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Further provision about the consumer financial education body |
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1 | This is the Schedule 1A to be inserted in the Financial Services and Markets |
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Act 2000 after Schedule 1— |
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Further provision about the consumer financial education body |
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Ensuring exercise of consumer financial education function etc |
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1 (1) | The Authority must take such steps as are necessary to ensure that |
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the consumer financial education body is, at all times, capable of |
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exercising the consumer financial education function. |
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(2) | In complying with the duty under sub-paragraph (1) the |
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Authority may, in particular, provide services to that body which |
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the Authority considers would facilitate the exercise of that |
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2 (1) | The constitution of the consumer financial education body must |
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(b) | a chief executive; and |
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(c) | a board (which must include the chair and chief executive) |
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whose members are the body’s directors. |
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(2) | The members of the board must be persons appointed, and liable |
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to removal from office, by the Authority (acting, in the case of the |
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chair or chief executive, with the approval of the Treasury). |
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(3) | But the terms of appointment of members of the board (and in |
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particular those governing removal from office) must be such as to |
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secure their independence from the Authority in the exercise of |
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the consumer financial education function. |
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3 (1) | The consumer financial education body is not to be regarded as |
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exercising functions on behalf of the Crown. |
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(2) | The body’s board members, officers and staff are not to be |
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regarded as Crown servants. |
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Discharge of function by others |
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4 (1) | The consumer financial education body may discharge the |
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consumer financial education function by— |
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(a) | supporting the doing by other persons of anything that it |
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considers would enhance the understanding, knowledge |
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or ability mentioned in section 6A(1); or |
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(b) | arranging for other persons to do anything that it considers |
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would enhance that understanding, knowledge or ability. |
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(2) | The reference in sub-paragraph (1)(a) to support includes financial |
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(3) | The reference in sub-paragraph (1)(b) to arrangements includes |
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arrangements under which payments are made to the other |
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(4) | Nothing in this paragraph is to limit other ways in which the |
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consumer financial eduction body may discharge the consumer |
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financial education function. |
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5 (1) | This paragraph applies if the consumer financial education body |
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arranges for any person (including one established by or under an |
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enactment) to do anything that it considers would enhance the |
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understanding, knowledge or ability mentioned in section 6A(1). |
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(2) | The person may do that thing despite any limitation on its capacity |
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(whether under a rule of law or otherwise) which, but for this |
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paragraph, would have applied. |
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Market confidence and financial stability |
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6 | In discharging the consumer financial education function, the |
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consumer financial education body must have regard to the |
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(a) | maintaining confidence in the UK financial system; and |
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(b) | maintaining the stability of the UK financial system. |
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7 (1) | The consumer financial education body must adopt an annual |
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budget which has been approved by the Authority. |
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(2) | The budget must be adopted— |
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(a) | in the case of the body’s first financial year, as soon as |
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reasonably practicable after the body is established; and |
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(b) | in the case of each subsequent financial year, before the |
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start of the financial year. |
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(3) | The consumer financial education body may, with the approval of |
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the Authority, vary the budget for a financial year at any time after |
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(4) | Before adopting or varying a budget, the consumer financial |
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education body must consult— |
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(b) | the Secretary of State; |
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(c) | the Office of Fair Trading; and |
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(d) | such other persons (if any) as the body considers |
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(5) | The consumer financial education body must publish each |
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budget, and each variation of a budget, in the way it considers |
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8 (1) | The consumer financial education body must in respect of each of |
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its financial years prepare an annual plan which has been |
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approved by the Authority. |
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(2) | The plan must be prepared— |
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(a) | in the case of the body’s first financial year, as soon as |
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reasonably practicable after the body is established; and |
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(b) | in the case of each subsequent financial year, before the |
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start of the financial year. |
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(3) | The consumer financial education body may, with the approval of |
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the Authority, vary the plan in respect of a financial year at any |
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time after its preparation. |
