The Milk Marketing Board (Residuary Functions) Regulations 1994

Made: 27th October 1994

Laid before Parliament: 28th October 1994

Coming into force: 1st November 1994

The Minister of Agriculture, Fisheries and Food and the Secretary of State, acting jointly in exercise of the powers conferred on them by sections 14(2), (3) and (6) and 62(1) and (2) of the Agriculture Act 1993[^f00001] and of all other powers enabling them in that behalf, hereby make the following Regulations:–

PART I — PRELIMINARY

Title, extent and commencement

1

These Regulations may be cited as the Milk Marketing Board (Residuary Functions) Regulations 1994, shall apply in England and Wales and shall come into force on 1st November 1994.

Interpretation; preservation of preliminary provisions of the old marketing scheme

2

• (1) In these Regulations, unless the context otherwise requires–

• “the Act” means the Agriculture Act 1993;

• “the 1958 Act” means the Agricultural Marketing Act 1958[^f00002];

• “the 1986 Act” means the Insolvency Act 1986[^f00003];

• “the approved scheme” means the approved scheme (within the meaning of section 24(1) of the Act) of the Board;

• “assets” includes interests, property and rights;

• “the Board” means the Milk Marketing Board established to administer the old marketing scheme;

• “the B Reserve Fund” has the meaning assigned to it in regulation 18(1);

• “Dairy Crest Limited” means the company registered under the Companies Act 1985[^f00004] with registration number 2085882 as Dairy Crest Limited;

• “Dairy Crest plc” means the company registered under the Companies Act 1985 with registration number 02845500 as Twicesimple Projects Limited;

• “Dairy Crest shares” means any shares in Dairy Crest Limited or Dairy Crest plc which are retained;

• “distribution entitlement” means the entitlement specified in Schedule 1;

• “eligible producer” has the meaning assigned to it in Part I of Schedule 2;

• “end year producer” has the meaning assigned to it in Part II of Schedule 2;

• “entry” has the meaning assigned to it in regulation 14(8);

• “final distribution” has the meaning assigned to it in regulation 27(3);

• “the final liquidation of the Board” has the meaning assigned to it in regulation 27(1);

• “the final trading period” means the period commencing on 1st April 1994 and ending immediately before Vesting Day;

• “the general fund” has the meaning assigned to it in regulation 18(2);

• “interim distribution” has the meaning assigned to it in regulation 21(1)(g);

• “the old marketing scheme” means the Milk Marketing Scheme 1933[^f00005];

• “preserved”, in relation to a given provision of the old marketing scheme or any prescriptive resolution made under such a provision, means subjected to section 14(3)(a) of the Act (which provides that, notwithstanding section 1(1) of the Act (which provides for the revocation of the old marketing scheme on Vesting Day) the provision shall continue to have effect by virtue of these Regulations, subject to such modifications as may be specified in these Regulations);

• “property” includes any retained undertaking whether or not it has been retained for the purposes of the Board’s commercial activities;

• “register” has the meaning assigned to it in regulation 14(1);

• “registered” means registered under Part III of these Regulations;

• “relevant asset total” means– where in accordance with these Regulations the Board at any given time intends to transfer or procure to be transferred or requires to be issued and allotted any shares in Dairy Crest Limited, Dairy Crest plc, or any other company formed to acquire the shares or business of Dairy Crest Limited to registered eligible producers, the total number of such shares to be so transferred or, as the case may be, issued and allotted at that time; on any occasion where, in accordance with these Regulations, the Board intends by means of an interim distribution or a final distribution to distribute, or procure to be distributed, the proceeds of realised assets of the Board, or any other assets, to registered eligible producers, the total amount of such proceeds or assets to be so distributed on that occasion;

• “relevant period” means the period commencing on 1st April 1992 and ending on 31st March 1993;

• “relevant producer” means any producer who at any material time was registered with the Board under the old marketing scheme;

• “retained” means retained by the Board following the transfer referred to in the definition of Vesting Day below;

• “rights” includes contingent rights;

• “Vesting Day” means 1st November 1994 being the day on which, in accordance with the approved scheme, certain property, rights and liabilities of the Board are, as a result of section 11 of the Act, transferred by virtue of the Act.

• (2) Paragraph 3(1) of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (3) Paragraph 3(2) of the old marketing scheme in so far as it relates to the following expressions and the definitions assigned to them is preserved–

• (a) “company”;

• (b) “milch cow”;

• (c) “prescription” and “prescribe”;

• (d) “producer”;

• (e) “secretary”;

• (f) “subsidiary”;

and shall have effect as set out in Schedule 3 and in these Regulations, unless the context otherwise requires, any reference to one of these expressions has the meaning assigned to it in that scheme, save that the expressions “eligible producer” and “end year producer” shall not be taken to exclude any person solely by virtue of his having ceased to be a producer.

• (4) Paragraph 3(2) of the old marketing scheme in so far as it relates to the expressions “retail” and “semi–retail” is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (5) Paragraph 3(2) of the old marketing scheme in so far as it relates to the expressions “commercial activities”, “milk”, “Minister” and “prescriptive resolution” is preserved, subject to modifications, and shall have effect as set out in Schedule 3 and in these Regulations each of those expressions has the meaning assigned to it in that scheme as modified by this paragraph.

• (6) At the end of paragraph 3 of the old marketing scheme there shall be inserted a new sub–paragraph (3) and this shall have effect as set out in Schedule 3.

• (7) In these Regulations unless the context otherwise requires any reference to a numbered regulation or Schedule shall be construed as a reference to the regulation or Schedule so numbered in these Regulations.

Effect of provisions of the old marketing scheme as preserved, inserted or continuing in force

3

The provisions of the old marketing scheme which–

• (a) are preserved, whether or not subject to modifications,

• (b) are inserted by virtue of these Regulations, or

• (c) by virtue of section 13 of the Act continue in force subject to the provisions of Part VII of these Regulations,

shall in aggregate have effect as set out in Schedule 3.

PART II — CONSTITUTION AND MEMBERSHIP OF THE BOARD

Restructuring of the Board’s functions

4

• (1) The Board shall immediately after the transfer under section 11 of the Act continue to exist until dissolved by order made under section 14(5) of the Act as a body corporate, with a common seal, called the Milk Marketing Board but with their functions confined to–

• (a) managing or otherwise dealing with the assets which are for the time being vested in them,

• (b) discharging such other functions as are specified in Part V of these Regulations in relation to the assets and liabilities which are for the time being vested in them,

• (c) carrying on other activities which they are obliged or empowered by these Regulations or other requirements of law to carry on, and

• (d) undertaking any functions ancillary or incidental to the functions mentioned above,

in such a manner and with such expedition as, as well as having regard to the interests of registered producers and the desirability referred to in paragraph (2) below, they consider is best calculated to secure that the winding up purpose is achieved.

