Session 2012 - 13
Internet Publications
Other Bills before Parliament

Financial Services Bill


Financial Services Bill
Schedule 7 — Application of provisions of FSMA 2000 to Bank of England etc

216

 

(b)   

subsections (3) and (4) were omitted, and

(c)   

the reference in subsection (5)(a) to authorised persons or

recognised investment exchanges were a reference to

recognised clearing houses.

      (4)  

Section 192E has effect as if the reference in subsection (1) to an

5

authorised person or recognised investment exchange were a

reference to a recognised clearing house.

      (5)  

Section 192I has effect as if the reference in subsection (1)(a) to the

other regulator and the Bank were a reference to the FCA and the

PRA.

10

      (6)  

Before the Bank gives a notice under section 192E(1) or (8)(b)—

(a)   

if the notice relates to the parent undertaking of an

authorised person or recognised investment exchange, the

Bank must consult the FCA, and

(b)   

if the notice relates to the parent undertaking of a PRA-

15

authorised person, the Bank must also consult the PRA.

Auditors

18    (1)  

Section 342 (information given by auditor to a regulator) applies

in relation to a relevant auditor as if—

(a)   

the references in that section to a recognised investment

20

exchange were to a recognised clearing house,

(b)   

in the case of an auditor of a recognised clearing house

which is also an authorised person or recognised

investment exchange, the references to a regulator

included the Bank, and

25

(c)   

in the case of an auditor of a recognised clearing house not

falling within paragraph (b), the references to a regulator

were to the Bank.

      (2)  

A “relevant auditor” is a person who is, or has been, an auditor of

a recognised clearing house appointed under or as a result of a

30

statutory provision.

19    (1)  

Section 343 (information given by auditor: person with close links)

applies in relation to a relevant auditor as if—

(a)   

the references in that section to a recognised investment

exchange were to a recognised clearing house,

35

(b)   

in the case of an auditor of a recognised clearing house

which is an authorised person or which is a recognised

investment exchange, the references to a regulator

included the Bank, and

(c)   

in the case of an auditor of a recognised clearing house not

40

falling within paragraph (b), the references to a regulator

were to the Bank.

      (2)  

A “relevant auditor” is a person who—

(a)   

is, or has been, an auditor of a recognised clearing house

appointed under or as a result of a statutory provision, and

45

(b)   

is, or has been, an auditor of a person who has close links

with the recognised clearing house.

 
 

Financial Services Bill
Schedule 7 — Application of provisions of FSMA 2000 to Bank of England etc

217

 

20         

Section 344 (duty of auditor resigning to give notice) applies to an

auditor to whom section 342 applies (whether by virtue of

paragraph 18 or otherwise) as if—

(a)   

the references in that section to a recognised investment

exchange were to a recognised clearing house,

5

(b)   

in the case of an auditor of a recognised clearing house

which is neither an authorised person nor a recognised

investment exchange, the reference in the definition of “the

appropriate regulator” to the FCA were a reference to the

Bank,

10

(c)   

in the case of an auditor of a recognised clearing house

which is a PRA-authorised person, the reference in the

definition of “the appropriate regulator” to the PRA were

a reference to the PRA and the Bank,

(d)   

in the case, not falling within paragraph (c), of an auditor

15

of a recognised clearing house which is an authorised

person or which is a recognised investment exchange, the

reference in the definition of “the appropriate regulator” to

the FCA were a reference to the FCA and the Bank.

21         

Sections 345A to 345E apply to auditors to whom section 342

20

applies only by virtue of paragraph 18 as if—

(a)   

the references in those sections to an auditor or actuary to

whom section 342 applies were to an auditor to whom

section 342 applies by virtue of paragraph 18,

(b)   

the references in those sections to a PRA-authorised person

25

were to a recognised clearing house,

(c)   

in a case where the Bank disqualifies a person from being

an auditor of a recognised clearing house that is also a

recognised investment exchange, section 345A(5)(a)

required the Bank to notify the FCA, and

30

(d)   

the references in sections 345D and 345E to a regulator

included the Bank.

