§ 48. Sir John Mellor
asked the Chancellor of the Exchequer whether, in view of the appointment of members of 1701 the Council of Foreign Bondholders being under the Act of 1898 exclusively in the hands of the Central Association of Bankers of London, of the London Chamber of Commerce, and of the Council itself, he will consider taking steps to amend the Act in order to secure that the Council shall be more widely representative of British holders of foreign bonds; and whether he will consider taking steps to require the Council, when the revision of the conditions of any foreign bonds issued in the United Kingdom is sought by a borrower or guarantor, to call a meeting of the British bondholders concerned before deciding to recommend acquiescence in any departure from the obligations of the bonds?
§ Sir J. Simon
The majority of the members of the Council of Foreign Bondholders are themselves holders of foreign bonds and large holders, such as the insurance companies and investment trust companies, are also represented on the Council. The Council is, therefore, widely representative of British holders of foreign bonds, and I do not consider that any alteration in the method of its appointment is called for. As regards the second part of the question, the Council call a public meeting when legal requirements make this necessary, but their usual practice is to consult a committee of representative holders of the bonds in question, and, in the light of the view of the committee and of those of the individual bondholders with whom the Council is constantly in touch, to publish an offer made by the foreign Government concerned and to state whether the Council recommend its acceptance or not. Such a recommendation does not bind the individual bondholders and it rests with them to decide whether or not to accept the offer. The Council have found by experience that the procedure which I have described is, as a general rule, the most effective method of ascertaining the views of bondholders and I see no reason to dissent from that view.