Finance Bill

House of Commons

Session 2006 - 07
Internet Publications
Other Bills before Parliament

Finance Bill

Finance Bill
Schedule 20 — Pension schemes etc: miscellaneous
238

beginning with the earlier of the day on which the member’s
death was first known to the trustees or other persons having
the control of the fund and the day on which they could first
reasonably be expected to have known of it.”
Benefits under employer-financed retirement benefits schemes
5
19
In section 393B of ITEPA 2003 (employer-financed retirement benefits
schemes: relevant benefits), after subsection (4) insert—
“(4A)
Regulations under subsection (3)(d) may include provision having
effect in relation to times before they are made.”
Consequential amendments
10
20    (1)
In section 167(2) of FA 2004 (meaning of “pension death benefit”), for
““Pension” substitute “In this Part “pension”.
      (2)
In section 280(2) of that Act (index of expressions), insert at the appropriate
place—

“pension death benefit
section 167(2)”.

15
21    (1)
In section 1(1) of the Pension Schemes Act 1993 (c. 48) (categories of pension
schemes), in paragraph (b) of the definition of “personal pension scheme”,
omit “any of the paragraphs of”.
      (2)
In section 1(1) of the Pension Schemes (Northern Ireland) Act 1993 (c. 49)
(categories of pension schemes), in paragraph (b) of the definition of
20
“personal pension scheme”, omit “any of the paragraphs of”.
Commencement
22    (1)
The amendments made by paragraphs 2 to 4 and 21 are deemed to have
come into force on 6th April 2007.
      (2)
The amendment made by paragraph 5 has effect in relation to payments
25
made on or after 6th April 2007.
      (3)
The amendments made by paragraphs 6, 7(2), 9, 13 to 17 and 20 are deemed
always to have had effect.
      (4)
The amendment made by paragraph 7(3) has effect in relation to reductions
occurring on or after 6th April 2007.
30
      (5)
The amendments made by paragraph 8 have effect in relation to
notifications given on or after 6th December 2006.
      (6)
The amendments made by paragraph 10 have effect in relation to lump sums
paid on or after 6th April 2006.
      (7)
The amendments made by paragraph 11 have effect in relation to deaths
35
occurring on or after 6th April 2006.
      (8)
The amendments made by paragraph 12 are deemed to have come into force
on 1st January 2007.

Finance Bill
Schedule 21 — Exemptions from stamp duty and SDRT: intermediaries, repurchases etc
239

      (9)
The amendment made by paragraph 18 has effect in relation to lump sum
death benefits paid on or after 6th April 2006.
Schedule 21
Section 72

Exemptions from stamp duty and SDRT: intermediaries, repurchases etc
Intermediaries
5
1     (1)
Section 80A of FA 1986 (exemption from stamp duty: sales to intermediaries)
is amended as follows.
      (2)
For subsections (1) to (3) substitute—
“(1)
Stamp duty shall not be chargeable on an instrument transferring
stock of a particular kind on sale to a person or the person’s nominee
10
if—
(a)
the person is a member of a regulated market on which stock
of that kind is regularly traded;
(b)
the person is an intermediary and is recognised as such by the
market in accordance with arrangements approved by the
15
Commissioners; and
(c)
the sale is made public in accordance with Article 28(1) of the
Directive (post-trade disclosure by investment firms).
(1A)
Stamp duty shall not be chargeable on an instrument transferring
stock of a particular kind on sale to a person or the person’s nominee
20
if—
(a)
the person is a member of a multilateral trading facility, or a
recognised foreign exchange, on which stock of that kind is
regularly traded;
(b)
the person is an intermediary and is recognised as such by the
25
facility or exchange in accordance with arrangements
approved by the Commissioners; and
(c)
the sale is effected on the facility or exchange.
(1B)
Stamp duty shall not be chargeable on an instrument transferring
stock of a particular kind on sale to a person or the person’s nominee
30
if—
(a)
the person is an intermediary who is approved for the
purposes of this section by the Commissioners;
(b)
stock of that kind is regularly traded on a regulated market;
and
35
(c)
the sale is made public in accordance with Article 28(1) of the
Directive.
(1C)
Stamp duty shall not be chargeable on an instrument transferring
stock of a particular kind on sale to a person or the person’s nominee
if—
40
(a)
the person is an intermediary who is approved for the
purposes of this section by the Commissioners;
(b)
stock of that kind is regularly traded on a multilateral trading
facility or a recognised foreign exchange; and

