In accordance with the finding of the committee and the resulting Treasury Minute, an act was passed in 1899, conferring upon the boroughs and borough districts to which the Postmaster-General might grant licences the right to borrow money upon the security of the rates for the erection and management of telephone systems. A loan of £2,000,000 was authorized for the use of the department itself in establishing telephone competition with the company in London. The act also defined the relations between the company and the municipalities (or other new licencees) in the event of competition. If the telephone company would agree to abandon the power of discriminating between subscribers and would consent to limit their charges within the maxima and minima prescribed by the Postmaster-General, the latter was to extend any way-leave rights already possessed for the period of the licence granted to the competing municipality or new licencee. If the new licence were extended beyond 1911, the company's licence would be likewise extended, but if their licence were extended for as much as eight years beyond 1911, the company were bound, at the request of the licencee and under certain conditions, to grant interchange of communication within the area. The new licences would be granted only to local authorities or companies approved by them, and the National Company was prohibited from opening exchanges in any area in which they had not, before the passing of the act, established an effective exchange. The effect of the act was to limit competition to the municipalities, to confine the National Company to those towns and areas they were already serving, and to throw upon the Postmaster-General the duty of serving other parts of the country.[834] [834] 62 and 63 Vict., c. 38.