External Loans
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LAWS OF MALAYSIA
REPRINT
Act 403
EXTERNAL LOANS
ACT 1963
Incorporating all amendments up to 1 January 2006
PUBLISHED BY
THE COMMISSIONER OF LAW REVISION, MALAYSIA
UNDER THE AUTHORITY OF THE REVISION OF LAWS ACT 1968
IN COLLABORATION WITH
PERCETAKAN NASIONAL MALAYSIA BHD
2006
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EXTERNAL LOANS ACT 1963
First enacted ... ... ... ... ... ... ...
1963 (Act No. 22 of
1963)
Revised
.....................
1989 (Act 403 w.e.f
14 December 1989)
PREVIOUS REPRINT
First Reprint
...
...
...
...
...
2001
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LAWS OF MALAYSIA
Act 403
EXTERNAL LOANS ACT 1963
ARRANGEMENT OF SECTIONS
Section
1.
Short title and application
PART I
AUTHORITY TO BORROW
2.
Power to raise external loans, and application of sums raised
PART II
GENERAL PROVISIONS
3.
Provisions regulating the raising of external loans
4.
Raising of loans
5.
Management of external loans
6.
Exchange of securities
7.
Cancellation of securities exchanged or redeemed
SCHEDULE
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External Loans
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LAWS OF MALAYSIA
Act 403
EXTERNAL LOANS ACT 1963
An Act to authorize the raising of loans outside Malaysia to provide
sums required for the purposes of the Federal Development Fund
or for the repayment or amortization of external loans, and to make
general provision with respect to external loans.
[Peninsular Malaysia--15 June 1963;
Sabah and Sarawak--16 September 1963]
BE IT ENACTED by the Seri Paduka Baginda Yang di-Pertuan
Agong with the advice and consent of the Dewan Negara and
Dewan Rakyat in Parliament assembled, and by the authority of
the same, as follows:
Short title and application
1. (1) This Act may be cited as the External Loans Act 1963.
(2) This Act shall apply throughout Malaysia.
PART I
AUTHORITY TO BORROW
Power to raise external loans, and application of sums raised
2. (1) The Minister (that is to say, the Minister for the time being
charged with responsibility for finance) may from time to time
raise loans outside Malaysia--
(a) for the purposes of the Federal Development Fund or
some one or more of those purposes; or
(b) for the repayment or amortization of loans raised outside
Malaysia, whether under this section or not.
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(2) Any sums raised by way of loan under this section are
hereby appropriated first to the payment of the expenses in connection
with the raising of the loan, and subject to payment of those
expenses, to the purposes for which the loan is raised; but if the
sums so raised for the repayment or amortization of any loan
exceed the amounts required for that purpose after the application
thereto of any amounts available in a sinking fund relating to the
loan, then the excess shall be applied and is hereby appropriated
to the redemption, at such times and in such manner as the Minister
may determine, of securities of Malaysia.
(3) The sums raised under this section shall not exceed the sum
specified from time to time by the Yang di-Pertuan Agong by
order published in the Gazette and such order shall as soon as
possible after its publication be laid by the Minister before the
Dewan Rakyat; and in applying this subsection sums raised in a
currency other than ringgit shall be converted into ringgit as at the
day when the amount to be raised is determined and by the use
of such rate of exchange as the Governor of Bank Negara may
certify to be then appropriate.
(3A) Any agreement entered into in respect of sums raised under
this Act shall be made in the name of Malaysia and may be signed
on behalf of Malaysia by the Minister or by any person authorized
thereto in writing by the Minister.
(4) The Loan Ordinance 1953 [Ord. 56 of 1953], is hereby
repealed.
PART II
GENERAL PROVISIONS
Provisions regulating the raising of external loans
3. (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.
*NOTE--The Government Trustee Securities Ordinance 1957 [Ord. 41 of 1957] has since been
superseded by the Government Trustee Securities Act 1957 [Act 426].
External Loans
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(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".
Raising of loans
4. (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.
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(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
5.  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;
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(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
6. (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.
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(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
7.  All securities exchanged or redeemed in pursuance of this Act
shall be cancelled and disposed of in such manner as the Minister
may determine.
SCHEDULE
Amendments of existing Ordinances
1.  In the General Loan and Stock Ordinance 1949 [Ord. 3 of 1949], the
following provisions are hereby repealed, that is to say, sections 3, 5 to 24, 32,
33, 35 and 38; in paragraphs 31(1)(a), (c) and (d) and subsection 31(2); and
in section 34 the words "into stock or cancelled or purchased".
2.  In the Government Trustee Securities Ordinance 1957 [Ord. 41 of 1957],
in section 3, there shall be added at the end--
"Provided that this Ordinance shall not apply to securities issued after the
commencement of the External Loans Act 1963."
External Loans
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LAWS OF MALAYSIA
Act 403
EXTERNAL LOANS ACT 1963
LIST OF AMENDMENTS
Amending law
Short title
In force from
Ord. 21/1954
Registration of Pharmacists
01-02-1952
L.N. 102/64
Modification of Laws (External
16-09-1963
Loans) (Extension) Order 1964
Act 49
External Loans (Amendment)
28-07-1966
Act 1966
Act A184
External Loans (Amendment)
30-03-1973
Act 1973
P.U. (B) 346/1977
Resolution Under Section 2--
27-05-1977
External Loans Act 1963
Act A477
Loan (Local) External and
01-02-1980
Extended Credit (Amendment)
Act 1980
P.U. (B) 406/1982
External Loans (Statutory
16-07-1982
Borrowing Ceiling) Order 1982
Act A579
External Loans (Amendment)
15-06-1963
Act 1984
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LAWS OF MALAYSIA
Act 403
EXTERNAL LOANS ACT 1963
LIST OF SECTIONS AMENDED
Section
Amending authority
In force from
2
Act 49
28-07-1966
Act A184
30-02-1973
Act A477
01-02-1980
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Act A579
15-06-1963
DICETAK OLEH
PERCETAKAN NASIONAL MALAYSIA BERHAD,
KUALA LUMPUR
BAGI PIHAK DAN DENGAN PERINTAH KERAJAAN MALAYSIA