NO REDUCTION

Hokitika Guardian, 24 November 1933, Page 5

NO REDUCTION

LOCAL BODIES INTEREST ON BONDS DOMICILED OVERSEAS WELLINGTON, November 22. Special existing securities of New Zealand local authorities disposed of in London prior to July 1 last are, so long as the oversea domicile, is preserved, to be exempt from the statutory 20 per cent, interest reduction, and they will not be liable to conversion under exist, ing legislation. Provision along these lines in redemption of a promise given to London interests is contained in a Government Bill read a first time in the House to-night. The measure, however, doe s not in any way deal with payment of interest on London loans in New Zealand currency or sterling. In the first place the Bill extends the definition of. the term “securities” to include mortgages of land and other charges executed before April 1 as security for local body loans, and then proceeds to provide the exemptions referred to. According to the, description given conversion will not apply to existing securities (interest on which is payable outside New Zealand) which expressly or by implication confer on the holders the option to receive payment in New Zealand or the United Kingdom, and which were either issued in the United Kingdom or issued elsewhere and acquired by the holder outside the Dominion as a result of a sale effected in the United Kingdom on or before July 1 last. If a dispute crises as to whether a security was issued in the United Kingdom or acquired outside New Zealand as an outcome of a United Kingdom sale on or before July 1 the final dr*'"’'" l !nation is to rest with the Finance Minister.

“But you must look after the other follow,” said Mr parry (Auckland Central). when Mr Coates intimated that the Bill made no provision for local purchasers. Mr Coates: The good name of New Zealand must he maintained overseas. Other Labour members took the line that Parliament should not now be asked to protect any who had speculated in exchange. The Bill was read a first time.