Session 2012 - 13
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Financial Services Bill


Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 1 — Amendments of Schedule 3 to FSMA 2000: EEA passport rights

191

 

Part 4

Miscellaneous

Exemption from liability in damages

30    (1)  

None of the following is to be liable in damages for anything done

or omitted in the discharge, or purported discharge, of the PRA’s

5

functions—

(a)   

the PRA;

(b)   

any person (“P”) who is, or is acting as, an officer of, or

member of the staff of, the PRA or a member of its

governing body;

10

(c)   

any person who could be held vicariously liable for things

done or omitted by P, but only in so far as the liability

relates to P’s conduct.

      (2)  

Sub-paragraph (1) does not apply—

(a)   

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

15

(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 result of section 6(1) of the Human

Rights Act 1998.

Accredited financial investigators

20

31         

For the purposes of this Act anything done by an accredited

financial investigator within the meaning of the Proceeds of Crime

Act 2002 who—

(a)   

is, or is acting as, an officer of, or member of the staff of, the

PRA or a member of its governing body, or

25

(b)   

is appointed by the PRA under section 167 or 168 to

conduct an investigation,

           

is to be treated as done in the exercise or discharge of a function of

the PRA.

Amounts required by rules to be paid to the PRA

30

32         

Any amount (other than a fee) which is required by rules to be

paid to the PRA may be recovered as a debt due to the PRA.”

Schedule 4

Section 10

 

EEA passport rights and treaty rights

Part 1

35

Amendments of Schedule 3 to FSMA 2000: EEA passport rights

Introductory

1          

Schedule 3 to FSMA 2000 (EEA passport rights) is amended as follows.

 
 

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 1 — Amendments of Schedule 3 to FSMA 2000: EEA passport rights

192

 

Exercise of passport rights by EEA firms

2     (1)  

Paragraph 13 (establishment) is amended as follows.

      (2)  

In sub-paragraphs (1) and (1A), for “Authority”, in each place, substitute

“appropriate UK regulator”.

      (3)  

After sub-paragraph (1A) insert—

5

   “(1B)  

Where the PRA receives a consent notice, it must give a copy to the

FCA without delay.

     (1C)  

Where the FCA receives a consent notice it must in prescribed

cases give a copy to the PRA without delay.

     (1D)  

In a case where the FCA is the appropriate UK regulator, the

10

consent of the PRA is required for any notice by the FCA for the

purposes of sub-paragraph (1)(ba) which relates to—

(a)   

a PRA-regulated activity,

(b)   

a PRA-authorised person, or

(c)   

a person whose immediate group includes a PRA-

15

authorised person.

     (1E)  

If the FCA—

(a)   

receives a consent notice, or

(b)   

receives under sub-paragraph (1B) a copy of a consent

notice,

20

           

it must prepare for the firm’s supervision.

     (1F)  

If the PRA—

(a)   

receives a consent notice, or

(b)   

receives under sub-paragraph (1C) a copy of a consent

notice which identifies PRA-regulated activities or relates

25

to a PRA-authorised person,

           

it must prepare for the firm’s supervision.”

      (4)  

In sub-paragraph (2)—

(a)   

for “Authority” substitute “appropriate UK regulator”, and

(b)   

omit paragraph (a).

30

      (5)  

In sub-paragraph (3), for “Authority” substitute “appropriate UK regulator”.

      (6)  

In sub-paragraph (4), after the definition of “applicable provisions” insert—

““the appropriate UK regulator” means whichever of the FCA

and the PRA is the competent authority for the purposes of

the relevant single market directive;”.

35

3     (1)  

Paragraph 14 (services) is amended as follows.

      (2)  

In sub-paragraph (1), for “Authority”, in each place, substitute “appropriate

UK regulator”.

