House of Commons Amendments

House of Commons

Session 2007 - 08
Internet Publications
Other Bills before Parliament

Public Bill Committee: 6th November 2008
100

Banking Bill, continued

Ian Pearson

14

Clause  122,  page  61,  line  26,   leave out ‘and an Act of the Scottish Parliament’.

Ian Pearson

15

Clause  143,  page  77,  line  11,   leave out subsection (2).

Ian Pearson

16

Clause  154,  page  80,  line  25,   leave out ‘and an Act of the Scottish Parliament’.

Ian Pearson

33

Clause  239,  page  115,  line  5,  leave out ‘section 231 extends’ and insert ‘sections

[Registration of charges: Scotland] and 231 extend’.

New Clauses

“Financial institution”

Ian Pearson

NC3

To move the following Clause:—

‘(1)
The Treasury may by order provide that a specified institution, or an institution

of a specified class, is or is not to be treated as a financial institution for the

purposes of section 214 or 215.

(2)
An order—

(a)
shall be made by statutory instrument, and

(b)
shall be subject to annulment in pursuance of a resolution of either House

of Parliament.’.

Public Bill Committee: 6th November 2008
101

Banking Bill, continued

“Enactment”

Ian Pearson

NC5

To move the following Clause:—

‘In this Act “enactment” includes—

(a)
subordinate legislation,

(b)
an Act of the Scottish Parliament and an instrument under an Act of the

Scottish Parliament, and

(c)
Northern Ireland legislation.’.

Registration of charges: Scotland

Ian Pearson

NC6

To move the following Clause:—

‘(1)
The Bankruptcy and Diligence etc. (Scotland) Act 2007 is amended as follows.

(2)
In section 38 (creation of floating charges)—

(a)
in subsection (3), after “to” insert “subsection (3A) and”, and

(b)
after that subsection insert—

“(3A)
If a floating charge is granted in favour of a central institution, it

is created only when the document granting the floating charge

is executed by the company granting the charge.”

(3)
In section 39 (advance notice of floating charges), after subsection (3) add—

“(4)
This section does not apply where a company proposes to grant a floating

charge in favour of a central institution.”

(4)
In section 42 (assignation of floating charges), after subsection (3) add—

“(4)
This section does not apply where a floating charge is assigned (whether

in whole or to a specified extent) to or by a central institution.”

(5)
In section 43 (alteration of floating charges)—

(a)
in subsection (4), for “But paragraph” substitute “Paragraph”, and

(b)
after that subsection insert—

“(4A)
Paragraph (b) of subsection (3) above does not apply in respect

of an alteration if—

(a)
the holder of the floating charge is a central institution,

or

(b)
the holder of the floating charge is not a central

institution but the alteration is to be made in connection

with a floating charge which is held (or which has been

or is to be held) by a central institution.”

(6)
In section 44 (discharge of floating charges), after subsection (3) add—

“(4)
This section does not apply where the floating charge to be discharged

(whether in whole or to a specified extent) is or has been held by a central

institution.”

Public Bill Committee: 6th November 2008
102

Banking Bill, continued

(7)
In section 47 (interpretation), after “Part—” insert—


““central institution” means—

(a)
the Bank of England,

(b)
the central bank of a country or territory outside the United

Kingdom, or

(c)
the European Central Bank;”.’

Banking Liaison Panel

Ian Pearson

NC8

To move the following Clause:—

‘(1)
The Treasury shall make arrangements for a panel to advise the Treasury about

the exercise of powers to make statutory instruments under or by virtue of this

Part, Part 2 or Part 3 (excluding the stabilisation powers, compensation scheme

orders, resolution fund orders and third party compensation orders).

(2)
The Treasury shall ensure that the panel includes—

(a)
a member appointed by the Treasury,

(b)
a member appointed by the Bank of England,

(c)
a member appointed by the FSA,

(d)
a member appointed by the scheme manager of the Financial Services

Compensation Scheme,

(e)
one or more persons who in the Treasury’s opinion represent the interests

of banks,

(f)
one or more persons who in the Treasury’s opinion have expertise in law

relating to the financial systems of the United Kingdom, and

(g)
one or more persons who in the Treasury’s opinion have expertise in

insolvency law and practice.’.

