Law of January 29, 1862

ARTICLE 1. The limit of the issue of obligations authorized by article 1 of the law of July 11, 1860, to companies holding concessions for public works shall be determined by the sinking-fund value of -the same obligations and by the interest fixed on this value. When the interest should be 6 per cent, considered as an average rate, the total sinking-fund value of the obligations issued, computed by their nominal value, can not exceed a sum equal to the capital realized from the shares, or this sum and the amount of the subsidy received if the company should receive this aid.

ART. 2. When the interest offered on the sinking-fund value and nominal value of the obligations should be less than 6 per cent, the limit of the issue shall be proportionately increased as the rate of interest decreases. The amount of all the obligations, computed at their nominal value, shall not exceed, however, no matter how small the interest offered, a sum equal to double that of the capital realized from the shares, or the double of this and the subsidy received in a proper case.

ART. 3. If the interest on the nominal value should exceed 6 per cent, the limit of the issue shall be reduced proportionately to the difference which exists between the interest which serves as a basis and the interest that is offered. This provision shall not be applicable to the issues made at an interest higher than 6 per cent on the nominal value before the publication of this law.' Said issues shall be computed as made at the average interest, but on renewing the operation or making new issues the company shall be subject to the foregoing rule.

ART. 4. In the future, all issues of obligations which can not be redeemed with the proceeds of the works within the term of the concession and without resorting to the same means of credit shall be forbidden.

ART. 5. Every three months the Government, in view of the quarterly statements of the condition, and of the notices received through the governors of the provinces, or of the respective delegates, shall publish in the Gaceta Oficial the number, nominal value, and interest, on this value of the obligations issued by each one of said companies, as also the amount of the capital realized from the subsidy received by the same.

ART. 6. The Government shall issue the regulations which it, may consider proper in order to insure the fulfillment of the provisions of this law.

Given at the Palace on January 29, 1862.

I, the Queen.

ANTONIO AGUILAR Y CORREA,
Secretary of the Interior.