation is incorporated;
“body corporate” means a corporation or company declared by the Minister under section 12 to be subject to
Part III
“borrow” includes the raising of money for State purposes through arrangement or agreement whereby the Government is obligated to repay or refund any money or benefits that may accrue or which it enjoys under the said arrangement or agreement, and “loan” shall be construed accordingly;
“Central Bank” means the Central Bank of Malaysia established by section 3 of the Central Bank of Malaysia Act 1958 [Act 519];
“Consolidated Fund” means the State Consolidated Fund formed or established under Article 29(1) of the Constitution of the State of Sarawak [G.N.S. 163/63];
“Development Fund” means the Development Fund established by the Financial Procedure (Contingencies and Trust
Funds) Ordinance, 1963 [Cap. 37];
“federal Government” means the Government of the
Federation;
“Federation” means the Federation of Malaysia, and includes the Government of the Federation;
“Government” means the State Government of Sarawak;
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“guarantee” includes any undertaking or promise to pay, but does not include any instrument which does not impose a liability on the Government to answer for the default of another person;
“Minister” means the Chief Minister or, subject to such authority as may be vested or assigned to him, generally or specially, by the Chief Minister, the Minister in the Government charged with the responsibilities for the financial affairs of the
State;
“securities” shall have the meaning assigned to it in the
Securities Industry Act 1983 [Act 280];
“State financial authority” shall have the meaning assigned to it in the Financial Procedure Act 1957 [Act 61];
“State purpose” includes any matter with respect to which the Dewan Undangan Negeri has powers to make laws and any matter enumerated in the Concurrent List in the Ninth Schedule to the Federal Constitution;
In this Ordinance, any reference to the Yang di-Pertua
Negeri shall be construed as a reference to the Yang di-Pertua Negeri acting in accordance with the advice of the Majlis Mesyuarat Kerajaan
Negeri or any member thereof acting under the general authority of the Majlis.
Power to borrow from the Federation
Subject to this Part, the Government may, in such manner and subject to such terms and conditions as may be agreed upon between the Government and federal Government, borrow from the
Federation from time to time, such sums as may be required by the
Government for any State purpose.
Borrowings within Sarawak
Subject to the approval of the Central Bank and Article 112B of the Federal Constitution, the Government may borrow from any bank or financial source within Sarawak, such sum and upon such terms and conditions, as may be approved by the Majlis Mesyuarat
Kerajaan Negeri.
Borrowings from outside Sarawak
Subject to Article 111(2) of the Federal Constitution and this Ordinance, the Government may, in such manner and subject to such terms and conditions as may be approved by the Majlis
Mesyuarat Kerajaan Negeri, borrow such sum, as may be determined by the Majlis, from any bank or financial source outside the State as may be approved by the federal Government.
Issue of bonds or other securities by Government
All bonds or other securities issued under subsection (1)
shall be signed or authenticated by the Minister or the State Financial
Secretary.
The State Financial Secretary shall keep a register, containing such particulars as may be required by regulations made under section 24, of all bonds and other securities issued pursuant to subsection (1).
Loan agreements, etc.
All agreements relating to any borrowings or loans or loan facilities made under this Part and the issue of any bonds or securities hereunder shall be approved by the Majlis Mesyuarat Kerajaan Negeri and signed by the Minister or the State Financial Secretary or any other public officer duly authorized by the Minister.
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Details of agreements and borrowings to be laid before Dewan
Undangan Negeri
The Minister shall cause to be laid before the Dewan
Undangan Negeri, as soon as practicable, an instrument containing the following particulars pertaining to any agreement for any borrowings, loans or loan facilities made pursuant to this Part or in relation to any bonds or securities issued pursuant to section 6:
the date of issue of any bonds or other securities, if any, issued pursuant to the agreement, and the date of maturity thereof;
the date or dates of drawdown of such borrowings, loans or loan facilities and, for the repayment thereof;
the nature of any security, if any, provided by the
Government or any other party, for such borrowings, loans or loan facilities;
any other relevant information or details pertaining to such agreement, borrowings, loans or loan facilities.
