29

House of Commons

Tuesday 5 January 2010

Public Bill Committee

Financial Services Bill

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Note

The Amendments have been arranged in accordance with the Order of the

Committee [8 December 2009].

Mr Mark Hoban

37

Clause  1,  page  1,  line  12,  at end add—

‘(c)	where appropriate, direct the relevant authorities to act in accordance

with the powers available to them under the relevant legislation.’.

Mr Colin Breed

Dr Vincent Cable

20

Clause  1,  page  2,  line  1,  leave out ‘may’ and insert ‘must’.

Mr Colin Breed

Dr Vincent Cable

21

Clause  1,  page  2,  line  3,  leave out ‘may’ and insert ‘should inter alia’.

Mr Mark Hoban

36

Clause  1,  page  2,  line  8,  after ‘Council’, insert—

‘( )	specify the responsibilities of each member of the Council in protecting

or enhancing the stability of the UK financial system;

( )	specify the powers each member of the Council is able to exercise in

protecting or enhancing the stability of the system;’.

Mr Colin Breed

Dr Vincent Cable

22

Clause  1,  page  2,  line  9,  leave out ‘Treasury’ and insert ‘Council’.

Public Bill Committee: 5 January 2010

30

Financial Services Bill, continued

Mr Colin Breed

Dr Vincent Cable

23

Clause  1,  page  2,  line  10,  leave out ‘by the Council’.

Mr Colin Breed

Dr Vincent Cable

24

Clause  2,  page  2,  line  22,  leave out ‘quarterly’.

Mr Mark Hoban

35

Clause  2,  page  2,  line  22,  at end insert ‘and publish its response to those risks in its

minutes.’.

Mr Colin Breed

Dr Vincent Cable

25

Clause  2,  page  2,  line  24,  leave out ‘quarterly’.

Mr Colin Breed

Dr Vincent Cable

26

Clause  2,  page  2,  line  25,  leave out ‘quarterly’.

Mr Colin Breed

Dr Vincent Cable

27

Clause  2,  page  2,  line  25,  after ‘meetings’, insert ‘within 40 days of the meeting.’.

Mr Colin Breed

Dr Vincent Cable

28

Clause  2,  page  2,  line  36,  leave out ‘someone else’ and insert ‘an approved

nominee’.

Mr Mark Hoban

39

Clause  2,  page  2,  line  39,  at end add—

‘(9)	Where the Council is unable to reach agreement on the exercise of its functions,

the Chancellor of the Exchequer can take reasonable steps in pursuit of its

function.’.

Mr Colin Breed

Dr Vincent Cable

29

Clause  3,  page  2,  line  41,  leave out ‘Treasury’ and insert ‘Council’.

Public Bill Committee: 5 January 2010

31

Financial Services Bill, continued

Mr Colin Breed

Dr Vincent Cable

30

Clause  3,  page  3,  line  3,  leave out ‘Treasury’ and insert ‘Council’.

Mr Colin Breed

Dr Vincent Cable

31

Clause  3,  page  3,  line  5,  leave out ‘Treasury’ and insert ‘Council’.

Mr Colin Breed

Dr Vincent Cable

32

Clause  3,  page  3,  line  5,  leave out ‘lay’ and insert ‘publish’.

Mr Colin Breed

Dr Vincent Cable

33

Clause  3,  page  3,  line  6,  leave out ‘before Parliament’.

Mr Colin Breed

Dr Vincent Cable

34

Clause  3,  page  3,  line  7,  leave out ‘laid before Parliament’.

Mr Mark Hoban

38

Clause  4,  page  3,  line  31,  at end add ‘“the relevant legislation” means for the

Financial Services Authority, the Financial Services and Markets Act 2000 and for the

Bank of England, the Banking Act 2009.’.

Mr Mark Hoban

41

Clause  5,  page  4,  line  10,  at end add—

‘( )	The Financial Services and Markets Act 2000 is amended as follows.

( )	In section 2, insert after subsection (2)—

“(2A)

In discharging its general functions the Authority must, so far as is

reasonably possible, act in a way that ensures that financial stability takes

precedence over its other regulatory objectives.”’.

Mr Mark Hoban

40

Clause  6,  page  4,  line  15,  leave out subsection (3).

Public Bill Committee: 5 January 2010

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Financial Services Bill, continued

Mr Andrew Love

42

Clause  6,  page  4,  line  15,  at end insert—

‘(3A)

In section 5(2) (matters the FSA must have regard to in considering what degree

of consumer protection may be appropriate), insert at end “, including—

(i)	advice and information about regulatory action taken in

pursuance of this objective, and

(ii)	any needs for advice and information identified by the consumer

financial education body.”’.

Mr Mark Hoban

43

Clause  6,  page  4,  line  36,  leave out ‘and advice’.

Mr Mark Hoban

47

Schedule  1,  page  52,  line  31,  at end insert—

‘(4)	The board must include at least two members who represent the interests of

consumers.’.

Mr Mark Hoban

46

Schedule  1,  page  53,  line  30,  leave out paragraph 6.

