Guarantee of Loans (Companies)
GUARANTEE OF LOANS (COMPANIES) ACT

CHAPTER 71:82

LAWS OF TRINIDAD AND TOBAGO

Current Authorised Pages
Pages Authorised

(inclusive) by L.R.O.
1–8 ..

L.R.O.

Act
21 of 1969

Amended by
52 of 1970
1 of 1980

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LAWS OF TRINIDAD AND TOBAGO

2 Chap. 71:82 Guarantee of Loans (Companies)

Index of Subsidiary Legislation

Page

Resolutions … … … … … … … 8

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LAWS OF TRINIDAD AND TOBAGO

Guarantee of Loans (Companies) Chap. 71:82 3

CHAPTER 71:82

GUARANTEE OF LOANS (COMPANIES) ACT

ARRANGEMENT OF SECTIONS

SECTION

1. Short title.
2. Interpretation.
3. Power of Minister to guarantee loans by Lending Agencies to Public

Companies.
4. Limit on amount of guarantees.
5. Restriction on borrowing powers of Company so far as guarantee

outstanding.
6. Powers exercisable by Minister in event or prospect of default by

Company.
7. Company to repay to Government sums paid under guarantee.
8. Regulations.

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LAWS OF TRINIDAD AND TOBAGO

4 Chap. 71:82 Guarantee of Loans (Companies)

CHAPTER 71:82

GUARANTEE OF LOANS (COMPANIES) ACT

An Act to provide for the guarantee by the Government of
Trinidad and Tobago of loans by Lending Agencies to
Companies in which the Government holds at least fifty
per cent of the ordinary share capital.

[1ST JULY 1969]

1. This Act may be cited as the Guarantee of Loans
(Companies) Act.

2. In this Act—
“borrowing” includes the obtaining of any credit or the undertaking

to pay any debt or to discharge any pecuniary obligation;
“Company” means any company incorporated in Trinidad and

Tobago or incorporated elsewhere and registered under the
Companies Act that is controlled by the Government or by
any body corporate controlled by the Government
“controlled” here meaning that the Government or the body
corporate, as the case may be—

(a) exercises or is entitled to exercise control directly
or indirectly over the affairs of the company or
body corporate;

(b) is entitled to appoint a majority of the directors
of the Board of Directors of the company or body
corporate; or

(c) holds at least fifty per cent of the ordinary share
capital of the company or the body corporate,

as the case may be;
“Lending Agency” means an International Financial Organisation

or any bank, insurance company or other source of financing
and sources of suppliers credit;

“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 profit of the company.

21 of 1969.

Commencement.

Short title.

Interpretation.
[52 of 1970
1 of 1980].

Ch. 81:01.

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Guarantee of Loans (Companies) Chap. 71:82 5

3. (1) Subject to this Act, the Government may in such
manner 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 Company of its
obligations under any agreement which may be
entered into by the Company with a Lending
Agency in respect of any borrowing by that
Company that is authorised by the Government;

(b) undertake such other obligation as may be agreed
between the Government and a Lending Agency
in relation to or pursuant to any such agreement.

(2) A guarantee or undertaking given under this section
shall be given in writing in the name of Trinidad and Tobago and
any guarantee or undertaking given under this section may be
signed on behalf of Trinidad and Tobago by the Minister or by any
person authorised in writing by the Minister in that behalf.

4. (1) Subject to this section, the aggregate amount of all
borrowings by Companies that are guaranteed by the Government
under this Act shall not exceed fifty million dollars (without taking
into account any amount in respect of interest, commissions and
any other expenses secured by the guarantees) or such greater sum
as may from time to time be specified by resolution of the Senate
and the House of Representatives.

