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Terrorist Asset-Freezing etc. Bill [HL]


Terrorist Asset-Freezing etc. Bill [HL]
Part 1 — Terrorist Asset-Freezing
Chapter 4 — Supplementary provisions

19

 

(4)   

For the purposes of such proceedings—

(a)   

any rules of court relating to the service of documents have effect as if

the body were a body corporate, and

(b)   

the following provisions apply as they apply in relation to a body

corporate—

5

(i)   

in England and Wales, section 33 of the Criminal Justice Act

1925 and Schedule 3 to the Magistrates’ Courts Act 1980;

(ii)   

in Northern Ireland, section 18 of the Criminal Justice Act

(Northern Ireland) 1945 and Article 166 of, and Schedule 4 to,

the Magistrates’ Courts (Northern Ireland) Order 1981 (S.I.

10

1981/1675 (N.I.26)).

(5)   

For the purposes of proceedings in Scotland for such an offence—

(a)   

any rules of court relating to the service of documents have effect as if

the body were a body corporate, and

(b)   

in the case of proceedings on indictment, section 70 of the Criminal

15

Procedure (Scotland) Act 1995 applies as it applies in relation to a body

corporate.

(6)   

Subsection (5)(b) does not apply so far as the amendments made to section 70

of the Act of 1995 by section 66 of the Criminal Justice and Licensing (Scotland)

Act 2010 (proceedings on indictment against organisations) are in force

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instead.

Interpretation

39      

Meaning of “funds” and “economic resources”

(1)   

In this Part, “funds” means financial assets and benefits of every kind,

including (but not limited to)—

25

(a)   

cash, cheques, claims on money, drafts, money orders and other

payment instruments;

(b)   

deposits with relevant institutions or other persons, balances on

accounts, debts and debt obligations;

(c)   

publicly and privately traded securities and debt instruments,

30

including stocks and shares, certificates representing securities, bonds,

notes, warrants, debentures and derivative products;

(d)   

interest, dividends and other income on or value accruing from or

generated by assets;

(e)   

credit, rights of set-off, guarantees, performance bonds and other

35

financial commitments;

(f)   

letters of credit, bills of lading and bills of sale;

(g)   

documents providing evidence of an interest in funds or financial

resources;

(h)   

any other instrument of export financing.

40

(2)   

In this Part, “economic resources” means assets of every kind, whether tangible

or intangible, movable or immovable, which are not funds but can be used to

obtain funds, goods or services.

 
 

Terrorist Asset-Freezing etc. Bill [HL]
Part 1 — Terrorist Asset-Freezing
Chapter 4 — Supplementary provisions

20

 

40      

Meaning of “financial services”

(1)   

In this Part, “financial services” means any service of a financial nature,

including (but not limited to)—

(a)   

insurance-related services consisting of—

(i)   

direct life assurance;

5

(ii)   

direct insurance other than life assurance;

(iii)   

reinsurance and retrocession;

(iv)   

insurance intermediation, such as brokerage and agency;

(v)   

services auxiliary to insurance, such as consultancy, actuarial,

risk assessment and claim settlement services;

10

(b)   

banking and other financial services consisting of—

(i)   

accepting deposits and other repayable funds;

(ii)   

lending (including consumer credit, mortgage credit, factoring

and financing of commercial transactions);

(iii)   

financial leasing;

15

(iv)   

payment and money transmission services (including credit,

charge and debit cards, travellers’ cheques and bankers’ drafts);

(v)   

providing guarantees or commitments;

(vi)   

financial trading (as defined in subsection (2) below);

(vii)   

participating in issues of any kind of securities (including

20

underwriting and placement as an agent, whether publicly or

privately) and providing services related to such issues;

(viii)   

money brokering;

(ix)   

asset management, such as cash or portfolio management, all

forms of collective investment management, pension fund

25

management, custodial, depository and trust services;

(x)   

settlement and clearing services for financial assets (including

securities, derivative products and other negotiable

instruments);

(xi)   

providing or transferring financial information, and financial

30

data processing or related software (but only by suppliers of

other financial services);

(xii)   

providing advisory and other auxiliary financial services in

respect of any activity listed in sub-paragraphs (i) to (xi)

(including credit reference and analysis, investment and

35

portfolio research and advice, advice on acquisitions and on

corporate restructuring and strategy).

(2)   

In subsection (1)(b)(vi), “financial trading” means trading for own account or

for account of customers, whether on an investment exchange, in an over-the-

counter market or otherwise, in—

40

(a)   

money market instruments (including cheques, bills and certificates of

deposit);

(b)   

foreign exchange;

(c)   

derivative products (including futures and options);

(d)   

exchange rate and interest rate instruments (including products such as

45

swaps and forward rate agreements);

(e)   

transferable securities;

(f)   

other negotiable instruments and financial assets (including bullion).