• (2) In determining how to dispose of the national milk records undertaking the Board shall have regard to the desirability of such undertaking being maintained as a recording service available to all producers.

• (3) The Board shall not be regarded as acting on behalf of, and their property shall not be regarded as property of, or held on behalf of, the Crown and neither the Board nor their members nor the members of their staff shall be regarded as Crown servants.

• (4) In this regulation–

• “the national milk records undertaking” means such assets and liabilities as the Board have retained for the purposes of their commerical activities relating to collecting milk samples and data relating to milch cows, testing milk samples and providing a service in the supply of resulting data and collecting, processing and publishing dairy management information, and for the purpose of paragraph (2) above disposal of the national milk records undertaking shall be taken to include discharging any liability falling within it as well as realising the value or otherwise disposing of any asset falling within it;

• “the winding up purpose” means the purpose that– the Board’s assets shall be got in and their value shall be realised so far as is required by the approved scheme; where realisation of the value of any asset of the Board is not so required, it shall be– realised for value, disposed of by means other than realisation for value, or applied towards discharging the Board’s liabilities and other functions under these Regulations; the proceeds of assets the value of which is realised shall be applied in or towards discharging the Board’s liabilities and other functions under these Regulations; while any particular asset of the Board remains unrealised, it shall be held and managed in a manner which is consistent with sub–paragraphs (a) and (b) above; and the liablities of the Board so far as not discharged in pursuance of sub– paragraphs (b) and (c) above shall be otherwise discharged.

Members of the Board

5

• (1) The Board shall consist of not more than seven members whom the Minister shall appoint.

• (2) The Minister shall designate one of the members appointed under this regulation as chairman of the Board.

• (3) In appointing a person to be a member of the Board, the Minister shall have regard to the desirability of appointing–

• (a) persons who have experience of, and have shown capacity in, some matter relevant to the Board’s functions, and

• (b) (without prejudice to sub–paragraph (a) above) not more than three persons who are producers.

• (4) Subject to the following provisions of this regulation, a member of the Board shall hold and vacate office in accordance with the terms of his appointment specified in the instrument by which the Minister appoints him, which shall include a condition that the member shall comply with the provisions of these Regulations binding on him and ensure in combination with the other members that the Board complies with the provisions of these Regulations binding on them.

• (5) Any appointment of a person as a Board member shall be for a term not exceeding two years, but a person who ceases to be such a member at the end of the term shall be eligible for re–appointment.

• (6) A member of the Board may by notice to the Minister resign his office with effect from such time as is specified in the notice.

• (7) If the Minister is satisfied in relation to a member of the Board–

• (a) that that member has been absent without the written permission of the chairman of the Board from two consecutive meetings of the Board, or

• (b) that that member has been adjuged bankrupt, that his estate has been sequestrated or that he has made a composition or arrangement with, or granted a trust deed for, his creditors, or

• (c) that that member is unable or unfit to discharge the functions of a member, or

• (d) that that member has not complied with the terms of his appointment,

the Minister may by notice to him remove him from office with effect from such time as is specified in the notice.

• (8) The chairman of the Board may by notice delivered to the secretary of the Board appoint another person as his deputy (in this regulation referred to as “vice–chairman”) and paragraphs (9) to (13) below, as well as regulation 10(2) and those preserved provisions of the old marketing scheme which relate to the powers of a vice–chairman, shall apply to such appointment, to the revocation of such appointment and to the powers and responsibility of a vice–chairman.

• (9) A person may not be appointed as a vice–chairman unless he is a member of the Board.

• (10) The appointment of a vice–chairman ceases to have effect in either of the following circumstances–

• (a) where the chairman of the Board by notice delivered to the secretary of the Board revokes the appointment of the vice–chairman, or

• (b) where the person who appointed him has ceased to be a member under the provisions of this regulation or has ceased to be appointed to the office of chairman of the Board.

• (11) A vice–chairman shall be entitled (in so far as he would not otherwise be so entitled) to receive notice of all meetings of any committees of the Board of which the chairman of the Board is a member and in the absence of the chairman of the Board to attend such meetings.

• (12) When a vice–chairman attends any meeting of a committee of the Board pursuant to paragraph (11) above or any meeting of the Board from which the chairman of the Board is absent, the vice–chairman shall be entitled–

• (a) to exercise all the powers, rights, duties and authorities of the chairman of the Board, and

• (b) to have a separate vote for the chairman of the Board,

although he shall count as only one for the purpose of determining whether a quorum is present.

• (13) A person acting as vice–chairman shall–

• (a) alone be responsible to the Board for his own acts and defaults, and

• (b) not be deemed to be the agent of the chairman of the Board.

Official address of the Board

6

Paragraph 6(2) of the old marketing scheme is preserved and shall have effect as set out in Schedule 3.

General powers and staff

7

• (1) Paragraph 7 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (2) The Board may by power of attorney or otherwise–

• (a) appoint a person to be the agent of the Board, and

• (b) delegate to that person any of their functions,

for such purposes, for such time and on such terms and conditions (including as to remuneration) as they think fit and may at any time revoke or alter such terms and conditions.

• (3) The Board may–

• (a) pay such remuneration, pensions, allowances or gratuities to or in respect of any persons who have been or are their officers or employees as they may determine;

• (b) make such payments as they may so determine towards provision for the payment of remuneration, pensions, allowances or gratuities to or in respect of such persons; and

• (c) provide and maintain, or participate in, such schemes as they may so determine (whether contributory or not) for the payment of remuneration, pensions, allowances or gratuities to or in respect of such persons.

• (4) Any reference in paragraph (3) above to remuneration, pensions, allowances or gratuities to or in respect of such persons as are mentioned in that paragraph includes a reference to remuneration, pensions, allowances or gratuities by way of compensation to or in respect of any of the Board’s officers or employees who suffer loss of office or employment or loss or diminuition of emoluments.

• (5) If any person–

• (a) on ceasing to hold any office or employment with the Board, becomes or continues to be one of their members, and

• (b) was, by reference to his office or employment with the Board, a participant in a pension scheme maintained by the Board for the benefit of any of their officers or employees,

the Board may make provision for him to continue to participate in that scheme, on such terms and conditions as they may determine, as if his service as a member were service as an officer or employee of the Board; and any such provision shall be without prejudice to regulation 8 below.

Remuneration, allowances etc of members of the Board

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• (1) Paragraph 8 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (2) The Board shall pay to the members of the Board such remuneration as may be determined–

• (a) as respects the period commencing on Vesting Day and ending on a relevant date, by the Minister, and

• (b) as respects any period thereafter (which shall also end on a relevant date), in accordance with the procedure specified in paragraph 78A of the old marketing scheme as inserted by these Regulations.

