Banking Bill

House of Commons

Session 2007 - 08
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Other Bills before Parliament

Banking Bill

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Onward transfer
(1)
This section applies where the Treasury have made a share transfer order, in
respect of securities issued by a bank, in accordance with section 13(2) (“the
original order”).
(2)
The Treasury may make one or more onward share transfer orders.
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(3)
An onward share transfer order is a share transfer order which—
(a)
provides for the transfer of—
(i)
securities which were issued by the bank before the original
order and have been transferred by the original order or a
supplemental share transfer order, or
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(ii)
securities which were issued by the bank after the original
order;
(b)
makes other provision for the purposes of, or in connection with, the
transfer of securities issued by the bank (whether the transfer has been
or is to be effected by that order, by another share transfer order or
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otherwise).
(4)
An onward share transfer order may not transfer securities to the transferor
under the original order.
(5)
Sections 7 and 9 do not apply to an onward share transfer order (but it is to be
treated in the same way as any other share transfer order for all other purposes,
20
including for the purposes of the application of a power under this Part).
(6)
Before making an onward share transfer order the Treasury must consult—
(a)
the FSA, and
(b)
the Bank of England.
(7)
Section 27 applies where the Treasury have made an onward share transfer
25
order.
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Reverse share transfer
(1)
This section applies where the Treasury have made a share transfer order in
accordance with section 13(2) (“the original order”) providing for the transfer
of securities issued by a bank to a person (“the original transferee”).
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(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
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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,
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(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—

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(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
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transfer of securities which are, could be or could have been transferred
under paragraph (a) or (b).
(5)
Sections 7, 9 and 52 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
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Part).
(6)
Before making a reverse share transfer order the Treasury must consult—
(a)
the FSA, and
(b)
the Bank of England.
(7)
Section 27 applies where the Treasury have made a reverse share transfer
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order.
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Bridge bank: share transfers
(1)
This section applies where the Bank of England has made a property transfer
instrument in respect of a bridge bank in accordance with section 12(2) (“the
original instrument”).
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(2)
The Bank of England may make one or more bridge bank share transfer
instruments.
(3)
A bridge bank share transfer instrument is a share transfer instrument which—
(a)
provides for securities issued by the bridge bank to be transferred;
(b)
makes other provision for the purposes of, or in connection with, the
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transfer of securities issued by the bridge bank (whether the transfer
has been or is to be effected by that instrument, by another share
transfer instrument or otherwise).
(4)
Sections 7 and 8 do not apply to a bridge bank share transfer instrument (but it
is to be treated in the same way as any other share transfer instrument for all
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other purposes, including for the purposes of the application of a power under
this Part).
(5)
Before making a bridge bank share transfer instrument the Bank of England
must consult—
(a)
the FSA, and
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(b)
the Treasury.
(6)
Section 26 applies where the Bank of England has made a bridge bank share
transfer instrument.
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Bridge bank: reverse share transfer
(1)
This section applies where the Bank of England has made a bridge bank share
40
transfer instrument in accordance with section 30(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

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(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
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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).
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(4)
Sections 7, 8 and 52 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
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England must consult—
(a)
the FSA, and
(b)
the Treasury.
(6)
Section 26 applies where the Bank of England has made a bridge bank reverse
share transfer instrument.
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Interpretation: general
In this group of sections—
“service contract” has the meaning given by section 227 of the Companies
Act 2006, and
“transfer date” means the date or time on or at which a share transfer
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instrument or order (or the relevant part of it) takes effect.
Transfer of property
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Property transfer instrument
(1)
A property transfer instrument is an instrument which—
(a)
provides for property, rights or liabilities of a specified bank to be
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transferred;
(b)
makes other provision for the purposes of, or in connection with, the
transfer of property, rights or liabilities of a specified bank (whether the
transfer has been or is to be effected by that instrument, by another
property transfer instrument or otherwise).
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(2)
A property transfer instrument may relate to—
(a)
all property, rights and liabilities of the specified bank,
(b)
all its property, rights and liabilities subject to specified exceptions,
(c)
specified property, rights or liabilities, or
(d)
property, rights or liabilities of a specified description.
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Effect
(1)
In this section “transfer” means a transfer provided for by a property transfer
instrument.
(2)
A transfer takes effect by virtue of the instrument (and in accordance with its
provisions as to timing or other ancillary matters).
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(3)
A transfer takes effect despite any restriction arising by virtue of contract or
legislation or in any other way.
(4)
In subsection (3) “restriction” includes—
(a)
any restriction, inability or incapacity affecting what can and cannot be
assigned or transferred (whether generally or by a particular person),
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and
(b)
a requirement for consent (by any name).
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Transferable property
(1)
A property transfer instrument may transfer any property, rights or liabilities
including, in particular—
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(a)
property, rights and liabilities acquired or arising between the making
of the instrument and the transfer date,
(b)
rights and liabilities arising on or after the transfer date in respect of
matters occurring before that date,
(c)
property outside the United Kingdom,
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(d)
rights and liabilities under the law of a country or territory outside the
United Kingdom, and
(e)
rights and liabilities under an enactment (including legislation of the
European Union).
(2)
Section 32 applies for the interpretation of this section (with the necessary
25
modification).
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Continuity
(1)
A property transfer instrument may provide—
(a)
for a transfer to be, or to be treated as, a succession;
(b)
for a transferee to be treated for any purpose connected with the
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transfer as the same person as the transferor.
(2)
A property transfer instrument may provide for agreements made or other
things done by or in relation to a transferor to be treated as made or done by or
in relation to the transferee.
(3)
A property transfer instrument may provide for anything (including legal
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proceedings) that relates to anything transferred and is in the process of being
done by or in relation to the transferor immediately before the transfer date, to
be continued by or in relation to the transferee.
(4)
A property transfer instrument which transfers or enables the transfer of a
contract of employment may include provision about continuity of
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employment.
(5)
A property transfer instrument may modify references (express or implied) in
an instrument or document to a transferor.

