|
| |
|
165 | Special resolution regime |
| |
(1) | After section 214A of the Financial Services and Markets Act 2000 (contingency |
| |
funding - inserted by section 164 above) insert— |
| |
“214B | Contribution to costs of special resolution regime |
| |
(1) | This section applies where— |
| 5 |
(a) | a stabilisation power under Part 1 of the Banking Act 2008 has |
| |
been exercised in respect of a bank, building society or credit |
| |
union (within the meaning of that Part), and |
| |
(b) | the Treasury think that the bank, building society or credit |
| |
union was, or but for the exercise of the stabilisation power |
| 10 |
would have become, unable to satisfy claims against it. |
| |
(2) | Where this section applies— |
| |
(a) | the Treasury may require the scheme manager to contribute |
| |
towards expenses connected with the exercise of the |
| |
| 15 |
(b) | contributions shall be treated as expenditure under the scheme |
| |
for all purposes (including levies, contingency funds and |
| |
| |
(3) | The Treasury shall make regulations— |
| |
(a) | specifying what expenses the scheme manager may be required |
| 20 |
to contribute towards under subsection (2), |
| |
(b) | providing for independent verification of the nature and |
| |
amount of expenses incurred (which may include provision |
| |
about appointment and payment of an auditor), and |
| |
(c) | providing for the method by which amounts to be contributed |
| 25 |
| |
(4) | The regulations must ensure that contributions required do not exceed |
| |
the amount of compensation that would have been payable under the |
| |
scheme if the stabilisation power had not been exercised and the bank |
| |
had been unable to satisfy claims against it; and for that purpose the |
| 30 |
amount of compensation that would have been payable does not |
| |
| |
(a) | amounts that would have been likely, at the time when the |
| |
stabilisation power was exercised, to be recovered by the |
| |
| 35 |
(b) | any compensation actually paid to an eligible depositor of the |
| |
| |
(5) | The regulations must provide for the appointment of an independent |
| |
valuer (who may be the person appointed as valuer under section 54 of |
| |
the Banking Act 2008 in respect of the exercise of the stabilisation |
| 40 |
power) to calculate the amounts referred to in subsection (4)(a); and the |
| |
| |
(a) | must provide for the valuer to be appointed by the Treasury or |
| |
by a person designated by the Treasury, |
| |
(b) | must include provision enabling the valuer to reconsider a |
| 45 |
| |
(c) | must provide a right of appeal to a court or tribunal, |
| |
(d) | must provide for payment of the valuer, |
| |
|
| |
|
| |
|
(e) | may replicate or apply a provision of section 54 or 55, and |
| |
(f) | may apply or include any provision that is or could be made |
| |
| |
(6) | The regulations may include provision— |
| |
| 5 |
(b) | about procedures to be followed; |
| |
(c) | for discretionary functions to be exercised by a specified body |
| |
or by persons of a specified class; |
| |
(d) | about the resolution of disputes (which may include provision |
| |
conferring jurisdiction on a court or tribunal). |
| 10 |
(7) | The compensation scheme may include provision about contributions |
| |
under and levies in connection with this section, provided that it is not |
| |
inconsistent with this section or regulations under it.” |
| |
(2) | At the end of section 223(3) of the Financial Services and Markets Act 2000 |
| |
(management expenses) add “; |
| 15 |
(c) | under section 214B.”. |
| |
166 | Investing in National Loans Fund |
| |
After section 223 of the Financial Services and Markets Act 2000 (management |
| |
| |
“223A | Investing in National Loans Fund |
| 20 |
(1) | Sums levied for the purpose of maintaining a contingency fund may be |
| |
| |
(2) | The Treasury may receive sums under subsection (1) and may set terms |
| |
and conditions of receipts. |
| |
(3) | Sums received shall be treated as if raised under section 12 of the |
| 25 |
National Loans Act 1968 (and shall therefore be invested as part of the |