• (3) Subject to paragraph (2) above, the Board may–

• (a) pay such allowances or gratuities as they may determine to or in respect of any persons who have been or are their members;

• (b) make such payments as they may determine towards provision for payment of remuneration, allowances or gratuities to or in respect of any such persons; and

• (c) provide and maintain, or participate in, such schemes as they may so determine (whether contributory or not) for the payment of remuneration, allowances or gratuities to or in respect of such persons.

• (4) If, when a person ceases to be a member of the Board, the Board determine that there are special circumstances which make it appropriate that any member should receive compensation, the Board shall pay to him as compensation such amount, not exceeding a sum equal to the annual remuneration which that member last received, as they may determine.

• (5) Any compensation determined under paragraph (4) above shall be treated (as to disclosure) in the Board’s annual accounts in the same manner as the Board members' remuneration is so treated.

• (6) In this regulation “relevant date” means any day after 31st December 1995 on which a different remuneration for the members of the Board is determined in accordance with the procedure specified in paragraph 78A of the old marketing scheme as inserted by these Regulations.

Committees

9

Paragraph 20 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Proceedings of the Board

10

• (1) Subject to the provisions of these Regulations the Board may determine their own quorum and procedure and the quorum and procedure of any committee appointed by them.

• (2) In the case of an equality of votes at any meeting of the Board or of any committee appointed by them the person who is the chairman of that meeting (who shall be the chairman of the Board if present, or, in his absence, the vice–chairman unless absent) shall have a second or casting vote.

• (3) In the absence of the chairman and vice–chairman of the Board, the chairman of any meeting of any committee appointed by the Board shall be a member of that committee so designated by the chairman of the Board.

• (4) Paragraph 25 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Minutes

11

Paragraphs 26 and 27 of the old marketing scheme are preserved and shall have effect as set out in Schedule 3.

The seal

12

Paragraph 28 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Contracts

13

• (1) Paragraph 29 of the old marketing scheme is preserved and shall have effect as set out in Schedule 3.

• (2) Paragraph 30 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

PART III — REGISTER OF PRODUCERS

Maintenance of register

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• (1) The Board shall compile and thereafter maintain a register (in these Regulations referred to as “the register”) of the entry of every person who they have reasonable grounds to believe is an eligible producer or an end year producer, Part I of which shall consist of entries of eligible producers and Part II of which shall consist of entries of end year producers.

• (2) Any person whose entry does not appear in the register shall be entitled, on application to the Board and on demonstrating to their reasonable satisfaction that he is an eligible producer or an end year producer (as the case may be), to have his entry placed on Part I or Part II (as the case may be) of the register.

• (3) It shall be the duty of every registered producer to notify the Board of any changes to his registered entry.

• (4) The Board shall be entitled to assume that information provided to them for the purpose of paragraph (2) or (3) above is correct.

• (5) Subject to paragraph (6) below, the entries of end year producers to whom the Board have made the final payments (as that expression is used in Schedule 4) may be removed from Part II of the register at any time after the Board have become satisfied that no further sums are or may become due to them from the Board.

• (6) No entry of any end year producer shall be removed from Part II of the register while moneys remain standing to the credit of the B Reserve Fund.

• (7) The Board may arrange for the register to be maintained on their behalf by a third party.

• (8) In these Regulations “entry” means name and address.

Inspection of register

15

Paragraph 39 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Partnerships

16

Paragraph 41(1) of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Death etc of producers

17

• (1) Paragraph 41(2) of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (2) After paragraph 41(2) of the old marketing scheme there shall be inserted new sub–paragraphs (3) and (4), which shall have effect as set out in Schedule 3.

PART IV — FINANCIAL PROVISIONS

Reserve funds

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• (1) The Board shall maintain a special reserve fund (in these Regulations referred to as “the B Reserve Fund”) in accordance with the provisions of the approved scheme to which effect is given in Schedule 4.

• (2) The Board shall maintain a general reserve fund (in these Regulations referred to as “the general fund”), which shall include, for as long as it subsists, the Residuary Body Reserve. Unless otherwise required in accordance with paragraph (1) above, all moneys received by the Board shall be paid into the general fund and any moneys required by the Board for the discharge of their functions shall be paid out of that fund.

• (3) Any moneys for the time being standing to the credit of the general fund may be left in any bank or building society account or, if not for the time being required for the purposes of the functions of the Board, may be invested in such manner as they see fit.

• (4) If prior to finalisation of the special accounts mentioned in paragraph 53(1B) of the old marketing scheme (as preserved) the condition specified in paragraph (5) below applies, the Board shall withdraw the surplus funding from the Residuary Body Reserve and in determining the price which shall by payable under regulation 21(1)(e) shall include the surplus funding as an additional payment due to the end year producers.

• (5) The condition mentioned in paragraph (4) above is that the Board is satisfied that the withdrawal is called for by the approved scheme.

• (6) In this regulation–

• “the Residuary Body Reserve” means the retained reserve established by the Board prior to Vesting Day for the purposes set out in the approved scheme;

• “the surplus funding” means the amount which the Board consider falls to be withdrawn from the Residuary Body Reserve in accordance with the approved scheme.

Borrowing

19

Paragraph 52 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Administration, accounts and separation of commercial activities

20

• (1) Paragraphs 8A and 52A of the old marketing scheme are preserved and shall have effect as set out in Schedule 3.

• (2) Paragraph 53 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (3) Paragraph 59A of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (4) After paragraph 59A of the old marketing scheme there shall be inserted paragraph 59B, which shall have effect as set out in Schedule 3.

PART V — FUNCTIONS OF THE BOARD

Functions

21

• (1) The functions mentioned in regulation 4(1)(b) are–

• (a) collecting sums owed in payment for milk supplied by the Board in the final trading period and sums owed in respect of other debts as are due, or shall fall due, to the Board;

• (b) collecting–

• (i) contributions which in respect of milk sold before Vesting Day became payable pursuant to paragraph 71(1) or (4A) of the old marketing scheme;

• (ii) contributions which in respect of milk sold before Vesting Day became payable pursuant to any agreement entered into under paragraph 56A(1)(i) of the old marketing scheme;

• (iii) penalties which before Vesting Day became recoverable by the Board pursuant to paragraph 77(6) of the old marketing scheme;

• (iv) contributions which become recoverable pursuant to the preserved provisions of the old marketing scheme to which reference is made in regulation 25;

• (v) any sum which before Vesting Day became recoverable under section 10 of the 1958 Act;

• (vi) any other sums which are recoverable by the Board;

• (c) realising or otherwise disposing of their assets (other than the Dairy Crest shares and the whole or any part of the business of Dairy Crest Limited);

• (d) holding and disposing of the Dairy Crest shares or the whole or any part of the business of Dairy Crest Limited as permitted in Schedule 5;

• (e) in accordance with regulation 18(4), paragraphs (2) to (5) below and Schedule 4, making payments to end year producers and other relevant producers for milk supplied by them to the Board;

• (f) discharging the Board’s other liabilities as they fall due;

• (g) making or procuring to be made interim distributions (in these Regulations referred to as “interim distributions”) of relevant assets to registered eligible producers, in accordance with their distribution entitlements, in the circumstan– ces specified in paragraph (7) below;

• (h) collecting contributions from eligible producers in the exercise of any power conferred on the Board by order made under section 17(2) of the Act.

