.F. 73A
о
Law Draftsman. (Atun.
Mr Gilbert MO, SCC)
MEMO
ALACMA)1
From...
To
Ref.
867 2726
Tei. No.
Your Ref.
in..
Date
2nd August 1990
dated
Middle East Finance International Ltd. Bill
I am in the process of preparing a substantive response to the first draft of the above bill.
2.
Yesterday I met with the parties' solicitors, Johnson, Stokes & Master to discuss the way forward. It occurred to me following our meeting that it might not be necessary to seek the FCO's approval for this bill.
3.
All previous merger bills have effected mergers between banks (whereas this bill will effect a merger between a deposit taking company and a restricted licence bank). They therefore were referred to the FCO because of Clause XXVI of the Royal Instructions which applies, as relevant,
to
"4. Any Bill establishing any Banking
Association, or amending or altering the constitution, powers, or privileges of any Banking Association".
As the term "Banking Association" is not defined by the Royal Instructions it should be afforded its usual meaning. The traditional view has been that no one may be considered a banker unless he pays cheques drawn a himself. That view was confirmed by the English Court of Appeal in United Dominions Trust Ltd. v Kirkwood (1966) where the Court stated that the usual characteristics of banking business are
(i)
(ii)
the acceptance of money form, and collection of cheques, for customers and the placing of them to the customer's credit;
the honouring of cheques or orders drawn on the bank by their customers when presented for payment; and
(iii) the keeping of some form of current
running accounts in their books in which the credits and debits are entered.
/2.....