SCHEDULE 5 continued
Contents page 50-59 60-69 70-79 80-89 90-99 100-109 110-119 120-129 130-139 140-149 150-169 169-170 170-179 180-182 Last page
Financial Services (Banking Reform) BillPage 150
group constituted for the purpose by the chair of the CMA under Schedule
4 to the Enterprise and Regulatory Reform Act 2013.
2
(1)
Schedule 4 to the Enterprise and Regulatory Reform Act 2013 is amended as
follows.
(2) 5In paragraph 35(1) (membership of CMA panel), after paragraph (c) insert—
“(ca)
at least one person (a “payment systems panel member”)
appointed to the CMA panel under paragraph 1(1)(b) for
the purpose of being available for selection as a member of
a group constituted to carry out functions on behalf of the
10CMA with respect to an appeal made in accordance with
section 72 of the Financial Services (Banking Reform) Act
2013 (a “specialist payment systems group”);”.
(3)
In paragraph 38 (membership of CMA groups), after sub-paragraph (5)
insert—
“(5A)
15In the case of a specialist payment systems group, the group must
include at least one payment systems member.”
(4)
In paragraph 48 (performance of functions of chair with respect to
constitution etc of CMA group), in sub-paragraph (4)(c), at the end insert—
“(v)
Schedule 5 to the Financial Services (Banking
20Reform) Act 2013.”
3
(1)
An application for permission to bring an appeal may be made only by
sending a notice to the CMA requesting the permission.
(2)
An application for permission to appeal must be accompanied by all such
25information as may be required by appeal rules.
(3)
Appeal rules may require information contained in an application for
permission to appeal to be verified by a statement of truth.
(4)
A person who applies for permission to bring an appeal in accordance with
this paragraph is referred to in this Schedule as the appellant.
(5) 30The appellant must send the Payment Systems Regulator—
(a)
a copy of the application for permission to appeal at the same time as
it is sent to the CMA, and
(b) such other information as may be required by appeal rules.
(6)
The CMA’s decision whether to grant permission to appeal is to be taken by
35an authorised member of the CMA.
(7)
Before the authorised member decides whether to grant permission under
this paragraph, the Payment Systems Regulator must be given an
opportunity of making representations or observations, in accordance with
paragraph 5(2).
(8) 40The CMA’s decision on an application for permission must be made—
(a)
where the Payment Systems Regulator makes representations or
observations in accordance with paragraph 5(2), before the end of 10
working days beginning with the first working day after the day on
which those representations or observations are received;
Financial Services (Banking Reform) BillPage 151
(b)
in any other case, before the end of 14 working days beginning with
the first working day after the day on which the application for
permission was received.
(9)
The grant of permission may be made subject to conditions, which may
5include—
(a)
conditions which limit the matters that are to be considered on the
appeal in question;
(b)
conditions for the purpose of expediting the determination of the
appeal;
(c)
10conditions requiring the appeal to be considered together with other
appeals (including appeals relating to different matters or decisions
and appeals brought by different persons).
(10)
Where a decision is made to grant or to refuse an application for permission,
an authorised member of the CMA must notify the decision, giving reasons,
15to the following persons—
(a) the appellant, and
(b) the Payment Systems Regulator.
(11)
A decision of the CMA under this paragraph must be published, in such
manner as an authorised member of the CMA considers appropriate, as
20soon as reasonably practicable after it is made.
(12)
The CMA may exclude from publication under sub-paragraph (11) any
information which it is satisfied is—
(a)
commercial information, the disclosure of which would, or might in
the CMA’s opinion, significantly harm the legitimate business
25interests of an undertaking to which it relates, or
(b)
information relating to the private affairs of an individual, the
disclosure of which would, or might in the CMA’s opinion,
significantly harm the individual’s interests.
4
(1)
30The CMA may direct that, pending the determination of an appeal against a
decision of the Payment Systems Regulator—
(a) the decision is not to have effect, or
(b)
the decision is not to have effect to such extent as may be specified in
the direction.
(2)
35The power to give a direction under this paragraph is exercisable only
where—
(a)
an application for its exercise has been made by the appellant at the
same time as the appellant made an application in accordance with
paragraph 3 for permission to bring an appeal against a decision of
40the Payment Systems Regulator,
(b)
the Payment Systems Regulator has been given an opportunity of
making representations or observations, in accordance with
paragraph 5(2), and
(c)
the balance of convenience does not otherwise require effect to be
45given to the decision pending that determination.
(3)
The CMA’s decision on an application for a direction under this paragraph
must be made—
Financial Services (Banking Reform) BillPage 152
(a)
where the Payment Systems Regulator makes representations or
observations in accordance with paragraph 5(2), before the end of 10
working days beginning with the first working day after the day on
which those representations or observations are received;
(b)
5in any other case, before the end of 14 working days beginning with
the first working day following the day on which the application
under sub-paragraph (2)(a) is received.
