Article 12 Outstanding internal public debt of the Federation
The liabilities of the Federation in respect of each of the loans raised in the Federation and specified in Parts A, B and C of Schedule I are hereby apportioned amongst the Territories as follows—
those in Part A as to 52.120 per cent. to Southern Rhodesia, 37.127 per cent. to Northern Rhodesia, and 10.753 per cent. to Nyasaland;
those in Part B as to 50.000 per cent. to Southern Rhodesia and 50.000 per cent. to Northern Rhodesia; and
those in Part C, in the manner set out in that Part.
The liabilities of the Federation as apportioned by subsection (1) are hereby transferred to the respective Territories in accordance with the provisions of this section.
The Government of each Territory, to the extent of the liability apportioned to it by subsection (1), is hereby authorised to and shall issue bonds or stock of that Government in substitution for any bonds or stock (in this section referred to as “original bonds or stock”) issued under any Act of the Federal Legislature in respect of any loan referred to in subsection (1).
Any document of title relating to original bonds or stock shall be valid as against the Territories in proportion to the liability apportioned to them by subsection (1) in respect of the loan concerned until such time as new documents of title are issued in substitution therefor.
In respect of bonds or stock issued under this section—
interest thereon shall be paid at the place stated therein and in the currency of the Territory of issue, and on the dates and at the percentage rate and on the terms and conditions applicable to the payment of interest on the original bonds or stock;
they shall be redeemable or repayable at the place stated therein and in the currency of the Territory of issue, and otherwise be redeemable or repayable on the terms and conditions applicable to the original bonds or stock; and
they shall be held by the holder in the same right and on the same trusts and subject to the same powers, privileges, charges, restraints and liabilities as those in, on or subject to which he held the original bonds or stock, and any provision of any deed, will, disposition or other instrument shall have the same effect in relation to the bonds or stock issued under this section as it would have had in relation to the original bonds or stock.
In relation to any loans in respect of which no bonds or stock have been issued the lenders shall, subject to the provisions of subsection (1) and of any agreement entered into with the respective Territories, continue to enjoy the same rights as they enjoyed immediately before the dissolution of the Federation, except that interest on the loans shall be paid, and the loans shall be redeemed or repaid, both in, and in the currency of, the respective Territories.
The Government of each Territory, to the extent of the liability apportioned to it by subsection (1), shall establish a sinking fund for any bonds or stock for which a sinking fund was required to be established by the Federal Government, and on the same terms and conditions, and shall maintain the sinking fund until the bonds or stock for which it was established are redeemed or repaid.
The sinking funds established by the Federal Government in respect of any loan referred to in subsection (1) are hereby apportioned amongst the Territories in the same proportions as the relevant loans are apportioned by that subsection and shall be transferred accordingly to the appropriate sinking funds established under subsection (7).
The trustees of any such sinking fund established by the Federal Government shall—
as soon as may be after the dissolution of the Federation, submit to the Government of each Territory a full account of the assets of the fund subsisting immediately before the dissolution of the Federation;
take such steps as may be necessary to give effect to the provisions of subsection (8); and
continue to have all the powers that at present appertain to them in relation to the fund until effect is given to the provisions of subsection (8) in relation to that fund;
and no stamp duty, transfer fee or any other duty shall be payable in respect of anything done for the purposes of subsection (8).
Notwithstanding any other provision of this section, the liabilities apportioned and transferred by subsections (1) and (2) shall be calculated to the nearest penny, and bonds or stock issued under subsection (3) shall be expressed in units of one pound nominal or multiples thereof, so however that the aggregate amount of bonds or stock issued shall be of the same face value as the bonds or stock for which they are substituted, and shall be issued to each holder in proportion to the liability in respect of the loan apportioned to the Territory by subsection (1).