“Financial assistance”

Ian Pearson

NC9

To move the following Clause:—

‘(1)
In this Act “financial assistance” includes giving guarantees or indemnities and

any other kind of financial assistance (actual or contingent).

(2)
The Treasury may by order provide that a specified activity or transaction, or

class of activity or transaction, is to be or not to be treated as financial assistance

for a specified purpose of this Act; and subsection (1) is subject to this subsection.

(3)
An order—

(a)
shall be made by statutory instrument, and

Public Bill Committee: 6th November 2008
103

Banking Bill, continued

(b)
shall be subject to annulment in pursuance of a resolution of either House

of Parliament.’.

Reverse share transfer

Ian Pearson

NC10

To move the following Clause:—

‘(1)
This section applies where the Treasury have made a share transfer order in

accordance with section 12(2) (“the original order”) providing for the transfer of

securities issued by a bank to a person (“the original transferee”).

(2)
The Treasury may make one or more reverse share transfer orders in respect of

securities issued by the bank and held by the original transferee (whether or not

they were transferred by the original order).

(3)
If the Treasury makes an onward share transfer order in respect of securities

transferred by the original order, the Treasury may make one or more reverse

share transfer orders in respect of securities—

(a)
issued by the bank, and

(b)
held by a transferee under the onward share transfer order of any of the

following kinds—

(i)
a company wholly owned by the Bank of England,

(ii)
a company wholly owned by the Treasury, or

(iii)
a nominee of the Treasury.

(4)
A reverse share transfer order is a share transfer order which—

(a)
provides for transfer to the transferor under the original order (where

subsection (2) applies);

(b)
provides for transfer to the original transferee (where subsection (3)

applies);

(c)
makes other provision for the purposes of, or in connection with, the

transfer of securities which are, could be or could have been transferred

under paragraph (a) or (b).

(5)
Sections 7, 9 and 47 do not apply to a reverse share transfer order (but it is to be

treated in the same way as any other share transfer order for all other purposes

including for the purposes of the application of a power under this Part).

(6)
Before making a reverse share transfer order the Treasury must consult—

(a)
the FSA, and

(b)
the Bank of England.

(7)
Section 26 applies where the Treasury have made a reverse share transfer order.’.

Public Bill Committee: 6th November 2008
104

Banking Bill, continued

Bridge bank: reverse share transfer

Ian Pearson

nc11

To move the following Clause:—

‘(1)
This section applies where the Bank of England has made a bridge bank share

transfer instrument in accordance with section 28(2) (“the original instrument”)

providing for the transfer of securities to—

(a)
a company wholly owned by the Bank of England,

(b)
a company wholly owned by the Treasury, or

(c)
a nominee of the Treasury.

(2)
The Bank of England may make one or more bridge bank reverse share transfer

instruments in respect of securities issued by the bridge bank and held by a person

within subsection (1)(a) to (c).

(3)
A bridge bank reverse share transfer instrument is a share transfer instrument

which—

(a)
provides for transfer to the transferor under the original instrument;

(b)
makes other provision for the purposes of, or in connection with, the

transfer of securities which are, could be or could have been transferred

under paragraph (a).

(4)
Sections 7, 8 and 47 do not apply to a bridge bank reverse share transfer

instrument (but it is to be treated in the same way as any other share transfer

instrument for all other purposes including for the purposes of the application of

a power under this Part).

(5)
Before making a bridge bank reverse share transfer instrument the Bank of

England must consult—

(a)
the FSA, and

(b)
the Treasury.

(6)
Section 25 applies where the Bank of England has made a bridge bank reverse

share transfer instrument.’.

Reverse property transfer

Ian Pearson

nc12

To move the following Clause:—

‘(1)
This section applies where the Bank of England has made a property transfer

instrument in accordance with section 11(2) (“the original instrument”) providing

for the transfer of property, rights or liabilities to a bridge bank.

(2)
The Bank of England may make one or more reverse property transfer

instruments in respect of property, rights or liabilities of the bridge bank.

