House of Commons Amendments

House of Commons

Session 2008 - 09
Internet Publications
Other Bills before Parliament

5
39
Page 23, line 26, leave out “security interests or set-off or netting” and insert

“protected”
40
Page 23, line 29, leave out “security interests or set-off or netting” and insert

“protected”
41
Page 23, line 33, leave out “security interests or set-off or netting” and insert

“protected”
42
Page 23, line 39, after first “to” insert “protected”
43
Page 23, line 43, leave out “security interests or set-off or netting” and insert

“protected”
44
Page 24, line 2, at end insert “or trusts;”
45
Page 24, line 5, at end insert—

“(d)
involve any number of parties;

(e)
operate partly by reference to other arrangements between other

parties.”
Clause 58
46
Page 28, line 40, leave out paragraph (a)
47
Page 29, line 3, leave out paragraph (a)
48
Page 29, line 6, at end insert—

“(8)
A requirement under subsection (6) or (7) is to be complied with only in so

far as is compatible with—

(a)
pursuit of the special resolution objectives, and

(b)
compliance with the code of practice under section 5.”
Clause 71
49
Page 36, line 30, after “bank” insert “, or a group company of the bank,”
50
Page 36, line 30, at end insert—

“(7)
In subsection (6)(b) the reference to a group company of the bank is a

reference to anything that is or was a group undertaking in relation to the

bank within the meaning given by section 1161(5) of the Companies Act

2006.”
Clause 74
51
Page 38, line 9, after “section” insert—

“(a)
”
52
Page 38, line 11, leave out “Regulations under this section” and insert—


“, and

(b)
”
53
Page 38, line 13, leave out subsection (10)
Clause 75
54
Page 38, line 26, at end insert “(but in relying on this subsection the Treasury shall

6

have regard to the fact that it is in the public interest to avoid retrospective

legislation).”
55
Page 38, line 29, leave out second “or”
56
Page 38, line 30, at end insert—


“, or

(c)
amend any provision of an instrument or order made in the exercise

of a stabilisation power.”
57
Page 39, line 10, at end insert “(in new terms).”
After Clause 80
58
Insert the following new Clause—

“Temporary public ownership: report

(1)
Where the Treasury make one or more share transfer orders under section

13(2) in respect of a bank, the Treasury must lay before Parliament a report

about the activities of the bank.

(2)
The first report must be made as soon as is reasonably practicable after the

end of one year beginning with the date of the first share transfer order.

(3)
A report must be made as soon as is reasonably practicable after the end of

each subsequent year.

(4)
The obligation to produce reports continues to apply in respect of each year

until the first during which no securities issued by the bank are owned

by—

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

(b)
a nominee of the Treasury.”
59
Insert the following new Clause—

“Holding companies: temporary public ownership

(1)
The Treasury may take a parent undertaking of a bank (the “holding

company”) into temporary public ownership, in accordance with section

13(2), if the following conditions are met.

(2)
Condition 1 is that the FSA are satisfied that the general conditions for the

exercise of a stabilisation power set out in section 7 are met in respect of the

bank.

(3)
Condition 2 is that the Treasury are satisfied that it is necessary to take

action in respect of the holding company for the purpose specified in

Condition A or B of section 9.

(4)
Condition 3 is that the holding company is an undertaking incorporated in,

or formed under the law of any part of, the United Kingdom.

(5)
Before determining whether Condition 2 is met the Treasury must

consult—

(a)
the FSA, and

(b)
the Bank of England.

7

(6)
Expressions used in this section have the same meaning as in the

Companies Act 2006.”
60
Insert the following new Clause—

“Holding companies: supplemental

(1)
In the following provisions references to banks include references to

holding companies—

(a)
section 10(1),

(b)
section 13(3),

(c)
section 16(1), and

(d)
section 75(5)(a).

(2)
Where the Treasury take a bank’s holding company into temporary public

ownership in reliance on section (Holding companies: Temporary public

ownership)—

(a)
section 20(2) applies to (i) directors of the holding company, (ii)

directors of the bank, and (iii) directors of a bank in the same group,

(b)
section 25(2) applies as if references to a bank were references to a

holding company,

(c)
sections 27 to 29 apply as if references to a bank were references to

a holding company,

(d)
a share transfer may be made in respect of securities which were

issued by the bank or by another bank which is or was in the same

group; and a transfer—

(i)
shall be made by onward share transfer order under section

28 or by reverse share transfer order under section 29 (in

addition to any that may be made under those sections as

applied by paragraph (c) above),

(ii)
may be made under section 28 only in respect of securities

held by (or for the benefit of) the holding company or a

subsidiary undertaking of the holding company,

(iii)
is not subject to section 28(4),

(iv)
may be made under section 29 only in respect of securities

held by a person of a kind listed in section 29(3)(b), and

(v)
is not (otherwise) subject to section 29(3),

(e)
section 45 applies as if—

(i)
the reference to a bank in subsection (1) were a reference to

a holding company, and

(ii)
a reference to the bank in subsection (3) were a reference to

the holding company, the bank and any other bank which is

or was in the same group,

(f)
sections 65 to 68 apply, with—

(i)
references to the bank or the transferred bank taken as

references to the bank, the holding company and any other

bank which is or was in the same group, and

(ii)
references to securities of the bank taken as including

references to securities of the holding company (so that, in

particular, sections 65(1)(a)(ii) and 68(1)(a) include

references to the earlier transfer of securities issued by the

holding company),

8

(g)
other provisions of this Act about share transfer orders apply with

any necessary modifications,

(h)
section 214B of the Financial Services and Markets Act 2000 applies

(contribution to costs of special resolution regime - inserted by

section 168 below), and

(i)
the reference in section 214B(1)(b) to the bank, and later references

in the section, are treated as including references to any other bank

which is also a subsidiary undertaking of the holding company (but

not to the holding company itself).

(3)
A reference in this Act or another enactment to a share transfer order in

respect of securities issued by a bank includes (so far as the context

permits) a reference to a share transfer order in respect of securities issued

by a holding company.

(4)
In so far as sections 47 and 60 apply in relation to orders treated as property

transfer instruments by virtue of section 45(5)(b) or 46(5)(b) (including

those sections as applied by virtue of subsection (2) above) the reference in

section 47(1) to the property of a bank includes a reference to the property

of a holding company and of any other bank which is or was in the same

group.

(5)
Expressions used in this section have the same meaning as in the

Companies Act 2006.

(6)
A reference to two banks being in the same group is a reference to their

being group undertakings in respect of each other.”
Clause 98
61
Page 50, line 4, at end insert “or under section 141(2) or 142(2) of the Insolvency Act

1986 (as applied by section 100 below)”
Clause 100
62
Page 52, line 22, at end insert—

“Section 141
Liquidation
The application of section 141 is subject to—

Committee
(a)
sections 97, 98 and 106 of this Act,

(England
(b)
rules under section 411 (as applied

and Wales)
by section 122 of this Act) which

may, in particular, adapt section 141

to reflect (i) the fact that the bank

liquidator is appointed by the court

and (ii) the possibility of calling

creditors’ meetings under other

provisions, and

(c)
the omission of references to the

official receiver.

Section 142
Liquidation
The application of section 142 is subject to—

Committee
(a)
sections 97, 98 and 106 of this Act,

(Scotland)
(b)
rules under section 411 (as applied

by section 122 of this Act) which

may, in particular, adapt section 142

to reflect (i) the fact that the bank

liquidator is appointed by the court

and (ii) the possibility of calling

creditors’ meetings under other

provisions, and

(c)
the omission of references to the

official receiver.”