Part II Transfer of Airport Undertakings of Local Authorities
Public airport companies
25 Financial backing for establishment and operations of public airport companies.
1
A principal council shall have power to make loans to any associated company, or to guarantee loans made to any associated company by any other person, for the provision of working capital.
2
The reference in subsection (1) to guaranteeing loans is a reference to guaranteeing the repayment of the principal of, the payment of interest on, and the discharge of any other financial obligation in connection with, the loans.
3
A principal council shall have power to make loans—
a
to any associated company, or
b
to any subsidiary of an associated company,
for the purpose of meeting any expenses incurred or to be incurred by that company or subsidiary in connection with the provision or improvement of assets in connection with its business.
4
Any loan under subsection (1) or (3) must be made on terms, both as to rates of interest and otherwise, no more favourable than the terms on which the council making the loan would themselves be able to borrow at the time when the loan is made.
5
A principal council shall have power to give any guarantees and do any other things which appear to the council to be necessary or expedient for the purpose of or in connection with—
a
any disposal authorised under section 20(2); or
b
any disposal by any associated company of the whole or any part of that company’s undertaking, or of any property, rights or liabilities of that company.
6
A principal council shall have power to provide financial assistance by way of grants, loans or guarantees for any associated company which has incurred losses affecting the viability of its business.
7
A principal council shall have power, where on the winding up of any associated company the assets of the company are not sufficient to meet the company’s liabilities, to make to the creditors of the company such payments as may be necessary to meet the balance of those liabilities (and may accordingly give to persons dealing or proposing to deal with any such company such guarantees with respect to the exercise of their power under this subsection in relation to the company as they think fit).