• (2) The Board shall have the power–

• (a) to determine a price payable by the Board as the price of milk supplied by end year producers to them in the month immediately before Vesting Day (in this regulation referred to as “an October price”);

• (b) to determine any supplemental price payable by the Board by way of additional payment for milk supplied by end year producers to them in the final trading period (in this regulation referred to as “a supplemental price”); and

• (c) to determine the level of any contribution to which paragraph (1)(b)(i) refers and, to the extent consistent with any agreement to which paragraph (1)(b)(ii) above refers, of any contribution under that agreement;

and the board shall take such action as they consider expedient for the purpose of bringing an October price or any supplemental price or any payment they have determined under regulation 18(4) or any such contribution level to the notice of registered end year producers.

• (3) In determining an October price or any supplemental price or any payment under regulation 18(4) the Board–

• (a) shall have regard to the provisions of Schedule 4, and

• (b) may determine different prices for different classes of producers or classes of sale or description of milk,

and in determining the level of contribution payable pursuant to paragraph 71(1) of the old marketing scheme the Board may determine different contribution levels for different descriptions of milk.

• (4) The Board shall have the power to determine that the date on which any amount falling to be paid by the Board to relevant producers shall become due for payment shall be such date as is specified in the determination, but this power does not extend to determination of a date earlier than has before Vesting Day been determined by the Board as the date on which that amount shall become due for payment, and where a date has been determined under this paragraph the Board shall take such action as they consider expedient for the purpose of bringing it to the notice of those producers.

• (5) Any determination by the Board of an October price, a supplemental price, the level of any contribution to which paragraph (1)(b)(i) above refers or any payment under regulation 18(4) or of any date under paragraph (4) above shall have effect as if it were a prescriptive resolution of the Board under paragraph 60, 64 or 71 of the old marketing scheme and as if those paragraphs, prescriptive resolution no. 1595 of the Board and prescriptive resolutions of the Board prescribing prices under that resolution (to the extent such resolutions were in effect immediately before Vesting Day) had been preserved, and for this purpose and for the purposes of paragraphs (2) to (4) above “determination” includes an amendment of a previous determination (including one made before Vesting Day).

• (6) In connection with the discharging of the Board’s liabilities as they fall due–

• (a) the Board shall have the power if they deem it necessary or expedient to remit the whole or any part of their liabilities by way of composition or arrangement with their creditors;

• (b) all expenses properly incurred in discharging their liabilities and functions (including any fees payable to any person whom the Board may appoint as their agent) shall be payable out of the Board’s assets in priority to all other claims;

• (c) subject to sub–paragraph (b) above and the provisions of the 1986 Act as to preferential payments the Board’s assets shall be applied in satisfaction of their liabilities.

• (7) The circumstances mentioned in paragraph (1)(g) above are that, subject to regulation 18(4) and paragraph 2(3) of Schedule 4, the Board may make interim distributions if in their judgement it is financially prudent to do so.

• (8) In these Regulations–

• (a) “collecting” includes recovery in any proceedings or arbitration to which the Board is or becomes a party;

• (b) “relevant assets” means any assets forming part of the relevant asset total.

Prohibition on buying and selling milk etc

22

Nothing in these Regulations shall be construed as authorising the Board to carry out functions prohibited by paragraph 16 of Schedule 1 to the Act from inclusion within a qualifying scheme (as that expression is used in paragraph 1 of that Schedule).

Assessment of sales

23

• (1) Paragraph 71(2) of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (2) Paragraph 71(5) of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Information

24

Paragraph 75 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Contraventions of the old marketing scheme

25

Paragraph 77 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

PART VI — MEETINGS OF REGISTERED PRODUCERS

Meetings

26

• (1) Paragraph 78 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (2) After paragraph 78 of the old marketing scheme there shall be inserted a new paragraph 78A, which shall have effect as set out in Schedule 3.

• (3) Paragraph 79 of the old marketing scheme is preserved and shall have effect as set out in Schedule 3.

• (4) Paragraph 80 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (5) After paragraph 80 of the old marketing scheme there shall be inserted a new paragraph 80A, which shall have effect as set out in Schedule 3.

• (6) Paragraph 81 of the old marketing scheme is preserved and shall have effect as set out in Schedule 3.

• (7) After paragraph 81 of the old marketing scheme there shall be inserted a new paragraph 81A, which shall have effect as set out in Schedule 3.

• (8) Paragraph 82 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (9) Paragraph 83 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (10) Paragraph 84 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

• (11) Paragraphs 85, 87 and 88 of the old marketing scheme are preserved and shall have effect as set out in Schedule 3.

PART VII — FINAL LIQUIDATION OF THE BOARD

Completion of winding up and distribution of surplus

27

• (1) The completion of the winding up of the affairs of the Board (in these Regulations referred to as “the final liquidation of the Board”) shall be conducted in accordance with either of the two methods specified in paragraph (2) below.

• (2) The methods mentioned in paragraph (1) above are–

• (a) a voluntary solvent liquidation under regulation 28;

• (b) a liquidation on application to the court under the 1986 Act in accordance with the amended provisions of the old marketing scheme to which reference is made in regulation 29.

• (3) Any surplus assets of the Board remaining on the final liquidation shall be distributed by way of distributions (in these Regulations referred to as “final distributions”) among registered eligible producers, pari passu and in accordance with their distribution entitlements.

Voluntary solvent liquidation

28

• (1) This regulation applies where–

• (a) all moneys standing to the credit of the B Reserve Fund have been withdrawn from it and the Board have made the final payments (as that expression is used in Schedule 4) to the end year producers,

• (b) the Board are satisfied that–

• (i) their assets have been got in and realised or otherwised disposed of, and

• (ii) their liabilities and other functions under these Regulations (other than those specified in this Part) have been discharged, and

• (c) there is a surplus in the general fund.

• (2) Where the circumstances mentioned in paragraph (1) above apply the Board may make the final distributions.

• (3) As soon as the Board have made the final distributions under paragraph (2) above, they shall make up an account showing–

• (a) how their assets have been got in and realised, and

• (b) how the Board’s assets have been disposed of,

and shall thereupon call a general meeting of registered eligible producers for the purpose of laying before it the account and giving an explanation of it.

