European Union Referendum Bill (HL Bill 60)

(2) The value of a regulated transaction which is a credit facility is the
maximum amount which may be borrowed under the agreement
for the facility.

(3) The value of a regulated transaction which is an arrangement by
5which any form of security is given is the contingent liability
under the security provided.

(4) For the purposes of sub-paragraphs (1) and (2), no account is to be
taken of the effect of any provision contained in a loan agreement
or an agreement for a credit facility at the time it is entered into
10which enables outstanding interest to be added to any sum for the
time being owed in respect of the loan or credit facility, whether or
not any such interest has been so added.

Part 2 Controls on regulated transactions

15Regulated transactions with non-qualifying persons

4 (1) A permitted participant must not—

(a) be a party to a regulated transaction to which a person who
is not a qualifying person is also a party;

(b) derive a benefit in consequence of a connected transaction
20if any of the parties to that transaction is not a qualifying
person.

(2) In this Schedule, “qualifying person” means—

(a) a permissible donor falling within section 54(2) (but see
sub-paragraph (3));

(b) 25a Gibraltar elector;

(c) any body falling within any of paragraphs (b) to (g) of
section 54(2A);

(d) a body incorporated by Royal Charter which does not fall
within section 54(2);

(e) 30a charitable incorporated organisation within the meaning
of Part 11 of the Charities Act 2011 or Part 11 of the
Charities Act (Northern Ireland) 2008;

(f) a Scottish charitable incorporated organisation within the
meaning of Chapter 7 of Part 1 of the Charities and Trustee
35Investment (Scotland) Act 2005 (asp 10)2005 (asp 10);

(g) a partnership constituted under the law of Scotland which
carries on business in the United Kingdom.

(3) In relation to transactions entered into by a permitted participant
other than a designated organisation, references in this Schedule
40to a qualifying person do not include—

(a) a registered party, or

(b) a political party which is not a registered party but is
established in Gibraltar,

and sub-paragraph (2)(a) and (c) have effect subject to this sub-
45paragraph.

(4) In this paragraph “designated organisation” has the meaning
given by section 110(5).

Effect of transaction with non-qualifying person

5 (1) This paragraph applies if a permitted participant is a party to a
5regulated transaction to which a non-qualifying person is also a
party.

(2) The transaction is void.

(3) Despite sub-paragraph (2)—

(a) any money received by the permitted participant by virtue
10of the transaction must be repaid by the responsible person
to the person from whom it was received, along with
interest at the rate referred to in section 71I(3)(a);

(b) the person from whom it was received is entitled to
recover the money, along with such interest.

(4) 15If—

(a) the money is not (for whatever reason) repaid as
mentioned in sub-paragraph (3)(a), or

(b) the person entitled to recover the money refuses or fails to
do so,

20the Commission may apply to the court to make such order as it
thinks fit to restore (so far as is possible) the parties to the
transaction to the position they would have been in if the
transaction had not been entered into.

(5) An order under sub-paragraph (4) may in particular—

(a) 25where the transaction is a loan or credit facility, require
that any amount owed by the permitted participant be
repaid (and that no further sums be advanced under it);

(b) where any form of security is given for a sum owed under
the transaction, require that security to be discharged.

(6) 30In the case of a regulated transaction where a party other than a
permitted participant—

(a) at the time the permitted participant enters into the
transaction, is a qualifying person, but

(b) subsequently, for whatever reason, ceases to be a
35qualifying person,

the transaction is void and sub-paragraphs (3) to (5) apply with
effect from the time when the other party ceased to be a qualifying
person.

Guarantees and securities involving non-qualifying persons

6 (1) 40This paragraph applies if—

(a) a permitted participant and another person (“A”) enter
into a transaction of a description mentioned in
paragraph 2(3)(a),

(b) A is party to a regulated transaction of a description
45mentioned in paragraph 2(3)(b) (“the connected
transaction”) with another person (“B”), and

(c) B is not a qualifying person.

