House of Commons Amendments

House of Commons

Session 2007 - 08
Internet Publications
Other Bills before Parliament

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Part 5

Enforcement: information powers

Enforcement authorities and officers

18  (1)
In this Schedule “enforcement authority” means—

(a)
the Financial Services Authority (“the FSA”),

(b)
the Commissioners for Her Majesty’s Revenue and Customs

(“HMRC”),

(c)
the Office of Fair Trading (“the OFT”), or

(d)
in relation to credit unions in Northern Ireland, the Department

of Enterprise, Trade and Investment in Northern Ireland

(“DETINI”).

      (2)
In this Part of this Schedule “enforcement officer” means—

(a)
an officer of the FSA, including a member of the staff or an agent

of the FSA,

(b)
an officer of Revenue and Customs,

(c)
an officer of the OFT,

(d)
an officer of DETINI acting for the purposes of its functions

under this Schedule in relation to credit unions in Northern

Ireland, or

(e)
a local enforcement officer.

      (3)
A “local enforcement officer” means—

(a)
in Great Britain, an officer of a local weights and measures

authority;

(b)
in Northern Ireland, an officer of DETINI acting pursuant to

arrangements made with the OFT for the purposes of this

Schedule.

Power to require information or documents

19  (1)
An enforcement officer may by notice to a relevant person require the

person—

(a)
to provide such information as may be specified in the notice, or

(b)
to produce such documents as may be so specified.

      (2)
An officer may exercise powers under this paragraph only if the

information or documents sought to be obtained as a result are

reasonably required in connection with the exercise by the enforcement

authority for whom the officer acts of its functions under this Schedule.

      (3)
Where an officer requires information to be provided or documents

produced under this paragraph—

(a)
the notice must set out the reasons why the officer requires the

information to be provided or the documents produced, and

(b)
the information must be provided or the documents produced—

(i)
before the end of such reasonable period as may be

specified in the notice; and

(ii)
at such place as may be so specified.

      (4)
In relation to a document in electronic form the power to require

production of it includes a power to require the production of a copy of

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it in legible form or in a form from which it can readily be produced in

visible and legible form.

      (5)
An enforcement officer may take copies of, or make extracts from, any

document produced under this paragraph.

      (6)
The production of a document does not affect any lien which a person

has on the document.

Entry, inspection without a warrant etc

20  (1)
Where an enforcement officer has reasonable cause to believe that any

premises are being used by a relevant person in connection with the

person’s business activities, the officer may on producing evidence of

authority at any reasonable time—

(a)
enter the premises;

(b)
inspect the premises;

(c)
observe the carrying on of business activities by the relevant

person;

(d)
inspect any document found on the premises;

(e)
require any person on the premises to provide an explanation of

any document or to state where it may be found.

      (2)
An enforcement officer may take copies of, or make extracts from, any

document found under sub-paragraph (1).

      (3)
An officer may exercise powers under this paragraph only if the

information or document sought to be obtained as a result is reasonably

required in connection with the exercise by the enforcement authority

for whom the officer acts of its functions under this Schedule.

      (4)
In this paragraph “premises” means any premises other than premises

used only as a dwelling.

Entry to premises under warrant

21  (1)
A justice may issue a warrant under this paragraph if satisfied on

information on oath given by an enforcement officer that there are

reasonable grounds for believing that the first, second or third set of

conditions is satisfied.

      (2)
The first set of conditions is—

(a)
that there is on the premises specified in the warrant a document

in relation to which a requirement could be imposed under

paragraph 19(1)(b), and

(b)
that if such a requirement were to be imposed—

(i)
it would not be complied with, or

(ii)
the document to which it relates would be removed,

tampered with or destroyed.

      (3)
The second set of conditions is—

(a)
that a person on whom a requirement has been imposed under

paragraph 19(1)(b) has failed (wholly or in part) to comply with

it, and

(b)
that there is on the premises specified in the warrant a document

that has been required to be produced.

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      (4)
The third set of conditions is—

(a)
that an enforcement officer has been obstructed in the exercise of

a power under paragraph 20, and

(b)
that there is on the premises specified in the warrant a document

that could be inspected under paragraph 20(1)(d).

      (5)
A justice may issue a warrant under this paragraph if satisfied on

information on oath given by an officer that there are reasonable

grounds for suspecting that—

(a)
an offence under this Schedule has been, is being or is about to be

committed by a relevant person, and

(b)
there is on the premises specified in the warrant a document

relevant to whether that offence has been, or is being or is about

to be committed.

      (6)
A warrant issued under this paragraph shall authorise an enforcement

officer—

(a)
to enter the premises specified in the warrant;

(b)
to search the premises and take possession of anything

appearing to be a document specified in the warrant or to take, in

relation to any such document, any other steps which may

appear to be necessary for preserving it or preventing

interference with it;

(c)
to take copies of, or extracts from, any document specified in the

warrant;

(d)
to require any person on the premises to provide an explanation

of any document appearing to be of the kind specified in the

warrant or to state where it may be found;

(e)
to use such force as may reasonably be necessary.

