HOUTHOFF BURUMA
ADVOCATEN NOTARISSEN BELASTINGADVISEURS
Postbus 75505 1070 AM Amsterdam
Parnassusweg 126 1076 AT Amsterdam
Exhibit 5.4
To: Diageo plc and Diageo Finance B.V.
c/o Diageo plc
8 Henrietta Place
WIG 0NB LONDON
United Kingdom
Amsterdam, 26 November 2003
our ref.: I:\Dossiers\Advocatuur\Amsterdam\62\106551\Legal
opinions\Diageo-0005h-814.opinion_sec.6.doc
Re: DIAGEO FINANCE B.V. -- SHELF REGISTRATION UNDER THE UNITED STATES SECURITIES
ACT OF 1933, AS AMENDED, OF GUARANTEED DEBT SECURITIES
Dear Sirs,
I. INTRODUCTION
We have acted as Netherlands legal counsel to Diageo Finance B.V., with
corporate seat in Amsterdam, The Netherlands (the "ISSUER") in connection
with the registration with the United States Securities and Exchange
Commission (the "SEC") of a shelf facility (the "FACILITY") under which the
Issuer may from time to time issue up to US$ 7,000,000,000 debt securities
(the "SECURITIES" or, in singular, a "SECURITY") (the "REGISTRATION"). The
Securities will be issued under the Indenture (as defined below) and are to
be fully and unconditionally guaranteed as to payment of principal, premium
(if any) and interest by Diageo plc ("DIAGEO"). Under the Facility, Diageo
Investment Corporation ("DIAGEO INVESTMENT") and Diageo Capital plc
("DIAGEO CAPITAL") may issue guaranteed debt securities (the "GUARANTEED
SECURITIES") and Diageo may issue debt securities, warrants, preference
shares and ordinary shares (the "DIAGEO SECURITIES").
II. SCOPE OF INVESTIGATION; DEFINITIONS
For purposes of this letter, we have examined and relied solely upon the
following documents:
(a) A print of an e-mailed copy received by us on 18 November 2003 of a
form of an indenture (the "INDENTURE") to be entered into between the
issuer as issuer,
Houthoff Buruma is een maatschap van besloten vennootschappen met beperkte
aansprakelijkheid. De algemene voorwaarden van Houthoff Buruma, waarin een
beperking van aansprakelijkheid is opgenomen, zijn op alle opdrachten van
toepassing. Een lijst van vennoten en de algemene voorwaarden worden op verzoek
toegezonden, maar zijn eveneens te vinden op www.houthoff.com Houthoff Buruma is
a professional partnership, consisting of private companies having limited
liability. Houthoff Buruma's general terms and conditions, which include a
limitation of liability, are applicable to all work performed. A list of
partners and a copy of the general terms and conditions are available on request
or at www.houthoff.com
HOUTHOFF BURUMA
ADVOCATEN NOTARISSEN BELASTINGADVISEURS
Diageo as guarantor and Citibank N.A. as trustee (the "TRUSTEE"),
including the form of the Securities and the form of guarantees to be
given by Diageo (the "GUARANTEES");
(b) a print of an e-mailed copy received by us on 20 November 2003 of a
registration statement on Form F-3 relating to the Registration dated
20 November 2003 (including the prospectus contained therein (the
"PROSPECTUS"), Diageo's annual report on Form 20-F for the fiscal year
ended 30 June 2003, which is incorporated in the registration
statement by reference, and the annexes to it) (the "REGISTRATION
STATEMENT");
(c) a notarial copy of the Issuer's deed of incorporation dated 9 October
2003 containing, according to the Extract (as defined below), its
current articles of association (the "ARTICLES"), as filed with the
Amsterdam chamber of commerce and industry commercial register (the
"CHAMBER OF COMMERCE");
(d) a faxed copy of an extract regarding the Issuer obtained from the
Chamber of Commerce and dated 20 November 2003 (the "EXTRACT");
(e) a faxed copy of the minutes of the meeting of the Company's board of
managing directors (bestuur) held on 7 November 2003 (the "MANAGING
BOARD RESOLUTION");
(f) a faxed copy of a written resolution of Guinness United Distillers &
Vintners Amsterdam B.V. in its stated capacity as the Issuer's sole
shareholder dated 20 November 2003 (the "SHAREHOLDERS RESOLUTION");
and
(g) a photocopy of a signed notification form of the Issuer for purposes
of section 4 of the Exemption Regulation pursuant to the Netherlands
1992 Act of the Supervision of the Credit System
(Vrijstellingsregeling Wtk 1992) dated 23 October 2003 (the
"REGULATION").