      (3)  

After sub-paragraph (1) insert—

   “(1A)  

“Relevant notice” means—

40

(a)   

a regulator’s notice, or

 
 

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 1 — Amendments of Schedule 3 to FSMA 2000: EEA passport rights

193

 

(b)   

where none is required by sub-paragraph (1), a notice

informing the appropriate UK regulator of the firm’s

intention to provide services in the United Kingdom.

     (1B)  

Where the PRA receives a relevant notice, it must give a copy to

the FCA without delay.

5

     (1C)  

Where the FCA receives a relevant notice, it must in prescribed

cases give a copy to the PRA without delay.

     (1D)  

If the FCA—

(a)   

receives a relevant notice, or

(b)   

receives under sub-paragraph (1B) a copy of a relevant

10

notice,

           

it must prepare for the firm’s supervision.

     (1E)  

If the PRA—

(a)   

receives a relevant notice, or

(b)   

receives under sub-paragraph (1C) a copy of a relevant

15

notice which identifies PRA-regulated activities or relates

to a PRA-authorised person,

           

it must, unless the firm falls within paragraph 5(e), prepare for the

firm’s supervision.”

      (4)  

For sub-paragraph (2) substitute—

20

    “(2)  

If the appropriate UK regulator has received a relevant notice, it

must, unless the firm falls within paragraph 5(a) or (e), notify the

firm of the applicable provisions (if any).”

      (5)  

Omit sub-paragraph (2A).

      (6)  

In sub-paragraph (3)—

25

(a)   

for “(2)(b)” substitute “(2)”, and

(b)   

for the words from “Authority” to the end substitute “appropriate

UK regulator received the relevant notice”.

      (7)  

In sub-paragraph (4), after the definition of “applicable provisions” insert—

““the appropriate UK regulator” means whichever of the FCA

30

and the PRA is the competent authority for the purposes of

the relevant single market directive;”.

4     (1)  

Paragraph 15A (application for approval to manage UCITS) is amended as

follows.

      (2)  

For “Authority” or “Authority’s”, in each place, substitute “appropriate UK

35

regulator” or “appropriate UK regulator’s”.

      (3)  

After sub-paragraph (6) insert—

   “(6A)  

If—

(a)   

the FCA is the appropriate UK regulator, and

(b)   

the firm is, or the firm’s immediate group includes, a PRA-

40

authorised person,

           

the FCA must give the PRA a copy of the notice under sub-

paragraph (4).”

 
 

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 1 — Amendments of Schedule 3 to FSMA 2000: EEA passport rights

194

 

      (4)  

In sub-paragraph (7), before the definition of “specified” insert—

““the appropriate UK regulator” means whichever of the FCA

and the PRA is the competent authority for the purposes of

the UCITS directive;”.

5     (1)  

Paragraph 15B (representations and references to the Tribunal) is amended

5

as follows.

      (2)  

For “Authority”, in both places, substitute “appropriate UK regulator”.

      (3)  

After sub-paragraph (3) insert—

    “(4)  

In this paragraph “the appropriate UK regulator” has the same

meaning as in paragraph 15A.”

10

6          

In paragraph 15C (information to home state regulator), in sub-paragraph

(1), for “Authority” substitute “appropriate UK regulator, as defined in

paragraph 15A(7),”.

7          

In paragraph 17 (continuing regulation of EEA firms)—

(a)   

before paragraph (a) insert—

15

“(za)   

require the FCA and the PRA to notify

each other about EEA firms qualifying

for authorisation;”, and

(b)   

in paragraph (c), for “the Authority” substitute “the FCA or the

PRA”.

20

8          

In paragraph 18 (giving up right to authorisation), in paragraph (b), for “Part

IV permission” substitute “Part 4A permission”.

Exercise of passport rights by UK firms

9          

In Part 3 (exercise of passport rights by UK firms), before the italic heading

before paragraph 19 insert—

25

“Meaning of “the appropriate UK regulator”

18A        

In this Part of this Schedule “the appropriate UK regulator”

means—

(a)   

where the UK firm is a PRA-authorised person, the PRA;

(b)   

in any other case, the FCA.”