      (7)
Where a warrant is issued by a justice under sub-paragraph (1) or (5) on

the basis of information on oath given by an officer of the FSA, for “an

enforcement officer” in sub-paragraph (6) substitute “a constable”.

      (8)
In sub-paragraphs (1), (5) and (7), “justice” means—

(a)
in relation to England and Wales, a justice of the peace;

(b)
in relation to Scotland, a justice within the meaning of section 307

of the Criminal Procedure (Scotland) Act 1995 (interpretation);

(c)
in relation to Northern Ireland, a lay magistrate.

      (9)
In the application of this paragraph to Scotland, the references in sub-

paragraphs (1), (5) and (7) to information on oath are to be read as

references to evidence on oath.

Restrictions on powers

22  (1)
This paragraph applies in relation to the powers conferred by—

(a)
paragraph 19 (power to require information or documents),

(b)
paragraph 20 (entry, inspection without warrant etc), or

(c)
paragraph 21 (entry to premises under warrant).

      (2)
Those powers are not exercisable in relation to information or

documents in respect of which a claim to legal professional privilege (in

Scotland, to confidentiality of communications) could be maintained in

legal proceedings.

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      (3)
The exercise of those powers and the provision of information or

production of documents under them is not otherwise subject to any

restriction on the disclosure of information, whether imposed by statute

or otherwise.

Failure to comply with information requirement

23  (1)
If on an application made by—

(a)
an enforcement authority, or

(b)
a local weights and measures authority or DETINI pursuant to

arrangements made with the OFT—

(i)
by or on behalf of the authority; or

(ii)
by DETINI,


it appears to the court that a person (the “information defaulter”) has

failed to do something that they were required to do under paragraph

19(1), the court may make an order under this paragraph.

      (2)
An order under this paragraph may require the information defaulter—

(a)
to do the thing that they failed to do within such period as may

be specified in the order;

(b)
otherwise to take such steps to remedy the consequences of the

failure as may be so specified.

      (3)
If the information defaulter is a body corporate, a partnership or an

unincorporated body of persons that is not a partnership, the order may

require any officer of the body corporate, partnership or body, who is

(wholly or partly) responsible for the failure to meet such costs of the

application as are specified in the order.

      (4)
In this paragraph “the court” means—

(a)
in England and Wales and Northern Ireland, the High Court or

the county court;

(b)
in Scotland, the Court of Session or the sheriff court.

Powers of local enforcement officers

24  (1)
A local enforcement officer may only exercise powers under this Part of

this Schedule pursuant to arrangements made with the OFT—

(a)
by or on behalf of the relevant local weights and measures

authority, or

(b)
by DETINI.

      (2)
Anything done or omitted to be done by, or in relation to, a local

enforcement officer in the exercise or purported exercise of a power in

this Part of this Schedule is treated for all purposes as if done or omitted

to be done by, or in relation to, an officer of the OFT.

      (3)
Sub-paragraph (2) does not apply for the purposes of criminal

proceedings brought against the local enforcement officer, the relevant

local weights and measures authority, DETINI or the OFT, in respect of

anything done or omitted to be done by the officer.

      (4)
A local enforcement officer must not disclose to any person other than

the OFT and the relevant local weights and measures authority or, as the

case may be, DETINI information obtained by the officer in the exercise

of powers under this Part of this Schedule unless—

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(a)
the officer has the approval of the OFT to do so, or

(b)
the officer is under a duty to make the disclosure.

      (5)
In this paragraph “the relevant local weights and measures authority”,

in relation to a local enforcement officer, means the authority of which

the officer is an officer.

Part 6

Enforcement: civil penalties

Power to impose civil penalties

25  (1)
An enforcement authority may impose a penalty of such amount as it

considers appropriate on a person who fails to comply with a

requirement imposed—

(a)
by a direction under this Schedule, or

(b)
by a condition of a licence under paragraph 17.


For this purpose “appropriate” means effective, proportionate and

dissuasive.

      (2)
No such penalty is to be imposed if the authority is satisfied that the

person took all reasonable steps and exercised all due diligence to ensure

that the requirement would be complied with.

      (3)
In deciding whether to impose a penalty for failure to comply with a

requirement, an enforcement authority must consider whether the

person followed any relevant guidance which was at the time—

(a)
issued by a supervisory authority or any other appropriate body,

(b)
approved by the Treasury, and

(c)
published in a manner approved by the Treasury as suitable in

their opinion to bring the guidance to the attention of persons

likely to be affected by it.

      (4)
In sub-paragraph (3) “appropriate body” means a body which regulates

or is representative of any trade, profession, business or employment

carried on by the person.

