{"id":"C2004A01659","name":"Asian Development Bank (Additional Subscription) Act 1977","slug":"asian-development-bank-additional-subscription-act-1977","collection":"act","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":"21 of 1977","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":6488,"registerId":"commonwealth-C2004A01659-current","compilationNumber":null,"startDate":"2026-03-30","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Short title","content":"#### 1 Short title\n\n  This Act may be cited as the Asian Development Bank (Additional Subscription) Act 1977.","sortOrder":0},{"sectionNumber":"2","sectionType":"section","heading":"Commencement","content":"#### 2 Commencement\n\n  This Act shall come into operation on the day on which it receives the Royal Assent.","sortOrder":1},{"sectionNumber":"3","sectionType":"section","heading":"Definitions","content":"#### 3 Definitions\n\n  In this Act:\n\n> Bank means the Asian Development Bank.\n\n> Bank Agreement means the Agreement establishing the Asian Development Bank, done at Manila on 4 December 1965, as in force for Australia on the commencement of this Act.\n\n> Note: The Agreement establishing the Asian Development Bank is in Australian Treaty Series 1966 No. 13 (\\[1966\\] ATS 13) and could in 2024 be viewed in the Australian Treaties Library on the AustLII website (http://www.austlii.edu.au).\n\n> callable shares has the same meaning as in the Bank Agreement.\n\n> paid‑in shares has the same meaning as in the Bank Agreement.\n\n> United States dollar means a dollar in the currency of the United States of America of the weight and fineness that was in effect on 31 January 1966.","sortOrder":2},{"sectionNumber":"4","sectionType":"section","heading":"Subscription for capital stock of the Bank","content":"#### 4 Subscription for capital stock of the Bank\n\n  (1) The Treasurer may, on behalf of the Commonwealth, make an agreement or agreements with the Bank providing for the purchase by Australia of 2,869 paid-in shares, and 25,818 callable shares, of the capital stock of the Bank at a price per share that is the equivalent of 10,000 United States dollars.\n  (2) Subject to this Act, an agreement so made may contain such terms and conditions as the Treasurer determines.","sortOrder":3},{"sectionNumber":"5","sectionType":"section","heading":"Agreement subject to increase of capital stock","content":"#### 5 Agreement subject to increase of capital stock\n\n  An agreement made under this Act does not have effect before the authorized capital stock of the Bank has been increased in pursuance of the resolution adopted by the Board of Governors of the Bank on 29 October 1976, a copy of the text of which is set out in the Schedule to this Act.","sortOrder":4},{"sectionNumber":"6","sectionType":"section","heading":"Issue of promissory notes","content":"#### 6 Issue of promissory notes\n\n  (1) To the extent to which the Bank is prepared to accept promissory notes from Australia in lieu of any payment that Australia is required to make to the Bank in pursuance of an agreement made under this Act, the Treasurer may, on behalf of the Commonwealth, execute and issue to the Bank promissory notes.\n  (2) A promissory note issued under subsection (1):\n    (a) shall be payable to the Bank;\n    (b) shall be non-negotiable and non-interest-bearing; and\n    (c) shall be payable at its par value on demand.","sortOrder":5},{"sectionNumber":"7","sectionType":"section","heading":"Appropriation","content":"#### 7 Appropriation\n\n  There may be paid out of the Consolidated Revenue Fund, which is appropriated accordingly, the moneys necessary for the purpose of making any payment that is to be made by Australia:\n    (a) in pursuance of an agreement made under this Act; or\n    (b) under a promissory note issued under this Act.","sortOrder":6}],"analysis":{"issue_detection":{"absurdities":[{"type":"impossible_compliance","section":"3 (Definition of 'United States dollar')","severity":"high","reasoning":"The United States abandoned the Bretton Woods gold standard system on 15 August 1971 (the 'Nixon Shock'), meaning the US dollar no longer has any defined weight or fineness in gold. The definition therefore refers to a monetary unit that has not existed for over 50 years. Any actual payment made under section 4 at '10,000 United States dollars per share' would need to use a currency unit that is legally and physically impossible to tender, making the price per share effectively incalculable under the Act's own terms.","confidence":0.92,"description":"The Act defines 'United States dollar' as a dollar of the weight and fineness in effect on 31 January 1966, anchoring the currency to a gold standard weight that no longer exists."