30

10    (1)  

Paragraph 19 (establishment) is amended as follows.

      (2)  

For “Authority”, in each place, substitute “appropriate UK regulator”.

      (3)  

After sub-paragraph (7B) insert—

“(7C)   

Where the PRA is the appropriate UK regulator, it must consult the

FCA before deciding whether to give a consent notice, except where

35

sub-paragraph (7A) applies.

(7D)   

Where the FCA is the appropriate UK regulator, it must consult the

PRA before deciding whether to give a consent notice in relation to a

UK firm whose immediate group includes a PRA-authorised

person.”

40

11    (1)  

Paragraph 20 (services) is amended as follows.

 
 

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 1 — Amendments of Schedule 3 to FSMA 2000: EEA passport rights

195

 

      (2)  

For “Authority”, in each place, substitute “appropriate UK regulator”.

      (3)  

After sub-paragraph (3A) insert—

  “(3AA)  

Where the PRA is the appropriate UK regulator, it must consult

the FCA before deciding whether to give a consent notice.

    (3AB)  

Where the FCA is the appropriate UK regulator, it must consult

5

the PRA before deciding whether to give a consent notice in

relation to a UK firm whose immediate group includes a PRA-

authorised person.”

12         

In paragraph 20ZA (information for host state regulator), for “Authority”, in

each place, substitute “appropriate UK regulator”.

10

13         

In paragraph 20B (notice of intention to market), for “Authority”, in each

place, substitute “appropriate UK regulator”.

14         

In paragraph 22 (continuing regulation of UK firms), in sub-paragraph (3)—

(a)   

for “the Authority’s consent” substitute “the consent of the FCA or

the PRA”, and

15

(b)   

in paragraph (b), for “the Authority” substitute “the FCA or the

PRA”.

15    (1)  

Paragraph 23 (power to impose requirements) is amended as follows.

      (2)  

For “the Authority”, in each place, substitute “the FCA”.

      (3)  

In sub-paragraph (1)(a), for “Part IV permission” substitute “Part 4A

20

permission”.

      (4)  

In sub-paragraphs (2) and (2A), for “section 45” substitute “section 55L or

55M”.

      (5)  

After sub-paragraph (2A) insert—

   “(2B)  

This paragraph does not affect any duty of the FCA to consult the

25

PRA before exercising its power under section 55L or 55M.”

16    (1)  

Paragraph 24 (which relates to UK firms exercising rights under the banking

consolidation directive) is amended as follows.

      (2)  

In sub-paragraph (1)(a), for “Part IV permission” substitute “Part 4A

permission”.

30

      (3)  

In sub-paragraph (2)—

(a)   

for “the Authority”, in the first place, substitute “either regulator”,

(b)   

in paragraph (a), for “Part IV permission” substitute “Part 4A

permission”, and

(c)   

in paragraph (b), for “the Authority” substitute “that regulator”.

35

17         

After paragraph 24 insert—

“Arrangements between FCA and PRA

24A   (1)  

The regulators may make arrangements about—

(a)   

how they will consult each other when required to do so by

paragraph 19(7C) or (7D) or 20(3AA) or (3AB) or by

40

regulations under paragraph 22;

 
 

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 2 — Amendments of Schedule 4 to FSMA 2000: Treaty rights

196

 

(b)   

how each of them will act in response to any advice or

representations received from the other.

      (2)  

The arrangements may require one regulator to obtain the consent

of the other in specified circumstances before—

(a)   

giving a consent notice under paragraph 19 or 20, or

5

(b)   

exercising specified functions under regulations under

paragraph 22.

      (3)  

The arrangements must be in writing, and must specify—

(a)   

the EEA rights to which they relate, and

(b)   

the date on which they come into force.

10

      (4)  

Where arrangements are in force under this paragraph, the

regulators must exercise functions in accordance with the

arrangements.