• (4) The provisions of Part VII of the old marketing scheme as set out in Schedule 3 shall apply to the advertisement and conduct of such meeting, subject to the further requirement that in addition to publishing notice of the meeting under paragraph 80 of the old marketing scheme as so set out the Board shall give notice of it in the London Gazette.

• (5) Within one week after the meeting, the Board shall send to the Minister a copy of the account and shall make a return to him of the holding of the meeting and of its date.

• (6) The voluntary solvent liquidation of the Board under this regulation does not bar the right of any creditor or registered eligible producer (being a contributory for the purposes of section 124 of the 1986 Act) to have the Board wound up by the court under the 1986 Act in accordance with the amended provisions of the old marketing scheme to which reference is made in regulation 29; but in the case of an application by a registered eligible producer the court must be satisfied that the rights of registered eligible producers will be prejudiced by a voluntary liquidation by the Board under this regulation.

Liquidation on application to court under the 1986 Act

29

• (1) Paragraphs 91 and 92 of the old marketing scheme (which by virtue of section 13 of the Act but subject to these Regulations continue in force notwithstanding the revocation of the marketing scheme on Vesting Day) shall be amended and shall have effect as set out in Schedule 3.

• (2) After paragraph 91 of the old marketing scheme, there shall be inserted new paragraphs 91A and 91B, which shall have effect as set out in Schedule 3.

PART VIII — MISCELLANEOUS

Arbitration

30

Paragraph 93 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Service of documents

31

Paragraph 94 of the old marketing scheme is preserved, subject to modifications, and shall have effect as set out in Schedule 3.

Cows which are in the possession of a producer

32

Paragraph 95 of the old marketing scheme is preserved.

Prescriptive resolutions

33

The Board shall continue to maintain the record of prescriptive resolutions which they were required to keep under paragraph 96 of the old marketing scheme and any person shall be entitled, on payment of the cost of postage and such fee not exceeding one pound as the Board may determine, to be supplied with a copy of any item in such record.

Indemnity

34

• (1) Subject to paragraph (2) below, every member or officer or auditor of the Board shall be indemnified out of the assets of the Board from and against–

• (a) any action, cost, charge, loss, damage and expense which he may incur, and

• (b) any liability which by virtue of any rule of law or equity would otherwise attach to him,

by reason of, or in connection with, any act done, concurred in or omitted in or about the execution of his duty in relation to the affairs of the Board.

• (2) Paragraph (1) above shall not apply where any such action, cost, charge, loss, damage, expense or liability has arisen from or been contributed to by any dishonest act or omission, wilful default or wilful neglect on the part of such member, officer or auditor.

SCHEDULE 1 — DISTRIBUTION ENTITLEMENT

Normal entitlement

1

Each registered eligible producer shall be entitled to receive his personal allocation from the relevant asset total.

Personal value

2

The personal value, in respect of each standard eligible producer shall be the value of any qualifying milk sold by him to the Board in the relevant period, calculated in accordance with paragraph 3 below, added to the value of any qualifying milk sold by him in that period otherwise than to the Board for ultimate consumption by the public as milk or in the form of a product which is wholly or partly derived from milk or includes milk as an ingredient, calculated in accordance with paragraph 4 below.

Milk sold to the Board

3

• (1) The value of qualifying milk sold to the Board by any registered eligible producer shall be the total of the values of qualifying milk sold by him in each calendar month during the relevant period to the Board.

• (2) The value of qualifying milk sold by any registered eligible producer in any calendar month as mentioned in sub–paragraph (1) above shall be the number of litres of qualifying milk sold to the Board during that month, calculated (in the case of any standard eligible producer) from information held on the Board’s records on 11th March 1994, multiplied by his standard entitlement for that month.

• (3) In this paragraph–

• “milk fund” means the fund formerly provided for in paragraph 50 of the old marketing scheme;

• “standard entitlement”, for any producer in respect of any month, means the amount payable to him per litre of milk in accordance with the Board’s basis of calculation of entitlement to payments from the milk fund for that month for milk sold to them under a wholesale contract– including all supplements finally declared for that month; excluding all payments described by provisions of the approved scheme relating to the distribution entitlement as payments of the rolling fund; calculated by reference only to the following elements, namely butterfat, protein, lactose, seasonality adjustment, hygiene quality band (TBC and cell count) and failed antibiotic production.

Milk sold otherwise than to the Board

4

• (1) The value of any qualifying milk sold by a producer otherwise than to the Board for the purposes mentioned in paragraph 2 above shall be the total number of litres of qualifying milk sold by him during the relevant period, calculated (in the case of any standard eligible producer) from information supplied on behalf of the Minister to the Board on 11th March 1994, multiplied by the average annual wholesale value.

• (2) In this paragraph “average annual wholesale value” means the total value of litres of qualifying milk sold by registered eligible producers to the Board in the relevant period as calculated in accordance with paragraph 3 above divided by the total number of litres so sold.

Rounding

5

The personal allocation shall be rounded down–

• (a) where the allocation is of a quantity of shares, to the nearest whole number of that quantity;

• (b) where the allocation is of cash being the proceeds of realised assets of the Board, upon an interim payment or on the winding up of the Board, to the nearest whole penny.

Exceptional hardship

6

• (1) The personal value for any accepted hardship producer shall be calculated by reference to the volume of milk produced by him in the alternative period and–

• (a) paragraphs 3(1) and 4(1) above, and

• (b) the definition of qualifying milk in paragraph 7 below,

shall have effect in relation to him as if for the words “relevant period” there were substituted the words “alternative period” and as if, in paragraph 3(2) above, for the words “his standard entitlement for that month” there were substituted the words “his standard entitlement for the equivalent month of the relevant period”.

• (2) The personal value for any assessed hardship producer shall be calculated by reference to the determination of the assessor in accordance with the approved scheme.

• (3) In this paragraph–

• “accepted hardship producer” means a registered eligible producer whose hardship application has been accepted by the Board;

• “assessed hardship producer” means a registered eligible producer whose hardship application has been accepted by the assessor;

• “assessor” means the person or persons whom the Board has appointed under the approved scheme to review hardship applications which have not been accepted by the Board;

• “hardship application” means an application under the approved scheme by an eligible producer pleading that calculation of his personal value by reference to milk produced by him in the relevant period, in comparison with milk produced in the alternative period, would cause him exceptional hardship.