Finance Bill
Schedule 21 — Exemptions from stamp duty and SDRT: intermediaries, repurchases etc
240

(c)
the sale is effected on the facility or exchange.
(2)
Stamp duty shall not be chargeable on an instrument transferring
stock of a particular kind on sale to a person or the person’s nominee
if—
(a)
the person is a member of a regulated market, a multilateral
5
trading facility or a recognised foreign options exchange;
(b)
options to buy or sell stock of that kind are regularly traded
on, and are listed by or quoted on, that market, facility or
exchange;
(c)
the person is an options intermediary and is recognised as
10
such by that market, facility or exchange in accordance with
arrangements approved by the Commissioners;
(d)
stock of that kind is regularly traded on a regulated market;
and
(e)
the sale is made public in accordance with Article 28(1) of the
15
Directive.
(2A)
Stamp duty shall not be chargeable on an instrument transferring
stock of a particular kind on sale to a person or the person’s nominee
if—
(a)
the person is a member of a regulated market, a multilateral
20
trading facility or a recognised foreign options exchange;
(b)
options to buy or sell stock of that kind are regularly traded
on, and are listed by or quoted on, that market, facility or
exchange;
(c)
the person is an options intermediary and is recognised as
25
such by that market, facility or exchange in accordance with
arrangements approved by the Commissioners; and
(d)
the sale is effected on a relevant qualifying exchange on
which stock of that kind is regularly traded or is effected on
a relevant qualifying exchange pursuant to the exercise of a
30
relevant option and options to buy or sell stock of that kind
are regularly traded on, and are listed by or quoted on, that
exchange;

and in paragraph (d) “relevant qualifying exchange” means a
multilateral trading facility, a recognised foreign options exchange
35
or a recognised foreign exchange.
(2B)
Stamp duty shall not be chargeable on an instrument transferring
stock of a particular kind on sale to a person or the person’s nominee
if—
(a)
the person is an options intermediary who is approved for
40
the purposes of this section by the Commissioners;
(b)
options to buy or sell stock of that kind are regularly traded
on, and are listed by or quoted on, a regulated market, a
multilateral trading facility or a recognised foreign options
exchange;
45
(c)
stock of that kind is regularly traded on a regulated market;
and
(d)
the sale is made public in accordance with Article 28(1) of the
Directive.

Finance Bill
Schedule 21 — Exemptions from stamp duty and SDRT: intermediaries, repurchases etc
241

(2C)
Stamp duty shall not be chargeable on an instrument transferring
stock of a particular kind on sale to a person or the person’s nominee
if—
(a)
the person is an options intermediary who is approved for
the purposes of this section by the Commissioners;
5
(b)
options to buy or sell stock of that kind are regularly traded
on, and are listed by or quoted on, a regulated market, a
multilateral trading facility or a recognised foreign options
exchange; and
(c)
the sale is effected on a relevant qualifying exchange on
10
which stock of that kind is regularly traded or is effected on
a relevant qualifying exchange pursuant to the exercise of a
relevant option and options to buy or sell stock of that kind
are regularly traded on, and are listed by or quoted on, that
exchange;
15