In addition, we have obtained the following confirmations over the
telephone on the date hereof:
o confirmation from the Chamber of Commerce that an extract regarding
the Issuer dated today would contain the same information as is
contained in the Extract; and
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o confirmation from the office of the bankruptcy division
(faillissementsgriffie) of the Amsterdam district court that the
Issuer is not registered as having been declared bankrupt or granted
suspension of payments (the "BANKRUPTCY CONFIRMATION").
Our investigation has been limited to the text of the documents. We have
not investigated the meaning and effect of any document governed by a law
other than Netherlands Law under that other law.
III. ASSUMPTIONS
For the purpose of this letter, we have assumed that:
(i) all copies of documents conform to the originals and that all
originals are authentic and complete;
(ii) each signature is the genuine signature of the individual
concerned;
(iii) all factual matters, statements in documents and other results of
our investigation, relied upon or assumed herein, were true and
accurate on the date of the execution of the Indenture and remain
true and accurate on the date hereof;
(iv) the Issuer is not the subject of (i) any of the procedures listed
in Annex A or B of the Council Regulation (EC) No 1346/2000 of 29
May 2000 on insolvency proceedings (OJ 2000, L 160, 1) (each an
"INSOLVENCY PROCEEDING"), (ii) a non-insolvency dissolution or
liquidation, or (iii) a statutory merger or demerger;
(v) the Registration Statement has been filed with the SEC in the
form reviewed by us, that the Indenture and the Guarantees have
been or will have been entered into in the form reviewed by us
and that the Securities have been or will have been issued in the
form reviewed by us;
(vi) there is no works council whose advice on the Issuer's entry into
the Indenture or the issue of the Securities must be sought
pursuant to the Netherlands Works Councils Act (Wet op de
Ondernemingsraden);
(vii) the Managing Board Resolution is a true record of the proceedings
of the meeting described therein in a duly convened, constituted
and quorate meeting and that the resolutions set out therein were
validly passed and remain in full force and effect without
modification;
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(viii) the Shareholders Resolution was validly passed and remains in
full force and effect without modification;
(ix) each party to the Indenture and the Guarantees other than the
Issuer has all requisite power (corporate and otherwise) to enter
into and perform the Indenture and the Guarantees;
(x) the Indenture and the Guarantees have been duly authorised and
entered into by or on behalf of the parties thereto other than
the Issuer;
(xi) the Securities have been or will have been duly and validly
authorised, authenticated, delivered and issued by the Issuer in
accordance with the Indenture and that the Securities will be in
the form set out in Article Two of the Indenture and will be
subject to the terms and conditions of the Indenture;
(xii) prior to each issue of Securities under the Facility the Issuer's
managing board approves the terms and conditions of such
Securities and of the offering of such Securities in a validly
passed managing board resolution which remains in full force and
effect without modification;
(xiii) when validly signed by all the parties thereto, the Indenture
(including the submission to jurisdiction contained therein), the
Guarantees and the Securities constitute the valid and binding
obligations of each of the parties thereto, and are enforceable
against those parties in accordance with their terms, under the
laws of the State of New York ("NEW YORK LAW"), by which they are
expressed to be governed;
(xiv) the Indenture has been or will have been signed on behalf of the
Issuer by two of its managing directors and that the Securities
have been or will have been signed on behalf of the Issuer,
manually or, with the approval of the managing directors
concerned, in facsimile by two of its managing directors;
(xv) the Issuer meets and complies with the criteria set out in the
Regulation and therefore does not require a licence to act as a
credit institution (kredietinstelling) within the meaning of the