},{"type":"other","section":"3 (Definition of 'Bank Agreement') read with section 5","severity":"low","reasoning":"The Bank Agreement definition is deliberately static ('as in force for Australia on the commencement of this Act'), which is a common drafting technique. However, any subsequent amendments to the Bank Agreement that affect the meaning of 'paid-in shares' or 'callable shares' would not be captured, potentially leaving the incorporated definitions diverging from the operative international instrument Australia is actually a party to. This creates a latent interpretive inconsistency rather than an immediate absurdity, but it is a structural weakness.","confidence":0.65,"description":"The 'Bank Agreement' is frozen at its state as in force on commencement of this Act (1977), yet section 5 makes the subscription contingent on a capital stock increase resolved in 1976 — a forward-looking operational condition tied to a backward-looking, static definition."},{"type":"self_contradicting","section":"6(2)(b) and 6(2)(c)","severity":"medium","reasoning":"Under Australian bills of exchange and promissory note law (and general commercial law), a promissory note's value as an instrument derives substantially from its negotiability. Making it non-negotiable, non-interest-bearing, and payable on demand at par essentially makes it functionally equivalent to a letter of credit or a simple IOU rather than a promissory note in any legally meaningful sense. While this may be a deliberate policy choice to prevent the Bank from trading the note on secondary markets, the instrument is described as a 'promissory note' while being stripped of the defining legal characteristics of one — an internal definitional absurdity within the section itself.","confidence":0.72,"description":"A promissory note that is simultaneously non-negotiable and payable on demand at par value creates a commercially incoherent instrument that contradicts core features of promissory note law."}],"contradictions":[{"severity":"low","section_a":"7(b) — appropriation for payments under promissory notes","section_b":"6(2)(b) — promissory notes are non-interest-bearing","confidence":0.61,"description":"Section 7 appropriates funds for payments 'under a promissory note issued under this Act,' but since the note is payable only at par on demand (section 6(2)(c)) and bears no interest (section 6(2)(b)), the appropriation in section 7(b) is entirely redundant with section 7(a), which already covers payments under the agreement."},{"severity":"medium","section_a":"4(1) — Treasurer may make agreement(s) for purchase of shares","section_b":"5 — agreement does not have effect before capital stock is increased","confidence":0.75,"description":"Section 4(1) grants the Treasurer power to make an agreement, implying the agreement is legally formed upon execution. Section 5 then provides the agreement 'does not have effect' until a precondition is met. This creates a tension between the moment of legal formation of the agreement and the moment of its operative effect, raising the question of whether the Treasurer can contractually bind the Commonwealth to an instrument that has no legal effect — and what the Bank's rights are in the intervening period."}]},"kimi_summary":{"content_quality":"ok","complexity_score":2,"scope_assessment":{"changed":false,"description":"This legislation remains tightly focused on its original purpose: authorising a specific additional capital subscription to the Asian Development Bank in 1977. There is no evidence of scope creep; the Act does exactly what its title suggests and contains no extraneous provisions."},"complexity_factors":["Only 6 defined terms in a short interpretation section","No cross-references to other Acts","Simple conditional structure: one main condition in section 5 (capital increase must happen first)","Straightforward appropriation mechanism with no special accounts or complex funding formulas","Single purpose legislation with no regulatory schemes, offences, or administrative procedures"],"plain_english_summary":"**What this law does:**\n\nThis Act authorises Australia to buy more shares in the Asian Development Bank (ADB) — a regional bank that provides loans and development assistance to countries in Asia and the Pacific.\n\n**Key points:**\n\n- **The investment:** Australia can purchase **2,869 \"paid-in\" shares** (shares paid for upfront) and **25,818 \"callable\" shares** (shares that Australia promises to pay for if the Bank ever needs the money). Each share costs the equivalent of US$10,000.\n\n- **Who decides:** The **Treasurer** (Australia's finance minister) has the power to make the agreement with the Bank and decide the specific terms.\n\n- **Important condition:** The deal only goes ahead if the ADB actually increases its total capital stock as planned — this was decided by the Bank's governors in October 1976.