Interpretation

7

In this Schedule–

• “allocation ratio” means, in relation to any registered eligible producer, the fraction represented by the personal value divided by the collective value;

• “alternative period” means the period commencing on 1st April 1993 and ending on 31st March 1994;

• “collective value” means the total of the personal values for all registered eligible producers;

• “personal allocation” means the allocation ratio multiplied by the relevant asset total;

• “personal value” means the total value of qualifying milk calculated in accordance with paragraph 2 above;

• “qualifying milk” means milk produced during the relevant period by a registered eligible producer while he was a relevant producer; and

• “standard eligible producer” means a registered eligible producer who is neither an accepted hardship producer nor an assessed hardship producer for the purposes of paragraph 6 above.

SCHEDULE 2 — ELIGIBLE AND END YEAR PRODUCER CRITERIA

PART I — ELIGIBLE PRODUCER CRITERIA

1

An eligible producer is any person (other than an excluded producer) who–

• (a) at any time during the relevant period was registered as a producer under the old marketing scheme,

• (b) both–

• (i) is a transferee of a person who satisfied the condition specified in sub–paragraph (a) above, and

• (ii) notified the Board of such transfer in writing using the Board’s form CR 160, or

• (c) subject to paragraph 4 of Part III of this Schedule–

• (i) is a transferee of a person who satisfied the condition specified in sub–paragraph (a) or (b) above, and

• (ii) notified the Board of such transfer in writing in accordance with the conditions specified in paragraph 2 of Part III of this Schedule.

2

Evidence that a person sold milk to the Board at any given time shall be deemed to be evidence of his having been registered as a relevant producer at that time.

3

Part III of this Schedule shall have effect to supplement this Part, as well as Part II, of this Schedule.

PART II — END YEAR PRODUCER CRITERIA

1

An end year producer is any person who–

• (a) sold milk to the Board during the final trading period,

• (b) both–

• (i) is a transferee of a person who satisfied the condition specified in sub–paragraph (a) above, and

• (ii) notified the Board of such transfer in writing using the Board’s form CR 160, or

• (c) subject to paragraph 4 of Part III of this Schedule–

• (i) is a transferee of a person who satisfied the condition specified in sub–paragraph (a) or (b) above, and

• (ii) notified the Board of such transfer in writing in accordance with the conditions specified in paragraph 2 of Part III of this Schedule.

2

Part III of this Schedule shall have effect to supplement this Part, as well as Part I, of this Schedule.

PART III — SUPPLEMENTAL

1

In this Schedule a person is the transferee of another person if–

• (a) by reason of that other person dying or becoming subject to some legal disability or entering into a composition or scheme of arrangement with his creditors, he has (in the capacity of a personal representative, trustee, committee or in another like capacity) acquired any of the milk producing business of that other person;

• (b) if in a transaction for value or otherwise he has acquired any of the milk producing business of that other person, whether he is connected with that other person or not.

2

The conditions mentioned respectively in paragraph 1(c)(ii) of Part I, and paragraph 1(c)(ii) of Part II, of this Schedule are that the transferee shall notify the Board of the transfer in writing–

• (a) as regards transfers before Vesting Day, within three months, or such longer period as the Board may determine, following Vesting Day, or

• (b) as regards transfers on or after Vesting Day, within three months, or such longer period as the Board may determine, following the transfer,

using any form of notification approved by the Board which meets the requirement specified in paragraph 3 below.

3

The requirement mentioned in paragraph 2 above is–

• (a) in relation to a transferee to whom the circumstances described in paragraph 1(a) above apply, that the form of notification shall be signed by or on behalf of the transferee and shall have annexed to it documentary evidence of the acquisition;

• (b) in relation to a transferee to whom the circumstances described in paragraph 1(b) above apply, that the form of notification shall be signed by or on behalf of the transferor and by or on behalf of the transferee and shall specify the date of the transfer.

4

Regardless of the date of the transfer, the entry of the transferor shall remain on the register until the transferee is entered in the register in his place.

5

In this Schedule “excluded producer” means any producer who during the relevant period was a division or subsidiary of, or was otherwise beneficially owned or controlled by, the Board.

SCHEDULE 3 — PROVISIONS OF THE OLD MARKETING SCHEME PRESERVED, INSERTED OR CONTINUING IN FORCE

PART I. — PRELIMINARY

3

• (1) Except where the context otherwise requires, a reference in this Scheme to a paragraph–

• (a) shall be construed as a reference to a paragraph in this Scheme where that paragraph is preserved or continues in force in, or has been inserted into, this Scheme;

• (b) shall be construed as a reference to a paragraph formerly in this Scheme where that paragraph is not one to which paragraph (a) of this sub–paragraph applies.

• (2) In this Scheme, unless the context otherwise requires, the following expressions have the meanings hereby respectively assigned to them, that is to say:

“commercial activities”–

• (a) in relation to the final trading period, means the following activities–

• (i) processing milk or producing commodities from milk or commodities of which milk is a substantial ingredient;

• (ii) selling, grading, packing, storing, adapting for sale, insuring and advertising milk so processed or such commodities;

• (iii) transporting milk or such commodities;

• (iv) other activities reasonably incidental to those specified above, and

• (b) in relation to the period beginning on Vesting Day, means the following activities–

• (i) buying and selling milk carried out by Dairy Crest Limited;

• (ii) processing milk and producing from milk, or from products derived from milk, commodities or products of which milk, or a product derived from milk, is an ingredient;

• (iii) selling milk so processed or such commodities or such products;

• (iv) grading, packing, storing, adapting for sale, insuring and advertising milk or milk so processed or such commodities or such products;

• (v) transporting milk or milk so processed or such commodities or such products;

• (vi) other activities falling within the objects of Dairy Crest Limited as set out in provisions of the approved scheme relating to the proposed constitution of Dairy Crest Limited, as may be varied from time to time by Dairy Crest Limited with the prior approval of the Board;

• (vii) collecting milk samples and data relating to milch cows, testing milk samples and providing a service in the supply of resulting data and collecting, processing and publishing dairy management information;

• (viii) other activities reasonably incidental to those specified above;

• “company” has the same meaning as in section 735(1)(a) of the Companies Act 1985;

• “Minister” means the Minister of Agriculture, Fisheries and Food and the Secretary of State for Wales acting jointly;

• “milch cow” means a cow kept for milking purposes whether dry or in milk, but does not include a heifer which has never calved;

• “milk” means cows' milk produced in England and Wales;

• “prescription” means a determination by the Board made by means of a prescriptive resolution, and “prescribe” shall be construed accordingly;

• “prescriptive resolution” means a resolution of the Board made prior to Vesting Day, embodying a determination of the Board, which was recorded in the record then provided for by paragraph 96;

• “producer” means a producer of milk;

• “retail” and “semi–retail” in relation to sales of milk mean respectively such class or classes of milk as may from time to time have been prescribed and defined by the Board as such;

• “secretary” includes any person for the time being authorised by the Board to act as secretary;

• “subsidiary” has the same meaning as it has for the purposes of section 736 of the Companies Act 1985.

