Amendments proposed to the Financial Services and Markets Bill, As Amended - continued	House of Commons
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Rules in relation to persons to whom the general prohibition does not apply

   

Mr Chancellor of the Exchequer

NC42

To move the following Clause—

    '.—(1) The Authority may make rules applicable to persons to whom, as a result of section (Exemption from the general prohibition)(1), the general prohibition does not apply.

    (2) The power conferred by subsection (1) is to be exercised for the purpose of ensuring that clients are aware that such persons are not authorised persons.

    (3) A designated professional body must make rules—

(a) applicable to members of the profession in relation to which it is established who are not authorised persons; and

(b) governing the carrying on of regulated activities by those members.

    (4) Rules made in compliance with subsection (3) must be designed to secure that, in providing a particular professional service to a particular client, the member carries on only regulated activities which arise out of, or are complementary to, the provision by him of that service to that client.

    (5) Rules made by a designated professional body under subsection (3) require the approval of the Authority.'.

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Matters to be included in orders under section 20

   

Mr William Hague
Mr Francis Maude [R]
Mr David Heathcoat-Amory
Mr Howard Flight [R]
Sir Nicholas Lyell
Mr Tim Loughton [R]

NC2

To move the following Clause:—

    '.—(1) The Treasury shall specify each of the activities set out in subsection (2) in any order made by it pursuant to section 20.

    (2) The activities referred to in subsection (1) are the following—

(a) providing advice to a consumer on the choice of a manager;

(b) providing advice to a consumer on the performance of assets under the management of a manager;

(c) providing advice to a consumer on asset mix or allocation for a fund;

(d) advising on the structuring or reorganisation of a fund.

    (3) References in this section to advice and advising do not include the provision of legal advice.

    (4) "Consumer" means a person who uses, or may be contemplating using, the services provided by a manager.

    (5) "Manager" means a person who performs the regulated activity of managing investments in the United Kingdom.

    (6) "Fund" means an occupational pension scheme, or other assets held under trust.

    (7) "Occupational pension scheme" means any scheme or arrangement which is comprised in one or more instruments or agreements and which has, or is capable of having, effect in relation to one or more descriptions or categories of employment so as to provide benefits, in the form of pensions or otherwise, payable on termination of service, or on death or retirement, to or in respect of earners with qualifying service in an employment of any such description or category.'.

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Review of regulatory system and performance of Authority

   

Mr William Hague
Mr Francis Maude [R]
Mr David Heathcoat-Amory
Mr Howard Flight [R]
Sir Nicholas Lyell
Mr Tim Loughton [R]

NC3

To move the following Clause:—

    '.—(1) The Treasury must on the third anniversary of the coming into force of section 2 appoint an independent person to conduct a review of the regulatory system established by this Act and the performance of the Authority in discharging its general duties under section 2.

    (2) The scope of such a review may be limited by the Treasury in such manner as the Treasury may specify in appointing the person to conduct it but the review must cover the extent to which the Authority, in discharging its general functions, has met the regulatory objectives and had regard to the matters in section 2(3).

    (3) On completion of a review under this section, the person conducting it must make a written report to the Treasury—

(a) setting out the result of the review; and

(b) making such recommendations (if any) as he considers appropriate.

    (4) A copy of the report must be—

(a) laid before each House of Parliament; and

(b) published in such manner as the Treasury considers appropriate.

    (5) Any expenses reasonably incurred in the conduct of the review are to be met by the Treasury out of money provided by Parliament.

    (6) "Independent" means independent of the Authority.'.

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Transfer to Financial Services Ombudsman of functions of Pensions Ombudsman

   

Mrs Jacqui Lait

NC34

To move the following Clause:—

    '.—(1) There shall be transferred to the scheme operator all the functions and powers of the Pensions Ombudsman established under Part X of the Pension Schemes Act 1993 (as amended by the Pensions Act 1995).

    (2) The Treasury may by order—

(a) provide for the transfer of any property, rights or liabilities held, enjoyed or incurred by any person in connection with functions transferred under this section;

(b) provide for the carrying on and completion by or under the authority of the scheme operator of any proceedings, investigations or other matters commenced, before the order takes effect, by or under the authority of the Pensions Ombudsman;

(c) make any transitional, incidental or consequential provision which is necessary or expedient as a result of the transfer of functions under this section;

(d) provide for the substitution of the scheme operator for the Pensions Ombudsman in any instrument, contract or legal proceedings made or begun before the order takes effect.