Netherlands 1992 Act on the Supervision of the Credit System (Wet
toezicht kredietwezen 1992);
(xvi) the Securities have been, are and will be offered, and to the
extent applicable such offer has been, is and will be announced,
anywhere in the world, only:
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ADVOCATEN NOTARISSEN BELASTINGADVISEURS
(a) to persons who trade or invest in securities in the conduct
of their profession or trade (which includes banks,
securities intermediaries (including dealers and brokers),
insurance companies, pension funds, other institutional
investors and commercial enterprises which as an ancillary
activity regularly invest in securities) ("PROFESSIONAL
INVESTORS"), provided that the offer, the applicable Pricing
Agreement (as defined in the Underwriting Agreement) and
each announcement of the offer states that the offer is
exclusively made to those persons; or
(b) otherwise in accordance with the Netherlands 1995 Act on
the Supervision of the Securities Trade (Wet toezicht
effectenverkeer 1995);
(xvii) any transfer requirements applicable to zero coupon Securities in
bearer form pursuant to the Netherlands Savings Certificates Act
(Wet inzake spaarbewijzen) are complied with;
(xviii) the aggregate initial offering price of all Securities,
Guaranteed Securities and Diageo Securities issued under the
Facility will not exceed the maximum amount of the Facility of
US$ 7,000,000,000;
(xix) none of the Securities for the determination of the amount of
payment of principal, premium (if any) or interest of which an
index or uncertain event (onzekere gebeurtenis) is used,
qualifies as game or wager (spel en weddenschap) within the
meaning of section 7A:1811 of the Netherlands Civil Code
(Burgerlijk Wetboek, "NCC") and that no issue of Securities falls
within the scope of the Netherlands Games of Chance Act (Wet op
de kansspelen); and
(xx) at the time of the issue of Securities neither the Issuer nor any
other party involved in such issue as underwriter possessed any
knowledge of a particular fact concerning the Issuer or knowledge
of a particular fact concerning the trade in its securities,
which had not been made public and disclosure of which could
reasonably be expected to influence the price of these securities
(whether upwards or downwards) (voorwetenschap).
IV. OPINIONS
Based upon the foregoing and subject to any factual matters and documents
not disclosed to us in the course of our investigation, and subject to the
qualifications and limitations stated hereafter, we are of the opinion
that:
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ADVOCATEN NOTARISSEN BELASTINGADVISEURS
1. The Issuer has been incorporated and is existing as a legal entity
(rechtspersoon) in the form of a private company with limited
liability (besloten vennootschap met beperkte aansprakelijkheid) under
Netherlands Law.
2. Under Netherlands Law, the choice of New York Law as the governing law
of the Indenture and the Securities is recognised as a valid choice of
law.
3. The Indenture and Securities will, according to the courts of the
Netherlands correctly applying New York Law as the law expressed to be
governing the Indenture and Securities, constitute valid, binding and
enforceable obligations of the Issuer.
4. The entry into and performance of the Indenture, and the issue and
performance of the Securities, by the Issuer does not conflict with or
result in a violation of the Articles or Netherlands Law which would
affect the validity, binding effect and enforceability of the
Indenture or the Securities against the Issuer.
5. A judgment rendered by a court in the State of New York will not be
recognised and enforced by the Netherlands courts. However, if a
person has obtained a final and conclusive judgment for the payment of
money rendered by a court in the State of New York (the "FOREIGN
COURT") which is enforceable in the United States of America (the
"FOREIGN JUDGMENT") and files his claim with the Netherlands court of
competent jurisdiction, the Netherlands court will generally give
binding effect to the foreign judgment insofar as it finds that the
jurisdiction of the foreign court has been based on grounds which are
internationally acceptable and that proper legal procedures have been
observed, unless the foreign judgment contravenes Netherlands public
policy.
