L.R.O. 1/2012
LAWS OF GUYANA
COMPANIES) ACT
CHAPTER 77:01
Act
16 of 1971
Amended by
35 of 1974 15 of 1997

(inclusive) by L.R.O.
Pages Authorised
Current Authorised Pages
GUARANTEE OF LOANS (PUBLIC CORPORATIONS AND
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Note
on
Subsidiary Legislation
This Chapter contains no subsidiary legislation.


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CHAPTER 77:01
GUARANTEE OF LOANS (PUBLIC CORPORATIONS AND
COMPANIES) ACT
ARRANGEMENT OF SECTIONS
SECTION
1. Short title.
2. Interpretation.
3. Power of Government to guarantee loans by lending agencies
Corporations.
4. Limit on amount outstanding under guarantees.
5. Restriction on borrowing powers of Corporation so long as guarantee
outstanding.
6. Powers exercisable by Minister in event of prospect of default by
Corporation.
7. Corporation to repay to Government sums paid under guarantee.
8. Regulations.
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16 of 1971 AN ACT to provide for the guarantee by the Government of
Guyana of loans to public Corporations and Companies
in which the Government has a controlling interest and
to authorise the Government to give undertakings to
sources of financing under which sums payable by the
Government pursuant thereto shall become chargeable
on the Consolidated Fund.
[24TH AUGUST, 1971]
Short title.
Interpretation.
[15 of 1977]
1. This Act may be cited as Guarantee of Loans
(Public Corporations and Companies) Act.
2. (1) In this Act—
“Corporation” means—

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(a) any corporation as defined in
section 2(c) of the Public
Corporations Act;
(b) any other body corporate owned by
the State or in which the controlling
interest vests in the State or any
agency on behalf of the State;
(c) any co-operative society registered
under the Co-operative Societies Act;
and
(d) any such company incorporated in
Guyana and, having regard to its
importance to the national economy
or capital invested in it by the
Government, as may be specified by
the Minister by notification in the
Gazette, for the purposes of this Act;
“lending agency” means an international financial
organisation or any bank, insurance company or other
source of financing;

“ordinary share capital” means all the issued share capital by
whatever name called, other than capital the holders
whereof have a right to a dividend at a fixed rate, but
have no other rights to share in the profits of the
company.
(2) For the purposes of this Act, a borrowing by a
Corporation shall be deemed to include the obligation of the
Corporation to make payments to any person arising out of
any contract lawfully entered into by the Corporation.

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Power of
Government to
guarantee
loans by
lending
agencies to
Corporations.
[35 of 1974]

Limit on
amount
outstanding
under
guarantees.
3. (1) Subject to this Act, the Government may in such
manner Government and on such terms and subject to such
conditions as may be agreed between it and a lending
agency—
(a) guarantee the discharge by a
Corporation of its obligations under
any agreement which may be entered
into by the Corporation with a
lending agency in respect of any
borrowing by that Corporation that is
authorised by the government;
(b) assume such other obligations as may
be agreed between the Government
and a lending agency in relation to or
pursuant to any such agreement;
(c) undertake the repayment to a lending
agency of such sums as the lending
agency may have advanced to or for
the benefit of the Government.
(2) A guarantee or undertaking given under this
section shall be given in writing in the name of the
Government and any guarantee or undertaking given under
this section may be signed on behalf of the Government by
the Minister or by any person authorised in writing by the
Minister in that behalf.
(3) The power to give guarantees conferred by
subsection (1) is in addition to any like power conferred by
any other law.
4. (1) The aggregate amount of the liability of the
Government in respect of guarantees or undertakings, given
under section 3 shall not at any time exceed the sum of
fifty million dollars or such greater sum as may from time
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[35 of 1974]


Restriction on
borrowing
powers of
Corporation as
long as
guarantee
outstanding.


Powers
exercisable by
Minister in
event or
prospect of
to time be specified by the resolution of the National
Assembly.
(2) The Minister shall, as soon as may be after the
expiration of each quarter of each year during which
guarantees or undertakings may be given under section 3, lay
before the National Assembly a statement of the guarantees
or undertakings given under that section during that quarter,
together with particulars of the purposes to which the loans
guaranteed were to be applied, and shall, so long as any such
guarantees or undertakings are in force, lay before the
National Assembly as soon as may be after the end of each
financial year an account up to that date of the total amount
of such guarantees or undertakings as are in force and the
total sums, if any, which have been either issued out of the
Consolidated Fund under this Act or paid in or towards
repayment of any money so issued.
(3) The reference in subsection (1) to the
liability of the Government in respect of a guarantee or
undertaking shall be construed exclusively of any liability in
respect of interest on any principal moneys the payment of
which is the subject of the guarantee or undertaking.
5. So long as any guarantee or other undertaking
given in exercise of the powers conferred by section 3 is in
force in respect of any borrowing by a Corporation, the
Corporation shall not, without the consent of the Minister,
exercise any other power to borrow possessed by it except
any power to borrow by way of overdraft or otherwise in the
ordinary course of business for a period not exceeding twelve
months.
6. (1) Where in the opinion of the Minister there is
reasonable cause to believe—
(a) that a Corporation is likely to fail or
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default by
Corporation.


Corporation to
repay to
Government
sums paid
under
guarantee.
be unable to discharge any of its
obligations under any agreement
concluded by it with a, lending
agency in respect of any borrowing;
and
(b) that the Government is or may
become liable to pay any sum or fulfil
any obligation pursuant to any
guarantee or other undertaking
given by it in respect of any such
obligation of the Corporation, the
Minister may, notwithstanding any
rule of law or agreement to the
contrary, give, or authorize any other
person to give such directions in
writing to the Corporation as may
from time to time be necessary or
desirable to ensure that such
arrangements are made by the
Corporation as will enable it to
discharge its obligations under such
agreement, or under this Act, and
the Corporation shall comply with
such directions.

(2) Where any sum becomes payable by the
Government pursuant to a guarantee or undertaking given in
exercise of the powers conferred by section 3 that sum shall
be charged on the Consolidated Fund and the Minister shall
direct payment to issue out of the Consolidated Fund.
7. Where any sum is paid out of the Consolidated
Fund in respect of any liability incurred by the Government
under a guarantee or other undertaking given in exercise of
the powers conferred by section 3 in respect of any borrowing
by a Corporation, the Corporation shall repay such sum (together with interest thereon at such rate as the Minister
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Regulations.
may prescribe) to the Consolidated Fund in such manner and
at such time as the Minister may direct.
8. The Minister may make regulations for the purpose
of giving effect to the provisions of this Act, and in particular
for prescribing anything by this Act required to be prescribed.
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