Financial Services Bill

Session 2010 - 12
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Financial Services Bill

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 4 — Amendments of Part 13 of FSMA 2000: Powers of intervention
196

      (3)
After that subsection insert—
“(2A)
In subsection (2) “the appropriate regulator” means—
(a)
in the case of a PRA-authorised person, the PRA, and
(b)
in any other case, the FCA.”
      (4)
In subsection (3), for “Part IV permission” substitute “Part 4A permission”.
5
28    (1)
Section 35 of FSMA 2000 (Treaty firms) is amended as follows.
      (2)
In subsection (2), for “the Authority” substitute “the appropriate regulator”.
      (3)
After that subsection insert—
“(2A)
In subsection (2) “the appropriate regulator” means—
(a)
in the case of a PRA-authorised person, the PRA, and
10
(b)
in any other case, the FCA.”
      (4)
In subsection (3), for “Part IV permission” substitute “Part 4A permission”.
Part 4
Amendments of Part 13 of FSMA 2000: Powers of intervention
29
Part 13 of FSMA 2000 (incoming firms: intervention by Authority) is
15
amended as follows.
30
In the heading to Part 13, for “Authority” substitute “FCA or PRA”.
31
In section 193 (interpretation of Part 13), in subsection (1), in the definition
of “power of intervention”, for “the Authority” substitute “the FCA or the
PRA”.
20
32    (1)
Section 194 (general grounds on which power of intervention is exercisable)
is amended as follows.
      (2)
In subsection (1)—
(a)
for “Authority”, in each place, substitute “appropriate regulator”,
(b)
in paragraph (c), for the words from “meet” to the end substitute
25
“advance—
(i)
in the case of the FCA, one or more of its
operational objectives, and
(ii)
in the case of the PRA, any of its objectives.”
      (3)
After subsection (1A) insert—
30
“(1B)
“The appropriate regulator” means—
(a)
where the incoming firm is a PRA-authorised person, the
FCA or the PRA;
(b)
in any other case, the FCA.”
      (4)
In subsection (3), for “Authority”, in each place, substitute “FCA”.
35
33    (1)
Section 194A (contravention by relevant EEA firm with UK branch of
requirement under markets in financial instruments directive) is amended
as follows.
      (2)
For “Authority” or “Authority’s”, in each place (and in the heading),
substitute “appropriate regulator” or “appropriate regulator’s”.
40

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 4 — Amendments of Part 13 of FSMA 2000: Powers of intervention
197

      (3)
After subsection (7) insert—
“(8)
Subsection (4) is not to be regarded as requiring the PRA to take
action in relation to the contravention of a requirement falling within
subsection (3) in a case where it is satisfied the the FCA is required to
act, and is acting or has acted, under subsection (4)—
5
(a)
in relation to that requirement, or
(b)
where that requirement is imposed by rules made by the
PRA, in relation to an identical requirement imposed by rules
made by the FCA.”
(9)
“The appropriate regulator” means—
10
(a)
where the relevant EEA firm is a PRA-authorised person, the
FCA or, subject to subsection (8), the PRA;
(b)
in any other case, the FCA.”
34    (1)
Section 195 (exercise of power in support of overseas regulator) is amended
as follows.
15
      (2)
In subsection (1), for “Authority” substitute “appropriate regulator”.
      (3)
In subsection (2), for “Authority’s” substitute “appropriate regulator’s”.
      (4)
After subsection (2) insert—
“(2A)
The appropriate regulator” means—
(a)
where the incoming firm is a PRA-authorised person, the
20
FCA or the PRA;
(b)
in any other case, the FCA.”
      (5)
In subsection (4)—
(a)
in paragraph (a), for “the Authority” substitute “either regulator”,
and
25
(b)
omit paragraph (b).
      (6)
In subsections (5) to (8), for “Authority”, in each place, substitute
“appropriate regulator”.
35    (1)
Section 195A (contravention by relevant EEA firm or EEA UCITS of
directive requirement: home state regulator primarily responsible for
30
securing compliance) is amended as follows.
      (2)
For “Authority” or “Authority’s”, in each place, substitute “appropriate
regulator” or “appropriate regulator’s”.
      (3)
After subsection (11) insert—
“(11A)
Subsection (4) is not to be regarded as requiring the PRA to notify the
35
home state regulator in relation to the contravention of a
requirement falling within subsection (2) or (3) in a case where the
PRA is satisfied the the FCA is required to act, and is acting or has
acted, under subsection (4) in relation to that requirement.”
      (4)
In subsection (12), before the definition of “home state” insert—
40
““the appropriate regulator” means—
(a)
where the relevant EEA firm is a PRA-authorised
person, the FCA or, subject to subsection (11A), the
PRA;