(2) Paragraph 5(2) to (5) applies to the transaction mentioned in sub-
paragraph (1)(a).

(3) The connected transaction is void.

(4) 5Sub-paragraph (5) applies if (but only if) A is unable to recover
from the permitted participant the whole of the money mentioned
in paragraph 5(3)(a) (as applied by sub-paragraph (2) above),
along with such interest as is there mentioned.

(5) Despite sub-paragraph (3), A is entitled to recover from B any part
10of that money (and such interest) that is not recovered from the
permitted participant.

(6) Sub-paragraph (5) does not entitle A to recover more than the
contingent liability under the security provided by virtue of the
connected transaction.

(7) 15In the case of a connected transaction where B—

(a) at the time A enters into the transaction, is a qualifying
person, but

(b) subsequently, for whatever reason, ceases to be a
qualifying person,

20sub-paragraphs (2) to (6) apply with effect from the time when B
ceased to be a qualifying person.

(8) If the transaction mentioned in paragraph 2(3)(a) is not a regulated
transaction of a description mentioned in paragraph 2(1) or (2),
references in this paragraph and paragraph 5(2) to (5) (as applied
25by sub-paragraph (2) above) to the repayment or recovery of
money are to be construed as references to (as the case may be)—

(a) the return or recovery of any property provided under the
transaction,

(b) to the extent that such property is incapable of being
30returned or recovered or its market value has diminished
since the time the transaction was entered into, the
repayment or recovery of the market value at that time, or

(c) the repayment or recovery of the market value (at that
time) of any facilities or services provided under the
35transaction.

Transfer to non-qualifying person

7 If a qualifying person purports to transfer the person’s interest in
a regulated transaction to a non-qualifying person, the purported
transfer is of no effect.

Part 3 Offences

Offences of knowingly entering into certain transactions

8 (1) An individual who is a permitted participant commits an offence
5if—

(a) the individual enters into a regulated transaction of a
description mentioned in paragraph 2(1) or (2) to which a
non-qualifying person is also a party, and

(b) the individual knew or ought reasonably to have known of
10the matters mentioned in paragraph (a).

(2) A permitted participant that is not an individual commits an
offence if—

(a) it enters into a regulated transaction of a description
mentioned in paragraph 2(1) or (2) to which a non-
15qualifying person is also a party, and

(b) an officer of the permitted participant knew or ought
reasonably to have known of the matters mentioned in
paragraph (a).

(3) A person who is the responsible person in relation to a permitted
20participant that is not an individual commits an offence if—

(a) the permitted participant enters into a regulated
transaction of a description mentioned in paragraph 2(1)
or (2) to which a non-qualifying person is also a party, and

(b) the responsible person knew or ought reasonably to have
25known of the matters mentioned in paragraph (a).

(4) It is a defence for a person charged with an offence under sub-
paragraph (3) to prove that the person took all reasonable steps to
prevent the permitted participant from entering into the
transaction.

30Offences of failing to act on finding that transaction was not permitted

9 (1) An individual who is a permitted participant commits an offence
if—

(a) the individual has entered into a regulated transaction of a
description mentioned in paragraph 2(1) or (2) to which a
35non-qualifying person is also a party,

(b) the individual neither knew nor ought reasonably to have
known that the other party is a non-qualifying person,

(c) the individual comes to know of the matters mentioned in
paragraph (a), and

(d) 40the individual does not take, as soon as practicable after
coming to know of those matters, all reasonable steps to
repay any money which he or she has received by virtue of
the transaction.

(2) A permitted participant that is not an individual commits an
45offence if—

(a) it has entered into a regulated transaction of a description
mentioned in paragraph 2(1) or (2) to which a non-
qualifying person is also a party,

(b) no officer of the permitted participant knew or ought
5reasonably to have known that the other party is a non-
qualifying person,

(c) the responsible person comes to know of the matters
mentioned in paragraph (a), and

(d) the responsible person does not take, as soon as practicable
10after coming to know of those matters, all reasonable steps
to repay any money which the permitted participant has
received by virtue of the transaction.