      (5)
A person on whom a penalty is imposed under this paragraph is not

liable to be proceeded against for an offence under paragraph 30 in

respect of the same failure.

Imposition of penalty by HMRC: procedure and reviews

26  (1)
This paragraph applies where HMRC decide to impose a penalty under

paragraph 25 on a person.

      (2)
HMRC must give the person notice of—

(a)
their decision to impose the penalty and its amount,

(b)
the reasons for imposing the penalty,

(c)
the right to a review under this paragraph, and

(d)
the right to appeal under paragraph 28.

      (3)
The person may by notice to HMRC require them to review their

decision.

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      (4)
A notice requiring a review may not be given after the end of the period

of 45 days beginning with the day on which HMRC first gave the person

notice under sub-paragraph (2).

      (5)
On a review under this paragraph, HMRC must either—

(a)
confirm the decision, or

(b)
withdraw or vary the decision and take such further steps (if any)

in consequence of the withdrawal or variation as they consider

appropriate.

      (6)
Where HMRC do not, within the period of 45 days beginning with the

day the notice under sub-paragraph (3) was given, give notice to the

person of their determination of the review, they are to be taken to have

confirmed their decision.

Imposition of penalty by other enforcement authority: procedure

27  (1)
This paragraph applies if the FSA, the OFT or DETINI (“the authority”)

proposes to impose a penalty under paragraph 25 on a person.

      (2)
The authority must give the person notice of—

(a)
the proposal to impose the penalty and the proposed amount,

(b)
the reasons for imposing the penalty, and

(c)
the right to make representations to the authority within a

specified period (which may not be less than 28 days).

      (3)
The authority must then decide, within a reasonable period, whether to

impose a penalty under paragraph 25 and must give the person notice—

(a)
if it decides not to impose a penalty, of that decision;

(b)
if it decides to impose a penalty, of the following matters—

(i)
the decision to impose a penalty and the amount,

(ii)
the reasons for the decision, and

(iii)
the right to appeal under paragraph 28.

Appeal against imposition of civil penalty

28  (1)
A person may appeal to the tribunal against—

(a)
a decision of HMRC on a review under paragraph 26;

(b)
a decision of the FSA or the OFT under paragraph 27.

      (2)
A person may appeal to the High Court in Northern Ireland against a

decision of DETINI under paragraph 27.

      (3)
On the appeal the tribunal or court may—

(a)
set aside the decision appealed against, and

(b)
impose any penalty that could have been imposed by the body

whose decision is appealed or remit the matter to that body.

      (4)
An appeal against a decision of HMRC may not be made after the end of

the period of 30 days beginning with—

(a)
the date of the document notifying the person of the decision, or

(b)
if paragraph 26(6) (deemed confirmation of decision) applies, the

day after the end of the period mentioned there.

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      (5)
In this paragraph “the tribunal” means the First-tier Tribunal or, where

so provided by or determined under Tribunal Procedure Rules, the

Upper Tribunal.

      (6)
The Treasury may by order provide that, until a time specified in the

order, appeals under sub-paragraph (1) are to be made—

(a)
in the case of a decision of HMRC, to a VAT and duties tribunal;

(b)
in the case of a decision of the FSA, to the Financial Services and

Markets Tribunal;

(c)
in the case of a decision of the OFT, to the Consumer Credit

Appeals Tribunal;


(rather than to the tribunal).

      (7)
An order under sub-paragraph (6) may provide that any enactment

applies (with or without modifications) in relation to an appeal to a

tribunal mentioned in paragraph (a), (b) or (c) of that sub-paragraph.

      (8)
Such an order is subject to negative resolution procedure.

Payment and recovery of civil penalties

29  (1)
A penalty imposed under paragraph 25 is payable to the enforcement

authority that imposed it.

      (2)
Any such penalty is a debt due to the authority and is recoverable

accordingly.

Part 7

Enforcement: offences

Offences: failure to comply with requirement imposed by direction

30  (1)
A person who fails to comply with a requirement imposed by a direction

under this Schedule commits an offence, subject to the following

provisions.

      (2)
No offence is committed if the person took all reasonable steps and

exercised all due diligence to ensure that the requirement would be

complied with.

      (3)
In deciding whether a person has committed an offence under this

paragraph the court must consider whether the person followed any

relevant guidance that was at the time—

(a)
issued by a supervisory authority or any other appropriate body,

(b)
approved by the Treasury, and

(c)
published in a manner approved by the Treasury as suitable in

their opinion to bring the guidance to the attention of persons

likely to be affected by it.

      (4)
In sub-paragraph (3) “appropriate body” means a body that regulates or

is representative of any trade, profession, business or employment

carried on by the alleged offender.

      (5)
A person guilty of an offence under this paragraph is liable—

(a)
on summary conviction, to a fine not exceeding the statutory

maximum;