Schedule
21
Exemptions
from stamp duty and SDRT: intermediaries, repurchases
etc
Mr.
Timms:
I beg to move amendment No. 193, in
schedule 21, page 239, line 13, at
end insert
‘and’.
The
Chairman:
With this it will be convenient to discuss
Government amendments Nos. 194 to
210.
Mr.
Timms:
Schedule 21 introduces changes that will remove
obstacles to competition and expand choice in the trading of financial
instruments in the UK. They change the stamp duty and stamp duty
reserve tax reliefs so that institutions in the City of London can take
advantage of the liberalisation of market structures being introduced
across Europe by the markets in financial instruments directive, or
MIFID.
The rules on
intermediary relief are being changed so that, from 1 November, it will
no longer be necessary to report and exchange transactions in shares
that are admitted to trading on a regulated market such as the main
market of the London stock exchange. That will allow providers of
transaction reporting services to enter the market more easily. In
February, we announced our intention to extend that approach to include
shares that are admitted to trading on multilateral trading facilities
such as the AIM that are operated by the London stock exchange and
other similar markets. Before proceeding, however, we are allowing the
Financial Services Authority time to consider fully any regulatory
implications. We will provide an update on progress at the time of the
pre-Budget report.
The rules on intermediary
relief are also being changed to allow persons who provide an
over-the-counter service and who are not exchange members to apply
directly to HMRC for approval as intermediaries.
Our amendments will
remove an unnecessary condition from the stamp duty and stamp duty
reserve tax intermediary reliefs. From 1 November, intermediaries will
be able to benefit from MIFID, the new regulatory regime. As MIFID
contains provisions for making public transactions in shares that are
admitted to trading on regulated markets, we have decided that it is no
longer necessary for such provisions to be a condition for intermediary
relief. The amendments remove the requirement to make public
transactions in regulated market shares for shares that are admitted to
trading only on a multilateral trading facility. Transactions will
still qualify for relief only if reported to the market, so the changes
are consistent with the written ministerial statement of 20
February.
We are also
taking the opportunity to make a technical amendment to the definition
of a European economic area state to ensure that it has the same
meaning as the definition in the InterpretationAct
1978.
Mrs.
Villiers:
In contrast to what I said about the last two
clauses, I welcome the schedule. It is important that the reliefs
available for intermediaries at the London stock exchange be extended
throughout the variety of platforms that will open as a result of
MIFID. Access to exchanges from other countries in Europe will also be
opened up. The Treasury has worked constructively with industry players
such as the London Investment Banking Association to get this
complicated set of changes into reasonable shape. I understand that
there are a few glitches, but I hope that they are of the sort that can
be resolved satisfactorily using guidance.
Having spent two years of my
life on MIFID, I am pleased that the Government are pressing ahead with
implementation. Giving birth to MIFID was a long and painful labour.
However, I had the pleasure of working hand in hand with the Treasury
on many aspects of the negotiations. I am not sure that what we
produced was necessarily a great result, but I hope that it might be of
significant benefit in the future, both to consumers, by ensuring lower
costs with savings and investments, and to the City of London, by
opening access to markets across the European Union.
I pay tribute to the Government
for transposing MIFID on time. Sadly, the rest of Europe has chosen not
to do the same. It is a concern that, although market participants who
are preparing to implement MIFID might comply with UK legislation
because it will have been transposed, they will have to deal with
multiple systems across the rest of Europe because our European
partners have been somewhat slower to
implement.
Amendment
agreed
to.
Amendments
made: No. 194, in schedule 21,page 239, line 16, leave out
from ‘Commissioners’ to end of line
18.
No. 195, in
schedule 21, page 239, line 33, at
end insert
‘and’.
No.
196, in schedule 21, page 239, leave out
lines 35 to 37.
No. 197, in
schedule 21, page 240, line 12, at
end insert
‘and’.
No.
198, in schedule 21, page 240, leave out
lines 14 to 16.
No.
199, in
schedule 21, page 240, line 45, at
end insert
‘and’.
No.
200, in schedule 21, page 240, leave out
lines 47 to 49.
No.
201, in
schedule 21, page 241, line 43, after
second ‘time’ insert
‘is a member State or any other
State which at that
time’.
No. 202,
in
schedule 21, page 242, line 18, at
end insert
‘and’.
No.
203, in
schedule 21, page 242, line 22, leave
out from ‘(“the Commissioners”)’ to end of
line 24.
No. 204, in
schedule 21, page 242, line 37, at
end insert
‘and’.
No.
205, in
schedule 21, page 242, line 39, leave
out from ‘market’ to end of line
41.
No. 206, in
schedule 21, page 243, line 11, at
end insert
‘and’.
No.
207, in
schedule 21, page 243, line 13, leave
out from ‘market’ to end of line
15.
No. 208, in
schedule 21, page 243, line 42, at
end insert
‘and’.
No.
209, in
schedule 21, page 243, line 44, leave
out from ‘market’ to end of line
46.
No. 210, in
schedule 21, page 244, line 41, after
second ‘time’ insert
‘is a member State or any other
State which at that time’.—[Mr.
Timms.]
Schedule
21, as amended, agreed to.
It being One o’clock,
The Chairman adjourned the Committee without Question put, pursuant
to the Standing
Order.
Adjourned
till this day at half-past Four
o’clock.
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