(3)
If the Bank of England makes an onward property transfer instrument under

section 40 the Bank may make one or more reverse property transfer instruments

in respect of property, rights or liabilities of a transferee of any of the following

kinds under the onward property transfer instrument——

(a)
a company wholly owned by the Bank of England,

(b)
a company wholly owned by the Treasury, or

Public Bill Committee: 6th November 2008
105

Banking Bill, continued

(c)
a company wholly owned by a nominee of the Treasury.

(4)
A reverse property transfer instrument is a property transfer instrument which—

(a)
provides for transfer to the transferor under the original instrument

(where subsection (2) applies);

(b)
provides for transfer to the bridge bank (where subsection (3) applies);

(c)
makes other provision for the purposes of, or in connection with, the

transfer of property, rights or liabilities that are, could be or could have

been transferred under paragraph (a) or (b) (whether the transfer has been

or is to be effected by that instrument or otherwise).

(5)
Sections 7, 8 and 46 do not apply to a reverse property transfer instrument (but it

is to be treated in the same way as any other property transfer instrument for all

other purposes including for the purposes of the application of a power under this

Part).

(6)
Before making a reverse property transfer instrument the Bank of England must

consult—

(a)
the FSA, and

(b)
the Treasury.

(7)
Section 39 applies where the Bank of England has made a reverse property

transfer instrument.’.

Temporary public ownership: reverse property transfer

Ian Pearson

nc13

To move the following Clause:—

‘(1)
This section applies where the Treasury have made a property transfer order in

accordance with section 41(2) (“the original order”) providing for the transfer of

property, rights or liabilities to a company wholly owned by—

(a)
the Bank of England,

(b)
the Treasury, or

(c)
a nominee of the Treasury.

(2)
The Treasury may make one or more reverse property transfer orders in respect

of property, rights or liabilities of the transferee under the original order.

(3)
A reverse property transfer order is a property transfer order which—

(a)
provides for transfer to the transferor under the original order;

(b)
makes other provision for the purposes of, or in connection with, the

transfer of property, rights or liabilities which are, could be or could have

been transferred.

(4)
Sections 7, 8 and 9 do not apply to a reverse property transfer order.

(5)
A reverse property transfer order is to be treated—

(a)
in the same way as a share transfer order for the procedural purposes of

section 24, but

(b)
as a property transfer instrument for all other purposes (including for the

purposes of the application of a power under this Part).

(6)
In the application of section 36 by virtue of subsection (5)(b) above, the power to

give directions under section 36(7) vests in the Treasury (instead of the Bank of

England).

Public Bill Committee: 6th November 2008
106

Banking Bill, continued

(7)
Before making a reverse property transfer order the Treasury must consult—

(a)
the FSA, and

(b)
the Bank of England.

(8)
Section 39 applies where the Treasury have made a reverse property transfer

order.’.

Objectives of the compensation scheme for depositors

Mr Mark Hoban

Mr David Gauke

NC1

To move the following Clause:—

‘(1)
This section sets out the objectives for the compensation scheme for depositors.

(2)
Objective 1 is to maintain customers’ confidence in the UK banking system

regardless of whether the bank is incorporated in the UK or another EEA country.

(3)
Objective 2 is to be able to make payments to depositors within seven days and

to have eligibility criteria, qualification processes and information requirements

which facilitate that.

(4)
Objective 3 is to ensure that there are compensation arrangements for each bank

brand.

(5)
Objective 4 is to require that the scheme pays customers their gross balance and

that any amounts due from customers are collected in the usual way.’.

Compensation payable to depositors

Mr Mark Hoban

Mr David Gauke

NC2

To move the following Clause:—

‘(1)
Each depositor will be entitled to receive from the manager of the scheme referred

to in section [Objectives of the compensation scheme for depositors] a sum which

is the lower of—

(a)
the deposit protection amount; and

(b)
the gross balance held by the person.

(2)
The “deposit protection amount” is £50,000.

(3)
The Treasury may by order amend the figure in subsection (2).

(4)
An order under this section may not be made unless a draft statutory instrument

containing such an order has been laid before, and approved by a resolution of,

each House of Parliament.’.