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Financial Services Bill


Financial Services Bill
Part 6 — Investigation of complaints against regulators

149

 

(a)   

making rules under FSMA 2000;

(b)   

issuing codes under section 64 of FSMA 2000;

(c)   

issuing statements under—

(i)   

section 63C, 64, 69, 192H, 192N, 210 or 345D of FSMA 2000, or

(ii)   

section 76 of the Financial Services Act 2012;

5

(d)   

giving directions under section 316, 318 or 328 of FSMA 2000;

(e)   

issuing guidance under section 2H of FSMA 2000.

(6)   

For the purposes of subsection (3), the following functions of the Bank of

England under Part 18 of FSMA 2000 are legislative functions—

(a)   

making rules;

10

(b)   

issuing statements—

(i)   

under section 312J, or

(ii)   

by virtue of the application by Schedule 17A of a provision

mentioned in subsection (5)(c)(i) of this section.

(7)   

For the purposes of subsection (3), the following functions of the Bank of

15

England under Part 5 of the Banking Act 2009 are legislative functions—

(a)   

publishing principles or codes of practice under sections 188 and 189;

(b)   

preparing statements under section 198(3).

81      

Consultation in relation to, and publication of, complaints scheme

(1)   

Before making the complaints scheme, the regulators must publish a draft of

20

the proposed scheme in the way appearing to them to be best calculated to

bring it to the attention of the public.

(2)   

The draft must be accompanied by notice that representations about it may be

made to any of the regulators within a specified time.

(3)   

Before making the proposed complaints scheme, the regulators must have

25

regard to any representations made to any of them in accordance with

subsection (2).

(4)   

If the regulators make the proposed complaints scheme, they must publish an

account, in general terms, of—

(a)   

the representations made to any of them in accordance with subsection

30

(2), and

(b)   

their response to the representations.

(5)   

If the complaints scheme differs from the draft published under subsection (1)

in a way which is, in the opinion of the regulators, significant the regulators

must (in addition to complying with subsection (4)) publish details of the

35

difference.

(6)   

The regulators must publish up-to-date details of the complaints scheme

including, in particular, details of—

(a)   

the provision made under section 82(5), and

(b)   

the powers which the investigator has to investigate a complaint.

40

(7)   

Those details must be published in the way appearing to the regulators to be

best calculated to bring them to the attention of the public.

(8)   

The regulators must notify the Treasury of the publication of details under

subsection (6).

 
 

Financial Services Bill
Part 6 — Investigation of complaints against regulators

150

 

(9)   

A regulator may charge a reasonable fee for providing a person with a copy

of—

(a)   

a draft published under subsection (1), or

(b)   

details published under subsection (6).

(10)   

Subsections (1) to (5) and (9)(a) also apply to a proposal to alter or replace the

5

complaints scheme.

82      

Investigation of complaints

(1)   

A regulator is not obliged to investigate in accordance with the complaints

scheme a complaint which it reasonably considers would be more

appropriately dealt with in another way (for example by referring the matter

10

to the Upper Tribunal or by the institution of other legal proceedings).

(2)   

The complaints scheme must provide—

(a)   

for reference to the investigator of any complaint which a regulator is

investigating,

(b)   

for the investigator—

15

(i)   

to have the means to conduct a full investigation of the

complaint,

(ii)   

to report to the regulator to which the complaint relates and the

complainant on the result of the investigator’s investigation,

and

20

(iii)   

to be able to publish the investigator’s report (or part of it) if the

investigator considers that it (or the part) ought to be brought to

the attention of the public, and

(c)   

for the meeting by the regulators of the expenses of the scheme.

(3)   

If a regulator has decided not to investigate a complaint, it must notify the

25

investigator.

(4)   

If the investigator considers that a complaint of which the investigator has been

notified under subsection (3) ought to be investigated, the investigator may

proceed as if the complaint had been referred to the investigator under the

complaints scheme.

30

(5)   

The complaints scheme must confer on the investigator the power to

recommend, if the investigator thinks it appropriate, that the regulator to

which a complaint relates takes either or both of the following steps—

(a)   

makes a compensatory payment to the complainant, or

(b)   

remedies the matter complained of.

35

(6)   

The complaints scheme must require the regulator to which a complaint

relates, in a case where the investigator—

(a)   

has reported that the complaint is well-founded, or

(b)   

has criticised the regulator in a report,

   

to inform the investigator and the complainant of the steps which it proposes

40

to take in response to the report.

(7)   

The investigator may require the regulator to which a complaint relates to

publish the whole or a specified part of the response.

(8)   

The investigator may appoint a person to conduct the investigation on the

investigator’s behalf but subject to the investigator’s direction.

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Financial Services Bill
Part 7 — Amendments of Banking Act 2009

151

 

(9)   

An officer or employee of any of the regulators may not be appointed under

subsection (8).

(10)   

Subsection (2) is not to be taken as preventing a regulator from making

arrangements for the initial investigation of a complaint to be conducted by the

regulator.