(4)
The appellant must send the Payment Systems Regulator a copy of the
application for a direction under this paragraph at the same time as it is sent
10to the CMA.
(5)
The CMA’s decision whether to give a direction is to be taken by an
authorised member of the CMA.
(6) A direction under this paragraph must be—
(a) given by an authorised member of the CMA, and
(b)
15published, in such manner as an authorised member of the CMA
considers appropriate, as soon as reasonably practicable after it is
given.
(7)
Sub-paragraph (12) of paragraph 3 applies to the publication of a direction
under sub-paragraph (6) of this paragraph as it applies to the publication of
20a decision under sub-paragraph (11) of that paragraph.
5
(1)
Sub-paragraph (2) applies where the Payment Systems Regulator wishes to
make representations or observations to the CMA in relation to—
(a) an application for permission to bring an appeal under paragraph 3;
(b) 25an application for a direction under paragraph 4.
(2)
The Payment Systems Regulator must make the representations or
observations in writing before the end of 10 working days beginning with
the first working day after the day on which it received a copy of the
application under paragraph 3(5) or 4(4) (as the case may be).
(3)
30Sub-paragraph (4) applies where an application for permission to bring an
appeal has been granted and the Payment Systems Regulator wishes to
make representations or observations to the CMA in relation to—
(a)
the Payment Systems Regulator’s reasons for the decision in relation
to which the appeal is being brought;
(b)
35any grounds on which that appeal is being brought against that
decision.
(4)
The Payment Systems Regulator must make the representations or
observations in writing before the end of 15 working days beginning with
the first working day after the day on which permission to bring the appeal
40was granted.
(5)
The Payment Systems Regulator must send a copy of the representations
and observations it makes under this paragraph to the appellant.
6
(1)
A group constituted by the chair of the CMA under Schedule 4 to the
45Enterprise and Regulatory Reform Act 2013 for the purpose of carrying out
Financial Services (Banking Reform) BillPage 153
functions of the CMA with respect to an appeal must consist of three
members of the CMA panel.
(2) A decision of the group is effective if, and only if—
(a) all the members of the group are present when it is made, and
(b) 5at least two members of the group are in favour of the decision.
7
(1)
The CMA must determine an appeal within the period of 6 months
beginning with the permission date.
(2) If—
(a)
10the CMA has received representations on the timing of the
determination from a party to the appeal, and
(b)
it is satisfied that there are special reasons why the determination
cannot be made within the period specified in sub-paragraph (1),
the CMA must determine the appeal within the period specified by it, which
15must not be longer than the period of 7 months beginning with the
permission date.
(3) In a case where sub-paragraph (2) applies, the CMA must also—
(a)
inform the parties to the appeal of the time limit for determining the
appeal, and
(b)
20publish that time limit in such manner as it considers appropriate for
the purpose of bringing it to the attention of any other persons likely
to be affected by the determination.
(4)
In this paragraph the “permission date” is the date on which the CMA gave
permission to bring the appeal in accordance with section 69(8).
8
(1)
The CMA, if it thinks it necessary to do so for the purpose of securing the
determination of an appeal within the period provided for by paragraph 7,
may disregard—
(a)
any or all matters raised by an appellant that were not raised by that
30appellant at the time of the relevant application, and
(b)
any or all matters raised by the Payment Systems Regulator that
were not contained in representations or observations made for the
purposes of the appeal in accordance with paragraph 5.
(2)
In this paragraph “relevant application” means an application under
35paragraph 3 or 4.
9 (1) For the purposes of this Schedule, the CMA may by notice—
(a)
require a person to produce to the CMA the documents specified or
otherwise identified in the notice;
(b)
40require any person who carries on a business to supply to the CMA
such estimates, forecasts, returns or other information as may be
specified or described in the notice in relation to that business.
Financial Services (Banking Reform) BillPage 154
(2)
The power to require the production of a document, or the supply of any
estimate, forecast, return or other information, is a power to require its
production or, as the case may be, supply—
(a) at the time and place specified in the notice, and
(b) 5in a legible form.
(3)
No person is to be compelled under this paragraph to produce a document
or supply an estimate, forecast, return or other information which the person
could not be compelled to produce in civil proceedings in the High Court or
Court of Session.
(4)
10An authorised member of the CMA may, for the purpose of the exercise of
the functions of the CMA, make arrangements for copies to be taken of a
document produced or an estimate, forecast, return or other information
supplied to it under this paragraph.
(5) A notice for the purposes of this paragraph—
(a)
15may be issued on the CMA’s behalf by an authorised member of the
CMA;
(b)
must include information about the possible consequences of not
complying with the notice (as set out in paragraph 13).
