into account. They may consider Article 11 in the draft Order flouts their views.
The adoption of such a procedure for bonds in the case of the Russian distribution was justified to the JCSI on the grounds that bond claims were expected to be submitted in very large numbers far exceeding the number of such claims under previous distributions. The only practicable solution in the interests of an efficient discharge by the FCC of their functions under the Order was to provide for bond claims to be registered by them, acting in their adminstrative capacity and reported to the Secretary of State. It was also pointed out that the Russian case differed from the 1980 China registration in that the Order in relation to bonds specified simplified nationality and beneficial ownership requirements; the registration procedure being employed was for bond claims only, the bond itself being to a large extent its own proof of ownership and the fact of loss; and the Order incorporated clear rules, which did not require the exercise of judicial discretion, for the valuation of bond claims.
At the time of the Russian Order basing ourselves on pre-1951 registration we were aware of possible bond claims worth between £60 and £70 million with a potential for further claims for bonds amounting to a total of £1000 million. The total value of sterling bonds (the majority of which we suspect are held by UK nationals) in the case of China is over £60 million with potential further bond claims of about £20 million. This is much less, but nonetheless it could be argued that the expected number of bond claims in the case of China was sufficiently substantial to justify administrative procedure for bonds, and that most of the other factors which were relevant in the case of the Russian distribution are present in this case as well.
The preference of the FCC is, however, to revert to judicial procedure in respect of bonds. In addition to forestalling criticism by the JCSI, it can be argued in its favour that adoption of this procedure would not cause significant delay in the establishment of bond claims. The grounds for refusing such claims are usually very simple (failure to satisfy the nationality requirements) and even if an aggrieved claimant demanded a hearing there would be no undue delay. Moreover if the Russian distribution can be regarded as an indicator, the ratio of refused to claims accepted would not be high; the number of claims refused registration by 9 October was only 204 out of 4,582 with 810 claims remaining to be registered or rejected.
The Minister is invited to decide whether he is satisfied with the present procedures in relation to bonds or whether he wishes the Order to provide for judicial determination of bond claims.
/b)