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(6)
In so far as rights and liabilities in respect of anything transferred are
enforceable after transfer, a property transfer instrument may provide for
apportionment between transferor and transferee to a specified extent and in
specified ways.
(7)
A property transfer instrument may apportion liability to tax between
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transferor and transferee.
(8)
A property transfer instrument may enable the transferor and transferee by
agreement to modify a provision of the instrument; but a modification—
(a)
must achieve a result that could have been achieved by the instrument,
and
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(b)
may not transfer (or arrange for the transfer of) property, rights or
liabilities.
(9)
A property transfer instrument may require or permit—
(a)
a transferor to provide a transferee with information and assistance;
(b)
a transferee to provide a transferor with information and assistance.
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(10)
Section 32 applies for the interpretation of this section (with the necessary
modification).
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Licences
(1)
A licence in respect of anything transferred by property transfer instrument
shall continue to have effect despite the transfer.
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(2)
A property transfer instrument may disapply subsection (1) to a specified
extent.
(3)
Where a licence imposes rights or obligations, a property transfer instrument
may apportion responsibility for exercise or compliance between transferor
and transferee.
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(4)
In this section “licence” includes permission and approval and any other
permissive document in respect of anything transferred.
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Termination rights, &c.
(1)
In this section “default event provision” means a provision of a contract or
other agreement that if a specified event occurs—
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(a)
the agreement is terminated, modified or replaced,
(b)
rights or duties under the agreement are terminated, modified or
replaced,
(c)
a right accrues to terminate, modify or replace the agreement,
(d)
a right accrues to terminate, modify or replace rights or duties under
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the agreement,
(e)
a sum becomes payable or ceases to be payable,
(f)
delivery of anything becomes due or ceases to be due,
(g)
a right to claim a payment or delivery accrues, changes or lapses,
(h)
any other right accrues, changes or lapses, or
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(i)
an interest is created, changes or lapses.
(2)
A property transfer instrument may provide for subsection (3) or (4) to apply
(but need not apply either).

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(3)
If this subsection applies, the property transfer instrument is to be disregarded
in determining whether a default event provision applies.
(4)
If this subsection applies, the property transfer instrument is to be disregarded
in determining whether a default event provision applies except in so far as the
instrument provides otherwise.
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(5)
In subsections (3) and (4) a reference to the property transfer instrument is a
reference to—
(a)
the making of the instrument,
(b)
anything that is to be, or that may be, done under or by virtue of the
instrument, and
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(c)
any action or decision taken or made under this or another enactment
in so far as it resulted in, or was connected to, the making of the
instrument.
(6)
Provision under subsection (2) may apply subsection (3) or (4) generally or
only for specified purposes.
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Foreign property
(1)
This section applies where a property transfer instrument transfers foreign
property.
(2)
In subsection (1) “foreign property” means—
(a)
property outside the United Kingdom, and
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(b)
rights and liabilities under foreign law.
(3)
The transferor and the transferee must each take any necessary steps to ensure
that the transfer is effective as a matter of foreign law (if it is not wholly
effective by virtue of the property transfer instrument).
(4)
Until the transfer is effective as a matter of foreign law, the transferor must—
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(a)
hold the property or right for the benefit of the transferee (together with
any additional property or right accruing by virtue of the original
property or right), or
(b)
discharge the liability on behalf of the transferee.
(5)
The transferee must meet any expenses of the transferor in complying with this
30
section.
(6)
An obligation imposed by this section is enforceable as if created by contract
between the transferor and transferee.
(7)
The transferor must comply with any directions of the Bank of England in
respect of the obligations under subsections (3) and (4); and—
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(a)
a direction may disapply subsections (3) and (4) to a specified extent,
and
(b)
obligations imposed by direction are enforceable as if created by
contract between the transferor and the Bank of England.
(8)
In this section “foreign law” means the law of a country or territory outside the
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United Kingdom.