10
(1)
20For the purposes of this Schedule an oral hearing may be held, and evidence
may be taken on oath—
(a)
by a person considering an application for permission to bring an
appeal under paragraph 3,
(b)
by a person considering an application for a direction under
25paragraph 4, or
(c) by a group with the function of determining an appeal;
and, for that purpose, such a person or group may administer oaths.
(2) The CMA may by notice require a person—
(a) to attend at a time and place specified in the notice, and
(b)
30at that time and place, to give evidence to a person or group
mentioned in sub-paragraph (1).
(3) At any oral hearing the person or group conducting the hearing may—
(a)
require the appellant or the Payment Systems Regulator, if present at
the hearing, to give evidence or to make representations or
35observations, or
(b)
require a person attending the hearing as a representative of the
appellant or of the Payment Systems Regulator to make
representations or observations.
(4)
A person who gives oral evidence at the hearing may be cross-examined by
40or on behalf of any party to the appeal.
(5)
If the appellant, the Payment Systems Regulator, or the appellant’s or
Payment Systems Regulator’s representative is not present at a hearing—
(a)
there is no requirement to give notice to that person under sub-
paragraph (2), and
Financial Services (Banking Reform) BillPage 155
(b)
the person or group conducting the hearing may determine the
application or appeal without hearing that person’s evidence,
representations or observations.
(6)
No person is to be compelled under this paragraph to give evidence which
5the person could not be compelled to give in civil proceedings in the High
Court or Court of Session.
(7)
Where a person is required under this paragraph to attend at a place more
than 10 miles from the person’s place of residence, an authorised member of
the CMA must arrange for the person to be paid the necessary expenses of
10attendance.
(8)
A notice for the purposes of this paragraph may be issued on the CMA’s
behalf by an authorised member of the CMA.
11
(1)
The CMA may by notice require a person to produce a written statement
15with respect to a matter specified in the notice to—
(a)
a person who is considering, or is to consider, an application for a
direction under paragraph 4, or
(b) a group with the function of determining an appeal.
(2)
The power to require the production of a written statement includes
20power—
(a) to specify the time and place at which it is to be produced, and
(b) to require it to be verified by a statement of truth;
and a statement required to be so verified must be disregarded unless it is so
verified.
(3)
25No person is to be compelled under this paragraph to produce a written
statement with respect to any matter about which the person could not be
compelled to give evidence in civil proceedings in the High Court or Court
of Session.
(4)
A notice for the purposes of this paragraph may be issued on the CMA’s
30behalf by an authorised member of the CMA.
12
Where permission to bring an appeal is granted under paragraph 3, the
CMA may commission expert advice with respect to any matter raised by a
party to the appeal.
13 (1) If a person (“the defaulter”)—
(a)
fails to comply with a notice issued or other requirement imposed
under paragraph 9, 10 or 11,
(b)
in complying with a notice under paragraph 11, makes a statement
40that is false in any material particular, or
(c)
in providing information verified in accordance with a statement of
truth required by appeal rules, provides information that is false in a
material particular,
an authorised member of the CMA may certify that fact to the court.
Financial Services (Banking Reform) BillPage 156
(2)
If the court is satisfied that the defaulter failed without reasonable excuse to
comply with the notice or other requirement, or made the false statement, or
provided the false information, it may deal with the defaulter (and in the
case of a body corporate, any director or other officer of the body) as if that
5person were in contempt.
(3)
In sub-paragraph (2) “officer”, in relation to a limited liability partnership,
means a member of the limited liability partnership.
(4) In this paragraph “court” means—
(a) the High Court, or
(b) 10in Scotland, the Court of Session.
14
(1)
A person who wilfully alters, suppresses or destroys a document which the
person has been required to produce under paragraph 9 is guilty of an
offence.
(2) A person guilty of an offence under this paragraph is liable—
(a) 15on summary conviction—
(i)
in England and Wales, to imprisonment for a term not
exceeding 12 months (or 6 months, if the offence was
committed before the commencement of section 154(1) of the
Criminal Justice Act 2003) or a fine, or both;
(ii)
20in Scotland, to imprisonment for a term not exceeding 12
months or a fine not exceeding the statutory maximum, or
both;
(iii)
in Northern Ireland, to imprisonment for a term not
exceeding 6 months or a fine not exceeding the statutory
25maximum, or both;
(b)
on conviction on indictment, to imprisonment for a term not
exceeding 2 years or a fine, or both.
15 (1) A determination by the CMA on an appeal—
(a) 30must be contained in an order made by the CMA;
(b) must set out the reasons for the determination;
(c)
takes effect at the time specified in the order or determined in
accordance with provision made in the order;
(d) must be notified by the CMA to the parties to the appeal;
(e) 35must be published by the CMA—
(i)
as soon as reasonably practicable after the determination is
made;
(ii)
in such manner as the CMA considers appropriate for the
purpose of bringing the determination to the attention of any
40person likely to be affected by it (other than a party to the
appeal).