Application of loan proceeds
All moneys from borrowings, loans or loan facilities raised under this Part shall be paid or deposited into the Consolidated Fund or if so directed by the Majlis Mesyuarat Kerajaan Negeri into the
Development Fund, and shall be applied as appropriated for the purpose for which they are borrowed as stipulated in the agreement pertaining to such borrowings, loans or loan facilities.
Repayment of loans
All moneys borrowed under this Part together with interests and other charges accrued thereon shall be repaid in accordance with the terms of the agreement relating to such borrowings, loans or loan facilities and out of moneys from the
Consolidated Fund, and there shall be issued out of the Consolidated
Fund such sums as may be required during any financial year to meet the repayment of the moneys borrowed and any interests or charges accrued thereon.
Moneys for payment of bonds
All moneys required for the payment of bonds upon their maturity or otherwise or for the redemption of securities issued under this Part, or any interests or charges payable or due thereunder, shall be paid out of moneys from the Consolidated Fund and there shall be issued out of the Consolidated Fund such moneys as may be required during any financial year, to meet such payment.
Body corporate
The Minister may, with the approval of the Majlis
Mesyuarat Kerajaan Negeri, declare by notification in the Gazette any body corporate to which this Part shall apply.
Guarantee to the Federation
a body corporate to which this Part or the Loans
Guarantee (Bodies Corporate) Act 1965 [Act 96] applies, the Government may, if so required by the federal Government, issue or provide a guarantee to the federal Government, to guarantee the payment to the federal Government of all moneys which the federal
Government may become liable under the federal guarantee.
Any guarantee given to the federal Government pursuant to subsection (1) shall be in such form and contain such terms and conditions as may be approved by the Majlis Mesyuarat Kerajaan
Negeri and signed by the Minister or State Financial Secretary or by any other public officer duly authorized by the Minister.
Power to guarantee loans
Any guarantee given under this section shall be given in writing in the name of the Government, and the guarantee and any endorsement on any bonds or other securities given under this section shall be approved by the Majlis Mesyuarat Kerajaan Negeri and may be signed on behalf of the Government by the Minister or State
Financial Secretary or any other public officer authorized by the
Minister.
Details of guarantees to be laid before Dewan Undangan Negeri
The Minister shall cause to be laid, as soon as practicable, before the Dewan Undangan Negeri, an instrument containing the following particulars of any guarantee issued under this Part:
the terms and conditions pertaining to any borrowings, loans or loan facilities covered by the guarantee;
the nature of any collateral or related security provided by the body corporate under section 17(2), in addition to the guarantee issued under this Part, for the borrowings, loans and loan facilities; and
any other relevant information or particulars relating to the guarantee.
Appropriation of sums raised
Any sums guaranteed under this
Ordinance are appropriated first to the payment of expenses in connection with the raising of the loans or the issue of the bonds or securities relating thereto and, subject to payment of those expenses, to the purposes for which the loans are raised:
Provided that where any part of such sum cannot be applied to the purposes aforesaid the part may be applied to such other purposes as may be approved by the Majlis Mesyuarat Kerajaan Negeri.
Issue of bonds or other securities by body corporate
Notwithstanding anything contained in the written law by which a body corporate is established, the body corporate may charge or mortgage or pledge all or any of its assets (movable or immovable), undertaking or revenue to secure any sum raised by way of loan guaranteed under this Ordinance.
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Restriction on borrowing powers of body corporate so long as guarantee outstanding
not, except with the written approval of the State financial authority upon consultation with the Minister, exercise any other power to borrow possessed by it or conferred on it by any other written law or by virtue of any rules, regulations, articles of association to which the body corporate is subject;
submit to the State financial authority its audited accounts, at such intervals as he may determine; and
furnish to the State financial authority, if so required by him in writing, all accounting records of the body corporate, for inspection by him or an approved company auditor appointed by him.
