HC Deb 23 June 1964 vol 697 cc213-4
19. Mr. Edelman

asked the Chancellor of the Exchequer whether he is satisfied that his powers are adequate to control foreign investment in British industry when the public interest requires that it should be so controlled; and if he will make a statement.

Mr. Maudling

Yes, Sir.

Mr. Eldelman

But will the Chancellor of the Exchequer consider whether he is effectively exercising powers under the Exchange Control Act which was introduced by a Labour Government? Is he aware that in his statement on 8th June ho said that the Rootes family and their associates will continue to hold 50 per cent. of the voting shares, but is it not the case that the Rootes family and its associates held only 56 per cent. of the voting shares and as Chrysler has now already acquired 30 per cent. of the shares, does not this suggest that Chrysler will become very shortly the dominant shareholder in the Rootes company?

Mr. Maudling

No, Sir. I think that the hon. Member will find that the facts as I set them out are quite accurate.

Mr. Callaghan

Can the right hon. Gentleman say whether under the Exchange Control Act Chrysler is prevented from acquiring further securities because of a legal sanction, or is it because it has entered into an undertaking with the Chancellor or with Rootes not to do that?

Mr. Maudling

Chrysler entered into an undertaking with me. Before I gave my Answer of 8th June I had required an undertaking of that kind, which was part of my sanction of the deal.

Mr. Callaghan

Is it not a fact that if this undertaking were not kept through the sale by Rootes of shares to someone else there would be nothing in the Exchange Control Act to prevent Chrysler from purchasing shares and so acquiring control of Rootes?

Mr. Maudling

I had thought of that one. I asked for and obtained an undertaking that the Chrysler Corporation would not acquire any more Rootes shares other than by means involving Treasury consent.

Mr. Gordon Walker

If this kind of investment is such a good thing, why does the right hon. Gentleman impose any restrictions on it at all?

Mr. Maudling

Of all the questions that have come from the Opposition, that is about the silliest I have heard.

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