Financial Services and Markets Bill - continued        House of Commons
PART VII, PENALTIES FOR MARKET ABUSE - continued

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Procedure
Warning notices.     100. - (1) If the Authority proposes to impose a penalty on a person under section 98, it must give him a warning notice.
 
      (2) The warning notice must state the amount of the penalty.
 
      (3) Section 338(2) does not require a copy of a warning notice under this section to be given to a person on whom the Authority proposes to impose, or has imposed, a penalty under section 98 in respect of the matter which identifies him.
 
Decision notices and right to refer to Tribunal.     101. - (1) If the Authority decides to impose a penalty on a person under section 98, it must give him a decision notice.
 
      (2) The decision notice must state the amount of the penalty.
 
      (3) Section 339(2) does not require a copy of a decision notice under this section to be given to a person on whom the Authority proposes to impose, or has imposed, a penalty under section 98 in respect of the matter which identifies him.
 
      (4) If the Authority decides to impose a penalty on a person under section 98, that person may refer the matter to the Tribunal.
 
Notice for payment.     102. - (1) If the Authority imposes a penalty on a person under section 98, it must give him a notice under this section (a "notice for payment").
 
      (2) A notice for payment must-
 
 
    (a) be in writing; and
 
    (b) require the person concerned to pay the penalty to the Authority before the end of such period as may be specified in the notice.
      (3) The specified period may not be less than 14 days beginning with the date on which the notice for payment is given.
 
      (4) If all or any of the amount payable under a notice for payment is outstanding at the end of the specified period, the Authority may recover the outstanding amount as a debt due to it.
 
 
Miscellaneous
Suspension of investigations.     103. - (1) If the Authority considers it desirable or expedient because of the exercise or possible exercise of its power to impose penalties in market abuse cases, it may direct a recognised investment exchange or recognised clearing house-
 
 
    (a) to terminate, suspend or limit the scope of any inquiry which the exchange or clearing house is conducting under its rules; or
 
    (b) not to conduct an inquiry which the exchange or clearing house proposes to conduct under its rules.
      (2) A direction under this section-
 
 
    (a) must be given to the exchange or clearing house concerned by notice in writing; and
 
    (b) is enforceable, on the application of the Authority, by injunction or, in Scotland, by an order under section 45 of the Court of Session Act 1988.
      (3) The Authority's powers to impose penalties in market abuse cases are its powers-
 
 
    (a) to impose penalties under section 98; or
 
    (b) to impose penalties under section 138 in a case falling within subsection (2)(b) of that section.
Power of court to impose penalty in cases of market abuse.     104. - (1) The Authority may on an application to the court under section 331 or 333 request the court to consider whether the circumstances are such that a penalty should be imposed on the person to whom the application relates.
 
      (2) The court may, if it considers it appropriate, make an order requiring the person concerned to pay to the Authority a penalty of such amount as it considers appropriate.
 
Guidance.     105. - (1) The Treasury may from time to time issue written guidance for the purpose of helping relevant authorities to determine the action to be taken in cases where behaviour occurs which is behaviour-
 
 
    (a) with respect to which the power in section 98 appears to be exercisable; and
 
    (b) which appears to involve the commission of an offence under section 341 of this Act or Part V of the Criminal Justice Act 1993 (insider dealing).
      (2) The Treasury must obtain the consent of the Attorney General and the Secretary of State before issuing any guidance under this section.
 
      (3) In this section "relevant authority"-
 
 
    (a) in relation to England and Wales, means the Secretary of State, the Authority, the Director of the Serious Fraud Office and the Director of Public Prosecutions;
 
    (b) in relation to Scotland, means the Secretary of State and the Authority;
 
    (c) in relation to Northern Ireland, means the Secretary of State, the Authority, the Director of the Serious Fraud Office and the Director of Public Prosecutions for Northern Ireland.
Effect on transactions.     106. The imposition of a penalty under this Part does not make any transaction void or unenforceable.
 
 
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Prepared 18 November 1999