Mr Mark Hoban

48

Schedule  1,  page  54,  line  32,  at end insert—

‘(d)	the quantitative and qualitative measures it will use to determine whether

it has met its objectives.’.

Mr Mark Hoban

49

Schedule  1,  page  58,  line  4,  leave out sub-paragraph (4).

Mr Mark Hoban

44

Clause  7,  page  5,  line  18,  leave out paragraph (b).

Mr Mark Hoban

45

Clause  8,  page  6,  line  7,  leave out ‘financial stability objective’ and insert

Public Bill Committee: 5 January 2010

33

Financial Services Bill, continued

‘objectives’.

Mr Mark Hoban

52

Clause  9,  page  7,  line  5,  leave out paragraph (a).

Mr Mark Hoban

50

Clause  9,  page  7,  line  11,  leave out ‘first’.

Mr Mark Hoban

51

Clause  9,  page  7,  line  13,  leave out subsections (7) and (8).

Mr Mark Hoban

53

Clause  11,  page  8,  line  28,  leave out paragraph (c).

Mr Mark Hoban

54

Clause  11,  page  9,  line  11,  after ‘void’, insert ‘where that agreement was signed

after 19 November 2009.’.

New Clauses

Disclosure of enforcement actions

Mr Mark Hoban

NC1

To move the following Clause:—

‘In the Financial Services and Markets Act 2000, after section 349 insert—

“349A

Disclosure of enforcement actions

(1)	Section 348 does not prevent the disclosure by the Authority of

information that—

(a)	an authorised person is subject to actions taken under Part 14 of

the Act; or

(b)	an approved person is subject to actions taken under section 66

of the Act.

(2)	Prior to a public statement that action is being taken under Part 14 or

section 66 of the Act, the Authority must notify the person subject to the

Public Bill Committee: 5 January 2010

34

Financial Services Bill, continued

action seven days prior to any disclosure of its intended course of

action.”.’.

Identification of additional powers needed to fulfil responsibilities for financial stability

Mr Mark Hoban

NC2

To move the following Clause:—

‘The Treasury must lay a report setting out the powers that the Financial Services

Authority and the Bank of England need to fulfil their responsibilities for

financial stability under the relevant legislation within one year of the

commencement of this Act.’.

Securing consumer protection

Mr Andrew Love

NC3

To move the following Clause:—

‘(1)	The Financial Services and Markets Act 2000 is amended as follows.

(2)	After section 5, insert the following new section—

“5A	Securing consumer protection

(1)	This section applies where the Authority becomes aware that any feature

or combination of features of a financial services market, product,

service, or provider in the United Kingdom is or appears to be

significantly harming the interests of consumers.

(2)	The Authority must take such action as it considers reasonable and

practicable to remedy, mitigate or prevent any detrimental effects on

consumers resulting from or relating to the feature or features of a

financial services market, product or provider.

(3)	The Authority must ensure that action taken under subsection (2) shall

have regard to the need to achieve as comprehensive solution as is

reasonable and practicable.

(4)	Action under subsection (2) may include action by the Authority itself

and recommendations on the taking of action by others where the

Authority can not by itself meet the requirements of subsection (3).

(5)	For the purpose of subsection (1) the Authority becomes aware in the

event of any of the following—

(a)	its own research, reviews, monitoring, supervision or

enforcement work;

(b)	on a referral by the scheme operator of the ombudsman scheme

or the Office of Fair Trading; or

Public Bill Committee: 5 January 2010

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Financial Services Bill, continued

(c)	Following acceptance of a request from a designated consumer

body made under susection (6).

(6)	A designated consumer body may by presenting evidence of apparent or

likely significant harm to the interests of consumers request that the

Authority takes action under this section.

(7)	The Authority shall within 90 days of a request under subsection (6)

publish a response stating—

(a)	whether it accepts or rejects the need for action; and

(b)	the reasons for its decision.

(8)	For the purpose of section (5)(c) “designated consumer body” includes—

(a)	a body designated by the Secretary of State by order under

section 11 of the Enterprise Act 2002;

(b)	the financial services consumer panel; or

(c)	the consumer financial education body.

(9)	The Authority shall prepare and publish a report within one year of any

of the events set out in subsection (5) setting out the action it intends to

take and the reasons for its decisions.

(10)	In this section reference to a financial services market, product or

provider refers to regulated activities as defined by Section 22.”’.

Duty regarding socio-economic inequalities

Mr Andrew Love

NC4

To move the following Clause:—

‘(1)	The Financial Services and Markets Act 2000 is amended as follows.

(2)	In section 2(1) (the FSA’s general duties), after paragraph (b) insert—

“(c)	which when making decisions of a strategic nature about how to exercise

its functions the Authority considers desirable so as to exercise them in a

way that is designed to reduce the inequalities of outcome which result

from socio-economic disadvantage.”’.

Restrictions on provision of credit limit increases

Mr Colin Breed

Dr Vincent Cable

NC5

To move the following Clause:—

‘(1)	A consumer credit firm which provides an increase in credit limit otherwise than

in accordance with this section commits an offence.

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Revised 5 January 2010