and in paragraph (c) “relevant qualifying exchange” means a
multilateral trading facility, a recognised foreign options exchange
or a recognised foreign exchange.”
      (3)
In subsection (6) (meaning of sale being on an exchange)—
(a)
after “effected on” insert “a facility or”,
20
(b)
for “subsection (1) or (2) above” substitute “this section”, and
(c)
for “the exchange” (in each place) substitute “the facility or
exchange”.
      (4)
After that subsection insert—
“(6A)
The Commissioners may approve a person for the purposes of this
25
section only if the person is authorised under the law of an EEA State
to provide any of the investment services or activities listed in
Section A 2 or 3 of Annex I to the Directive (execution of orders on
behalf of clients and dealing on own account), whether or not the
person is authorised under the Directive.”
30
      (5)
The amendments made by this paragraph have effect in relation to any
instrument executed on or after 1st November 2007.
2     (1)
Section 80B of FA 1986 (exemption from stamp duty on sales to
intermediaries: supplementary) is amended as follows.
      (2)
In subsection (2)—
35
(a)
after the definition of “collective investment scheme” insert—
““the Directive” means Directive 2004/39/EC of the
European Parliament and of the Council of 21 April
2004 on markets in financial instruments, as amended
from time to time;”,
40
(b)
omit the definition of “EEA exchange”, and
(c)
in the definition of “EEA State”, for “means a State which” substitute
“, in relation to any time, means a State which at that time” and insert
at the end “(as modified or supplemented from time to time)”.
      (3)
After that subsection insert—
45
“(2A)
Each of the following expressions—
“multilateral trading facility”, and
“regulated market”,

Finance Bill
Schedule 21 — Exemptions from stamp duty and SDRT: intermediaries, repurchases etc
242


has the same meaning in section 80A above as it has for the purposes
of the Directive.”
      (4)
After subsection (5) insert—
“(5A)
The Treasury may by regulations amend section 80A above and this
section (as they have effect for the time being) in order to extend the
5
exemption from duty under that section.”
      (5)
In subsection (7) (power for regulations to provide for stamp duty to be
chargeable at a rate not exceeding 0.1%), for “subsection (1) or (2)” substitute
“any of subsections (1) to (2C)”.
      (6)
The amendments made by this paragraph have effect in relation to any
10
instrument executed on or after 1st November 2007.
3     (1)
Section 88A of FA 1986 (exemption from SDRT: sales to intermediaries) is
amended as follows.
      (2)
For subsections (1) to (3) substitute—
“(1)
Section 87 above shall not apply as regards an agreement to transfer
15
securities of a particular kind to B or B’s nominee if—
(a)
B is a member of a regulated market on which securities of
that kind are regularly traded;
(b)
B is an intermediary and is recognised as such by the market
in accordance with arrangements approved by the
20
Commissioners for Her Majesty’s Revenue and Customs
(“the Commissioners”); and
(c)
the agreement is made public in accordance with Article 28(1)
of the Directive (post-trade disclosure by investment firms).
(1A)
Section 87 above shall not apply as regards an agreement to transfer
25
securities of a particular kind to B or B’s nominee if—
(a)
B is a member of a multilateral trading facility, or a
recognised foreign exchange, on which securities of that kind
are regularly traded;
(b)
B is an intermediary and is recognised as such by the facility
30
or exchange in accordance with arrangements approved by
the Commissioners; and
(c)
the agreement is effected on the facility or exchange.
(1B)
Section 87 above shall not apply as regards an agreement to transfer
securities of a particular kind to B or B’s nominee if—
35
(a)
B is an intermediary who is approved for the purposes of this
section by the Commissioners;
(b)
securities of that kind are regularly traded on a regulated
market; and
(c)
the agreement is made public in accordance with Article 28(1)
40
of the Directive.
(1C)
Section 87 above shall not apply as regards an agreement to transfer
securities of a particular kind to B or B’s nominee if—
(a)
B is an intermediary who is approved for the purposes of this
section by the Commissioners;
45
(b)
securities of that kind are regularly traded on a multilateral
trading facility or a recognised foreign exchange; and

Finance Bill
Schedule 21 — Exemptions from stamp duty and SDRT: intermediaries, repurchases etc
243

