MERCANTILE BANK NOTE ISSUE ORDINANCE, 1911

MERCANTILE BANK NOTE ISSUE ORDINANCE, 1911

No. 59 of 1911, incorporated in No. 10 of 1911.

No. 60 of 1911, incorporated in No. 1 of 1903.

No. 61 of 1911, incorporated in -No. 19 of 1911.

No. 62 of 1911, incorporated generally.

No. 63 of 1911, incorporated generally.

No. 64 of 1911, incorporated in No. 1 of 1872.

No. 65 of 1911.


of Bills and Notcs payable to Bearer on demand
[29th December, 1911.]

1. The Mereantile Bank Note. Issue Ordinance, 1911.

2. In this Ordinance,-
---Company--- means the Mercantile Bank of India, Limited,
whose chief office is in Threadneedle Street, Landon, England
---Current coin--- means coin lawfithy current in the Colony :
----Notes--- means bills and notes payable to bearer on demand in
current coin.

3. (1) Subject to the provisions of this Ordinance, it shall be
lawful for the company to make, issue, reissue and circulate notes in
the Colony.

(2) Such notes shall not be issued for any other sum than the sum
of 5 dollars, or some multiple of such sum.

(3) Except as specified in section 6 the total amount of such
notes actually in circulation shall not at any time exceed the
amount of the capital of the company actually paid up.

If the company issues notes in excess of the amount authorised
by the provisions of this Ordinance, it and the manager of its





office in the Colony shall each be liable, on summary conviction, to
a fine not exceeding 50 dollars a day for every day during which
such excess of any sum not exceeding 10,000 dollars shall continue,
and to a further fine not exceeding 50 dollars a day for every day
during which such excess shall continue for every complete addi-
tional sum of 10,000 dollars in notes so issued in excess.

(4)-Such part of the books of the company as may contain any
entry relating to the notes issued or to be issued by the company or
relating te. the amount of such notes in circulation from time to
time, or any account, minute, or, memorandum in the possession of
the company or of any person in its employ, the sight or inspection
whereof may tend to insure the rendering or taking of true accounts
for any period of the average amount of such notes in circulation or
to test the truth of any such account, shall be open for the inspection
and examination at all reasonable times of any person authorised
in that behalf in writing signed by the Treasurer.

Every such authorised person shall be at liberty to take copies or
extracts from any such book, account, minute or memorandum.

If the company or any person in its employ keeping any such
book, account, ininute, or nienioranduni, or having the custody
or possession thereof or power to produce the same shall on demand
made by any such authorised person shewing if demanded his
authority in that behalf, refuse to produce any such book, account,
minute, or memorandum to him for hill inspection and examination
or to permit him to inspect and examine the same or to take copies
thereof or extracts therefrom, the company and such person in its
employ shall each be liable, on summary conviction, to a fine not
exceeding 500 dollars :

Provided that the Treasurer shall not exercise or cause to be
exercised the powers aforesaid without the consent of the Governor.

(5) Such notes shall not be legal tender but shall be redeemable
at the office of the company in the Colony in current coin which is
unlimited legal tender in the Colony.

4. The company shall deposit and at all times keep deposited
with the Crown Agents securities to be approved by the Secretary
of State to an amount equal in value to the face value of the notes
in circulation with the addition of 5 per cent. of such value; or at
its option the company shall deposit and at all times keep deposited
with the Treasurer coin which is unlimited legal tender in the





Colony to an amount equal to the face value of the notes in circula-
tion; or as its like option the company shall deposit and at all times
keep deposited securities, so approved as aforesaid, with the Crown
Agents and coin, which is unlimited legal tender in the Colony,
with the Treasurer, in which case the amount of such securities
shall be equal in value to the difference between the amount of the
coin deposited and the face value of the notes in circulation with
the addition of 5 per cent. Such securities and such coin shall be
tinder the control of the Treasurer and shall be held by the Crown
Agents and the Treasurer respectively as special funds exclusively
available for the redemption of such issue of notes, and in the event
of the company becoming insolvent shall be sold and applied toward
such redemption as far as may be necessary, but without prejudice
to the rights of the holders of such notes to rank with other creditors
of the company against the assets of the company.

