Make provision for or in connection with the relief of debts of certain developing countries.
[8th April 2010]
Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—
1 Meaning of “qualifying debt” etc
(1)This section applies for the purposes of this Act.
(2)“The Initiative” means the enhanced Heavily Indebted Poor Countries Initiative of the International Monetary Fund and the World Bank.
(3)“Qualifying debt” means a debt incurred before commencement that—
(a)is public or publicly guaranteed,
(c)is a debt of a country to which the Initiative applies or a potentially eligible Initiative country, and
(d)in the case of a debt of a country to which the Initiative applies, is incurred before decision point is reached in respect of the country.
(4)For the purposes of subsection (3) treat a debt incurred after commencement as incurred before commencement if (and so far as) it replaces one incurred before commencement.
(5)For the purposes of subsection (3)(d) treat a debt incurred after decision point as incurred before decision point if (and so far as) it replaces one incurred before decision point.
(6)“Potentially eligible Initiative country” means a country—
(a)that the International Monetary Fund and World Bank identify as potentially eligible for debt relief under the Initiative, and
(b)in respect of which decision point has not been reached.
(7)Decision point is regarded as reached in respect of a country if it is so regarded for the purposes of the Initiative.
(8)For the meaning of other expressions used in subsection (3), see section 2.
(9)“Country” includes a territory.
(10)“Commencement” means the commencement of this Act.
(11)If the terms of the Initiative are amended after commencement in such a way as to change a relevant eligibility condition, this Act has effect as if they had not been so amended.
(12)In subsection (11) “relevant eligibility condition” means a condition as to the level of a country's income or debt or the size of its economy that must be met in order for the country to be eligible for debt relief under the Initiative.
2 Qualifying debts: further definitions
(1)The expressions used in section 1(3) have the meaning given below.
(a)a liability that falls to be discharged otherwise than by the making of a payment,
(b)an obligation to repurchase property that arises under an agreement for the sale and repurchase of property (whether or not the same property), and
(c)a liability of the lessee under a finance lease (except a liability so far as relating to the operation or maintenance of property subject to the lease).
(3)“Debt” does not include—
(a)a liability to pay for goods or services that arose on the delivery of the goods or the provision of services,
(b)a liability that falls to be discharged in less than a year from the time it was incurred (“a short-term debt”) unless the short-term debt is within subsection (4), or
(c)a liability incurred after commencement that replaces anything that was (at the time of the replacement) within paragraph (a) or (b).
(4)A short-term debt is within this subsection if it ought to have been discharged—
(a)more than a year before commencement, and
(b)(where decision point has been reached in respect of the country concerned) more than a year before decision point.
(5)A debt is a “public” debt of a country if it was incurred by—
(a)the country or any part of it (or the government of the country or any part of the country or any department of any such government),
(b)the central bank or other monetary authority of the country, or
(c)a body corporate controlled (directly or indirectly) by anything within paragraph (a) or (b).
(6)In subsection (5)(a) references to part of a country include any municipality or other local government area in the country.
(7)A debt is a “publicly guaranteed” debt of a country if—
(a)it is guaranteed,
(b)the guarantee was entered into—
(i)before commencement, and
(ii)where decision point has been reached in respect of the country, before that point was reached, and
(c)the debt would be a public debt of the country if it had been incurred by the guarantor.
(8)If the conditions in subsection (7)(a) to (c) are met as regards part of a debt, that part is regarded as a publicly guaranteed debt of the country concerned.
(9)A public or publicly guaranteed debt of a country is “external” unless the creditor was resident in the country—
(a)if decision point was reached in respect of the country before commencement, at the time that point was reached, or
(b)otherwise, at commencement.
(10)If in any proceedings there is an issue as to whether a debt is a qualifying debt, treat the debt as external unless it is proved in those proceedings that it is not external.
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