(c)
the agreement is effected on the facility or exchange.
(2)
Section 87 above shall not apply as regards an agreement to transfer
securities of a particular kind to B or B’s nominee if—
(a)
B is a member of a regulated market, a multilateral trading
facility or a recognised foreign options exchange;
5
(b)
options to buy or sell securities of that kind are regularly
traded on, and are listed by or quoted on, that market, facility
or exchange;
(c)
B is an options intermediary and is recognised as such by that
market, facility or exchange in accordance with
10
arrangements approved by the Commissioners;
(d)
securities of that kind are regularly traded on a regulated
market; and
(e)
the agreement is made public in accordance with Article 28(1)
of the Directive.
15
(2A)
Section 87 above shall not apply as regards an agreement to transfer
securities of a particular kind to B or B’s nominee if—
(a)
B is a member of a regulated market, a multilateral trading
facility or a recognised foreign options exchange;
(b)
options to buy or sell securities of that kind are regularly
20
traded on, and are listed by or quoted on, that market, facility
or exchange;
(c)
B is an options intermediary and is recognised as such by that
market, facility or exchange in accordance with
arrangements approved by the Commissioners; and
25
(d)
the agreement is effected on a relevant qualifying exchange
on which securities of that kind are regularly traded or is
effected on a relevant qualifying exchange pursuant to the
exercise of a relevant option and options to buy or sell
securities of that kind are regularly traded on, and are listed
30
by or quoted on, that exchange;

and in paragraph (d) “relevant qualifying exchange” means a
multilateral trading facility, a recognised foreign options exchange
or a recognised foreign exchange.
(2B)
Section 87 above shall not apply as regards an agreement to transfer
35
securities of a particular kind to B or B’s nominee if—
(a)
B is an options intermediary who is approved for the
purposes of this section by the Commissioners;
(b)
options to buy or sell securities of that kind are regularly
traded on, and are listed by or quoted on, a regulated market,
40
a multilateral trading facility or a recognised foreign options
exchange;
(c)
securities of that kind are regularly traded on a regulated
market; and
(d)
the agreement is made public in accordance with Article 28(1)
45
of the Directive.
(2C)
Section 87 above shall not apply as regards an agreement to transfer
securities of a particular kind to B or B’s nominee if—
(a)
B is an options intermediary who is approved for the
purposes of this section by the Commissioners;
50

Finance Bill
Schedule 21 — Exemptions from stamp duty and SDRT: intermediaries, repurchases etc
244

(b)
options to buy or sell securities of that kind are regularly
traded on, and are listed by or quoted on, a regulated market,
a multilateral trading facility or a recognised foreign options
exchange; and
(c)
the agreement is effected on a relevant qualifying exchange
5
on which securities of that kind are regularly traded or is
effected on a relevant qualifying exchange pursuant to the
exercise of a relevant option and options to buy or sell
securities of that kind are regularly traded on, and are listed
by or quoted on, that exchange;
10

and in paragraph (c) “relevant qualifying exchange” means a
multilateral trading facility, a recognised foreign options exchange
or a recognised foreign exchange.”
      (3)
In subsection (6) (meaning of sale being on an exchange)—
(a)
after “effected on” insert “a facility or”,
15
(b)
for “subsection (1) or (2) above” substitute “this section”, and
(c)
for “the exchange” (in each place) substitute “the facility or
exchange”.
      (4)
After that subsection insert—
“(6A)
The Commissioners may approve a person for the purposes of this
20
section only if the person is authorised under the law of an EEA State
to provide any of the investment services or activities listed in
Section A 2 or 3 of Annex I to the Directive (execution of orders on
behalf of clients and dealing on own account), whether or not the
person is authorised under the Directive.”
25
      (5)
The amendments made by this paragraph have effect in relation to any
agreement to transfer securities—
(a)
in a case where the agreement is conditional, if the condition is
satisfied on or after 1st November 2007, and
(b)
in any other case, if the agreement is made on or after that date.
30
4     (1)
Section 88B of FA 1986 (exemption from SDRT on sales to intermediaries:
supplementary) is amended as follows.
      (2)
In subsection (2)—
(a)
after the definition of “collective investment scheme” insert—
““the Directive” means Directive 2004/39/EC of the
35
European Parliament and of the Council of 21 April
2004 on markets in financial instruments, as amended
from time to time;”,
(b)
omit the definition of “EEA exchange”, and
(c)
in the definition of “EEA State”, for “means a State which” substitute
40
“, in relation to any time, means a State which at that time” and insert
at the end “(as modified or supplemented from time to time)”.
      (3)
After that subsection insert—
“(2A)
Each of the following expressions—
“multilateral trading facility”, and
45
“regulated market”,