(3) A person who is the responsible person in relation to a permitted
participant that is not an individual commits an offence if—

(a) 15the permitted participant has entered into a regulated
transaction of a description mentioned in paragraph 2(1)
or (2) to which a non-qualifying person is also a party,

(b) paragraph 8(3)(b) does not apply to the responsible
person,

(c) 20the responsible person comes to know of the matters
mentioned in paragraph (a), and

(d) the responsible person does not take, as soon as practicable
after coming to know of those matters, all reasonable steps
to repay any money which the permitted participant has
25received by virtue of the transaction.

Offences of benefiting from certain connected transactions

10 (1) An individual who is a permitted participant commits an offence
if—

(a) the individual benefits from, or falls to benefit in
30consequence of, a connected transaction to which a non-
qualifying person is a party, and

(b) the individual knew or ought reasonably to have known of
the matters mentioned in paragraph (a).

(2) A permitted participant that is not an individual commits an
35offence if—

(a) it benefits from, or falls to benefit in consequence of, a
connected transaction to which a non-qualifying person is
a party, and

(b) an officer of the permitted participant knew or ought
40reasonably to have known of the matters mentioned in
paragraph (a).

(3) A person who is the responsible person in relation to a permitted
participant that is not an individual commits an offence if—

(a) the permitted participant benefits from, or falls to benefit
45in consequence of, a connected transaction to which a non-
qualifying person is a party, and

(b) the person knew or ought reasonably to have known of the
matters mentioned in paragraph (a).

(4) It is a defence for a person charged with an offence under sub-
paragraph (3) to prove that the person took all reasonable steps to
prevent the permitted participant from benefiting in consequence
of the connected transaction.

5Offences of failing to act on finding connected transaction was not permitted

11 (1) An individual who is a permitted participant commits an offence
if—

(a) the individual is a party to a transaction of a description
mentioned in paragraph 2(3)(a),

(b) 10the individual benefits from, or falls to benefit in
consequence of, a connected transaction to which a non-
qualifying person is a party,

(c) the individual neither knew nor ought reasonably to have
known of the matters mentioned in paragraphs (a) and (b),

(d) 15the individual comes to know of those matters, and

(e) the individual does not take, as soon as practicable after
coming to know of those matters, all reasonable steps to
pay to any person who has provided the individual with
any benefit in consequence of the connected transaction
20the value of the benefit.

(2) A permitted participant that is not an individual commits an
offence if—

(a) it is a party to a transaction of a description mentioned in
paragraph 2(3)(a),

(b) 25it benefits from, or falls to benefit in consequence of, a
connected transaction to which a non-qualifying person is
a party,

(c) no officer of the permitted participant knew or ought
reasonably to have known of the matters mentioned in
30paragraphs (a) and (b),

(d) the responsible person comes to know of those matters,
and

(e) the responsible person does not take, as soon as practicable
after coming to know of those matters, all reasonable steps
35to pay to any person who has provided the permitted
participant with any benefit in consequence of the
connected transaction the value of the benefit.

(3) A person who is the responsible person in relation to a permitted
participant that is not an individual commits an offence if—

(a) 40the permitted participant is a party to a transaction of a
description mentioned in paragraph 2(3)(a),

(b) the permitted participant benefits from, or falls to benefit
in consequence of, a connected transaction to which a non-
qualifying person is a party,

(c) 45paragraph 10(3)(b) does not apply to the person,

(d) the responsible person comes to know of the matters
mentioned in paragraphs (a) and (b), and

(e) the responsible person does not take, as soon as practicable
after coming to know of those matters, all reasonable steps

to pay to any person who has provided the permitted
participant with any benefit in consequence of the
connected transaction the value of the benefit.

