§ Mr. StanleyI beg to move, in page 21, line 41, to leave out from "requirements," to the end of line 44.
I must almost apologise to the House for this Amendment, and for bringing Members down from the very lofty heights if the legal intricacies to which we have just been listening. I was looking at the faces of hon. Members opposite. They seemed to understand the point of the last Amendment, though I confess that I myself was rather out of my depth. This is a most simple Amendment and one that can be understood by all. If hon. Members will look at Clause 30, they will see that it is intended to deal with a foreign company, where it is believed that in some form or other the control of the company is really exercised by a resident here, and that the resident here can either do, or refrain from doing, something which will have the result of that foreign company doing what the Treasury desires. In 2274 order to carry that out, there are three obligations placed on the resident of this country. They are contained in paragraphs (a), (b), and (c) of Clause 30 (1).
He must first of all
cause the foreign company to comply with any of the requirements.Secondly, he mustremove any obstacle to the foreign company complying with any of the requirements.Thirdly—and it is this that I move to leave out—he must either do, or refrain from doing, any acts whichrender it in any respect more probable that the foreign company will comply with any of the requirements.I move the deletion of the third paragraph of the Subsection because I believe this is an obligation so wide and so indefinite in its character that it will be quite unenforceable. It will be impossible to have a case upon which any court would be prepared to convict. I 2275 think it is more preferable that a provision which- cannot be enforced in law should not appear in the Act.It will be noticed that we have only put down an Amendment to this one of the three Subsections. At an earlier stage we referred to the danger of an indiscriminate or unwarranted use by the Treasury of the power conferred in the other two. That power might cause lasting damage to the relationship between the resident and the foreign company by any unwise act. However, we recognise that there may be some need and justification for these powers. They are, at any rate, definite and they apply to something which it is within the power of the resident of this country either to do or to refrain from doing. But when we come to this Subsection, which says that a man must do something which makes it more probable that a foreign company will take this or that line, then I submit to the House that it is so indefinite that it is really monstrous that it should be made the subject of a criminal prosecution. Who is to decide whether a particular action makes a result in a foreign country more or less probable? When the Treasury says, "You ought to have written this or that letter," and the man replies, "But from my knowledge of that company I think such a letter would only have made them more determined not to carry out this requirement"—who is to decide which is right? Who is to decide whether it is more probable that to have sent a letter, or not to have sent a letter, would have induced them to agree?
It seems to me that to ask a police court or a quarter sessions to decide whether a man is guilty of an infringement of this regulation is asking too much of any criminal court. I should have thought— and we have had no argument to the contrary—that the other two powers, which we are allowing to go through unchallenged, although with warnings as to the way they are used, would have been sufficient. They give the Treasury everything they are likely to want. They will cover any case where their decision is really enforceable. To use the learned Solicitor-General's description of a certain Amendment by one of my hon. Friends, the power contained in this paragraph is entirely otiose.
2276 In these circumstances I hope that the learned Solicitor-General will feel able to accept the Amendment. If not, I hope he will be able to give, what we have not had hitherto—some indication of the type of case which this is meant to cover and some indication of how its administration will be effected. The learned Solicitor-General, during the absence of the right hon. Gentleman the Chancellor of the Exchequer, has been in a yielding mood. I hope he will not let the return of the Chancellor in any way stiffen his attitude but that he will agree with us that this part of the subsection is unnecessary and, therefore, can be dropped quite safely.
§ Lieut.-Commander BraithwaiteThe matter raised by this Amendment was debated at some length during the Committee stage, and I only rise now because of a point which has been brought to my notice since that time. It refers to the shipping industry. A great carrying nation such as ours has often found it convenient for its shipping companies to have subsidiaries in foreign countries. For example, in Egypt, one still finds a number of subsidiary shipping firms with their parent companies in the United Kingdom. The same tiling happens in China, and so on. I believe I am right in saying that since the Committee stage the Chancellor of the Exchequer has heard from the General Council of British Shipping on this point. I wonder if it would be convenient, on this Amendment, for a Minister to say a word or two on the matter? The chief problem with which the shipping companies are faced is, I think, best expressed by quoting a short sentence or two from the letter in question. They sent me a copy of it. It says:
It appears to be possible, for example, under the Clause as drafted, for the Treasury to require the liquidation of assets on a scale which will not merely hamper the company's normal operations, but might, if the assets were acquired by a foreign competitor, put it at a most serious competitive disadvantage. So far as the Council can see, the Bill provides no safeguard against possibilities of this kind.I am sure that the last thing that the Government want to do is to hamper the handling of our shipping in foreign ports, and I only raise the matter in order that a statement might be forthcoming.
