142.37-40

House of Commons

Session 2013 - 14
Internet Publications
Other Bills before Parliament

Lords Amendments to the Financial Services (Banking Reform) Bill

37

(2)
If the Treasury amends a designation order, the Treasury must publish the

amended order.

(3)
The Treasury must publish any revocation of a designation order.”
73
Insert the following new Clause—

“General duties of Regulator


Regulator’s general duties in relation to payment systems

(1)
In discharging its general functions relating to payment systems the

Payment Systems Regulator must, so far as is reasonably possible, act in a

way which advances one or more of its payment systems objectives.

(2)
The payment systems objectives of the Payment Systems Regulator are—

(a)
the competition objective (see section (The competition objective)),

(b)
the innovation objective (see section (The innovation objective)), and

(c)
the service-user objective (see section (The service-user objective)).

(3)
In discharging its general functions relating to payment systems the

Payment Systems Regulator must have regard to—

(a)
the importance of maintaining the stability of, and confidence in,

the UK financial system,

(b)
the importance of payment systems in relation to the performance

of functions by the Bank of England in its capacity as a monetary

authority, and

(c)
the regulatory principles in section (Regulatory principles).

(4)
The general functions of the Payment Systems Regulator relating to

payment systems are—

(a)
its function of giving general directions under section (Directions)

(considered as a whole),

(b)
its functions in relation to the giving of general guidance under

section (Guidance) (considered as a whole), and

(c)
its function of determining the general policy and principles by

reference to which it performs particular functions.”
74
Insert the following new Clause—


“The competition objective

(1)
The competition objective is to promote effective competition in—

(a)
the market for payment systems, and

(b)
the markets for services provided by payment systems,


in the interests of those who use, or are likely to use, services provided by

payment systems.

(2)
The reference in subsection (1) to promoting effective competition includes,

in particular, promoting effective competition—

(a)
between different operators of payment systems,

(b)
between different payment service providers, and

(c)
between different infrastructure providers.

38

(3)
The matters to which the Payment Systems Regulator may have regard in

considering the effectiveness of competition in a market mentioned in

subsection (1) include—

(a)
the needs of different persons who use, or may use, services

provided by payment systems;

(b)
the ease with which persons who may wish to use those services

can do so;

(c)
the ease with which persons who obtain those services can change

the person from whom they obtain them;

(d)
the needs of different payment service providers or persons who

wish to become payment service providers;

(e)
the ease with which payment service providers, or persons who

wish to become payment service providers, can provide services

using payment systems;

(f)
the ease with which payment service providers can change the

payment system they use to provide their services;

(g)
the needs of different infrastructure providers or persons who wish

to become infrastructure providers;

(h)
the ease with which infrastructure providers, or persons who wish

to become infrastructure providers, can provide infrastructure for

the purposes of operating payment systems;

(i)
the needs of different operators of payment systems;

(j)
the ease with which operators of payment systems can change the

infrastructure used to operate the payment systems;

(k)
the level and structure of fees, charges or other costs associated with

participation in payment systems;

(l)
the ease with which new entrants can enter the market;

(m)
how far competition is contributing to the development of efficient

and effective infrastructure for the purposes of operating payment

systems;

(n)
how far competition is encouraging innovation.”
75
Insert the following new Clause—


“The innovation objective

(1)
The innovation objective is to promote the development of, and innovation

in, payment systems in the interests of those who use, or are likely to use,

services provided by payment systems, with a view to improving the

quality, efficiency and economy of payment systems.

(2)
The reference in subsection (1) to promoting the development of, and

innovation in, payment systems includes, in particular, a reference to

promoting the development of, and innovation in, infrastructure to be used

for the purposes of operating payment systems.”
76
Insert the following new Clause—


“The service-user objective

The service-user objective is to ensure that payment systems are operated

and developed in a way that takes account of, and promotes, the interests

of those who use, or are likely to use, services provided by payment

systems.”

39
77
Insert the following new Clause—


“Regulatory principles


The regulatory principles referred to in section (Regulator’s general duties in

relation to payment systems)(3)(c) are as follows—

(a)
the need to use the resources of the Payment Systems Regulator in

the most efficient and economic way;

(b)
the principle that a burden or restriction which is imposed on a

person, or on the carrying on of an activity, should be proportionate

to the benefits, considered in general terms, which are expected to

result from the imposition of that burden or restriction;

(c)
the desirability of sustainable growth in the economy of the United

Kingdom in the medium or long term;

(d)
the general principle that those who use services provided by

payment systems should take responsibility for their decisions;

(e)
the responsibilities of the senior management of persons subject to

requirements imposed by or under this Part, including those

affecting persons who use services provided by payment systems,

in relation to compliance with those requirements;

(f)
the desirability where appropriate of the Payment Systems

Regulator exercising its functions in a way that recognises

differences in the nature of, and objectives of, businesses carried on

by different persons subject to requirements imposed by or under

this Part;

(g)
the desirability in appropriate cases of the Payment Systems

Regulator publishing information relating to persons on whom

requirements are imposed by or under this Part, or requiring such

persons to publish information, as a means of contributing to the

advancement by the Payment Systems Regulator of its payment

systems objectives;

(h)
the principle that the Payment Systems Regulator should exercise

its functions as transparently as possible.”
78
Insert the following new Clause—

“Regulatory and competition functions


Directions

(1)
The Payment Systems Regulator may give directions in writing to

participants in regulated payment systems.

(2)
A direction given to a participant in a regulated payment system may—

(a)
require or prohibit the taking of specified action in relation to the

system;

(b)
set standards to be met in relation to the system.

(3)
A direction under this section may apply—

(a)
generally,

(b)
in relation to—

(i)
all operators, or every operator of a regulated payment

system of a specified description,

40

(ii)
all infrastructure providers, or every person who is an

infrastructure provider in relation to a regulated payment

system of a specified description, or

(iii)
all payment service providers, or every person who is a

payment service provider in relation to a regulated payment

system of a specified description, or

(c)
in relation to specified persons or persons of a specified description.

(4)
The Payment Systems Regulator must publish any direction given under

this section that applies as mentioned in subsection (3)(a) or (b).

(5)
A direction under this section that applies as mentioned in subsection (3)(a)

or (b) is referred to in this Part as a “general direction”.”
79
Insert the following new Clause—


“System rules

(1)
The Payment Systems Regulator may require the operator of a regulated

payment system—

(a)
to establish rules for the operation of the system;

(b)
to change the rules in a specified way or so as to achieve a specified

purpose;

(c)
to notify the Payment Systems Regulator of any proposed change to

the rules;

(d)
not to change the rules without the approval of the Payment

Systems Regulator.

(2)
A requirement under subsection (1)(c) or (d) may be general or specific.

(3)
A requirement under this section that is imposed on—

(a)
all operators of regulated payment systems, or

(b)
every operator of a regulated payment system of a specified

description,


is referred to in this Part as a “generally-imposed requirement”.”
80
Insert the following new Clause—


“Power to require granting of access to payment systems

(1)
This section applies where a person (“the applicant”) applies for an order

under this section.

(2)
The Payment Systems Regulator may by order require the operator of a

regulated payment system to enable the applicant to become a payment

service provider in relation to the system.

(3)
The Payment Systems Regulator may by order require any payment

service provider with direct access to a regulated payment system to enter

into an agreement with the applicant to enable the applicant to become a

payment service provider in relation to the system.

(4)
An order under this section may provide for the applicant to become a

payment service provider in relation to a payment system—

(a)
for a period specified in the order;

(b)
on terms and conditions specified in the order.”