(1)This section applies if any property, rights or liabilities are transferred under a transfer scheme to a transferee which at the time of the transfer is a company falling within subsection (3).
(2)The Treasury or the Secretary of State may guarantee the discharge of any financial obligation of the transferee if when the guarantee is made it is a company falling within subsection (3).
(3)A company falls within this subsection if it is—
(a)a company which is wholly owned by the Crown,
(b)a company which is wholly owned by the CAA, or
(c)a company which is a wholly owned subsidiary of a company falling within paragraph (a) or (b).
(4)In the case of a financial obligation incurred before the giving of a guarantee, it is immaterial when the obligation was incurred.
(5)A guarantee may be given on such terms and in such manner as the Treasury or the Secretary of State decides.
(6)A guarantee may continue to have effect after the transferee has ceased to be a company falling within subsection (3).
(7)The Treasury may not give a guarantee in relation to a financial obligation which is owed by the transferee to the Secretary of State.
(8)A guarantee may not be given unless the Treasury or the Secretary of State has entered into arrangements under which the transferee will be liable to make payments (including payments of interest) in respect of sums issued in fulfilment of the guarantee.
(9)The Treasury and the Secretary of State must exercise their powers under this section so as to ensure that the aggregate of the amounts of principal in relation to which guarantees are given under this section does not at any time exceed £500 million.
(10)As soon as practicable after giving a guarantee under this section the Treasury or the Secretary of State must lay a statement of the guarantee before each House of Parliament.
(11)As soon as practicable after issuing a sum in fulfilment of a guarantee under this section the Treasury or the Secretary of State must lay a statement relating to the sum before each House of Parliament.
(12)If a payment is not made as required by arrangements under subsection (8), as soon as practicable after the default occurs the Treasury or the Secretary of State (depending on who made the arrangements) must lay a statement of the default before each House of Parliament.
Commencement Information
I1S. 53 wholly in force at 1.2.2001, see s. 275(1)(2) and S.I. 2001/57, art. 3(1), Sch. 2 Pt. I (subject to the transitional provision and saving in Sch. 2 Pt. II)