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(4) | An annual plan in respect of a financial year must set out— |
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(a) | the objectives of the consumer financial eduction body for |
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(b) | the relative priorities of each of those objectives; and |
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(c) | how its resources are to be allocated among the activities to |
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be carried on in connection with the discharge of the |
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consumer financial education function. |
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(5) | Before preparing or varying an annual plan, the consumer |
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financial education body must consult— |
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(b) | the Secretary of State; |
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(c) | the Office of Fair Trading; |
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(d) | the Practitioner Panel; |
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(e) | the Consumer Panel; and |
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(f) | such other persons (if any) as the body considers |
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(6) | The consumer financial education body must publish each annual |
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plan, and each variation of an annual plan, in the way it considers |
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9 (1) | At least once a year, the consumer financial education body must |
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make a report to the Authority in relation to the discharge of the |
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consumer financial education function. |
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(a) | set out the extent to which the body has met its objectives |
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and priorities for the period covered by the report; |
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(b) | include a copy of its latest accounts; and |
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(c) | comply with any requirements specified in rules made by |
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(3) | The consumer financial education body must publish each report |
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in the way it considers appropriate. |
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(4) | Nothing in this paragraph requires the consumer financial |
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education body to make a report at any time in the period of 12 |
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months beginning with its establishment. |
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Exemption from consumer credit rules |
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10 (1) | A licence is not required under Part 3 of the Consumer Credit Act |
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1974 in respect of anything done by— |
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(a) | the consumer financial education body in discharging the |
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consumer financial education function; or |
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(b) | a person acting on its behalf in accordance with |
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arrangements made under paragraph 4(1)(b). |
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(2) | Nothing in Part 4 or 10 of that Act (seeking business or ancillary |
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credit business) is to apply in relation to anything done by— |
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(a) | the consumer financial education body in discharging the |
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consumer financial education function; or |
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(b) | a person acting on its behalf in accordance with |
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arrangements made under paragraph 4(1)(b). |
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Meaning of “the relevant costs” |
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11 (1) | In this Part of this Schedule “the relevant costs” means— |
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(a) | the expenses incurred by the Authority in establishing the |
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consumer financial education body; and |
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(b) | the expenses incurred, or expected to be incurred, by the |
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consumer financial education body in connection with the |
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discharge of the consumer financial education function. |
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(2) | For the purposes of sub-paragraph (1)(a) it does not matter when |
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the expenses were incurred. |
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Funding of the relevant costs by authorised persons |
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12 (1) | For the purpose of meeting a proportion of the relevant costs the |
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Authority may make rules requiring— |
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(a) | authorised persons, or |
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(b) | any specified class of authorised person, |
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| to pay to the Authority specified amounts or amounts calculated in a |
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(2) | Before making the rules the Authority must have regard to other |
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anticipated sources of funding of the relevant costs. |
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(3) | The amounts to be paid under the rules may include a component |
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to cover the expenses of the Authority in collecting the payments |
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(4) | The Authority must pay to the consumer financial education body |
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the amounts that it receives under the rules apart from amounts in |
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respect of its collection costs (which it may keep). |
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(5) | “Specified” means specified in the rules. |
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Funding of the relevant costs by consumer credit licensees etc |
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13 (1) | For the purpose of meeting a proportion of the relevant costs the OFT |
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may, with the approval of the Secretary of State and the Treasury, from |
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(a) | qualifying consumer credit licensees or applicants, or |
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(b) | any specified class of qualifying consumer credit licensee or |
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| to pay to the OFT specified amounts or amounts calculated in a specified |
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(2) | The requirements are to be imposed by general notice. |
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(3) | “Qualifying consumer credit licensee or applicant” means— |
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(a) | a licensee under a licence which covers to any extent the |
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carrying on of a type of business specified in an order |
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under section 226A(2)(e); or |
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(b) | an applicant for a licence, or for the renewal of a licence, |
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which (if granted or renewed) will fall within paragraph |
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(4) | Before giving a general notice the OFT must have regard to other |
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anticipated sources of funding of the relevant costs. |
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(5) | Before giving a general notice, the OFT must consult— |
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(b) | the consumer financial education body; and |