§ Colonel Crosthwaite-EyreWhen we debated this particular Clause in Com- 2277 mittee, if I may quote from the remarks of the learned Solicitor-General on 9th December, he said:
The scheme is designed to apply primarily to companies controlled, or, at any rate, owned by British people. Either the ownership or control, or both, must be exercised by British people. It is designed to apply only to those companies."—[OFFICIAL REPORT, 9th December, 1946; Vol. 431, c. 783.]It is impossible to circumscribe the provisions of the Clause within the definition given by the hon. and learned Gentleman. The provisions as to what constitutes control in the terms of this Clause are laid down in the Second Schedule, and it is impossible for the hon. and learned Gentleman to pretend that the terms laid down in that Schedule cover only companies controlled by British personnel or British residents. We are now being asked to pass a Clause which says that the control being laid down in these terms is a requirement under which the Treasury may make an Order, so that a British resident is asked to facilitate something which the Treasury may order. The whole thing simply becomes nonsense. During the Committee stage, a certain amount was said about Ruritania. There is no need for that to be discussed again, but there is one thing that should be said and that is that, if the Solicitor-General, or any other Minister who is to reply, insists that he will not accept this Amendment, then, indeed, they are taking this Bill into the realms of Ruritania It shows that they do not understand what constitutes controls, and, secondly that they are trying to impose on British industry a task which is quite impossible. As we on this side of the House have said, we are prepared to co-operate with the Government in anything that will safeguard the immediate position regarding currency, and on any other subject on which the Chancellor may want help, but we are not prepared to accept a Clause which will not help, but will only hamper, industry as a whole.If this paragraph remains as it is, it will simply add lunacy to an already bad Bill. No possible case could be made out for it remaining part of this Bill. I hope that its deletion will be secured both because, as my right hon. Friend has said, the powers in the other Subsections are sufficient and, more particularly, because, if this provision is maintained, it will add 2278 nothing to the Bill and will merely make the whole thing ludicrous in the eyes of anyone who may have to try to carry on the trade of the country under its provisions.
§ 9.0 p.m.
§ The Solicitor-GeneralParagraph (c) is needed in order to make Clause 30 workable. It is wider and would embrace other cases which would not be brought within the purview of paragraphs (a) and (b). We are most anxious that it should not be thought, either by the General Council of British Shipping or by any other trading body that this Subsection will be used in any way oppressively so as to injure their interests. The hon. and gallant Member for Holderness (Lieut. Commander Braithwaite) asked that whoever replied to the Amendment should make statement saying what the position was with regard to British shipping. I willingly respond to that invitation. I say, advisedly, that the importance of British shipping is fully realised so far as exchange control is concerned. Not only are considerable exchange facilities now provided, but they will continue to be provided in such a way as not to hamper the growth or operation of British shipping. There is no intention of interfering with the foreign subsidiaries of British shipping companies unless, of course, circumstances arise which make it unavoidably necessary.
Suppose, for example, that subsidiaries abroad were used as a means of locking up exchange which was entirely surplus to reasonable local requirements, then, of necessity, the position would be different. But, subject to that, there is no intention to interfere with foreign subsidiaries of British shipping companies. In particular, there is no intention of forcing liquidation in such a way as to make foreign subsidiaries the property of foreign concerns Great pains will be taken to avoid damaging the shipping industry by any action of that sort. All that is desired is that there should be reasonable behaviour on the part of the shipping companies, when they will be left untrammelled by any action under this Clause.
The right hon. Gentleman who moved the Amendment based his argument on the view that there was no reason to have this paragraph when we already have the other two. He asked me to give examples of cases which would come within paragraph (c), but which would not be got at by paragraphs (a) and (b). Supposing 2279 for example, that it were desirable that a new director should be appointed who would be likely to guide the affairs of the company in a way which was considered necessary in the public interest, that would be something which would make it more probable that the company should take a particular course. On the other hand, it would not be said that, by so doing, it was causing the foreign company to proceed under paragraph (a) or that it would be removing an obstacle within paragraph (b), but it would come within paragraph (c). There are many other cases which would not come within the first two paragraphs, but which would come within paragraph (c), such, for example, as a threat by debenture holders to appoint a receiver. It might not come within paragraph (a), or within paragraph (b), but, under paragraph (c), it could be said to be an act which made it more probable that the company should act in the desired way to further the national interest.