(2)
The CMA may exclude from publication under sub-paragraph (1)(e) any
information which it is satisfied is—
(a)
commercial information, the disclosure of which would, or might in
45the CMA’s opinion, significantly harm the legitimate business
interests of an undertaking to which it relates, or
Financial Services (Banking Reform) BillPage 157
(b)
information relating to the private affairs of an individual, the
disclosure of which would, or might in the CMA’s opinion,
significantly harm the individual’s interests.
(3)
The Payment Systems Regulator must take such steps as it considers
5necessary for it to comply with an order of the CMA made by virtue of sub-
paragraph (1)(a).
(4) The steps must be taken—
(a)
if a time is specified in (or is to be determined in accordance with) the
order, within that time;
(b) 10in any other case, within a reasonable time.
16
(1)
The CMA Board may make rules of procedure regulating the conduct and
disposal of appeals.
(2)
Those rules may include provision supplementing the provisions of this
15Schedule in relation to any application, notice, hearing, power or
requirement for which this Schedule provides; and that provision may, in
particular, impose time limits or other restrictions on—
(a) the taking of evidence at an oral hearing, or
(b) the making of representations or observations at such a hearing.
(3)
20The CMA Board must publish rules made under this paragraph in such
manner as it considers appropriate for the purpose of bringing them to the
attention of those likely to be affected by them.
(4)
Before making rules under this paragraph, the CMA Board must consult
such persons as it considers appropriate.
(5) 25Rules under this paragraph may make different provision for different cases.
17
(1)
A group that determines an appeal must make an order requiring the
payment to the CMA of the costs incurred by the CMA in connection with
the appeal.
(2) 30An order under sub-paragraph (1) must require those costs to be paid—
(a)
where the appeal is allowed in full, by the Payment Systems
Regulator;
(b) where the appeal is dismissed in full, by the appellant;
(c)
where the appeal is partially allowed, by one or more parties in such
35proportions as the CMA considers appropriate in all the
circumstances.
(3)
The group that determines an appeal may also make such order as it thinks
fit for requiring a party to the appeal to make payments to another party in
respect of costs reasonably incurred by that other party in connection with
40the appeal.
(4)
A person who is required by an order under this paragraph to pay a sum to
another person must comply with the order before the end of the period of
28 days beginning with the day after the making of the order.
Financial Services (Banking Reform) BillPage 158
(5)
Sums required to be paid by an order under this paragraph but not paid
within the period mentioned in sub-paragraph (4) are to bear interest at such
rate as may be determined in accordance with provision contained in the
order.
(6)
5Any costs payable by virtue of an order under this paragraph and any
interest that has not been paid may be recovered as a civil debt by the person
in whose favour the order is made.
18 (1) In this Schedule—
10“appeal” means an appeal made in accordance with section 72;
“appeal rules” means rules of procedure under paragraph 16;
“appellant” has the meaning given by paragraph 3(4);
“authorised member of the CMA”—
in relation to a power exercisable in connection with an
15appeal in respect of which a group has been constituted by
the chair of the CMA under Schedule 4 to the Enterprise and
Regulatory Reform Act 2013, means a member of that group
who has been authorised by the chair of the CMA to exercise
that power;
20in relation to a power exercisable in connection with an
application for permission to bring an appeal, or otherwise in
connection with an appeal in respect of which a group has
not been so constituted by the chair of the CMA, means—
any member of the CMA Board who is also a member
25of the CMA panel, or
any member of the CMA panel authorised by the
Treasury (whether generally or specifically) to
exercise the power in question;
“CMA” means the Competition and Markets Authority;
30“CMA Board” and “CMA panel” have the same meaning as in Schedule
4 to the Enterprise and Regulatory Reform Act 2013;
“group” means a group selected in accordance with paragraph 6;
“statement of truth”, in relation to the production of a statement or
provision of information by a person, means a statement that the
35person believes the facts stated in the statement or information to be
true;
“working day” means any day other than—
Saturday or Sunday;
Christmas Day or Good Friday;
40a day which is a bank holiday under the Banking and
Financial Dealings Act 1971 in any part of the United
Kingdom.
(2) References in this Schedule to a party to an appeal are references to—
(a) the appellant, or
(b) 45the Payment Systems Regulator.
Financial Services (Banking Reform) BillPage 159
Section 114
1 The following provisions of this Schedule provide for—
(a)
the general powers and duties of FMI administrators (by application
5of provisions about administrators), and
(b)
the general process and effects of FMI administration (by application
of provisions about administration).
2
The provisions set out in the Tables apply in relation to FMI administration
as in relation to administration, with—
(a) 10the modifications set out in paragraph 3,
(b) any other modification specified in the Tables, and
(c) any other necessary modification.