• (3) Other expressions used in this Scheme have, in so far as the context admits, the same meanings as in the Milk Marketing Board (Residuary Functions) Regulations 1994, any reference in this Scheme to a numbered regulation shall be construed as a reference to the regulation so numbered in those Regulations, any reference in this Scheme to “this Scheme” shall be construed as including a reference to those Regulations and those Regulations shall be read with this Scheme as if they and this Scheme formed a single instrument.

PART II. — THE BOARD AND COMMITTEES

THE BOARD AND THEIR GENERAL POWERS

6

• (2) The Board shall have an office at which communications and notices will at all times be received and shall notify the Minister of the address and of any change in the address thereof.

7

The Board may employ a secretary and such other officers and employees and engage the services of such persons as they think fit and may enter into such agreements, acquire such property and do such things as may, in their opinion, be necessary or desirable for the purpose of discharging any of their functions and may sell or otherwise dispose of any property acquired by them which they do not need for such purpose and, without prejudice to the generality of this provision, may–

• (a) acquire any interest in a body corporate;

• (b) form or take part in forming a body corporate;

• (c) transfer to any such body corporate any of their assets and arrange for it to discharge any of their liabilities.

8

The Board may pay to any member of the Board any such travelling and out–of–pocket expenses as have, in the opinion of the Board, been reasonably incurred by him in connection with the business of the Board.

8A

The Board, to the intent that so far as practicable their commercial activities may be put on an equal footing with the activities of independent commercial undertakings, shall place their commercial activities under a system of financial management and administration which is separately accountable from the system of financial management and administration for the Board’s other activities.

OTHER COMMITTEES

20

The Board may appoint committees consisting of such members of the Board and such other persons as they may determine and, subject to the provisions of this Scheme with respect to the application of the common seal of the Board, may delegate to any committee appointed by them any of the powers of the Board, except a power in connection with the borrowing of money.

PROCEEDINGS OF THE BOARD

25

All acts done at any meeting of the Board or of any committee appointed by them shall, notwithstanding that it is afterwards discovered that there was some defect in the appointment, election or qualification of a person purporting to be a member of the Board or of the committee, or that a member of the Board had voted upon any question upon which he was not entitled to vote, be as valid as if that defect had not existed or such member had been entitled to vote.

MINUTES

26

Minutes shall be kept of the proceedings of the Board and of every committee thereof, and any such minutes shall, if signed by a person purporting to have acted as chairman of the meeting to which the minutes relate or of a meeting at which they were read, be evidence of the proceedings at the first–mentioned meeting, and the meeting to which any such minutes related shall be presumed, until the contrary is proved, to have been regularly convened and constituted.

27

For the purpose of any proceedings a copy, purporting to be certified in writing by the chairman or vice–chairman or secretary of the Board to be a true copy, of the minutes or any parts of the minutes of any meeting of the Board or any committee of the Board shall be evidence of such of the proceedings at the said meeting as such minutes or parts of the minutes purport to relate to and, until the contrary be proved, the meeting shall be presumed to have been regularly convened and constituted.

THE SEAL

28

The common seal of the Board shall not be applied to any document except by the authority of the Board, and the application of the seal shall be attested by the chairman, or vice– chairman, and at least one other member of the Board and by the Secretary.

CONTRACTS

29

Any contract or instrument which, if entered into or executed by a person not being a body corporate, would not be required to be under seal, may be entered into or executed on behalf of the Board by any person authorised by them in that behalf, either generally or specially.

30

No contract to which the Board is a party shall be avoided by reason only that a member of the Board is also a party thereto or is interested therein, and a member of the Board who is a party to, or interested in, such a contract shall not, by reason only that he is a member of the Board, be liable to account to the Board for any profit realised by him by reason of the contract; but a member of the Board must forthwith disclose to the Board any interest which he has or acquires in any contract whatsoever, if such interest in any way conflicts with his duty as a member of the Board, and shall not vote upon any question relating to the contract, and if he does vote, his vote shall not be counted; but he shall, nevertheless, be taken into account for the purpose of constituting a quorum of the Board or of any committee appointed by them:

PART III. — REGISTER OF PRODUCERS

39

• (1) Any person shall be entitled, on payment of the cost of postage and such fee not exceeding one pound per entry as the Board may determine, to be supplied with a copy of any entry in the register.

• (2) Notwithstanding sub–paragraph (1) above, a registered producer on written application to the Board shall be entitled to be supplied with a copy of the entry which relates to him free of charge.

41

• (1) Registration of the name or style under which two or more persons carry on business in partnership as producers shall operate as the registration of all partners for the time being so however that (a) for the purposes of the provisions of this Scheme which relate to voting at meetings and assessment of contributions from relevant producers all the partners shall be regarded as constituting together a single registered producer or a single relevant producer (as the case may be) and (b) a person registered as a partner as aforesaid shall not be deemed to be registered as a producer except in respect of transactions which form part of the partnership business.

• (2) Subject to sub–paragraphs (3) and (4) below, where by reason of a registered producer dying or becoming subject to some legal disability or entering into a composition or scheme of arrangement with his creditors, the property in, or the control of, any business of producing milk is transferred from him to a personal representative, trustee, committee or other person, the personal representative, trustee, committee or other person shall, until he has disposed of the property in or control of such business of producing milk be deemed to be a registered producer for all the purposes of this Scheme.

• (3) On the day of the transfer and for three months, or such longer period as the Board may determine, thereafter only, the personal representative, trustee, committee, or other person may do, without being registered under sub–paragraph (4) below, anything for the purposes of this Scheme in relation to the business so transferred which the registered producer might have done.

• (4) Registration under this sub–paragraph shall be effected by notification to the Board in accordance with Schedule 2 to the Milk Marketing Board (Residuary Functions) Regulations 1994.

PART V. — FINANCIAL PROVISIONS

52

The Board may, for the purpose of exercising any of their functions, borrow money in such manner, on such terms, and on such security, as may be arranged by them with the person from whom the money is borrowed.

52A

The Board shall not make money or other financial benefits available for use in their commercial activities except on the market terms then prevailing.

53

• (1) The Board shall keep proper and separate accounts and records in respect of:

• (a) their commercial activities; and

• (b) their non–commercial activities,

and in particular shall annually make out for their commercial activities and for their non– commercial activities (other than their non–commercial activities in relation to the final trading period) separate cash flow accounts, balance sheets and income and expenditure accounts, and if the Board trade for profit, separate profit and loss accounts. Such accounts shall be in a form which shall be in accordance with accounting principles which are generally accepted in the United Kingdom. Consolidated accounts comprising all of the Board’s activities or in respect of their commercial activities as a whole need not be prepared. The accounts in respect of their non– commercial activities shall in particular include a statement of accounting policy and such schedules and notes as the Board consider appropriate but shall in any case include schedules specifying–

• (i) the movement and amount of moneys in the B Reserve Fund;

• (ii) payments made to end year producers and other relevant producers under regulation 21(1)(e);

• (iii) interim distributions;

• (iv) collections of contributions from eligible producers under regulation 21(1)(h);

• (v) final distributions.