Therefore, while following the points made by the right hon. Gentleman the Member for West Bristol (Mr. Stanley), we feel that we must have paragraph (c) because paragraphs (a) and (b) are not enough. We feel that without the additional direction of paragraph (c), which would cover the number of cases which do not fall within the specific terms of the other two paragraphs, we would not have sufficient powers to operate the Clause as we desire. I hope the right hon. Gentleman will withdraw his Amendment.
The right hon. Gentleman asked who would decide. In the case of a conflict of opinion, if the Treasury thought right to prosecute, it would be the court which would decide between them; but, naturally, the Treasury would not dream of prosecuting except in a clear case. Some cases are clear beyond controversy. If the person affected by the direction were obstinate, it might be a matter for the courts, but obviously it would not be the practice of the Treasury to proceed except in. cases where it could not reasonably be said on behalf of the person affected by the direction that what was asked was not reasonable. I therefore ask the right hon. Gentleman to withdraw the Amendment so that the paragraph may remain in the Clause.
Mr. Pick thornI do not suppose it is easy for those of us who are not habitually familiar with this business to understand this point, but I think it is right that we should try to understand it. Therefore, I should like to ask for a little more elucidation to make sure I have got it right. May I say, if it does not sound dogmatic, what I think is meant and hope to be corrected if I have got it wrong? What I think it means is that if the Treasury directs one of the companies concerned to do any act which, in the Treasury's opinion, would render it in any respect more probable that a foreign company would do something desired by the Treasury, that thereupon if the company did not do the directed act, the Treasury would prosecute in the extreme case, and in that case it would be the high court to which the case would go, or, if that is wrong, at what earlier stage and to whom would it go? Would it go to anyone other than the Treasury to decide whether an act of omission or commission asked for was, or was not, likely to make it "in any respects more probable" within the meaning of the Act?
§ Mr. DraysonI do not think the learned Solicitor-General has made the matter any clearer by his explanation. Turning to the Schedule relating to companies and types of holdings which British interests should have in order to exercise necessary control over these foreign companies with which we are concerned, I do not see that there is any guarantee that because the British interests receive more than 50 per cent. of the dividends there is any less reason to suppose that they actually control the company. I think a foreign company is entitled to take what action it can to protect the assets of its own concern, for the benefit of its minority holders who might exist outside this country, or those holders who might have the controlling votes of any particular type of share which did not receive more than 50 per cent. of the dividends payable by the company concerned. I was puzzled by these words:
.. that the Treasury wish any such requirements as are hereinafter mentioned….I hate the thought that we should include the word "order," but it seems to be rather vague for the Treasury to express a wish, because the directors concerned may feel that it is not desirable that that wish should be carried out, and then where do we stand? What is the further enforcement that the Treasury should bring 2281 on the individuals concerned? With regard to the words "more probable," the directors of the company know their fellow directors and those with whom they are associated overseas. Who is to be the judge of what action is ''more probable'' to bring about the desired result? If the company concerned consider that the desired result—that is, the result desired by the Treasury in this country—is not in the best interests of the country in which the company is domiciled, what is the position? I think the whole Clause is extremely difficult to follow, certainly for myself.
§ Mr. J. FosterI would like to ask the Chancellor of the Exchequer a question. He will probably remember that during the Committee stage he said that certain banks had apprehensions, in regard to Clause 30, which he was hoping to remove. I think he referred particularly to paragraph (c), although I am not sure about my recollection on that point. It was implicit in the Debate that paragraph (c) came into the apprehensions of the banks. The Chancellor said the Government were seeking to remove those apprehensions. I wonder if he could tell us what those apprehensions were, and how he has removed them?
Another point I would like to bring to the notice of the Chancellor is this. This Clause allows the Treasury to call upon any person resident in the United Kingdom to take certain steps with regard to foreign companies. For instance, the Treasury may serve a notice on a person resident in this country asking him to take some action which would make it more probable that the foreign company would pay a dividend, or to give particulars of its business, or to realise its assets if the Treasury so wanted. I am sure the Chancellor realises that commercial and financial dealings do not depend upon the strict legal relationship of the various classes of shareholders. They do not insist on their legal rights, but regard the business on moral considerations.