3 The modifications are that—
(a)
a reference to the administrator is a reference to the FMI
15administrator,
(b) a reference to administration is a reference to FMI administration,
(c)
a reference to an administration application is a reference to an FMI
administration application,
(d)
a reference to an administration order is a reference to an FMI
20administration order,
(e)
a reference to a company is a reference to the infrastructure
company, and
(f)
a reference to the purpose of administration (other than the reference
in paragraph 111(1) of Schedule B1) is a reference to the objective in
25section 108.
4
Powers conferred by this Part of this Act and by the 1986 Act (as applied) are
in addition to, and not in restriction of, any existing powers of instituting
proceedings against any contributory or debtor of an infrastructure
company, or the estate of any contributory or debtor, for the recovery of any
30call or other sum.
5
A reference in an enactment or other document to anything done under a
provision applied by this Part of this Act includes a reference to the
provision as applied.
TABLE 1 OF APPLIED PROVISIONS
| Provision of Schedule B1 |
Subject | 35Modification |
|---|---|---|
| Para. 40(1)(a) |
Dismissal of pending winding- up petition |
|
| Para. 41 | Dismissal of administrative or other receiver |
|
| Para. 42 | Moratorium on insolvency proceedings |
Ignore sub-paras. (4) and (5). |
Financial Services (Banking Reform) BillPage 160
| Provision of Schedule B1 |
Subject | Modification |
|---|---|---|
| Para. 43 | Moratorium on other legal process |
|
| Para. 44(1)(a) and (5) |
Interim moratorium | |
| Para. 46 | Announcement of appointment | Ignore sub-para. (6)(b) and (c). |
| Paras. 47 and 48 |
Statement of affairs | |
| Para. 49 | Administrator’s proposals | (a)
The administrator must obtain the (b)
Treat the reference in sub-para. (c)
Ignore sub-para. (3)(b). |
| Para. 59 | General powers | |
| Para. 60 and Schedule 1 |
General powers | The exercise of powers under Schedule 1 is 15subject to section 108 of this Act. |
| Para. 61 | Directors | |
| Para. 62 | Power to call meetings of creditors |
|
| Para. 63 | Application to court for directions |
(a)
Before making an application in (b)
In making directions the court must 25 |
| Para. 64 | Management powers | |
| Para. 65 | Distribution to creditors | |
| Para. 66 | Payments | |
| Para. 67 | Taking custody of property | |
| Para. 68 | Management | (a)
Ignore sub-paras. (1) and (3). (b)
The Bank of England may apply to |
| Para. 69 | Agency | |
| Para. 70 | Floating charges | |
| Para. 71 | Fixed charges | |
| Para. 72 | Hire-purchase property | |
| Para. 73 | Protection for secured and preferential creditors |
Financial Services (Banking Reform) BillPage 161
| Provision of Schedule B1 |
Subject | Modification |
|---|---|---|
| Para. 74 | Challenge to administrator’s conduct |
For sub-para. (2) there is to be taken to be
|
| Para. 75 | Misfeasance | In addition to applications that may anyway be made under para. 75, an application may 20be made by the FMI administrator or the Bank of England. |
| Para. 79 | Court ending administration on application of administrator |
For sub-paras. (1) to (3) there are to be taken
|
| Para. 84 | Termination: no more assets for distribution |
|
| Para. 85 | Discharge of administration order |
|
| Para. 86 | Notice to Companies Registrar of end of administration |
|
| Para. 87 | Resignation | An FMI administrator may not resign under 40para. 87 without giving 28 days’ notice of the intention to do so to the Bank of England. |
| Para. 88 | Removal | An application for an order removing an FMI administrator from office may be made only by or with the consent of the Bank of 45England. |
| Para. 89 | Disqualification | The notice under sub-para. (2) must be given to the Bank of England. |
| Paras. 90 and 91 |
Replacement | (a)
Para. 91(1) applies as if the only (b)
Ignore para. 91(2). |
| Para. 98 | Discharge | 55Ignore sub-paras. (2)(b) and (3). |
Financial Services (Banking Reform) BillPage 162
| Provision of Schedule B1 |
Subject | Modification |
|---|---|---|
| Para. 99 | Vacation of office: charges and liabilities |
In the application of sub-para. (3), payments (a)
in accordance with directions of the (b)
if the Bank is satisfied that they will |
| Paras. 100 to 103 |
Joint administrators | An application under para. 103 may be made only by the Bank of England. |
| Para. 104 | Validity | |
| Para. 106 (and section 430 and Schedule 10) |
Fines | |
| Paras. 107 to 109 |
Extension of time limits | |
| Para. 110 | Amendment of provisions about time |
15An order under para. 110 may amend a provision of the Schedule as it applies by virtue of this Act (whether or not in the same way as it amends the provision as it applies otherwise). |
| Para. 111 | Interpretation | |
| Paras. 112 to 116 |
Scotland |
20TABLE 2 OF APPLIED PROVISIONS
| Section | Subject | Modification or comment |
|---|---|---|
| Section 233 | Utilities | |
| Section 234 | Getting in company’s property | |