\n\n- **How Australia pays:** Instead of cash, Australia can issue **promissory notes** — basically IOUs that the Bank can cash in whenever it needs the money. These notes don't earn interest and can't be sold to anyone else.\n\n- **The money:** Payments come from Australia's **Consolidated Revenue Fund** (the government's main bank account), which this law automatically approves.\n\n**Why it matters:**\n\nThis is Australia's way of putting more money into a regional development bank, strengthening its influence in Asia-Pacific economic affairs and supporting infrastructure and development projects in neighbouring countries. It's a routine piece of \"parliamentary housekeeping\" that gives the government legal authority to make an international financial commitment."},"flash_summary_failed":{"failed":true,"reason":"Unauthenticated. Configure AI_GATEWAY_API_KEY or use a provider module. Learn more: https://ai-sdk.dev/unauthenticated-ai-gateway","source":"analysis-cron"},"summary":{"complexity_score":3,"scope_assessment":{"changed":false,"description":"The Act is narrowly focused and does exactly what its title suggests — it authorises a specific, quantified additional subscription to the Asian Development Bank's capital stock. There is no evidence of scope creep or expansion beyond the original intent. All provisions directly support this single purpose."},"complexity_factors":["References to international treaty obligations (Bank Agreement done at Manila 1965) requiring cross-referencing","Technical financial concepts such as callable shares vs paid-in shares require explanation","Currency definition anchored to a historical 1966 gold standard value, creating potential ambiguity in modern dollar terms","Conditional commencement of the agreement (dependent on a Board of Governors resolution from 1976)","Dual payment mechanism (cash or promissory notes) adds a small layer of procedural complexity"],"plain_english_summary":"This Act authorises Australia to buy additional shares in the Asian Development Bank—2,869 paid‑in shares and 25,818 callable shares at US$10,000 each—after the Bank’s 1976 capital increase. The Treasurer may pay from the Consolidated Revenue Fund in cash or non‑transferable promissory notes. It commits Australian public funds, affecting the Government and taxpayers, and increases Australia’s financial stake and influence in regional development financing."},"flash_summary":{"complexity_score":3,"scope_assessment":{"changed":false,"description":"The Act does not expand beyond authorising Australia’s additional subscription and associated payment mechanism. It creates authority for the Treasurer to enter the subscription, to issue promissory notes if accepted, and to draw from consolidated revenue; the operative scope aligns with enabling that single financial commitment and is contingent on the Bank’s capital increase (ss 4–7)."},"complexity_factors":["Narrow subject matter: single transaction (subscription) with few operative provisions (ss 4–7).","Treasurer discretion to set terms of the agreement (s 4(2)) and to issue notes if accepted by the Bank (s 6(1)).","Contingent effectiveness tied to external event — increase of the Bank’s authorised capital per Board resolution (s 5).","Fiscal impact and budgetary procedure: appropriation from the Consolidated Revenue Fund creates a public-payment obligation (s 7).","Contingent liability form: promissory notes are non‑interest, non‑negotiable obligations payable on demand (s 6(2)).","Reliance on external instrument definitions and the Bank Agreement for key terms (s 3 definitions and note).","Fixed-price foreign‑currency denomination with a historical definition of US dollar, potentially affecting valuation (s 3)."],"plain_english_summary":"This Act authorises the Treasurer to subscribe, on behalf of Australia, for 2,869 paid‑in shares and 25,818 callable shares in the Asian Development Bank at US$10,000 per share; allows the Treasurer to issue non‑negotiable, non‑interest promissory notes if the Bank accepts them; and provides appropriation from the Consolidated Revenue Fund to meet cash or promissory‑note payments (ss 4, 6, 7).\n\nThe Commonwealth funds payments (s 7); the Treasurer negotiates agreement terms and may issue notes (ss 4(2), 6(1)). The agreement only takes effect after the Bank’s authorised capital is increased (s 5)."}},"importantCases":[],"_links":{"self":"/api/acts/asian-development-bank-additional-subscription-act-1977","history":"/api/acts/asian-development-bank-additional-subscription-act-1977/history","analysis":"/api/acts/asian-development-bank-additional-subscription-act-1977/analysis","conflicts":"/api/acts/asian-development-bank-additional-subscription-act-1977/conflicts","importantCases":"/api/acts/asian-development-bank-additional-subscription-act-1977/important-cases","documents":"/api/acts/asian-development-bank-additional-subscription-act-1977/documents"}}