- 46
as those of the dependency.
In five of the nine dependencies surveyed, if there is disagreement, and no coins are issued in a
particular year, the issuing authority is precluded from making a
contract for a coin issue with another company. There is also the question whether the royalties currently received are in fact adequate Section 9.2(4)
•
How redemptions would appear
9.6(1) If the market should deteriorate, how would the resulting
pressures appear so far as the issuing authorites in the dependencies
were concerned? A fall in value to below face value would be likely
to affect specimen coins first. As more of these will have been
issued locally (eg, in the case of BVI) these will tend to be used
like ordinary coins by local residents. Larger denomination specimen
and proof coins might find their way back from abroad carried by collectors who are also tourists or by tourists who have received/
bought them from collectors, and would be used for paying hotel bills,
etc. If this was no more than a trickle, it would be tolerable.
9.6(2) It is more likely, however, that dealers familiar with the
market would buy up large numbers of coins at a discount from individual
collectors, perhaps through advertisements etc., and try to dispose of
them in bulk. Individual purchases that could be effected by such
coins (including of property) could, of course, be limited by the
legal tender limits. In the Caymans and BVI, for example, these limits have been increased to accommodate $100 gold coins. But legal
tender limits are mandatory on a recipient of coins only to the extent that he is bound to accept them in discharge of an obligation up to
the legal tender limit. He is not, therefore, obliged to accept
coins to a face value in excess of that limit, but he may, at his
option, do so. This limit is not, moreover, normally taken to apply
to deposits with banks. Dealers might in the first instance seek to
obtain the face value equivalent of their consignments of coins by
setting up bank deposits locally, presenting the coins personally or freighting them. Banks would be likely to redeem through the issuing
authority (where one exists) coins of too large a denomination for
their normal commercial requirements. They are normally subject only to minimum redemption amounts by a currency authority. If there was
no currency authority, the banks would have to resort direct to the
government concerned. Failure by the banks to obtain value from the
issuing authority would be reflected quickly in a refusal to acquire