Atomic Energy Authority Act 1995

Extinguishment of certain liabilities

10 Extinguishment of certain liabilities

(1) Subject to subsection (2) below, the Secretary of State may, at any time after the coming into force of a transfer scheme, by order extinguish all or any of the liabilities of the Authority in respect of the principal of such relevant loans as may be specified in the order to such extent as may be so specified.

(2) The aggregate amount of the liabilities extinguished under subsection (1) above shall not exceed the aggregate of—

(a) any sums received by the Secretary of State or the Authority in pursuance of agreements under section 4 of this Act, and

(b) any sums received by the Treasury, the Secretary of State or the Authority on the disposal of any securities of a successor company, or of rights to subscribe for such securities.

(3) The Secretary of State may by order extinguish all or any of the liabilities of a publicly owned successor company in respect of the principal of such relevant loans as may be specified in the order to such extent as may be so specified.

(4) Where any liabilities are extinguished under subsection (1) or (3) above, the assets of the National Loans Fund shall accordingly be reduced by amounts corresponding to the liabilities so extinguished.

(5) Where the Secretary of State has made an order under subsection (3) above and he considers it appropriate to do so, he may from time to time give a direction under this subsection to a successor company whose liabilities are extinguished by the order; and a company to which such a direction is given shall, as a consequence of the making of the order, issue such securities of the company as may be specified or described in the direction—

(a) to the Treasury, the Secretary of State or the Authority, or

(b) to any person entitled to require the issue of the securities following their initial allotment to the Treasury, the Secretary of State or the Authority.

(6) No direction may be given to a successor company under subsection (5) above at any time after that company has ceased to be publicly owned.

(7) Unless the Secretary of State otherwise determines in any particular case, where a company is directed to issue debentures in pursuance of this section—

(a) the aggregate of the principal sums payable under the debentures to which the direction relates shall be equal to the aggregate of the sums the liability to repay which is extinguished by the order, and

(b) the terms as to the payment of the principal sums payable on the debentures to which the direction relates, and as to the payment of interest on those principal sums, shall be the same as the corresponding terms of the loans specified in the order.

(8) For the purposes of subsection (7) above, any express or implied terms of a loan shall be disregarded in so far as they relate to the early discharge of liabilities to make repayments of principal and payments of interest.

(9) Paragraphs 1(4) and (5), 3 and 4 of Schedule 2 to this Act shall apply for the purposes of subsection (5) above as they apply for the purposes of paragraph 1 of that Schedule.

(10) The Secretary of State shall not exercise any power conferred on him by this section except with the consent of the Treasury.

(11) The power to make an order under this section shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

(12) In this section “relevant loan”—

(a) in relation to the Authority, means the Authority’s commencing capital debt under section 1 of the [1986 c. 3.] Atomic Energy Authority Act 1986 and any loan made to the Authority under section 4 of that Act, and

(b) in relation to a successor company, means—

(i) any debt or loan mentioned in paragraph (a) above, if and to the extent that the liability to repay it is transferred to the company in accordance with a transfer scheme, and

(ii) any loan made to that company by the Secretary of State under paragraph 11 of Schedule 2 to this Act.