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Exchange Control: Surrender Rule

Volume 387: debated on Wednesday 16 November 1977

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asked Her Majesty's Government:Whether they are satisfied that the specific legislation embodied in the Exchange Control Acts has not been used for a purpose not intended by Parliament in relation to the 25 per cent. Surrender Requirement.

(Baroness Birk)

It was the clear intention of Parliament as expressed in the Exchange Control Act 1947 to provide the Treasury with wide discretionary powers. I am satisfied that the 25 per cent. requirement is properly imposed within those powers. Section 37(1)(c) of the Exchange Control Act 1947 gives the Treasury express power to impose conditions on any permission given under that Act. The permission required under Section 17(2) of the Act by United Kingdom resident holders of foreign currency securities to transfer those securities to other persons is only given subject to the condition inter alia that transactions in fulfilment of the 25 per cent. requirement are previously undertaken.

asked Her Majesty's Government:What immediate plans they have for consulting with the Stock Exchange, the Bank of England and other interested bodies on the effect foreseen from the reduction or abolition of the 25 per cent. Surrender Requirement:

  • (a) on the Reserves;
  • (b) On United Kingdom Invisible Earnings; and
  • (c) on effective management of Overseas Portfolios.
  • These matters are kept under review and interested bodies are consulted as appropriate.