5

83      

Exemption from liability in damages

(1)   

Neither the investigator appointed under section 79 nor a person appointed to

conduct an investigation on the investigator’s behalf under section 82(8) is to

be liable in damages for anything done or omitted in the discharge, or

purported discharge, of functions in relation to the investigation of a

10

complaint.

(2)   

Subsection (1) does not apply—

(a)   

if the act or omission is shown to have been in bad faith, or

(b)   

so as to prevent an award of damages made in respect of an act or

omission on the ground that the act or omission was unlawful as a

15

result of section 6(1) of the Human Rights Act 1998.

Part 7

Amendments of Banking Act 2009

Special resolution regime and bank administration

84      

Private sector purchasers

20

(1)   

The Banking Act 2009 is amended as follows.

(2)   

After section 26 insert—

“26A    

Private sector purchaser: reverse share transfer

(1)   

This section applies where the Bank of England has made a share

transfer instrument in accordance with section 11(2) (“the original

25

instrument”) providing for the transfer of securities issued by a bank to

a person (“the original transferee”).

(2)   

The Bank of England may make one or more private sector reverse

share transfer instruments in respect of securities issued by the bank

and held by the original transferee.

30

(3)   

A private sector reverse share transfer instrument is a share transfer

instrument which—

(a)   

provides for transfer to the transferor under the original

instrument;

(b)   

makes other provision for the purposes of, or in connection

35

with, the transfer of securities which are, could be or could have

been transferred under paragraph (a).

(4)   

The Bank of England must not make a private sector reverse share

transfer instrument without the written consent of the original

transferee.

40

 
 

Financial Services Bill
Part 7 — Amendments of Banking Act 2009

152

 

(5)   

Sections 7, 8 and 50 do not apply to a private sector reverse share

transfer instrument (but it is to be treated in the same way as any other

share transfer instrument for all other purposes including for the

purposes of the application of a power under this Part).

(6)   

Before making a private sector reverse share transfer instrument the

5

Bank of England must consult—

(a)   

the PRA,

(b)   

the FCA, and

(c)   

the Treasury.

(7)   

Section 26 applies where the Bank of England has made a private sector

10

reverse share transfer instrument.”

(3)   

In section 29 (reverse share transfer)—

(a)   

in subsection (3) for the words from “securities”, in the second place, to

the end substitute “securities issued by the bank and held by a

transferee under the onward share transfer order (“the onward

15

transferee”).”, and

(b)   

after subsection (4) insert—

“(4A)   

The Treasury must not make a reverse share transfer order

under subsection (3) unless—

(a)   

the onward transferee is—

20

(i)   

a company wholly owned by the Bank of

England,

(ii)   

a company wholly owned by the Treasury, or

(iii)   

a nominee of the Treasury, or

(b)   

the reverse share transfer order is made with the written

25

consent of the onward transferee.”

(4)   

In section 31 (bridge bank: reverse share transfer)—

(a)   

in subsection (1) omit the words from “providing for” to the end,

(b)   

in subsection (2) for “person within subsection (1)(a) to (c)” substitute

“transferee under the original instrument”,

30

(c)   

after subsection (3) insert—

“(3A)   

The Bank of England must not make a bridge bank reverse

share transfer instrument unless—

(a)   

the transferee under the original instrument is—

(i)   

a company wholly owned by the Bank of

35

England,

(ii)   

a company wholly owned by the Treasury, or

(iii)   

a nominee of the Treasury, or

(b)   

the bridge bank reverse share transfer instrument is

made with the written consent of the transferee under

40

the original instrument.”

(5)   

After section 42 insert—

“42A    

Private sector purchaser: reverse property transfer

(1)   

This section applies where the Bank of England has made a property

transfer instrument in accordance with section 11(2) (“the original

45

 
 

Financial Services Bill
Part 7 — Amendments of Banking Act 2009

153

 

instrument”) providing for the transfer of property, rights or liabilities

of a bank to a person (“the original transferee”).

(2)   

The Bank of England may make one or more private sector reverse

property transfer instruments in respect of property, rights or liabilities

of the original transferee.

5

(3)   

A private sector reverse property transfer instrument is a property

transfer instrument which—

(a)   

provides for transfer to the transferor under the original

instrument;

(b)   

makes other provision for the purposes of, or in connection

10

with, the transfer of property, rights or liabilities that are, could

be or could have been transferred under paragraph (a) (whether

the transfer has been or is to be effected by that instrument or

otherwise).

(4)   

The Bank of England must not make a private sector reverse property

15

transfer instrument without the written consent of the original

transferee.

(5)   

Sections 7, 8 and 50 do not apply to a private sector reverse property

transfer instrument (but it is to be treated in the same way as any other

property transfer instrument for all other purposes including for the

20

purposes of the application of a power under this Part).

(6)   

Before making a private sector reverse property transfer instrument the

Bank of England must consult—

(a)   

the PRA,

(b)   

the FCA, and

25

(c)   

the Treasury.