Public record and disclosure of information

22         

Section 347 (record of authorised persons, recognised investment

exchanges, etc), so far as it relates to recognised investment

35

exchanges, applies in relation to the Bank as if references in that

section to a recognised investment exchange were to a recognised

clearing house.

23         

Sections 348 to 350 and 353 (disclosure of information) apply in

relation to information received by the Bank for the purposes of,

40

or in the discharge of, any of its functions relating to recognised

clearing houses.

Injunctions and restitution

24    (1)  

The power to make an application under section 380(1), (2) or (3)

(injunctions) is exercisable by the Bank.

45

      (2)  

For the purposes of the application, any reference in that section to

a relevant requirement is to—

 
 

Financial Services Bill
Schedule 7 — Application of provisions of FSMA 2000 to Bank of England etc

218

 

(a)   

a requirement that is imposed by or under any provision of

this Part of this Act that relates to a recognised clearing

house;

(b)   

a requirement that is imposed under any other provision

of this Act by the Bank;

5

(c)   

a requirement that is imposed by any qualifying EU

provision that is specified, or of a description specified, for

the purposes of this sub-paragraph by the Treasury by

order; or

(d)   

a requirement that is imposed by this Act and whose

10

contravention constitutes an offence that the Bank has

power to prosecute under this Act (see section 401, as

applied by paragraph 29).

25    (1)  

The power to make an application under section 382(1) (restitution

order) is exercisable by the Bank.

15

      (2)  

For the purposes of the application, any reference in that section to

a relevant requirement is to be read in accordance with paragraph

24(2) of this Schedule.

26    (1)  

The power conferred by section 384(5) (power of FCA to require

restitution order) is exercisable by the Bank.

20

      (2)  

That power is exercisable if the Bank is satisfied that a recognised

clearing house has contravened a relevant requirement, or been

knowingly concerned in the contravention of a relevant

requirement, and—

(a)   

that profits have accrued to the recognised clearing house

25

as a result of the contravention; or

(b)   

that one or more persons have suffered loss or been

otherwise adversely affected as a result of the

contravention.

      (3)  

For the purposes of that power, “relevant requirement” is to be

30

read in accordance with paragraph 24(2) of this Schedule.

      (4)  

Where this paragraph applies, section 384(5) and (6) are to have

effect as if—

(a)   

any reference to the person concerned were a reference to

the recognised clearing house; and

35

(b)   

any reference to subsection (1) were a reference to sub-

paragraph (2) of this paragraph.

Notices

27         

The provisions of Part 26 of this Act (notices) apply in relation to a

warning or decision notice given by the Bank under section 192L,

40

312G or 312H as they apply in relation to such a notice given by

the FCA under that section.

Offences

28         

Section 398 (misleading the FCA: residual cases) applies to

information given to the Bank in purported compliance with—

45

 
 

Financial Services Bill
Schedule 7 — Application of provisions of FSMA 2000 to Bank of England etc

219

 

(a)   

a requirement that is imposed by or under any provision of

Part 18 of this Act that relates to a recognised clearing

house;

(b)   

a requirement that is imposed under any other provision

of this Act by the Bank; or

5

(c)   

a requirement that is imposed by any qualifying EU

provision specified, or of a description specified, for the

purposes of this paragraph by the Treasury by order.

29    (1)  

Section 401 (proceedings for an offence) applies to the Bank as if

for the purposes of subsections (2)(a) and (3)(a) of that section the

10

Bank were an appropriate regulator in respect of each of the

following offences—

(a)   

an offence under section 177(3) where the investigation is

being, or is likely to be, conducted on behalf of the Bank;

(b)   

an offence under section 177(4) where the requirement is

15

imposed by the Bank;

(c)   

an offence under section 177(6) where the warrant is issued

as a result of information on oath given by the Bank or a

person appointed by it to conduct an investigation on its

behalf;

20

(d)   

an offence under section 398(1) where the information was

given to the Bank.