6. The statements in the Prospectus under the headings "Enforcement of
Civil Liabilities" and "Taxation -- Netherlands Taxation", to the
extent that they are statements as to Netherlands Law, are correct in
all material respects.
V. QUALIFICATIONS
This letter is subject to the following qualifications:
a. This letter is subject to any limitations arising from or in
connection with (i) the general defences available under Netherlands
Law in respect of the validity, binding effect and enforceability of
agreements and (ii) any insolvency
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Proceeding, dissolution, liquidation, statutory merger and demerger,
fraudulent conveyance (actio pauliana) and other laws of general
application relating to or affecting the rights of creditors.
b. Under Netherlands Law, notwithstanding the recognition of New York Law
as the governing law of the lndenture and the Securities:
o effect may be given to the law of another jurisdiction with which
the situation has a close connection, insofar as, under the law
of that jurisdiction, that law is mandatory irrespective of the
governing law of the Indenture and the Securities;
o Netherlands Law will be applied insofar as it is mandatory
irrespective of the governing law of the Indenture and the
Securities;
o the application of New York Law may be refused if it is
manifestly incompatible with Netherlands public policy; and
o regard will be had to the law of the jurisdiction in which
performance takes place in relation to the manner of performance
and the steps to be taken in the event of defective performance.
c. The enforcement in a Netherlands court of the Indenture and the
Securities and of foreign judgments is subject to Netherlands rules of
civil procedure.
d. In proceedings before a Netherlands court for the enforcement of the
Indenture, the court may mitigate amounts due in respect of litigation
and collection costs. In addition, specific performance or injunction
relief may not always be granted.
e. To the extent Netherlands Law applies, a provision to the effect that
the holder of a Security may be treated as its absolute owner or as
solely entitled to the Security may not be enforceable under all
circumstances.
f. To the extent Netherlands Law applies, title to a Security may not
pass if (i) the Security is not delivered (geleverd) in accordance
with Netherlands Law, (ii) the transferor does not have the power to
pass on title (beschikkingsbevoegdheid) to the Security or (iii) the
transfer of title is not effected pursuant to a valid title of
transfer (geldige titel).
g. To the extent that the Indenture or the Securities qualify as general
conditions within the meaning of section 6:231 NCC, a holder of a
Security may nullify
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(vernietigen) a provision therein if (i) the Issuer has not offered
the holder a reasonable opportunity to examine them or (ii) the
provision, having regard to all relevant circumstances, is
unreasonably onerous to the holder. A provision in general conditions
as referred to in section 6:236 NCC is deemed to be unreasonably
onerous, irrespective of the circumstances, if the holder of a
Security is a natural person not acting in the conduct of a profession
or trade (i.e., someone other than a professional investor). The
notice provisions in clause 106 of the Indenture might fall within the
scope of section 6:236 NCC.
h. If any Security has been signed on behalf of the Issuer (manually or
in facsimile) by a person who at the signing date is, but before the
date of the Security and its authentication and issue ceases to be, a
duly authorised representative of the Issuer, enforcement of the
Security in a Netherlands court may require that the holder of the
Security submits a copy of the Indenture.
i. Under Netherlands Law, any trust to which the Convention on the Law
applicable to Trusts and their Recognition 1985 (the "TRUST
CONVENTION") applies, will be recognised subject to the Trust
Convention. Any trust to which the Trust Convention does not apply,
may not be recognised.
j. To the extent Netherlands Law applies, the substitution of a party to
an agreement (such as the Indenture) only takes effect against another
party to such agreement if and when the latter has cooperated with
such substitution (medewerking) within the meaning of section 6:159
NCC, after the original party to the agreement and the third party by
whom such original party will be substituted have entered into a deed
for the purpose of such substitution. We do not express any opinion as
to the validity of any succession or substitution pursuant to Section
802 of the Indenture.
k. To the extent Netherlands Law applies, the provisions in the Indenture
to the effect that in any proceedings initiated by the Trustee, the
Trustee shall be held to represent all the Holders (as therein
defined) of the Securities (as therein defined) to which such
proceedings relate, and that it shall not be necessary to make any
Holders of such Securities parties to any such proceedings, may not be
enforceable.