(7)   

Section 42 applies where the Bank of England has made a private sector

reverse property transfer instrument.”

(6)   

In section 44 (reverse property transfer)—

(a)   

in subsection (3) for “of a transferee” to the end substitute “of a

30

transferee under the onward property transfer instrument (“the

onward transferee”).”,

(b)   

after subsection (4) insert—

“(4A)   

The Bank of England must not make a reverse property transfer

instrument unless—

35

(a)   

the onward transferee is—

(i)   

a company wholly owned by the Bank of

England,

(ii)   

a company wholly owned by the Treasury, or

(iii)   

a company wholly owned by a nominee of the

40

Treasury, or

(b)   

the reverse property transfer instrument is made with

the written consent of the onward transferee.”

(7)   

In section 46 (temporary public ownership: reverse property transfer)—

(a)   

in subsection (1) omit from “providing for” to the end, and

45

 
 

Financial Services Bill
Part 7 — Amendments of Banking Act 2009

154

 

(b)   

after subsection (3) insert—

“(3A)   

The Treasury must not make a reverse property transfer order

unless—

(a)   

the transferee under the original order is—

(i)   

a company wholly owned by the Bank of

5

England,

(ii)   

a company wholly owned by the Treasury, or

(iii)   

a nominee of the Treasury, or

(b)   

the reverse property transfer order is made with the

written consent of the transferee under the original

10

order.”

(8)   

In section 48A (creation of liabilities), in subsection (1) after “42(3)(b),” insert

“42A(3)(b),”.

(9)   

In section 53 (onward and reverse transfers: compensation), in subsection (1)—

(a)   

before paragraph (a) insert—

15

“(za)   

the Bank of England makes a private sector reverse

share transfer instrument under section 26A,”,

(b)   

after paragraph (d) insert—

(da)   

the Bank of England makes a private sector reverse

property transfer instrument under section 42A,”.

20

(10)   

In the Table in section 261 (index of defined terms), after the entry relating to

“partial property transfer”, insert—

 

“Private sector reverse property transfer

42A

 
 

instrument

  
 

Private sector reverse share transfer

26A”.

 

25

 

instrument

  

85      

Property transfer instruments: property held on trust

(1)   

The Banking Act 2009 is amended as follows.

(2)   

In section 34(7) (effect of property transfer instruments: provision in respect of

property held on trust), in paragraph (a) omit “(which provision may remove

30

or alter the terms of the trust)”.

(3)   

At the end of section 34 insert—

“(8)   

Provision under subsection (7)(a) may remove or alter the terms of the

trust on which the property is held only to the extent that the Bank of

England thinks it necessary or expedient for the purpose of

35

transferring—

(a)   

the legal or beneficial interest of the transferor in the property;

(b)   

any powers, rights or obligations of the transferor in respect of

the property.

(9)   

In subsection (8) references to the transferor are references to the

40

transferor under the property transfer instrument.”

(4)   

In section 45 (temporary public ownership: property transfer orders) after

 
 

Financial Services Bill
Part 7 — Amendments of Banking Act 2009

155

 

subsection (5) insert—

“(5A)   

In the application of section 34(8) by virtue of subsection (5)(b) above,

the reference to the Bank of England is to be treated as a reference to the

Treasury.”

(5)   

In section 46 (temporary public ownership: reverse property transfer orders)

5

after subsection (5) insert—

“(5A)   

In the application of section 34(8) by virtue of subsection (5)(b) above,

the reference to the Bank of England is to be treated as a reference to the

Treasury.”

86      

Reports following exercise of a stabilisation power

10

(1)   

After section 79 of the Banking Act 2009 insert—

“79A    

Private sector purchaser: report

(1)   

This section applies where the Bank of England sells all or part of a

bank’s business to a commercial purchaser.

(2)   

The Bank must report to the Chancellor of the Exchequer about the

15

exercise of the power to make share transfer instruments and property

transfer instruments under section 11(2).

(3)   

The report must comply with any requirements as to content specified

by the Treasury.

(4)   

The report must be made as soon as is reasonably practicable after the

20

end of one year beginning with the date of the first transfer instrument

made under section 11(2).”

(2)   

After section 81 of that Act insert—

“81A    

Accounting information to be included in reports under sections 80

and 81

25

(1)   

A report under section 80(1) or 81 must include accounting information

in respect of the bank or bridge bank that is the subject of the report.

(2)   

In this section “accounting information” means—

(a)   

a balance sheet that, in the opinion of the person making the

report, gives a true and fair view of the state of affairs of the

30

bank or bridge bank as at the reporting date, and

(b)   

a profit and loss account that, in the opinion of the person

making the report, gives a true and fair view of the profit or loss

of the bank or bridge bank for the reporting period.

(3)   

In this section—

35

(a)   

“reporting period” means the period to which the report relates,

and

(b)   

“reporting date” means the last day of the reporting period.”

 
 

 
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