      (2)  

Section 401(3B) has effect subject to the provision made by this

paragraph (so that the FCA is not the appropriate regulator for the

purposes of subsections (2)(a) and (3)(a) in respect of the above

25

offences).

Records

30         

Paragraph 17 of Schedule 1ZB (records) applies in relation to the

recording of decisions made by the Bank in the exercise of its

functions relating to recognised clearing houses.

30

Annual report

31         

Paragraph 18 of Schedule 1ZB (annual report by PRA) applies in

relation to the Bank, but—

(a)   

as if for paragraphs (a) to (g) of sub-paragraph (1) there

were substituted—

35

“(a)   

the discharge of its functions relating to recognised

clearing houses,

(b)   

the extent to which, in its opinion, in discharging

those functions its financial stability objective has

been met,”, and

40

(b)   

as if sub-paragraph (3) were omitted.

 
 

Financial Services Bill
Schedule 8 — Sections 26 to 31: minor and consequential amendments

220

 

Part 3

Fees

32    (1)  

The Bank of England may, in connection with the discharge of any

of its qualifying functions, require recognised clearing houses to

pay fees to the Bank.

5

      (2)  

The “qualifying functions” of the Bank are—

(a)   

its functions under or as a result of this Part of this Act, and

(b)   

its functions under or as a result of a qualifying EU

provision that is specified, or of a description specified, for

the purposes of this sub-paragraph by the Treasury by

10

order.

      (3)  

The power of the Bank to set fees includes power to set fees for the

purpose of meeting expenses incurred by it or the FCA—

(a)   

in preparation for the exercise of functions by the Bank

under this Part of this Act, or

15

(b)   

for the purpose of facilitating the exercise by the Bank of

those functions or otherwise in connection with their

exercise by it.

      (4)  

It is irrelevant when the expenses were incurred (and, in

particular, it is irrelevant if expenses were incurred by the FCA at

20

a time when it was known as the Financial Services Authority).

33         

Any fee which is owed to the Bank under paragraph 32 may be

recovered as a debt due to the Bank.”

Schedule 8

Section 32

 

Sections 26 to 31: minor and consequential amendments

25

1          

FSMA 2000 is amended as follows.

2     (1)  

Section 286 (qualification for recognition) is amended as follows.

      (2)  

In subsection (1)(a), for “the Authority” substitute “the appropriate

regulator”.

      (3)  

In subsections (4A), (4C) and (6), for “the Authority” substitute “the FCA”.

30

3     (1)  

Section 287 (application by an investment exchange) is amended as follows.

      (2)  

In subsections (1) and (2) for “the Authority”, in each place, substitute “the

FCA”.

      (3)  

In subsection (3)—

(a)   

in paragraph (a), after “provision” insert “by another person”,

35

(b)   

in paragraph (b), for “clearing services” substitute “services falling

within section 285(2)(b)”, and

(c)   

in paragraphs (d) and (e), for “the Authority” substitute “the FCA”.

4     (1)  

Section 288 (application by a clearing house) is amended as follows.

 
 

Financial Services Bill
Schedule 8 — Sections 26 to 31: minor and consequential amendments

221

 

      (2)  

In subsection (1), for “the Authority” substitute “the Bank of England”.

      (3)  

In subsection (2)—

(a)   

in the opening words, for “the Authority” substitute “the Bank of

England”, and

(b)   

in paragraph (d), for “the Authority” substitute “the Bank”.

5

      (4)  

In subsection (3)(b), after “clearing services” insert “or services falling within

section 285(3)(b)”.

5          

In section 289 (applications: supplementary), in subsections (1), (2) (in both

places) and (3), for “the Authority” substitute “the appropriate regulator”.

6     (1)  

Section 290 (recognition orders) is amended as follows.

10

      (2)  

In subsection (1)—

(a)   

for “the Authority”, in the first place, substitute “the appropriate

regulator”, and

(b)   

for “the Authority”, in the second place, substitute “the regulator

concerned”.

15

      (3)  

In subsection (1B), for “the Authority” substitute “the FCA”.