| |
| |
(4) | Interest accruing on the invested sums may be credited to the |
| |
contingency fund (subject to any terms and conditions set under |
| |
| 30 |
(5) | The Treasury shall comply with any request of the scheme manager to |
| |
arrange for the return of sums for the purpose of making payments out |
| |
of a contingency fund (subject to any terms and conditions set under |
| |
| |
167 | Borrowing from National Loans Fund |
| 35 |
After section 223A of the Financial Services and Markets Act 2000 (investing in |
| |
National Loans Fund - inserted by section 166 above) insert— |
| |
“223B | Borrowing from National Loans Fund |
| |
(1) | The scheme manager may request a loan from the National Loans Fund |
| |
for the purpose of funding expenses incurred or expected to be |
| 40 |
incurred under the scheme. |
| |
|
| |
|
| |
|
(2) | The Treasury may arrange for money to be paid out of the National |
| |
Loans Fund in pursuance of a request under subsection (1). |
| |
(3) | The Treasury shall determine— |
| |
(a) | the rate of interest on a loan, and |
| |
(b) | other terms and conditions. |
| 5 |
(4) | The Treasury may make regulations— |
| |
(a) | about the amounts that may be borrowed under this section; |
| |
(b) | permitting the scheme manager to impose levies under section |
| |
213 for the purpose of meeting expenses in connection with |
| |
loans under this section (and the regulations may have effect |
| 10 |
despite any provision of this Act); |
| |
(c) | about the classes of person on whom those levies may be |
| |
| |
(d) | about the amounts and timing of those levies. |
| |
(5) | The compensation scheme may include provision about borrowing |
| 15 |
under this section provided that it is not inconsistent with regulations |
| |
| |
| |
(1) | After section 214(1) of the Financial Services and Markets Act 2000 (the |
| |
compensation scheme: powers) insert— |
| 20 |
“(1A) | Rules by virtue of subsection (1)(h) may, in particular, allow the scheme |
| |
manager to treat persons who are or may be entitled to claim under the |
| |
scheme as if they had done so. |
| |
(1B) | A reference in any enactment or instrument to a claim or claimant |
| |
under this Part includes a reference to a deemed claim or claimant in |
| 25 |
accordance with subsection (1A). |
| |
(1C) | Rules by virtue of subsection (1)(j) may, in particular, allow, or be |
| |
subject to rules which allow, the scheme manager to settle a class of |
| |
claim by payment of sums fixed without reference to, or by |
| |
modification of, the normal rules for calculation of maximum |
| 30 |
entitlement for individual claims.” |
| |
(2) | In section 417(1) (definitions) at the appropriate place insert— |
| |
““claim”, in relation to the Financial Services Compensation |
| |
Scheme under Part XV, is to be construed in accordance with |
| |
| 35 |
| |
(1) | This section amends section 215 of the Financial Services and Markets Act 2000 |
| |
(rights of scheme following insolvency). |
| |
(2) | For section 215(1) substitute— |
| |
“(1) | The compensation scheme may make provision— |
| 40 |
(a) | about the effect of a payment of compensation under the |
| |
scheme on rights or obligations arising out of matters in |
| |
connection with which the compensation was paid; |
| |
|
| |
|
| |
|
(b) | giving the scheme manager a right of recovery in respect of |
| |
those rights or obligations.” |
| |
(3) | In section 215(2) for “the relevant person’s insolvency” substitute “a person’s |
| |
| |
(4) | The heading of section 215 becomes “Rights of the scheme in insolvency”. |
| 5 |
| |
(1) | Before section 219 of the Financial Services and Markets Act 2000 (scheme |
| |
manager’s power to require information) insert— |
| |
“218A | Authority’s power to require information |
| |
(1) | The Authority may make rules enabling the Authority to require |
| 10 |
authorised persons to provide information, which may then be made |
| |
available to the scheme manager by the Authority. |
| |
(2) | A requirement may be imposed only if the Authority thinks the |
| |