(2) For the purpose of subsection (1), before any further
guarantee is entered into or any undertaking is assumed—

(a) the amount of all borrowings by Companies
secured by guarantees by the Government shall
be computed on the date of any such further
guarantee in accordance with subsection (1) and
the aggregate amount of all such borrowings in
foreign currency shall be computed so as to take
into account the prevailing rates of exchange on
the date of such further guarantee;

(b) the Minister shall certify in each such new
guarantee that the aggregate amount of all
borrowings guaranteed by the Government does
not exceed the limits imposed for the time being
by or under subsection (1); and

Power of
Minister to
guarantee loans
by Lending
Agencies to
Public
Companies.
[52 of 1970].

Limit on amount
of guarantees.
[52 of 1970].

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6 Chap. 71:82 Guarantee of Loans (Companies)

(c) such certificate shall be conclusive evidence of
the facts stated therein.

(3) Where any sum is issued for fulfilling such a
guarantee, the Minister shall, as soon as possible after the end of
each financial year beginning with that in which the sum is issued
and ending with that in which all liability in respect of the principal
of the sum and in respect of interest thereon is finally discharged,
lay before Parliament a statement relating to that sum.

5. So long as the Government is liable under any guarantee
or other undertaking given in exercise of the powers conferred by
section 3(1) in respect of any borrowing by a Company, the
Company shall not, without the consent of the Minister, exercise
any power to borrow possessed by it except 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 Company is likely to fail or be unable to
discharge any of its obligations under any
agreement concluded by it with the Lending
Agency in respect of any borrowing; and

(b) that the Government is or may become liable
under any guarantee or other undertaking given
by it in respect of such obligation,

the Minister may, from time to time—
(i) by instrument in writing (notice of which

shall be published in the Gazette) appoint,
for such period as is specified in the
instrument, a Manager of the Company, and
the powers of management shall thereupon
vest in the Manager for the specified period
to the exclusion of the Board of Directors
of the Company or of any other person or
body of persons; and

(ii) give, or authorise any other person to give,
such directions in writing to such Manager
as may be necessary or desirable in order

Restriction on
borrowing
powers of
Company so far
as guarantee
outstanding.
[52 of 1970].

Powers
exercisable by
Minister in
event or
prospect of
default by
Company.
[52 of 1970].

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Guarantee of Loans (Companies) Chap. 71:82 7

to ensure that such arrangements are made
by the Company as will enable it to
discharge its obligations in respect of all
its borrowings guaranteed by the
Government and to satisfy any other
liabilities under this Act,

and the Company shall accept such appointment of a Manager and
be bound by all lawful acts of the Manager.

(2) Nothing in subsection (1) shall be read and construed
so as to treat a Manager appointed by instrument under
subsection (1)(i) as the agent or servant of Government or of any
person while acting in exercise of the powers or in performance of
the functions conferred on him by that subsection and,
notwithstanding any other written law or rule of law to the contrary,
such a Manager shall, for all purposes relating to the management
of the affairs of the Company, be deemed to be, and to act as, the
lawfully constituted Board of Directors of the Company.

(3) 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(1) in respect of any borrowing by a
Company, the Company shall repay such sum (together with interest
thereon at such rate as the Minister 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.

Company to
repay to
Government
sums paid under
guarantee.

Regulations.

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8 Chap. 71:82 Guarantee of Loans (Companies)

SUBSIDIARY LEGISLATION

RESOLUTIONS

made under section 4(1)

The aggregate amount of borrowings by companies that are
guaranteed by Government was increased from time to time by
resolutions of the Senate and of the House of Representatives
pursuant to section 4(1) of the Act as follows:

Government Notice Date Amount Authorised

GN 194/1970 21st December 1970 70 million dollars

GN 178/1972 5th December 1972 120 million dollars

GN 30/1974 29th January 1974 200 million dollars

GN 74/1976 1st June 1976 400 million dollars

GN 58/1978 4th April 1978 1,000 million dollars

GN 71/1979 22nd May 1979 5,000 million dollars

GN 28/2003 28th January 2003 9,000 million dollars

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