      (4)  

Omit subsection (2).

      (5)  

In subsection (3), for “the Authority” substitute “the appropriate regulator”.

      (6)  

Omit subsection (6).

7     (1)  

Section 290A (refusal of recognition on ground of excessive regulatory

20

provision) is amended as follows.

      (2)  

In subsection (1)—

(a)   

for “The Authority must” substitute “The appropriate regulator

must”,

(b)   

for “the Authority that” substitute “it that”,

25

(c)   

omit the “or” following paragraph (a), and

(d)   

at the end of paragraph (b) insert “or

(c)   

the provision by the applicant of services falling

within section 285(2)(b) or (3)(b),”.

      (3)  

In subsection (3), for “Authority” substitute “appropriate regulator”.

30

8          

In section 292 (overseas investment exchanges and overseas clearing house),

in subsections (2), (3)(c) and (d), (4) and (5)(c), for “the Authority” substitute

“the appropriate regulator”.

9          

In section 292A (publication of information by recognised investment

exchange), in subsections (1), (3), (5) and (6), for “Authority” substitute

35

“FCA”.

10    (1)  

Section 293 (notification requirements) is amended as follows.

      (2)  

In subsections (1) to (3) and (5), for “Authority” substitute “appropriate

regulator”.

      (3)  

In subsection (6)—

40

(a)   

in paragraph (a), after “provision” insert “by another person”,

 
 

Financial Services Bill
Schedule 8 — Sections 26 to 31: minor and consequential amendments

222

 

(b)   

in paragraph (b), for “clearing services” substitute “services falling

within section 285(2)(b)”, and

(c)   

for “the Authority” substitute “the FCA and the Bank of England”.

      (4)  

In subsection (7)—

(a)   

in paragraph (a), after “clearing services” insert “or services falling

5

within section 285(3)(b)”,

(b)   

in paragraph (b), after “clearing services” insert “or services falling

within section 285(3)(b)”, and

(c)   

for “the Authority” substitute “the Bank of England and the FCA”.

      (5)  

In subsection (9), for “the Authority’s” substitute “the appropriate

10

regulator’s”.

11         

For section 293A substitute—

“293A   

  Information: compliance with EU requirements

The appropriate regulator may require a recognised body to give the

appropriate regulator such information as the appropriate regulator

15

reasonably requires in order to satisfy itself that the body is

complying with any qualifying EU provision that is specified, or of a

description specified, for the purposes of this section by the Treasury

by order.”

12         

In section 294 (modification or waiver of rules), in subsections (1), (2), (4) and

20

(6), for “Authority” substitute “appropriate regulator”.

13    (1)  

Section 295 (notification: overseas investment exchanges and overseas

clearing houses) is amended as follows.

      (2)  

In subsection (1), for “the Authority” substitute “the appropriate regulator”.

      (3)  

In subsection (2), for the words from “likely” to the end substitute “likely to

25

affect the appropriate regulator’s assessment of whether it is satisfied as to

the requirements set out in section 292(3)”.

      (4)  

In subsection (3), for “the Authority” substitute “the appropriate regulator”.

      (5)  

Omit subsection (4).

14    (1)  

Section 296 (power to give directions) is amended as follows.

30

      (2)  

In subsection (1), for “the Authority” substitute “the appropriate regulator”.

      (3)  

In subsection (1A)—

(a)   

for the words from “in the case of a recognised body which is a

recognised investment” to “the body” substitute “if it appears to the

appropriate regulator that a recognised body”, and

35

(b)   

for the words from “directly applicable” to the end substitute

“directly applicable EU regulation specified (or of a description

specified) in an order made by the Treasury”.

      (4)  

In subsection (2), for “The Authority” substitute “The regulator concerned”.

      (5)  

In subsection (2A)—

40

(a)   

in the opening words, for “a recognised investment exchange other

than an overseas investment exchange” substitute “a recognised

 
 

 
previous section contents continue
 

© Parliamentary copyright
Revised 28 May 2012