m. To the extent Netherlands Law applies, the provision in the Indenture
to the effect that no Holder (as therein defined) of any Security (as
therein defined) of any series shall have any right by virtue or by
availing of any provision of the Indenture to institute any action or
proceeding, judicial or otherwise with respect
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to the Indenture, the Guarantees (as therein defined), the Securities
(as therein defined) or coupons or for the appointment of a receiver
or trustee, or for any other remedy thereunder, unless such Holder
previously shall have given to the Trustee written notice as further
provided in the Indenture, may not be enforceable under all
circumstances.
n. To the extent Netherlands Law applies, a power of attorney (volmacht)
or mandate (lastgeving) (including the appointment of an agent for
purposes of service of process) (i) does not exclude the principal's
right to perform the legal acts covered by the power of attorney, (ii)
can be irrevocable only to the extent it has been granted for the
purpose of performing a legal act in the interest of the authorised
person or a third party and is subject to any amendments made or
limitations imposed by a court on serious grounds (gewichtige
redenen), and (iii) will terminate upon the attorney being placed
under guardianship (onder curatele stelling) and upon the attorney
giving notice of termination (opzeggen).
o. The Extract does not provide conclusive evidence that the facts set
out therein are correct. However, under the Netherlands 1996 Trade
Register Act (Handelsregisterwet 1996), subject to limited exceptions,
the Issuer cannot invoke the incorrectness or incompleteness of its
commercial register registration against third parties who were
unaware thereof.
p. The Bankruptcy Confirmation does not provide conclusive evidence that
the Issuer has not been declared bankrupt or granted suspension of
payments.
VI. LIMITATIONS AND INTERPRETATION
We express no opinion on any law other than the published laws of the
Kingdom of the Netherlands excluding Aruba and the Netherlands Antilles
("NETHERLANDS LAW") as they are in effect and are applied by the
Netherlands courts. Except for the opinion expressed herein under 6, we
express no opinion on tax laws. We express no opinion on any laws of the
European Union (insofar as not implemented in the Netherlands in statutes
or other regulations of general application). Furthermore, we express no
opinion on any competition laws.
In this letter Netherlands legal concepts are expressed in English terms.
In some instances the Netherlands term expressing such concept is mentioned
for the purpose of clarification. These concepts of Netherlands law may not
be identical to the concepts existing under the laws of other jurisdictions
and described by the English terms used in this letter. This letter may
only be relied upon under the express condition that it and
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any issues of interpretation or liability arising thereunder will be
governed by Netherlands Law and be brought before a Netherlands court.
Nothing in this letter should be taken as expressing an opinion in respect
of any representations or warranties or other information contained in the
Indenture or any other document examined in connection with this letter
except as expressly confirmed herein.
The opinions and statements expressed herein are rendered as of the date of
this letter and in as far as the opinions and statements concern any matter
after the date hereof we have assumed that there will be no change in the
relevant facts, circumstances, events or the law after the date hereof. We
assume no obligation to advise you of facts, circumstances, events or
changes in the law that may hereafter be brought to our attention that may
alter, affect or modify the opinions or statements expressed herein. The
limitation of liability as set forth in the general conditions of Houthoff
Buruma, as referred to on the first page of this letter, does not apply to
anyone but the addressees of this letter.
VII. PURPOSE
This letter is addressed to you in connection with and for the sole purpose
of the Registration and may be filed with the SEC for the purpose thereof
and on the date hereof. We consent to the references to our name and
opinion under the captions "Taxation -- Netherlands Taxation", "Validity of
Securities" and "Enforceability of Certain Civil Liabilities" in the
Registration Statement. In giving this consent, we do not admit that we are
within the category of persons whose consent is required within section 7
of the United States Securities Act of 1933, as amended, or the rules and
regulations of the SEC thereunder.
Yours faithfully,
HOUTHOFF BURUMA
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