      (5)  

The regulators must publish any arrangements under this

paragraph in such manner as they think fit.”

15

18         

In paragraph 25 (information to be included in the public record) for

“Authority” substitute “FCA”.

19         

In paragraph 26 (UK management companies: delegation of functions), for

“Authority”, in each place, substitute “appropriate UK regulator”.

20         

In paragraph 27 (UK management companies: withdrawal of authorisation),

20

for “Authority”, in each place, substitute “appropriate UK regulator”.

21         

In paragraph 28 (management companies: request for information), for

“Authority”, in each place, substitute “appropriate UK regulator”.

Part 2

Amendments of Schedule 4 to FSMA 2000: Treaty rights

25

22         

Schedule 4 to FSMA 2000 (Treaty rights) is amended as follows.

23    (1)  

Paragraph 3 (exercise of Treaty rights) is amended as follows.

      (2)  

In sub-paragraph (2), for “Authority” substitute “appropriate UK regulator”.

      (3)  

After that sub-paragraph insert—

   “(2A)  

In sub-paragraph (2) “the appropriate UK regulator” means—

30

(a)   

where any of the activities to which the notification under

that sub-paragraph relates is a PRA-regulated activity, the

PRA;

(b)   

in any other case, the FCA.

     (2B)  

Where the PRA receives a notification under sub-paragraph (2), it

35

must give a copy to the FCA without delay.

     (2C)  

Where the FCA receives a notification under sub-paragraph (2), it

must in prescribed cases give a copy to the PRA without delay.”

 
 

Financial Services Bill
Schedule 4 — EEA passport rights and treaty rights
Part 3 — Amendments of sections 34 and 35 of FSMA 2000: EEA firms and Treaty firms

197

 

24         

After paragraph 3 insert—

“Notification between UK regulators

3A         

Regulations may require the PRA and the FCA to notify each other

about Treaty firms qualifying for authorisation.”

25    (1)  

Paragraph 4 (permission) is amended as follows.

5

      (2)  

In sub-paragraph (3)—

(a)   

for “a Part IV permission” substitute “a Part 4A permission”, and

(b)   

for “Authority” substitute “appropriate UK regulator”.

      (3)  

In sub-paragraph (4), for “Authority” substitute “appropriate UK regulator”.

      (4)  

After that sub-paragraph insert—

10

    “(5)  

“The appropriate UK regulator” means—

(a)   

where the Treaty firm is a PRA-authorised person, the

FCA or the PRA;

(b)   

in any other case, the FCA.”

26    (1)  

Paragraph 5 (notice to Authority) is amended as follows.

15

      (2)  

In sub-paragraph (2), for “the Authority” substitute “the appropriate UK

regulator”.

      (3)  

After sub-paragraph (2) insert—

   “(2A)  

“The appropriate UK regulator” means—

(a)   

where any of the activities to which the notice relates is a

20

PRA-regulated activity, the PRA;

(b)   

in any other case, the FCA.

     (2B)  

Where the PRA receives a notice under sub-paragraph (2), it must

give a copy to the FCA without delay.

     (2C)  

Where the FCA receives a notice under sub-paragraph (2) from—

25

(a)   

a PRA-authorised person, or

(b)   

a person whose immediate group includes a PRA-

authorised person,

           

it must give a copy to the PRA without delay.”

      (4)  

For sub-paragraph (4) substitute—

30

    “(4)  

Subsections (1), (4) and (8) of section 55U apply to a notice under

sub-paragraph (2) as they apply to an application for a Part 4A

permission.”

      (5)  

In the italic heading immediately before paragraph 5, for “Authority”

substitute “UK regulator”.

35

Part 3

Amendments of sections 34 and 35 of FSMA 2000: EEA firms and Treaty firms

27    (1)  

Section 34 of FSMA 2000 (EEA firms) is amended as follows.

      (2)  

In subsection (2), for “the Authority” substitute “the appropriate regulator”.

 
 

 
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Revised 28 May 2012