From...........
LA(MA)
CONFIDENTIAL#&
MEMO
Ref.......
...in....
Tel. No.
5-8672664
Date
5 May, 1989
To
(128
Secretary for Monetary Affairs
(Attn. Mr. Joseph Yam)
J
+615
Your Ref.
in
dated
Exchange Fund Ordinance Section 313)
-
0104
I refer to FCO telno. of 27 April, In paragraph 4 reference is rade to section 3(3) of the Ordinance. It is suggested that in the absence of any other borrowing power the Financial Secretary might be restricted in his borrowings for the account of the Exchange Fund to borrowings secured on the assets of the Fund or on the general revenue. In short, the question is whether or not as Controller of the Exchange Fund he can borrow unsecured. A restriction on his doing so would affect the Financial Secretary's power to use the Fund pursuant to section 3(1) and to hold/invest the Fund pursuant to section 3 (2). I propose to deal with each provision separately.
2.
Section 3(1) provides that the Financial Secretary may use the Fund
"
for such purposes as he thinks fit affecting either directly or indirectly the exchange value of the currency of Hong Kong and for other purposes incidental thereto."
The power conferred by this provision is expressed in wide terms. Its effect is to give the Financial Secretary a wide discretion as to the manner in which the Fund is used to achieve the stated purposes. Quite apart from the permissive drafting used it is a well-established rule of construction that powers expressly conferred will be interpreted as to authorise by implication the performance of acts reasonably incidental to those explicity oranted. Furthermore section 40 of the Interpretation and General Clause Ordinance provides that,
"Where any Ordinance confers upon any person power to do or enforce the doing of any act or thing, all such powers shall be deemed to be also conferred as are reasonably necessary to enable the person to do or enforce the doing of the act or thing."
/ 2
G. F. 79C
CONFIDENTIAL #3