This is a power which is capable of very great abuse if it is misused. The answer of the learned Solicitor-General and the Chancellor to this and other Amendments is, "You can trust us. You can trust the Treasury not to use this power except in a clear case." But when we look at the Clause we see it is adding yet another branch to the criminal law, 2282 namely, the offence of not taking actions which make it more probable that somebody else will do something. I think the Government have overstepped the line. They have extended the criminal law in yet another direction, making a crime of not doing something which makes somebody else's action more probable. Merely to state that-shows the difficulty and the vagueness of the realms into which we have gone in the criminal law. Imagine a man being prosecuted, and his offence being that of not writing to a company in New York threatening that if they do not tell the Treasury what their assets are he will be forced to realise his debentures, or to appoint some new directors, or that he will be forced to call in the loan which he has made to the company. There may be many moral or business relationships between him and that company which make it very undesirable that we should appear to disregard his moral obligations, purely to get at the foreign exchange.
9.15 p.m.
It may be answered that the Treasury will always have these considerations in mind, but one finds that Government Departments, like trustees, are very often unable to pay any attention to moral considerations, and the legal reason is that the trustees say, "We cannot pay any attention to these moral considerations, because we have our duty to the beneficiaries," and, Government Departments will say, "We are very sorry. We would like to pay attention to these moral obligations which you owe to your New York concern, and it is quite true that they saved you from bankruptcy in 1920, but the taxpayers are involved, and therefore we can have no regard to these moral considerations." A foreign country will then say that England in their desire to safeguard their exchange position are disregarding moral obligations, disregarding the relationship between this country and a foreign company, and in other words are assuming jurisdiction over foreign countries; retaliatory measures are then taken. The effect of this Clause may lead other countries to go in for retaliation. That happened in the war in another part of exchange control. When California learned that money left by British testators to persons within California could not be transferred, they said that no Briton shall get what he is entitled to from California. The mischief of this 2283 Clause goes further than the shortsighted view of being able to stop every clever or crooked person who may exist. It is better to go slower and not exercise powers of this wide nature.
§ Question put, "That the words proposed to be left out stand part of the Bill."
§ The House divided: Ayes, 227; Noes, 79.
2285| Division No. 49.] | AYES | 9.17 p.m. |
| Adams, Richard (Balham) | Fraser, T. (Hamilton) | Piratin, P. |
| Adams, W. T (Hammersmith, South) | Ganley, Mrs. C. S. | Porter, G. (Leeds) |
| Alexander, Rt. Hon. A. V. | George, Lady M. Lloyd (Anglesey) | Proctor, W. T. |
| Allen, A. C. (Bosworth) | Gibson, C. W. | Pursey, Cmdr. H |
| Allen, Scholefield (Crewe) | Gilzean, A. | Randall, H. E. |
| Alpass, J. H. | Glanville, J. E. (Consett) | Ranger, J. |
| Anderson, A. (Motherwell) | Gooch, E. G. | Rankin, J. |
| Anderson, F. (Whitehaven) | Gordon-Walker, P. C | Rees-Williams, D. R |
| Attewell, H. C. | Granville, E. (Eye) | Reeves, J. |
| Austin, H. L. | Grey, C. F. | Reid, T. (Swindon) |
