23931.
PUBLIC RECORD OFFICE
Reference :-
TRILIIC.O.885
13 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
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MY LORD,
No. 231.
(SOUTH AFRICA.)
* LAW OFFICERS to COLONIAL OFFICE.
Royal Courts of Justice,
December 11, 1891. We were honoured with your Lordship's commands signified in Mr. Bramston's letter of the 13th ultimo, stating that he was directed by your Lordship to invite our consideration of the following case.
That the Standard Bank of South Africa, Limited, was a bank incorporated under the English Companies Acts. That it had its head office in London, and a branch office at Pretoria in the South African Republic, from which it issued and re-issued bank notes payable at the place of issue and circulating in the Republic.
That the 14th Article of the London Convention of 27th February 1884 provided that "all persons other than Natives conforming themselves to the laws of the South "African Republic
will not be subject in respect of their persons or property, or in respect of their commerce or industry to any taxes, whether general or local, other than those which are or may be imposed upon citizens of the said Republic."
64
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That Sir Henry Loch, Her Majesty's High Commissioner for South Africa, had informed your Lordship that the above-mentioned Bank complained that its rights under the 14th Article of the Convention were in danger of being infringed under the following circumstances, which would affect also certain other British banks in the same way.
That a bank had been formed in the South African Republic under the name of the National Bank of the South African Republic, Limited, and that its position was regulated by the concession of which a copy was enclosed.
That it would be seen (Article 5) that the Transvaal Government was to take 100,000l. of shares; was to have the privilege of taking one-tenth of any further issues of shares; and bound itself to consult the National Bank before selling shares obtained by allotment. That the Government was also to have 20 per cent. of the net profits of the said Bank remaining after certain payments had been made; but (Article 26) was to forfeit its share of profits if it issued paper money of its own.
That the notes of the National Bank (Article 27) were to he legal tender, and free from stamp duty (Article 28). That the notes of no other bank were to be accepted at the Government offices after the National Bank had carried on business for a year. That the notes of the National Bank (Article 16) and of all other banks (Article 25), were to be covered by gold or bullion to the extent of one-third of the circulation; but that by Article 16, as regarded the National Bank, the debts due to it by the Govern- ment were to be treated as coin, and might be counted as part of the reserve.
That the Government appointed (Article 8) two directors, and approved one-half of the rest of the board and the two managers. That it also (Article 9) was to approve the articles of association and any alteration in thein, and (Article 18) might appoint a syndic or inspector.
That the National Bank was further (Article 29) to be free from license duty as imposed by law.
That it would thus be seen that the National Bank had much of the character of a Government institution, but that, except perhaps the exemption from license duty, there did not appear to be anything in the concession affecting the rights of the Standard Bank.
That it was, however, proposed to introduce into the Volksraad of the South African Republic a law (of which a copy was enclosed) from the provisions of which the National Bank would (Article 18) be exempt. That every other bank would be required to hold a large reserve of specie to protect its notes, and to publish more frequent returns of its business than the concession prescribed for the National Bank, but that, as those requirements did not involve the payment of taxes, they did not appear to be contrary to Article 14 of the Convention. But that it would be seen (Article 10) that every such bank was to affix a stamp of the value of one penny to every bank note issued by it, and further was (Article 11) to pay every half-year a duty of threepence in the pound sterling on the average amount of bank notes in circulation.
E 65453.-44. 25.-12, 91.
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