For the purpose of this section, “accounting records”
means—
the accounting and other records which the body corporate is required to keep or maintain under section 167(1) of the Companies Act 1965 [Act 125] or any other written laws; and
the accounting records which the body corporate is required by regulations made under section 24 to keep or maintain.
A body corporate and any of its officers or agents who contravenes any of the provisions of subsection (1) shall be guilty of an offence: Penalty, a fine not exceeding one hundred thousand ringgit or imprisonment for a term not exceeding four years or both such fine and imprisonment.
Powers exercisable by Government in event or prospect of default by body corporate
that a body corporate is likely to fail or be unable to discharge any of its obligations under any agreement concluded by it under this Ordinance or under any bonds or other securities issued pursuant to any such agreement; and
that the Government is or may become liable under any guarantee given under this Ordinance in respect of that obligation, the Majlis Mesyuarat Kerajaan Negeri may by order give or authorize any other person to give such directions to the body corporate as he or that other person may from time to time think necessary or desirable to ensure that satisfactory arrangements are made by the body corporate to enable it duly to discharge its obligations under such agreement, bonds or other securities under this Ordinance.
The body corporate shall, notwithstanding any provisions contained in the written law by which it is established, comply with any directions given by or under any such order.
Body corporate to repay to Government sums paid under guarantee
Kerajaan Negeri that there is reasonable cause to believe—
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 body corporate concerned, lay before the
Dewan Undangan Negeri, a statement relating thereto.
Terms and conditions which may be agreed to or approved
Without prejudice to sections 7 and 14(1), the terms and conditions which may be agreed to by the Government or approved by the Majlis Mesyuarat Kerajaan Negeri under this Ordinance, as the case may be, may include, in respect of any guarantee given or agreement concluded under this Ordinance or under any bonds or other securities issued pursuant to any such guarantee or agreement, provision for submission by the body corporate or the Government or both of them to the jurisdiction of the courts of the country in which the loan is raised.
Power to appoint bankers, etc.
For the purposes of raising loans or undertaking any borrowings or the issue of bonds or other securities in pursuance of this Ordinance, the Government may appoint or engage investment or financial advisers, consultants, bankers, rating agencies or other agents or persons with the requisite knowledge or expertise, as the Government deems fit or proper, and pay them such fees, remuneration or expenses as may be agreed between them and the
Government.
Directions
The State financial authority may, after consultation with the Minister, issue from time to time, direction on or relating to the procedure for the submission or evaluation of proposals or requests for borrowings, guarantees, bonds and other securities by the
Government pursuant to this Ordinance and the presentation of any such proposals or requests to the Majlis Mesyuarat Kerajaan Negeri for its consideration, direction or approval.
Regulations
The Yang di-Pertua Negeri may make regulations generally for carrying out the provisions of this Ordinance and, in particular, such regulations may provide for—
the issue of bonds or other securities by the
Government or a body corporate, and their redemption, and rights attached thereto;
the keeping of records of bonds and other securities issued by the Government and a body corporate; and
any other matters which may be considered necessary for carrying out the provisions of this Ordinance.
Repeal
The Ordinances set out in the Schedule are repealed.
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(Section 25)
ORDINANCES TO BE REPEALED
1.
Loan (Government of the
Ord. No. 4 of 1974.
Federation) Ordinance, 1974
2.
Loans and Guarantees (Banks
Ord. No. 10 of 1976.
and Other Financial Source)
Ordinance, 1976
3.
Loans Guarantee (Bodies
Ord. No. 11 of 1976.
Corporate) Ordinance, 1976
Chapter 31
LOANS AND LOAN ORDINANCE, 1999
LIST OF AMENDMENTS
Amending Law
Short Title
In force from
Swk. L.N. 4/2000
Date of Commencement of the
Ordinance 23.12.1999
[List of Amendments]