| Awbery, S. S | Grierson, E. | Rhodes, H. |
| Ayles, W. H. | Grffiths, W. D. (Moss Side) | Richards, R. |
| Ayrton Gould, Mrs. B | Gunter, R. J. | Ridealgh, Mrs. M. |
| Bacon, Miss A. | Hairs, John E. (Wycombe) | Roberts, Emrys (Merioneth) |
| Balfour, A | Hale, Leslie | Ross, William (Kilmarnock) |
| Barton, C. | Hall, W. G. | Royle, C. |
| Battley, J. R. | Hamilton, Lieut-Col. R. | Scollan, T. |
| Bechervaise, A. E. | Hannan, W. (Maryhill) | Scott-Elliot, W. |
| Bellenger, Rt. Hon. F. J | Hastings, Dr. Somerville | Segal, Dr. S. |
| Benson, G. | Haworth, J. | Shackleton, Wing-Cdr E. A. A |
| Berry, H. | Henderson, Joseph (Ardwick) | Sharp, Granville |
| Binns, J. | Harbison, Miss M | Shawcross, C. N. (Widnes) |
| Blackburn, A. R | Hobson, C. R. | Silverman, J. (Erdington) |
| Blenkinsop, A. | Holman, P. | Silverman, S. S. (Nelson) |
| Boardman, H. | Holmes, H. E. (Hemsworth) | Simmons, C. J |
| Bottomley, A. G. | Hubbard, T. | Skinnard, F. W. |
| Bowden, Flg.-Off H. W. | Hudson, J.H. (Ealing, W.) | Smith, C. (Colchester) |
| Bowles, F. G (Nuneaton) | Hughes, Hector (Aberdeen, N.) | Smith, Ellis (Stoke) |
| Braddock, Mrs. E. M. (L'pt, Exch'ge.) | Hynd, H. (Hackney, C.) | Smith S H (Hull S. W.) |
| Braddock, T. (Mitcham) | Irving, W. J. | Solley L. J. |
| Brooks, T. J. (Rothwell) | Isaacs, Rt Hon. G A | Soskice Mai Sir F |
| Brown, George (Belper) | Jay, D. P. T. | Sparks J. A. |
| Brown, T J. (Ince) | Jeger, G. (Winchester) | Stamford, W. |
| Bruce, Major D. W. T. | Jones, D. T. (Hartlepools) | Steele, T. |
| Buchanan, G. | Jones, Elwyn (Plaistow) | Stephen, C. |
| Burden, T. W | Kenyon, S. | Stewart, Capt. Michael (Fulham, E.) |
| Burke, W. A. | King, E. M. | Stubbs A. E. |
| Champion, A. J | Kinley, J. | Symonds, A. L. |
| Cluse, W. S. | Kirby, B.V. | Traylor, H. B. (Mansfield) |
| Cobb, F. A. | Kirkwood, D. | Taylor, H. B. (Morpeth) |
| Cocks, F. S. | Lee, F. (Hulme) | Baylor R. J. C (Morpeth) |
| Coldrick, W. | Lewis, A. W. J. (Upton) | Taylor, Dr. S. (Barnet) |
| Collick, P. | Lindgren, G. S. | Thomas D E (Aberdare) |
| Collindridge, F. | Longden, F. | Thomas, I.O.(Wrekin) |
| Collins, V J. | McEntee, V. L. T. | Thomas, John R.(Dover) |
| Colman, Miss G. M. | McKay, J. (Wallsend) | Thomas, George (Cardiff) |
| Comyns, Dr. L. | Mackay, R. W. G. (Hull, N.W.) | Thomson, Rt. Hn. G. R. (Ed'b'gh, E.) |
| Cooper, Wing-Comdr. G. | McLeavy, F. | Thurtle, E. |
| Corbet, Mrs. F K. (Camb'well, N.W) | Mann, Mrs. J. | Tiffany, S. |
| Corlett, Dr. J. | Manning, C. (Camberwell, N.) | Titterington, M. F |
| Corvedala, Viscount | Manning, Mrs. L. (Epping) | Tolley, L. |
| Cove, W. G. | Mathers, G. | Turner-Samuels, M. |
| Crawley, A | Messer, F. | Ungoed-Thomas, L. |
| Daines, P. | Middleton, Mrs. L | Vernon, Maj. W. F. |
| Dalton, Rt. Hon. H. | Monslow, W | Viant, S. P. |
| Davies, Edward (Burslem) | Moody, A. S. | Wadsworth, G |
| Davies, Harold (Leek) | Morgan, Dr. H. B. | Walkden, E. |
| Davies, R. J. (Westhoughton) | Morley, R. | Wallace, G. D. (Chislehurst) |
| Davies, S O. (Merthyr) | Morris, P. (Swansea, W.) | Wallace, H. W (Walthamstow, E.) |
| Deer, G. | Murray, J. D | Warbey, W. N. |
| Delargy, Captain H. J | Nally, W. | Weitzman, D. |
| Diamond, J. | Naylor, T E. | Wells W. T. (Walsall) |
| Dodds, N. N. | Nichol, Mrs. M. E. (Bradford, N.) | Whiteley, Rt. Hon. W |
| Donovan, T. | Noel-Baker, Capt. F. E. (Brentford) | Wigg, Col. G. E. |
| Driberg, T. E. N | Noel-Buxton, Lady | Wilkins, W. A. |
| Durbin, E. F M. | Oliver, G. H | Wilkins, W. A. |
| Dye S. | Orbach, M. | Willey, F. T. (Sundarland) |
| Edwards, John (Blackburn) | Palmer, A. M. F | Willey, O. G. (Cleveland) |