5.-(1) There shall be published in the Gazette every month, a
statement (to be rendered by the company on the first working
day of each month) of the face value of the notes outstanding, and
of the securities and coin held against these notes. The statement
shall show the nominal value of such securities, the price at which
they were valued on deposit and also the latest market price of such
securities.

(22) If for two consecutive months the said market price plus the
value of the coin (if any) deposited with the Treasurer should in-
dicate a selling value less than the amount required by section 4,
he shall demand that all notes returned to the company shall be
retained and not reissued until the amount so required is, reached,
or at his option he shall demand the deposit of additional -unlimited
legal tender coin or securities sufficient to raise the selling value
of the securities plus the valtie of the coin (if any) already deposited
to the amount so required; and the company shall comply. with
such demand. If, however, lor 3 consecutive months the said market
price indicates a continued and constant increase an their selling
value, the Governor-in-Council may allow the securities to be re-
duced provided the selling value of such securities plus the value of
the coin (if any) deposited is never allowed to fall below the
amount required by section 4.



as amended by no, 50 of 1911, no. 16 of 1912 and no. 43 of 1912
supp sched

as amended by no. 50 of 1911 and no. 17 of 1912






6. When in the opinion of the Governor-in-Council a temporary
emergency exists, he may permit the company to issue notes in
excess of the paid up capital of the company, provided there has
been specially deposited and is kept in the custody of the Colonial
Secretary and the Treasurer an amount of legal tender dollars
equal to the whole face value of such excess issue for the time being
actually in circulation, to be held by the said Colonial Secretary and
Treasurer exclusively for the redemption of such notes.

7. The powers granted by this Ordinance to the company to
make, issue, re-issue, and circulate notes shall be limited for a
period of 10 years from the com'itiencement of this Ordinance; after
such period the company shall cease to issue or re-issue notes but
shall redeem any notes which it has previously issued or re-issued :
Provided however, that if the company shall fall to comply with
the demand of the Treasurer referred to in section 5 (2), or shall
fall to comply with any of the other provisions of this Ordinance,
the power of the company to make, issue, re-issue and circulate
n6tes shall immediately cease.

8. Nothincr contained in this Ordinance shall exempt the coin-
pany from the operation of any law restricting or regulating the
issue of notes in the Colony.

-1912--

No. 1 of 1912, incorporated generally.

No. 2 of 1912, incorporated generally.

No. 3 of 1912, incorporated in No. 7 of 1896.

No. 4. of 1912, incorporated in No. 2 of 1891.


as amended by no. 50 of 1911 and no. 15 of 1912

as amended by no. 50 of 1911, no. 16 of 1912 and no. 17 of 1912

as amended by no. 16 of 1912

Short title. Definitions. Power for company to make and issue bills and notes and conditions of such issue. Deposit of securities or of coin or of both at option of company as funds exclusively available for re- demotion of note issue and in the event of insolvency. Monthly publication in Gazette of outstanding notes and securities. Power of Governor-in-Council to authorise excess note issue in temporary emergency. Issue and reissue of notes limited to 10 years from date of Ordinance. Saving as to laws restricting note issue.

Short title. Definitions. Power for company to make and issue bills and notes and conditions of such issue. Deposit of securities or of coin or of both at option of company as funds exclusively available for re- demotion of note issue and in the event of insolvency. Monthly publication in Gazette of outstanding notes and securities. Power of Governor-in-Council to authorise excess note issue in temporary emergency. Issue and reissue of notes limited to 10 years from date of Ordinance. Saving as to laws restricting note issue.

https://oelawhk.lib.hku.hk/items/show/996

1912

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