• (1A) In sub–paragraph (1) above the expression “annually” means in any twelve month period and in making out their annual accounts under that sub–paragraph the Board may–

• (a) determine in respect of their accounts for their commercial activities an accounting period which differs from such period in respect of their accounts for their non–commercial activities, and

• (b) determine accounting periods of any duration, commencing immediately after the end of the previous one.

• (1B) The Board shall make out for their non–commercial activities in the final trading period special cash flow accounts, balance sheets and income and expenditure accounts, and if the Board trade for profit, separate profit and loss accounts. Such accounts shall be in a form which shall be in accordance with accounting principles which are generally accepted in the United Kingdom. Consolidated accounts comprising all of the Board’s non–commercial activities need not be prepared. The accounts shall in particular include a statement of accounting policy and such schedules and notes as the Board consider appropriate.

• (2) The Board shall charge to their commercial activities such proportion of the Board’s general administrative expenses as is fairly attributable to their commercial activities.

• (3) The Board shall cause all their accounts and balance sheets prepared pursuant to sub– paragraph (1) or (1B) above to be audited by a member of, or a firm of accountants containing a member of, the Institute of Chartered Accountants in England and Wales or of the Association of Certified Accountants appointed (in the case of accounts and balance sheets which do not fall to be noted at their first annual general meeting after Vesting Day) by the registered producers in general meeting or (in the case of other accounts and balance sheets) either by the registered producers in general meeting or by relevant producers at the last general meeting before Vesting Day on which such an appointment was made. As soon as may be after the auditor has reported thereon, and in any case within nine months from the close of the period covered by any profit and loss account or income and expenditure account, the Board shall send to the Minister and to every registered producer a copy of the account and balance sheet and of the report of the auditor thereon, and also a report by the Board as to the discharge of their functions in the period covered by the profit and loss or income and expenditure account, which shall include a statement of the manner in which any moneys are invested.

The report of the Board mentioned in the preceding paragraph of this sub–paragraph which relates to the Board’s accounts and balance sheets for their non–commercial activities in the final trading period (prepared pursuant to sub–paragraph (1B) above) shall include such information relating to the Board’s commercial activities during that period as the Board think appropriate.

The Board shall on the demand of any person and on payment by him of such fee, not exceeding one pound, as may be fixed by the Board furnish to him a copy of any of their balance sheets.

• (4) The Board shall furnish the Minister with such information as he may from time to time require concerning any of the Board’s activities. The Board shall also permit any person duly authorised in writing by the Minister, on production of his authority, to inspect such of the Board’s accounts and records as he may reasonably require to satisfy himself that the Board are complying with the requirements of paragraph 8A, of this Part of this Scheme, of Council Regulation (EEC) No. 1422/78[^f00006] and of Commission Regulation (EEC) No. 1565/79[^f00007].

• (5) In this paragraph “non–commercial activities” means activities of the Board which are not commercial activities.

PART VI. — PRINCIPAL POWERS OF THE BOARD

MISCELLANEOUS POWERS

59A

• (1) For the purpose of complying with paragraph 8A, the Board may if it thinks fit and with the approval of the Minister–

• (a) set up a company to carry out commercial activities or to form a subsidiary to carry out commercial activities;

• (b) transfer to that company such assets or liabilities as are necessary;

• (c) make available to or for that company or that subsidiary on prevailing market terms loans, guarantees or other financial benefits;

• (d) on prevailing market terms grant security over their assets in support of borrowings undertaken by that company or that subsidiary.

• (2) For so long as and to the extent that any commercial activities of the Board are, under paragraph 59A, carried out by a company or subsidiary of the company–

• (a) they shall be the activities of that company or that subsidiary;

• (b) reference to their commercial activities in paragraphs 52A and 53 shall be construed accordingly; and

• (c) reference to the Board’s accounts and records in paragraph 53(4) of this Scheme shall be construed as including a reference to that company’s accounts and records and, if applicable, that subsidiary’s accounts and records.

59B

The Board shall ensure that moneys received in payment for milk supplied by them are not used in their commercial activities, except as permitted in paragraph 59A(1)(c) and (d).

ASSESSMENTS OF SALES

71

• (2)

• (a) If the Board are unable to obtain from any relevant producer a sufficient return showing the number of litres of milk sold by him during any accounting period he shall if the Board think fit be treated as having sold on each day during that period such number of litres of milk as the Board may think proper in respect of every cow which he had in his possession the first day of that period.

• (b) If the Board are unable to obtain from any relevant producer a sufficient return showing the number of cows in his possession on the said date, he shall if the Board think fit be treated as having in his possession on that date such number of milch cows as was shown in any return or written statement previously made by him to the Board as having been in his possession on any previous date.

• (5) In this paragraph the expression “accounting period” means such periods as the Board may from time to time determine.

INFORMATION AND INSPECTION

75

The Board may, whenever they consider it necessary for the discharge of their functions so to do, serve on any relevant producer a demand in writing requiring him to furnish to them such returns and other information relating to milk produced by him at any time prior to Vesting Day as may be specified in the demand.

CONTRAVENTIONS

77

• (1)

• (a) If any relevant producer–

• (i) has before Vesting Day contravened any prescription of the Board under paragraph 60 or 61, or

• (ii) has before Vesting Day sold milk in contravention of a direction of the Board given under paragraph 63,

the Board may recover from him such financial contribution (not exceeding £1,000 plus half the price for which the milk to which the contravention relates was sold) as they may determine.

• (b) If any relevant producer has before Vesting Day sold milk by retail or by semi–retail in contravention of any prescription of the Board under paragraph 69, the Board may recover from him such financial contribution (not exceeding £1,000) as they may determine.

• (c) If any relevant producer fails without reasonable excuse to comply with any demand made by the Board under paragraph 75, or knowingly makes any false statement in reply thereto, then the Board may recover from him such financial contribution (not exceeding £200) as they may determine.

• (ca) If any relevant producer who has before Vesting Day withheld milk for the purposes of paragraph 56A(1)(iv) (for sale to an exempt producer[^f00008]) has before Vesting Day failed without reasonable excuse to comply with any requirement of paragraph 56A(4)(b) or in purported compliance with any such requirement has before Vesting Day knowingly made any false return or has before Vesting Day knowingly given any false information, then the Board may recover from him such financial contribution (not exceeding £200) as they may determine.

• (d) No such contribution may be recovered in respect of such a contravention as aforesaid which would constitute an offence under any Act other than the 1958 Act.