information is of a kind that may be of use to the scheme manager in |
| |
connection with functions in respect of the scheme. |
| 15 |
(3) | A requirement under this section may apply— |
| |
(a) | to authorised persons generally or only to specified persons or |
| |
| |
(b) | to the provision of information at specified periods, in |
| |
connection with specified events or in other ways. |
| 20 |
(4) | In addition to requirements under this section, a notice under section |
| |
165 may relate to information or documents which the Authority thinks |
| |
are reasonably required by the scheme manager in connection with the |
| |
performance of functions in respect of the scheme; and section 165(4) is |
| |
subject to this subsection. |
| 25 |
(5) | Rules under subsection (1) shall be prepared, made and treated in the |
| |
same way as (and may be combined with) the Authority’s general |
| |
| |
(2) | Section 219 is amended as follows. |
| |
(3) | In subsection (1) for “given to the relevant person in respect of whom a claim |
| 30 |
is made under the scheme or to a person otherwise involved, require that |
| |
person” substitute “require a person”. |
| |
(4) | After subsection (1) insert— |
| |
“(1A) | A requirement may be imposed only— |
| |
(a) | on a person (P) against whom a claim has been made under the |
| 35 |
| |
(b) | on a person (P) who is unable or likely to be unable to satisfy |
| |
claims under the scheme against P, |
| |
(c) | on a person (“the Third Party”) whom the scheme manager |
| |
thinks was knowingly involved in matters giving rise to a claim |
| 40 |
against another person (P) under the scheme, or |
| |
(d) | on a person (“the Third Party”) whom the scheme manager |
| |
thinks was knowingly involved in matters giving rise to the |
| |
|
| |
|
| |
|
actual or likely inability of another person (P) to satisfy claims |
| |
| |
(1B) | For the purposes of subsection (1A)(b) and (d) whether P is unable or |
| |
likely to be unable to satisfy claims shall be determined in accordance |
| |
with provision to be made by the scheme (which may, in particular— |
| 5 |
(a) | apply or replicate, with or without modifications, a provision of |
| |
| |
(b) | confer discretion on a specified person).” |
| |
(5) | In subsection (3) for paragraphs (a) and (b) substitute “to be necessary (or likely |
| |
to be necessary) for the fair determination of claims which have been or may |
| 10 |
| |
(6) | After subsection (3) insert— |
| |
“(3A) | Where a stabilisation power under Part 1 of the Banking Act 2008 has |
| |
been exercised in respect of a bank, the scheme manager may by notice |
| |
in writing require the bank or the Bank of England to provide |
| 15 |
information that the scheme manager requires for the purpose of |
| |
applying regulations under section 214B(3) above.” |
| |
(7) | In subsection (6) for “the relevant person” substitute “P”. |
| |
| |
(9) | Omit subsection (10). |
| 20 |
| |
After section 223B of the Financial Services and Markets Act 2000 (borrowing |
| |
from National Loans Fund - inserted by section 167 above) insert— |
| |
| |
(1) | Payments made by the scheme manager in error may be provided for |
| 25 |
in setting a levy by virtue of section 213, 214A, 214B or 223B. |
| |
(2) | This section does not apply to payments made in bad faith.” |
| |
| |
In section 429(2) of the Financial Services and Markets Act 2000 (parliamentary |
| |
control of subordinate legislation: affirmative resolution) after “90B” insert “, |
| 30 |
| |
173 | Delegation of functions |
| |
(1) | Before section 222 of the Financial Services and Markets Act 2000 (scheme |
| |
manager: statutory immunity) insert— |
| |
“221A | Delegation of functions |
| 35 |
(1) | The scheme manager may arrange for any of its functions to be |
| |
discharged on its behalf by another person (a “scheme agent”). |
| |
(2) | Before entering into arrangements the scheme manager must be |
| |
satisfied that the scheme agent— |
| |
|
| |
|
| |
|
(a) | is competent to discharge the function, and |
| |
(b) | has been given sufficient directions to enable the agent to take |
