Provisions regulating the raising of external loans
(1) The General Loan and Stock Ordinance 1949 [Ord. 3 of 1949], and the *Government Trustee Securities Ordinance 1957 [Ord. 41 of 1957], shall not apply to any loan raised or issued after the commencement of this Act, and those Ordinances shall be amended as specified in the Schedule.
(2) Sections 4 and 5 shall apply to loans raised under section 2, and (subject to the Act relating thereto) to loans authorized by any other Act to be raised outside Malaysia in accordance with this Part; and any such loans are in this Part referred to as “external loans”.
*NOTE—The Government Trustee Securities Ordinance 1957 [Ord. 41 of 1957] has since been superseded by the Government Trustee Securities Act 1957 [Act 426].
Raising of loans
(1) External loans shall be raised—
(a) in such manner;
(b) by such arrangement; or
(c) by the creation and issue of such securities, as the Minister thinks fit.
(1A) Without prejudice to subsection (2), any external loan raised under subsection (1) shall be subject to such terms and conditions as may be determined by or with the authority of the Minister.
(2) The securities issued for raising any external loan under paragraph (1)(c) shall bear such rate of interest, and be subject to such terms and conditions as to repayment, redemption and other matters (including provision for a sinking fund) as may be determined by or with the authority of the Minister.
(3) In connection with the raising of any external loan under paragraph (1)(c), the Minister may make such arrangements as he sees fit for the underwriting of any offer for subscription or sale of the securities.
(4) Subsections (1), (1A) and (2) shall authorize the Minister to include among the terms and conditions of any external loan provisions for exemptions from taxes or for exempting from exchange control the debt charges or any description of debt charges in respect of an external loan; and the Minister shall by order make such provision as he considers necessary to give effect to any such exemption from tax or from exchange control, and any such order shall have effect notwithstanding anything in any written law relating to the tax, or to exchange control, as the case may be.
(5) Without prejudice to any of the foregoing provisions, the terms and conditions authorized by subsections (1), (1A) and (2) may include provision for the following matters:
(a) for charging on any assets (whether originally or in the event of other debts of Malaysia being charged thereon) the debt charges or any description of debt charges in respect of an external loan;
(b) for Malaysia, in proceedings relating to an external loan, to submit to the jurisdiction of the courts of the country in which the loan is raised.
(6) All debt charges in respect of any external loan shall be charged on the Federal Consolidated Fund (as provided by Article 98 of the Federal Constitution), and subsections (1), (1A) and (2) have effect subject to that Article.
(7) In this section “debt charges” includes interest, sinking fund charges, the repayment or amortization of debt, and all expenditure in connection with the raising of loans and the service and redemption of debt created thereby.
Management of external loans
In connection with any external loan the Minister may by any deed or deeds—
(a) appoint a Registrar, and provide for the establishment and maintenance of a register of any securities, for the location of the register and for the extent to which the register is to be conclusive of the title to those securities or of any other matter;
(b) provide for the conversion of registered securities into securities transferable by delivery, or vice versa;
(c) provide for the authentication of certificates relating to the securities or of other documents;
(d) appoint trustees of any sinking fund, and provide for the investment, management and application of the sinking fund;
(e) enable any such deed to the modified with or without requiring the consent of a meeting of the holders of securities, and provide or the summoning and conduct of such meetings for that or any other purpose, and the majority required at such a meeting for the decision of the meeting on any matter to be binding on the holders of securities;
(f) generally regulate, or authorize the Registrar to regulate, the management of the loan and all matters arising in connection therewith.
Exchange of securities
(1) The Minister may, for the purpose of carrying out any arrangement made with holders of securities issued under this Act for the exchange of those securities (whether on or before maturity, and whether with or without any further payment), create and issue such other securities as the Minister thinks fit, and sections 4 and 5 shall apply, with any necessary adaptations, to securities issued under this section as if they were issued for raising an external loan.
(2) Any arrangements made for the exchange of securities under this section may include provision for the making of payments to the holders of securities exchanged; and any such payments and all other expenses of any such exchange may be met out of the surplus (if any) created by the exchange in any sinking fund relating to the securities exchanged and, if not so met, shall be charged on the Federal Consolidated Fund as part of the debt charges for those securities.
(3) On any exchange of securities under this section the surplus (if any) thereby created in any sinking fund relating to the securities exchanged, or so much of it as is not applied under subsection (2), may if the Minister so directs be transferred to any other sinking fund relating to securities of Malaysia, and subject thereto shall be applied at such times and in such manner as the Minister may determine in the redemption of securities of Malaysia.
(4) This section shall apply to any conversion of securities authorized by section 31 of the General Loan and Stock Ordinance 1949, as if those securities had been issued for raising an external loan; and accordingly in paragraph (1)(b) of that section for the words “stock to be issued under the provisions of this Ordinance” there shall be substituted the words “securities to be issued as provided by section 6 of the External Loans Act 1963”.
Cancellation of securities exchanged or redeemed
All securities exchanged or redeemed in pursuance of this Act shall be cancelled and disposed of in such manner as the Minister may determine.
Source: Laws of Malaysia, Attorney General's Chambers of Malaysia (lom.agc.gov.my). Not a copy of the Gazette printed by the Government Printer (Interpretation Acts 1948 and 1967, s 61).
