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"rules made under section 118"
and insert "financial promotion rules".--[Mr. Robert Ainsworth.]
Mr. Flight:
I beg to move amendment No. 34, in page 13, line 29, at end insert--
Mr. Deputy Speaker:
With this it will be convenient to discuss the following: Government amendments Nos. 73 to 76, 112 and 121.
Amendment No. 380, in clause 211, page 107, line 5, leave out "on" and insert "under an express".
Amendment No. 65, in page 107, line 15, after "which", insert--
Amendment No. 381, in page 107, line 17, after "repurchased", insert--
Amendment No. 66, in page 107, line 17, leave out
Amendment No. 382, in page 107, line 18, leave out "are" and insert "may be".
Amendment No. 383, in page 107, line 18, after "are", insert--
Amendment No. 384, in page 107, line 21, leave out "related to" and insert "not significantly different from".
Amendment No. 385, in page 107, line 22, at end insert--
Amendment No. 386, in page 107, line 27, after "State", insert--
Amendment No. 387, in page 107, line 40, at end insert--
Amendment No. 393, in clause 236, page 118, line 37, after "that", insert--
Government amendments Nos. 450 to 453, 420, 155, 171 to 177 and 442.
Mr. Flight:
Amendment No. 34 deals with the same territory that, apparently, is dealt with by the Government amendments to schedule 5. Before going into the amendments, I would like to ask the Minister whether there are likely to be further Government amendments on this matter when the Bill is in Committee in another place, or whether they believe that they have got this matter into its final form. In Committee, it was clear that many provisions would have unintended effects and needed
Secondly, the new regulations for open-ended investment companies had not been promulgated. Since then, there has been considerable progress on that front. However, this is a practical matter concerned with the industry, and it is not a matter of principle.
Government amendments Nos. 73 to 76, 112 and 121 are not controversial. The main amendments that we stress are Nos. 380 to 387 and 393. Essentially, they repeat issues that we raised in Committee, and cover unit trusts to be constituted under an express trust, open-ended investment companies and the definition of "operator". Clause 236 would be amended for consistency. The most important amendment is No. 383, which requires the participants in an OEIC to request the redemption or repurchase of their interest in the OEIC.
Amendments Nos. 65 and 66 are new amendments to the OEIC definition which we have made to make sure that investment trusts are not caught by it. The amendments move the exemption for the repurchase of shares pursuant to the relevant provisions of the Companies Act 1985, so that it covers both limbs of clause 211(2)(b)(i), and not just the second limb.
Miss Melanie Johnson:
Amendment No. 34 raises a point that was discussed in Committee--namely, adding a further class of person requiring authorisation under the Bill to clause 28:
The hon. Gentleman asked whether we thought that there was a need further to amend clause 28. We think that clause 28 is fine as it stands, and we do not expect any further amendments--although one cannot be absolutely certain.
Amendments Nos. 65, 66 and 381 to 387 concern open-ended investment companies. Hon. Members will know that, on 28 January, we issued a consultation draft on the OEIC regulations under clause 237. This particular group of amendments are all aimed at the definition of an OEIC. We debated this issue in Committee, when a number of substantially similar amendments were tabled by the Opposition.
I said at that time that we were considering whether the definition might be improved. We are mindful of the need for greater certainty, and we are working on the definition. Features that we are looking at in bringing forward a definition include whether shareholders expect their shares to be redeemed or repurchased, the regularity of repurchases or redemptions and the proportion of capital in relation to which the right or redemption should apply. This is a technically difficult area, and it is important that we get these matters right in the Bill.
The hon. Gentleman said that he took no exception to a number of the Government amendments, so I shall address amendment No. 393. The amendment was debated in Committee, and I said that we would review the urgent intervention powers in the Bill at a later date, and we will do so. I give a continuing undertaking on that subject. I will not speak to any of the Government amendments unless anyone has any particular queries.
Mr. Flight:
I thank the Minister for her comments and, in the light of them, I beg to ask leave to withdraw the amendment.
Amendment made: No. 406, in page 9, line 15, after "which" insert
"is carried on by way of business and".--[Mr. Robert Ainsworth.]
Amendment made: No. 243, in page 10, line 30, leave out "('the provider')".--[Mr. Robert Ainsworth.]
Amendments made: No. 244, in page 11, line 33, leave out "provider" and insert
"person carrying on the regulated activity concerned".
No. 245, in page 11, line 36, leave out from "not" to "that", in line 37, and insert "know".--[Mr. Robert Ainsworth.]
Amendments made: No. 246, in page 12, line 13, leave out
"as a direct or indirect result"
and insert "in consequence"
No. 247, in page 12, line 20, leave out
"as a direct or indirect result"
and insert "in consequence".
No. 248, in page 12, line 32, leave out from "that" to end of line 4, on page 13, and insert
"the enforcement conditions are met.
( ) The enforcement conditions are that it is just and equitable for the agreement or obligation to be enforced or (as the case may be) for the money or property paid or transferred under the agreement to be retained and--
(a) if the applicant made the unlawful communication, that he reasonably believed that he was not making such a communication; or
(b) if the applicant did not make the unlawful communication, that he did not know that the agreement was entered into in consequence of such a communication.
( ) 'Applicant' means the person seeking to enforce the agreement or obligation or retain the money or property paid or transferred.
( ) Any reference to making a communication includes causing a communication to be made.".--[Mr. Robert Ainsworth.]
"(cc) a person qualifying for authorisation under Schedule 5,".
"(otherwise than under other provisions)."
"in accordance with the scheme".
"(otherwise than under other provisions)".
"at the request of participants".
"(2A) In subsection (2)(b)(i) participants are only to be regarded as having an entitlement to have their shares or securities redeemed or repurchased in cases where the entitlement is exercisable by the participants".
"or such other territory or country outside the United Kingdom as the Treasury may by order specify".
"and in relation to any other collective investment scheme means the person, if any, having responsibility under the arrangements constituting the scheme for the day to day management of the property of the scheme.".
"it is desirable in order to protect the interests of participants or potential participants that".
"a person qualifying for authorisation under Schedule 5".
However, we believe that subsection (d) should already include
"a person qualifying for authorisation under Schedule 5"
and so the amendment is unnecessary. I would be grateful if the hon. Member for Arundel and South Downs (Mr. Flight) would consider withdrawing the amendment.
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