Arrangements facilitating transactions with non-qualifying persons

12 5A person commits an offence if the person—

(a) knowingly enters into, or

(b) knowingly does any act in furtherance of,

any arrangement which facilitates or is likely to facilitate, whether
by means of concealment or disguise or otherwise, the
10participation by a permitted participant in a regulated transaction
with a non-qualifying person.

Offences: interpretation

13 (1) A reference in this Part of this Schedule to a permitted participant
entering into a regulated transaction includes a reference to any
15circumstances in which the terms of a regulated transaction are
varied so as to increase the amount of money to which the
permitted participant is entitled in consequence of the transaction.

(2) A reference in paragraph 8 or 9 to entering into a regulated
transaction of a description mentioned in paragraph 2(1) or (2) to
20which a non-qualifying person is also a party includes receiving
an amount of money under a regulated transaction of a
description mentioned in paragraph 2(1) or (2) at a time when a
person who is also a party to the transaction (and who was a
qualifying person when the transaction was entered into) has
25ceased to be a qualifying person.

(3) It is a defence for a person charged with an offence under
paragraph 8 by virtue of sub-paragraph (2) to prove that the
person took all reasonable steps, as soon as practicable, to repay
the money received as mentioned in sub-paragraph (2).

(4) 30Where a person is charged with an offence under paragraph 8(3)
by virtue of sub-paragraph (2), paragraph 8(4) does not apply.

(5) In relation to a case where paragraph 9(1)(a) to (c), (2)(a) to (c) or
(3)(a) to (c) apply by reason of sub-paragraph (2), the reference in
paragraph 9(1)(d), (2)(d) or (3)(d) to any money received by virtue
35of the transaction is to be read as a reference to any money so
received after the party in question ceased to be a qualifying
person.

Penalties

14 (1) A person guilty of an offence under paragraph 8(1) or (2), 9(1),
4010(1) or (2) or 11(1) is liable—

(a) on conviction on indictment, to a fine;

(b) on summary conviction in England and Wales, to a fine;

(c) on summary conviction in Scotland or Northern Ireland, to
a fine not exceeding the statutory maximum;

(d) on summary conviction in Gibraltar, to a fine not
exceeding level 5 on the Gibraltar standard scale.

(2) A person guilty of an offence under paragraph 8(3), 9(2) or (3),
10(3), 11(2) or (3) or 12 is liable—

(a) 5on conviction on indictment, to imprisonment for a term
not exceeding 12 months or to a fine, or to both;

(b) on summary conviction in England and Wales, to
imprisonment for a term not exceeding 12 months or to a
fine, or to both;

(c) 10on summary conviction in Scotland, to imprisonment for a
term not exceeding 12 months or to a fine not exceeding the
statutory maximum, or to both;

(d) on summary conviction in Northern Ireland, to
imprisonment for a term not exceeding 6 months or to a
15fine not exceeding the statutory maximum, or to both;

(e) on summary conviction in Gibraltar, to imprisonment for
a term not exceeding 12 months or to a fine not exceeding
level 5 on the Gibraltar standard scale, or to both.

(3) The reference in sub-paragraph (2)(b) to 12 months is to be read as
20a reference to 6 months in relation to an offence committed before
the commencement of section 154(1) of the Criminal Justice Act
2003.

(4) In this paragraph “the Gibraltar standard scale” means the
standard scale set out in Part A of Schedule 9 to the Criminal
25Procedure and Evidence Act.

Part 4 Reporting of regulated transactions

Statement of regulated transactions

15 (1) The responsible person in relation to a permitted participant must
30include in any return required to be prepared under section 120 a
statement of regulated transactions entered into by the permitted
participant.

(2) The statement must comply with paragraphs 16 to 20.

(3) For the purposes of those paragraphs a regulated transaction is a
35“recordable transaction”—

(a) if the value of the transaction is more than £7,500, or

(b) if the aggregate value of it and any other relevant benefit
or benefits is more than that amount.