    (3) The Treasury may make regulations providing for—

(a) the transfer to the scheme operator of any staff previously employed in the service of the Pensions Ombudsman;

(b) the terms on which any such transfer shall take place; and

(c) the terms on which the employment of any person previously employed in the service of the Pensions Ombudsman may be terminated.

    (4) In this section "scheme operator" means the body corporate established under Schedule 14 to operate the disputes resolution procedure referred to in section 200 as "the ombudsman scheme".'.

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Mr William Hague
Mr Francis Maude [R]
Mr David Heathcoat-Amory
Mr Howard Flight [R]
Sir Nicholas Lyell
Mr Tim Loughton [R]

12

Page     1,     line     17     [Clause     2],     leave out 'and'.

   

Mr William Hague
Mr Francis Maude [R]
Mr David Heathcoat-Amory
Mr Howard Flight [R]
Sir Nicholas Lyell
Mr Tim Loughton [R]

13

Page     1,     line     19     [Clause     2],     at end insert 'and

(c) which is reasonable, fair, open, accountable and proportionate'.

   

Mr William Hague
Mr Francis Maude [R]
Mr David Heathcoat-Amory
Mr Howard Flight [R]
Sir Nicholas Lyell
Mr Tim Loughton [R]

30

Page     1,     line     22     [Clause     2], at end insert—

'(bb) the maintenance of a vigorous and effective market in financial services;'.

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Mr William Hague
Mr Francis Maude [R]
Mr David Heathcoat-Amory
Mr Howard Flight [R]
Sir Nicholas Lyell
Mr Tim Loughton [R]

192

Page     2,     line     2     [Clause     2],     at end insert—

'(e) the maintenance of competition and promotion of United Kingdom competitiveness.'

   

Mr William Hague
Mr Francis Maude [R]
Mr David Heathcoat-Amory
Mr Howard Flight [R]
Sir Nicholas Lyell
Mr Tim Loughton [R]

49

Page     2,     line     3     [Clause     2],     leave out from 'must' to end of line 18 and insert 'seek to—

(a) use its resources in the most efficient and economic way;

(b) take into account the responsibilities of those who manage the affairs of authorised persons and ensure that it does not intrude unnecessarily into their management of the commercial affairs of such persons;

(c) impose burdens or restrictions on a person, or on the carrying on of an activity, only if they are proportionate to the benefits, considered in general terms, which are expected to result from the imposition of that burden or restriction;

(d) facilitate, and not unnecessarily impede, innovation in connection with regulated activities;

(e) maintain the international competitiveness of the United Kingdom and authorised persons;

(f) impede or distort competition between authorised persons only to the extent that such impediment or distortion is necessary.'.

   

Mr Chancellor of the Exchequer

240

Page     2,     line     17     [Clause     2],     leave out paragraph (f) and insert—

'(f) the need to minimise the adverse effects on competition that may arise from any exercise of its general functions;

(g) the desirability of facilitating competition between those who are subject to any form of regulation by the Authority.'.

   

Dr Vincent Cable
Mr Brian Cotter
Mr Colin Breed

456

Page     2,     line     18     [Clause     2],     at end insert—

'(g) the need to facilitate access to appropriate financial services for disadvantaged consumers.'.

   

Mr Chancellor of the Exchequer

241

Page     2,     line     23     [Clause     2],     leave out 'advice and' and insert 'general'.

   

Mr Chancellor of the Exchequer

242

Page     2,     line     26     [Clause     2],     at end insert—

    '( ) "General guidance" has the meaning given in section 130(5).'.

   

Mr William Hague
Mr Francis Maude [R]
Mr David Heathcoat-Amory
Mr Howard Flight [R]
Sir Nicholas Lyell
Mr Tim Loughton [R]

235

Page     2,     line     26     [Clause     2],     at end insert—

    '(4A) The Authority must ensure that its staff responsible for or involved in—

(a) monitoring, investigating or disciplining authorised or approved persons or,

(b) investigating persons suspected of engaging in, or of requiring or encouraging another person to engage in, market abuse or any offence for which it can institute proceedings, and

(c) drafting, or giving instructions to the draftsman of, rules, statements of principle or codes

    shall be suitably competent and shall have sufficient knowledge of the relevant financial sector to fulfil their functions.'.

Prepared 27 Jan 2000