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(c) | such other persons (if any) as the OFT considers |
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(6) | The amounts to be paid under a general notice may include a |
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component to cover the expenses of the OFT in collecting the |
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payments (“collection costs”). |
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(7) | The OFT must pay to the consumer financial education body the |
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amounts that it receives under a general notice apart from |
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amounts in respect of its collection costs (which it may keep). |
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(8) | A general notice may— |
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(a) | specify the time at or by which the payments are to be |
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(b) | provide for exceptions from requirements imposed on a |
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class of qualifying consumer credit licensee or applicant; |
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(c) | impose different requirements on different classes of |
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qualifying consumer credit licensee or applicant; |
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(d) | make provision for refunds in specified circumstances. |
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(9) | Expressions which are used in sub-paragraph (3) and in the |
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Consumer Credit Act 1974 have the same meaning in that sub- |
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paragraph as in that Act. |
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“general notice” means a notice published by the OFT at a |
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time and in a manner appearing to it suitable for securing |
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that the notice is seen within a reasonable time by persons |
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likely to be affected by it; |
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“the OFT” means the Office of Fair Trading; |
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“specified” means specified in the general notice. |
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Funding by grants or loans etc made by Treasury or Secretary of State |
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14 (1) | The Treasury or the Secretary of State may— |
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(a) | make grants or loans, or |
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(b) | provide any other form of financial assistance, |
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| to the consumer financial education body for the purpose of meeting any |
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expenses incurred by it in connection with the discharge of the consumer |
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financial education function. |
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(2) | Any grant or loan or other form of financial assistance under this |
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paragraph may be made or provided subject to such terms as the Treasury |
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or the Secretary of State consider appropriate. |
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(3) | Any expenses incurred by the Treasury or the Secretary of State under |
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this paragraph are to be met out of money provided by Parliament. |
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Reviews of economy etc of the consumer financial education body |
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15 (1) | The Authority may appoint an independent person to conduct a |
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review of the economy, efficiency and effectiveness with which |
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the consumer financial education body has used its resources in |
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discharging the consumer financial education function. |
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(2) | The Authority must consult the Treasury before acting under this |
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(3) | A review is not to be concerned with the merits of the body’s |
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general policy or principles in discharging the consumer financial |
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(4) | On completion of a review, the person conducting it must make a |
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written report to the Authority— |
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(a) | setting out the result of the review; and |
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(b) | making such recommendations (if any) as the person |
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(5) | The Authority must publish a copy of the report in the way it |
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(6) | Any expenses reasonably incurred in the conduct of the review are |
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to be met by the Authority. |
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(7) | “Independent” means appearing to the Authority to be |
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independent of the consumer financial education body. |
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Right to obtain documents and information |
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16 (1) | A person conducting a review under paragraph 15— |
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(a) | has a right of access at any reasonable time to all such |
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documents as the person may reasonably require for the |
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purposes of the review; and |
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(b) | may require any person holding or accountable for any |
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such document to provide such information and |
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explanation as are reasonably required for those purposes. |
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(2) | This paragraph applies only to documents in the custody or under |
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the control of the consumer financial education body. |
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(3) | An obligation imposed on a person as a result of this paragraph is |
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enforceable by an injunction or, in Scotland, by an order for |
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specific performance under section 45 of the Court of Session Act |
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2 (1) | This paragraph applies to rules under paragraph 12 of Schedule 1A to FSMA |
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2000 (as inserted by this Schedule). |
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(2) | The FSA may before commencement— |
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(a) | propose to make rules under that paragraph, and |
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(b) | publish a draft of the proposed rules in the way appearing to it to be |
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best calculated to bring them to the attention of the public. |
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(3) | The draft must be accompanied by— |
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(a) | an explanation of the purpose of the proposed rules, |
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(b) | an explanation of the FSA’s reasons for believing that making the |
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proposed rules is compatible with its general duties under section 2 |
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(c) | notice that representations about the proposals may be made to the |
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FSA within a specified time, and |
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(d) | details of the expected expenditure by reference to which the |
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