In paragraph (b) “relevant benefit” means any relevant donation
40(within the meaning of Schedule 15) or regulated transaction
made by, or entered into with, the person with whom the
regulated transaction was entered into.

Information about qualifying persons

16 (1) The statement must record, in relation to each recordable
transaction to which a qualifying person was a party—

(a) the information about the qualifying person which is, in
5connection with transactions entered into by registered
parties, required to be recorded in transaction reports by
virtue of paragraph 2 of Schedule 6A, or

(b) where the qualifying person is within any of paragraphs
(d) to (g) of paragraph 4(2), the information mentioned in
10sub-paragraph (2) below.

(2) The information referred to in sub-paragraph (1)(b) is—

(a) where the qualifying person is a body within paragraph
4(2)(d) (body incorporated by Royal Charter)—

(i) the name of the body, and

(ii) 15the address of its main office in the United
Kingdom;

(b) where the qualifying person is a body within paragraph
4(2)(e) or (f) (charitable incorporated organisation)—

(i) the name of the body, and

(ii) 20the address of its principal office;

(c) where the qualifying person is a body within paragraph
4(2)(g) (Scottish partnership)—

(i) the name of the body, and

(ii) the address of its main office in the United
25Kingdom.

Information about non-qualifying persons

17 The statement must record, in relation to each recordable
transaction to which a non-qualifying person was a party—

(a) the name and address of the person;

(b) 30the date when and the manner in which sub-paragraphs
(3) to (5) of paragraph 5, or those sub-paragraphs as
applied by paragraph 5(6) or 6(2), were complied with.

Details of transaction

18 (1) The statement must record, in relation to each recordable
35transaction, the information about the transaction which is, in
connection with transactions entered into by registered parties,
required to be recorded in transaction reports by virtue of
paragraph 5(2), (3) and (4) of Schedule 6A (read with the
modifications mentioned in sub-paragraph (2) and any other
40necessary modifications).

(2) In relation to the statement—

(a) paragraph 5(4) of Schedule 6A has effect as if the reference
to the relevant date for the transaction determined in
accordance with paragraph 8 of that Schedule were a
45reference to the relevant date for the transaction

determined in accordance with paragraph 8(1) of that
Schedule, and

(b) paragraph 8(1) of that Schedule has effect as if—

(i) the reference to a quarterly report were a reference
5to the statement,

(ii) the reference to section 71M(4)(a) or (7)(a) were a
reference to paragraph 15(3)(a) of this Schedule,
and

(iii) the reference to section 71M(4)(b) or (7)(b) were a
10reference to paragraph 15(3)(b) of this Schedule.

(3) The statement must record, in relation to each recordable
transaction of a description mentioned in paragraph 2(1) or (2)
above, the information about the transaction which is, in
connection with transactions entered into by registered parties,
15required to be recorded in transaction reports by virtue of
paragraph 6 of Schedule 6A.

(4) The statement must record, in relation to each recordable
transaction of a description mentioned in paragraph 2(3)(b) above,
the information about the transaction which is, in connection with
20transactions entered into by registered parties, required to be
recorded in transaction reports by virtue of paragraph 7(2)(b), (3)
and (4) of Schedule 6A.

Changes

19 (1) Where another qualifying person has become a party to a
25regulated transaction (whether in place of or in addition to any
existing party), or there has been any other change in any of the
information that is required by paragraphs 16 to 18 to be included
in the statement, the statement must record—

(a) the information as it was both before and after the change;

(b) 30the date of the change.

(2) Where a recordable transaction has come to an end, the statement
must—

(a) record that fact;

(b) record the date when it happened;

(c) 35in the case of a loan, state how the loan has come to an end.

(3) For the purposes of sub-paragraph (2), a loan comes to an end if—

(a) the whole debt (or all the remaining debt) is repaid;

(b) the creditor releases the whole debt.

Total value of non-recordable transactions

20 40The statement must record the total value of any regulated
transactions that are not recordable transactions.