ANNEX 1
Guidance Memorandum
Numismatic Coin Issues by Dependent Territories
It is considered useful that a survey should be undertaken to assess the involvement of UK dependent territories in the issue of numismatic coins (i.e. legal tender coins issued not for normal circulation in the territory concerned, but for collectors and investors elsewhere). It is apparent that the authorities in several territories see such issues, usually organised into a marketing programme, as a relatively simple means of raising extra income, particularly where alternative sources of revenue are limited.
HMG's involvement in coin issues and coin programmes has been limited mostly to sanctioning designs and providing "ad hoc" advice on specific points raised by the individual territories. With the expansion of the collectors' market and the evident increase in numismatic issues originating from many countries, it is felt that a better understanding of the situation is needed, particularly in view of the element of risk to HMG as well as to the authorities in the dependent territories. As the coins are usually legal tender currency, they are normally eligible, or are held to be eligible, to be redeemed at face value by the issuing authority; they thus constitute a financial liability of such authority or government, and, because of HMG's general responsibilities for dependencies, they also constitute a contingent liability of HMG. It is felt desirable to try to assess the risk on a comparative basis, and also to form a judgement on the profitability of the various arrangements.
It would therefore be helpful if you would arrange for answers to be provided to the following questions, which broadly cover three areas contractual terms, volume and method of issues, and legislation. We do, of course, already have some information but are seeking to fill in gaps in our knowledge. It is our intention that the summarised results of the survey will be circulated to the territories that have provided information, as this could be of general interest; but if you wish us to keep confidential any of the information you provide, please let us know.