| Section 235 | Duty to co-operate with office- holder |
|
| Section 236 | Inquiry into company’s dealings | |
| Section 237 | Section 236: enforcement by court |
|
| Section 238 | Transactions at an undervalue (England and Wales) |
|
| Section 239 | Preferences (England and Wales) |
|
| Section 240 | Ss. 238 and 239: relevant time |
Financial Services (Banking Reform) BillPage 163
| Section | Subject | Modification or comment |
|---|---|---|
| Section 241 | Orders under ss. 238 and 239 | (a)
In considering making an order in (b)
Ignore subsections (2A)(a) and (3) to |
| Section 242 | Gratuitous alienations (Scotland) |
|
| Section 243 | Unfair preferences (Scotland) | In considering the grant of a decree under 10subsection (5) the court must have regard to the objective in section 108 of this Act. |
| Section 244 | Extortionate credit transactions | |
| Section 245 | Avoidance of floating charges | |
| Section 246 | Unenforceability of liens | |
| Sections 386 and 387, and Schedule 6 (and Schedule 4 to the Pension Schemes Act 1993) |
Preferential debts | |
| Section 389 | Offence of acting without being qualified |
Treat references to acting as an insolvency practitioner as references to acting as an FMI administrator. |
| Section 390 | Persons not qualified to act | 15Treat references to acting as an insolvency practitioner as references to acting as an FMI administrator. |
| Section 391 | Recognised professional bodies | An order under section 391 has effect in relation to any provision applied for the 20purposes of FMI administration. |
| Sections 423 to 425 |
Transactions defrauding creditors |
In considering granting leave under section 424(1) or making an order in reliance on section 425, the court must have regard to the objective in section 108 of this Act. |
| Sections 430 to 432 and Schedule 10 |
Offences |
6
(1)
25The Treasury may by order amend this Schedule so as to make further
modifications.
(2)
The further modifications that may be made are confined to such
modifications of—
(a) the 1986 Act, or
(b)
30other enactments passed or made before this Act that relate to
insolvency or make provision by reference to anything that is or may
be done under the 1986 Act,
as the Treasury consider appropriate in relation to any provision made by or
under this Part of this Act.
Financial Services (Banking Reform) BillPage 164
(3)
An order under this paragraph may also make modifications of the
provisions of this Schedule.
Section 114
1 This Schedule applies where—
(a)
the court has made an FMI administration order in relation to a
company (“the old company”), and
(b)
it is proposed that a transfer within section 108(5) be made to another
10company (“the new company”).
2 In this Schedule—
“FMI transfer scheme” has the meaning given by paragraph 4(1);
“the new company” and “the old company” are to be read in
15accordance with paragraph 1;
“third party”, in relation to an FMI transfer scheme or a modification of
such a scheme, means a person other than the old company or the
new company.
3
20It is for the FMI administrator, while the FMI administration order is in
force, to act on behalf of the old company in the doing of anything that it is
authorised or required to do by or under this Schedule.
3
It is for the FMI administrator, while the FMI administration order is in
force, to act on behalf of the old company in the doing of anything that it is
25authorised or required to do by or under this Schedule.
4 (1) The old company may—
(a) with the consent of the new company, and
(b) for the purpose of giving effect to the proposed transfer,
30make a scheme under this Schedule for the transfer of property, rights and
liabilities from the old company to the new company (an “FMI transfer
scheme”).
(2)
Such a scheme may be made only at a time when the FMI administration
order is in force in relation to the old company.
(3)
35An FMI transfer scheme may set out the property, rights and liabilities to be
transferred in one or more of the following ways—
(a) by specifying or describing them in particular,
(b)
by identifying them generally by reference to, or to a specified part
of, the undertaking of the old company, or
(c) 40by specifying the manner in which they are to be determined.
(4)
An FMI transfer scheme is to take effect in accordance with paragraph 7 at
the time appointed by the court.
Financial Services (Banking Reform) BillPage 165
(5)
But the court must not appoint a time for a scheme to take effect unless that
scheme has been approved by the Bank of England.
(6)
The Bank of England may modify an FMI transfer scheme before approving
it, but only modifications to which both the old company and the new
5company have consented may be made.
(7)
In deciding whether to approve an FMI transfer scheme, the Bank of
England must have regard, in particular, to—
(a) the public interest, and
(b)
any effect that the scheme is likely to have on the interests of third
10parties.
(8)
Before approving an FMI transfer scheme, the Bank of England must consult
the Treasury.