| |
any decisions required in the course of exercising the function |
| |
in accordance with policy determined by the scheme manager. |
| |
(3) | Arrangements may include provision for payments to be made by the |
| 5 |
scheme manager to the scheme agent (which payments are |
| |
management expenses of the scheme manager).” |
| |
(2) | In section 222(1) of that Act after “officer” insert “, scheme agent”. |
| |
174 | Functions under this Act |
| |
At the end of Part 15 of the Financial Services and Markets Act 2000 add— |
| 10 |
“224A | Functions under the Banking Act 2008 |
| |
A reference in this Part to functions of the scheme manager (including |
| |
a reference to functions conferred by or under this Part) includes a |
| |
reference to functions conferred by or under the Banking Act 2008.” |
| |
| 15 |
Inter-Bank Payment Systems |
| |
| |
| |
This Part enables the Bank of England to oversee certain systems for payments |
| |
between financial institutions. |
| 20 |
176 | Interpretation: “inter-bank payment system” |
| |
(1) | In this Part “inter-bank payment system” means arrangements designed to |
| |
facilitate or control the transfer of money between financial institutions who |
| |
participate in the arrangements. |
| |
(2) | The fact that persons other than financial institutions can participate does not |
| 25 |
prevent arrangements from being an inter-bank payment system. |
| |
(3) | In subsection (1) “financial institutions” means— |
| |
| |
| |
(4) | In subsection (1) “money” includes credit. |
| 30 |
(5) | A system is an inter-bank payment system for the purposes of this Part |
| |
whether or not it operates wholly or partly in relation to persons or places |
| |
outside the United Kingdom. |
| |
177 | Interpretation: other expressions |
| |
| 35 |
|
| |
|
| |
|
(a) | a reference to the “operator” of an inter-bank payment system is a |
| |
reference to any person with responsibility under the system for |
| |
managing or operating it, |
| |
(b) | a reference to the operation of a system includes a reference to its |
| |
| 5 |
(c) | “the UK financial system” has the meaning given to “the financial |
| |
system” by section 3(2) of the Financial Services and Markets Act 2000 |
| |
| |
(d) | a reference to the Bank of England’s role as a monetary authority is to |
| |
be construed in accordance with section 231(2)(c), and |
| 10 |
(e) | “the FSA” means the Financial Services Authority. |
| |
| |
| |
(1) | The Treasury may by order (“recognition order”) specify an inter-bank |
| |
payment system as a recognised system for the purposes of this Part. |
| 15 |
(2) | A recognition order must specify in as much detail as is reasonably practicable |
| |
the arrangements which constitute the inter-bank payment system. |
| |
(3) | The Treasury may not specify an inter-bank system operated solely by the |
| |
| |
| 20 |
(1) | The Treasury may make a recognition order in respect of an inter-bank |
| |
payment system only if satisfied that any deficiencies in the design of the |
| |
system, or any disruption of its operation, would be likely— |
| |
(a) | to threaten the stability of, or confidence in, the UK financial system, or |
| |
(b) | to have serious consequences for business or other interests throughout |
| 25 |
| |
(2) | In considering whether to specify a system the Treasury must have regard to— |
| |
(a) | the number and value of the transactions that the system presently |
| |
processes or is likely to process in the future, |
| |
(b) | the nature of the transactions that the system processes, |
| 30 |
(c) | whether those transactions or their equivalent could be handled by |
| |
| |
(d) | the relationship between the system and other systems, and |
| |
(e) | whether the system is used by the Bank of England in the course of its |
| |
role as a monetary authority. |
| 35 |
| |
(1) | Before making a recognition order in respect of a payment system the Treasury |
| |
| |
(a) | consult the Bank of England, |
| |
(b) | notify the operator of the system, and |
| 40 |
(c) | consider any representations made. |
| |
|
| |
|