| Edwards, W. J. (Whitechapel) | Parkin, B. T. | Williams, D. J. (Neath) |
| Evans, E. (Lawestoft) | Paton, Mrs. F. (Rushcliffe) | Williams, J. L. (Kelvingrave) |
| Evans, S. N. (Wednesbury) | Paton, J. (Norwich) | Williams, W. R. (Heston) |
| Farthing W. J. | Pearnon, A. | Williamson, T |
| Field, Captain W. J | Peart, Capt. T. F | Willis, E. |
| Follick, M. | Perrins, W. | Wilson, J. H. |
| Wise, Major F. J. | Yates, V. F. | TELLERS FOR THE AYES: |
| Woodburn, A. | Younger, Hon. Kenneth | Mr. Snow and Mr. Popplewell. |
| Woods, G. S. | Zilliacus, K. | |
| NOES | ||
| Agnew, Cmdr. P. G. | Grimston, R. V. | Renton, D. |
| Assheton Rt. Hon. R. | Hinchingbrooke, Viscount | Ropner, Col. L. |
| Beamish, Maj. T. V. H. | Hogg, Hon. Q. | Sanderson, Sir F. |
| Boles, Lt.-Col. D. C. (Wells) | Holmes, Sir J. Stanley (Harwich) | Smiles, Lt.-Col. Sir W. |
| Boothby, R. | Howard, Hon. A. | Smith, E. P. (Ashford) |
| Bossom, A. C. | Hutchison, Lt.-Cm. Clark (E'b'rgh, W) | Snadden, W. M. |
| Bower, N. | Jennings, R. | Spence, H. R. |
| Boyd-Carpenter, J. A. | Kingsmill, Lt.-Col. W. H. | Stanley, Rt. Hon. O. |
| Braithwaite, Lt.-Comdr. J. G. | Lambart, Hon. Q. | Strauss, H. G. (English Universities) |
| Buchan-Hepburn, P. G. T. | Legge-Bourke, Maj. E. A. H. | Sutcliffe, H. |
| Butcher, H. W. | Lindsay, M. (Solihull) | Taylor, C. S. (Eastbourne) |
| Clarke, Col. R. S. | Lloyd, Selwyn (Wirral) | Thornton-Kemsley, C. N. |
| Clifton-Brown, Lt.-Col. G. | Lucas-Tooth, Sir H. | Thorp, Lt.-Col. R. A. F. |
| Crookshank, Capt. Rt. Hon. H. F. C. | MacDonald, Sir M. (Inverness) | Vane, W. M. F. |
| Crosthwaite-Eyre, Col. O. E. | Macdonald, Sir P. (Isle of Wight) | Walker-Smith, D. |
| Cuthbert, W. N. | Maclay, Hon. J. S. | Wheatley, Colonel M. J. |
| Darling, Sir W. Y. | Maclean, Brig. F. H. R. (Lancaster) | White, Sir D. (Fareham) |
| De la Bare, R. | Macpherson, Maj. N. (Dumfries) | White, J. B. (Canterbury) |
| Digby, Maj. S. W. | Manningham-Buller, R. E. | Williams, C. (Torquay) |
| Dodds-Parker, A. D. | Marlowe, A. A. H. | Willoughby de Eresby, Lord |
| Dower, E. L. G. (Caithness) | Marshall, D. (Bodmin) | Winterton, Rt. Hon Earl |
| Drayson, G. B. | Maude, J. C. | York, C. |
| Drewe, C. | Morrison, Rt. Hon. W. S. (Cirencester) | Young, Sir A. S. L. (Partick) |
| Foster, J. G (Northwich) | Noble, Comdr. A. H. P. | |
| Fraser, Sir I. (Lonsdale) | Peto, Brig. C. H. M. | TELLERS FOR THE NOES |
| Galbraith, Cmdr. T. D. | Pickthorn, K. | Major Ramsay and |
| Gomme-Duncan, Col. A. G. | Pitman, I. J. | Major Conant |
| Gridley, Sir A. | Prior-Palmer, Brig. O. |
§ The Solicitor-GeneralI beg to move, in page 22, line 36, at the end, to insert:
Provided that this Subsection shall not apply where the lender after making such inquiries as are reasonable in the circumstances of the case does not know and has no reason to suspect that the body corporate is controlled as aforesaid.During the discussion on the Committee stage, the hon Member for Chippenham (Mr. Eccles) pointed out that banks might be placed in some considerable difficulty by Subsection (3) of this Clause as it stood in that it imposed upon them the prohibition, among others, against lending to subsidiaries of foreign controlled companies. He said that it might be difficult for them, in particular cases, to know whether the loan was required for such a subsidiary. There is now the proviso in this Amendment which enables them to lend, providing they make reasonable inquiries and, as a result of those inquiries, have no reason to suspect that the loan is required for the subsidiary of a foreign controlled company.
§ Mr. AsshetonWe are much indebted to the Solicitor-General.
§ Amendment agreed to