(8)
The old company and the new company each have a duty to provide the
Bank of England with all information and other assistance that the Bank may
15reasonably require for the purposes of, or in connection with, the exercise of
the powers conferred on it by this paragraph.
5 (1) An FMI transfer scheme may contain provision—
(a)
for the creation, in favour of the old company or the new company,
20of an interest or right in or in relation to property transferred in
accordance with the scheme;
(b)
for giving effect to a transfer to the new company by the creation, in
favour of that company, of an interest or right in or in relation to
property retained by the old company;
(c)
25for the creation of new rights and liabilities (including rights of
indemnity and duties to indemnify) as between the old company and
the new company;
(d)
in connection with any provision made under this sub-paragraph,
provision making incidental provision as to the interests, rights and
30liabilities of other persons with respect to the property, rights and
liabilities to which the scheme relates.
(2)
The property, rights and liabilities of the old company that may be
transferred in accordance with an FMI transfer scheme include—
(a)
property, rights and liabilities that would not otherwise be capable
35of being transferred or assigned by the old company;
(b)
property acquired, and rights and liabilities arising, in the period
after the making of the scheme but before it takes effect;
(c)
rights and liabilities arising after it takes effect in respect of matters
occurring before it takes effect;
(d) 40property situated anywhere in the United Kingdom or elsewhere;
(e)
rights and liabilities under the law of a part of the United Kingdom
or of a place outside the United Kingdom;
(f)
rights and liabilities under an enactment, EU instrument or
subordinate legislation.
(3)
45The transfers to which effect may be given by an FMI transfer scheme
include transfers of interests and rights that are to take effect in accordance
with the scheme as if there were—
Financial Services (Banking Reform) BillPage 166
(a) no such requirement to obtain a person’s consent or concurrence,
(b)
no such liability in respect of a contravention of any other
requirement, and
(c) no such interference with any interest or right,
5as there would be, in the case of a transaction apart from this Act, by reason
of a provision falling within sub-paragraph (4).
(4)
A provision falls within this sub-paragraph to the extent that it has effect
(whether under an enactment or agreement or otherwise) in relation to the
terms on which the old company is entitled, or subject, to anything to which
10the transfer relates.
(5)
Sub-paragraph (6) applies where (apart from that sub-paragraph) a person
would be entitled, in consequence of anything done or likely to be done by
or under this Act in connection with an FMI transfer scheme—
(a) to terminate, modify, acquire or claim an interest or right, or
(b) 15to treat an interest or right as modified or terminated.
(6) That entitlement—
(a)
is not enforceable in relation to that interest or right until after the
transfer of the interest or right by the scheme, and
(b)
is then enforceable in relation to the interest or right only in so far as
20the scheme contains provision for the interest or right to be
transferred subject to whatever confers that entitlement.
(7)
Sub-paragraphs (3) to (6) have effect where shares in a subsidiary of the old
company are transferred—
(a)
as if the reference in sub-paragraph (4) to the terms on which the old
25company is entitled or subject to anything to which the transfer
relates included a reference to the terms on which the subsidiary is
entitled or subject to anything immediately before the transfer takes
effect, and
(b)
in relation to an interest or right of the subsidiary, as if the references
30in sub-paragraph (6) to the transfer of the interest or right included
a reference to the transfer of the shares.
(8)
Sub-paragraphs (3) and (4) apply to the creation of an interest or right by an
FMI transfer scheme as they apply to the transfer of an interest or right.
6
(1)
35An FMI transfer scheme may make incidental, supplemental, consequential
and transitional provision in connection with the other provisions of the
scheme.
(2)
An FMI transfer scheme may in particular make provision, in relation to a
provision of the scheme—
(a)
40for the new company to be treated as the same person in law as the
old company;
(b)
for agreements made, transactions effected or other things done by
or in relation to the old company to be treated, so far as may be
necessary for the purposes of or in connection with a transfer in
45accordance with the scheme, as made, effected or done by or in
relation to the new company;
Financial Services (Banking Reform) BillPage 167
(c)
for references in an agreement, instrument or other document to the
old company or to an employee or office holder with the old
company to have effect, so far as may be necessary for the purposes
of or in connection with a transfer in accordance with the scheme,
5with such modifications as are specified in the scheme;
(d)
that the effect of any transfer in accordance with the scheme in
relation to contracts of employment with the old company is not to
terminate any of those contracts but is to be that periods of
employment with that company are to count for all purposes as
10periods of employment with the new company;
(e)
for proceedings commenced by or against the old company to be
continued by or against the new company.
(3)
Sub-paragraph (2)(c) does not apply to references in an enactment or in
subordinate legislation.
(4)
15An FMI transfer scheme may make provision for disputes between the old
company and the new company as to the effect of the scheme to be referred
to such arbitration as may be specified in or determined under the scheme.