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 4 — Amendments of Part 13 of FSMA 2000: Powers of intervention
198

(b)
in any other case, the FCA;”.
36
For section 196 substitute—
“196
The power of intervention
(1)
If a regulator is entitled to exercise its power of intervention in
respect of an incoming firm under this Part, it may impose any
5
requirement in relation to the firm which that regulator could
impose if—
(a)
the firm’s permission was a Part 4A permission; and
(b)
the regulator was entitled to exercise its power under section
55L(3) or 55M(3).
10
(2)
The FCA must consult the PRA before exercising its powers by virtue
of this section in relation to—
(a)
a PRA-authorised person, or
(b)
a member of a group which includes a PRA-authorised
person.
15
(3)
The PRA must consult the FCA before exercising its powers by virtue
of this section.”
37    (1)
Section 197 (procedure on exercise of power of intervention) is amended as
follows.
      (2)
In subsection (2), for “Authority” substitute “regulator”.
20
      (3)
In subsection (3), for “the Authority” substitute “a regulator”.
      (4)
In subsection (4)—
(a)
in paragraph (c), for “Authority’s” substitute “regulator’s”, and
(b)
in paragraph (d), for “Authority” substitute “regulator”.
      (5)
In subsections (5) to (7), for “Authority”, in each place, substitute
25
“regulator”.
38    (1)
Section 198 (power to apply to court for injunction in respect of certain
overseas insurance companies) is amended as follows.
      (2)
In subsections (1) to (3), for “Authority”, in each place, substitute
“appropriate regulator”.
30
      (3)
After subsection (3) insert—
“(3A)
“The appropriate regulator” means whichever regulator is, at the
time when the request is received, the competent authority for the
purposes of the provision referred to in subsection (1)(a), (b) or (c).”
39    (1)
Section 199 (additional procedure for EEA firms in certain cases) is amended
35
as follows.
      (2)
In subsection (1), for “the Authority” substitute “a regulator”.
      (3)
In subsection (2)(a)(i), for “the Authority” substitute “that regulator”.
      (4)
In subsections (3) to (10), for “Authority” substitute “regulator”.

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 4 — Amendments of Part 13 of FSMA 2000: Powers of intervention
199

      (5)
After subsection (10) insert—
“(11)
Subsection (3) is not to be regarded as requiring the PRA to take
action in relation to the contravention of a relevant requirement in a
case where it is satisfied that the FCA is required to act, and is acting
or has acted, under subsection (3)—
5
(a)
in relation to that requirement, or
(b)
where that requirement is imposed by rules made by the
PRA, in relation to an identical requirement imposed by rules
made by the FCA.”
40    (1)
Section 199A (management companies: loss of authorisation) is amended as
10
follows.
      (2)
In subsection (2), for “Authority”, in both places, substitute “appropriate
regulator”.
      (3)
For subsection (4) substitute—
    “(4)
In this section—
15
“the appropriate regulator” means whichever of the FCA and
the PRA is the competent authority for the purposes of the
UCITS directive;
“collective investment scheme” has the same meaning as in
Part 17.”
20
41    (1)
Section 200 (rescission and variation of requirements) is amended as follows.
      (2)
In subsection (1), for “The Authority” substitute “Either regulator”.
      (3)
In subsection (2)—
(a)
for “the Authority”, in the first place, substitute “either regulator”,
and
25
(b)
for “the Authority”, in the second place, substitute “the regulator”.
      (4)
In subsections (3) and (4), for “Authority” substitute “regulator”.
      (5)
In subsection (5)—
(a)
for “the Authority”, in the first place, substitute “either regulator”,
and
30
(b)
in paragraph (a), for “the Authority” substitute “the regulator”.
42
For section 201 substitute—
“201
Effect of certain requirements on other persons
If either regulator, in exercising its power of intervention, imposes on
an incoming firm a requirement of the kind mentioned in subsection
35
(4) of section 55P, the requirement has the same effect in relation to
the firm as it would have in relation to an authorised person if it had
been imposed on the authorised person by the regulator acting
under section 55L or 55M.”
43
In section 202 (contravention of requirement imposed under Part 13), in
40
subsection (1), for “the Authority” substitute “a regulator”.