(5)
Where a person is entitled, in consequence of an FMI transfer scheme, to
possession of a document relating in part to the title to land or other
20property in England and Wales, or to the management of such land or other
property—
(a)
the scheme may provide for that person to be treated as having given
another person an acknowledgement in writing of the right of that
other person to production of the document and to delivery of copies
25of it, and
(b)
section 64 of the Law of Property Act 1925 (production and safe
custody of documents) is to have effect accordingly, and on the basis
that the acknowledgement did not contain an expression of contrary
intention.
(6)
30Where a person is entitled, in consequence of an FMI transfer scheme, to
possession of a document relating in part to the title to land or other
property in Scotland or to the management of such land or other property,
subsections (1) and (2) of section 16 of the Land Registration (Scotland) Act
1979 (omission of certain clauses in deeds) is to have effect in relation to the
35transfer—
(a) as if the transfer had been effected by deed, and
(b)
as if the words “unless specially qualified” were omitted from each
of those subsections.
(7)
Where a person is entitled, in consequence of an FMI transfer scheme, to
40possession of a document relating in part to the title to land or other
property in Northern Ireland or to the management of such land or other
property—
(a)
the scheme may provide for that person to be treated as having given
another person an acknowledgement in writing of the right of that
45other person to production of the document and to delivery of copies
of it, and
(b)
section 9 of the Conveyancing Act 1881 is to have effect accordingly,
and on the basis that the acknowledgement does not contain an
expression of contrary intention.
Financial Services (Banking Reform) BillPage 168
(8)
In this paragraph references to a transfer in accordance with an FMI transfer
scheme include references to the creation in accordance with such a scheme
of an interest, right or liability.
7
(1)
5In relation to each provision of an FMI transfer scheme for the transfer of
property, rights or liabilities, or for the creation of interests, rights or
liabilities—
(a)
the property, interests, rights or liabilities become by virtue of this
Schedule the property, interests, rights or liabilities of the transferee
10at the time appointed by the court for the purposes of paragraph 4(4),
and
(b)
the provisions of that scheme in relation to that property, or those
interests, rights or liabilities, have effect from that time.
(2) In this paragraph “the transferee” means—
(a)
15in relation to property, rights or liabilities transferred by an FMI
transfer scheme, the new company;
(b)
in relation to interests, rights or liabilities created by such a scheme,
the person in whose favour, or in relation to whom, they are created.
8
(1)
20The Bank of England may by notice to the old company and the new
company modify an FMI transfer scheme after it has taken effect, but only
modifications to which both the old company and the new company have
consented may be made.
(2)
The notice must specify the time at which it is to take effect (the
25“modification time”).
(3)
Where a notice is issued under this paragraph in relation to an FMI transfer
scheme, as from the modification time, the scheme is for all purposes to be
treated as having taken effect, at the time appointed for the purposes of
paragraph 4(4), with the modifications made by the notice.
(4) 30Those modifications may make—
(a)
any provision that could have been included in the scheme when it
took effect at the time appointed for the purposes of paragraph 4(4),
and
(aa) transitional provision in connection with provision falling within paragraph (a).
(5)
35In deciding whether to modify an FMI transfer scheme, the Bank of England
must have regard, in particular, to—
(a) the public interest, and
(b)
any effect that the modification is likely to have on the interests of
third parties.
(6)
40Before modifying an FMI transfer scheme that has taken effect, the Bank of
England must consult the Treasury.
(7)
The old company and the new company each have a duty to provide the
Bank of England with all information and other assistance that the Bank may
Financial Services (Banking Reform) BillPage 169
reasonably require for the purposes of, or in connection with, the exercise of
the powers conferred on it by this paragraph.
9 (1) An FMI transfer scheme may contain provision about—
(a) 5the transfer of foreign property, right and liabilities, and
(b) the creation of foreign property, rights and liabilities.
(2)
For this purpose property, or a right, interest or liability, is “foreign” if an
issue relating to it arising in any proceedings would (in accordance with the
rules of private international law) be determined under the law of a country
10or territory outside the United Kingdom.
10
Where a proposed transfer falling within subsection (5) of section 108 is a
transfer of the kind mentioned in subsection (6)(a) of that section, this
Schedule has effect in relation to the transfer as if—
(a) 15paragraph 4(1)(a) were omitted, and
(b)
in paragraph 4(6), for the words from “both” onwards there were
substituted “the old company has consented may be made”.
Section 122
1
Part 16A of FSMA 2000 (consumer protection and competition) is amended
as follows.
2 Omit section 234H (power of FCA to make request to Office of Fair Trading).
3 25After section 234H insert—
(1)
The functions to which this subsection applies (“the concurrent
functions”) are to be concurrent functions of the FCA and the
Competition and Markets Authority (referred to in this Part as “the
30CMA”).