 
 

Terrorist Asset-Freezing etc. Bill [HL]
Part 1 — Terrorist Asset-Freezing
Chapter 4 — Supplementary provisions

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41      

Meaning of “relevant institution”

(1)   

In this Part “relevant institution” means-

(a)   

a person that has permission under Part 4 of the Financial Services and

Markets Act 2000 (permission to carry on regulated activity);

(b)   

an EEA firm of the kind mentioned in paragraph 5(b) of Schedule 3 to

5

that Act that has permission under paragraph 15 of that Schedule (as a

result of qualifying for authorisation under paragraph 12 of that

Schedule) to accept deposits; or

(c)   

an undertaking that by way of business—

(i)   

operates a currency exchange office,

10

(ii)   

transmits money (or any representation of monetary value) by

any means, or

(iii)   

cashes cheques that are made payable to customers.

(2)   

The definition of “relevant institution” in subsection (1) must be read with

section 22 of the Financial Services and Markets Act 2000, any relevant order

15

under that section and Schedule 2 to that Act (classes of regulated activities and

categories of investment).

42      

Interpretation: general

(1)   

In this Part—

“designated person” has the meaning given by section 1;

20

“document” includes information recorded in any form and, in relation to

information recorded otherwise than in legible form, references to its

production include producing a copy of the information in legible

form;

“economic resources” has the meaning given by section 39(2);

25

“enactment” includes—

(a)   

an enactment comprised in subordinate legislation (within the

meaning of the Interpretation Act 1978);

(b)   

an enactment comprised in, or in an instrument made under—

(i)   

an Act of the Scottish Parliament;

30

(ii)   

Northern Ireland legislation; or

(iii)   

a Measure or Act of the National Assembly for Wales;

“final designation” means a designation under section 2 (including any

renewed such designation);

“financial services” has the meaning given by section 40;

35

“funds” has the meaning given by section 39(1);

“interim designation” means a designation under section 6;

“relevant institution” has the meaning given by section 41;

“the relevant Security Council resolutions” has the meaning given by

subsection (2) below.

40

(2)   

For the purposes of this Part “the relevant Security Council resolutions” are—

(a)   

resolution 1373 (2001) adopted by the Security Council of the United

Nations on 28th September 2001, and

(b)   

resolution 1452 (2002) adopted by the Security Council of the United

Nations on 20th December 2002.

45

 
 

Terrorist Asset-Freezing etc. Bill [HL]
Part 1 — Terrorist Asset-Freezing
Chapter 4 — Supplementary provisions

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(3)   

The Treasury may by order amend subsection (2) so as to add further relevant

Security Council resolutions or remove any that are superseded.

(4)   

Any such order must be made by statutory instrument subject to annulment in

pursuance of a resolution of either House of Parliament.

Miscellaneous

5

43      

Service of notices

(1)   

This section applies in relation to any notice to be given to a person by the

Treasury under this Part.

(2)   

Any such notice may be given—

(a)   

by posting it to the person’s last known address, or

10

(b)   

where the person is a body corporate, partnership or unincorporated

body other than a partnership, by posting it to the registered or

principal office of the body or partnership concerned.

(3)   

Where the Treasury do not have an address for the person, they must make

arrangements for the notice to be given to the person at the first available

15

opportunity.

44      

Crown application

(1)   

This Part binds the Crown.

(2)   

No contravention by the Crown of a provision of this Part makes the Crown

criminally liable.

20

(3)   

The High Court or, in Scotland, the Court of Session may, on the application of

a person appearing to the court to have an interest, declare unlawful any act or

omission of the Crown that constitutes a contravention of a provision of this

Part.

(4)   

Nothing in this section affects Her Majesty in her private capacity.

25

(5)   

Subsection (4 ) is to be read as if section 38(3) of the Crown Proceedings Act

1947 (meaning of Her Majesty in her private capacity) were contained in this

Part.

45      

Consequential amendments, repeals and revocations

(1)   

Part 1 of Schedule 1 (which contains amendments consequential on this Part)

30

has effect.

(2)   

Part 1 of Schedule 2 (which contains repeals and revocations consequential on

this Part) has effect.

46      

Transitional provisions and savings

(1)   

The Terrorist Asset-Freezing (Temporary Provisions) Act 2010 ceases to have

35

effect on the coming into force of this Part.

(2)   

The repeal by this Part of the Act of 2010 does not affect the continued validity,

lawfulness or effectualness of anything that—

 
 

Terrorist Asset-Freezing etc. Bill [HL]
Part 1 — Terrorist Asset-Freezing
Chapter 4 — Supplementary provisions

23

 

(a)   

was done or omitted by a person other than the Treasury in the period

beginning with 4 February 2010 and ending with the coming into force

of the Act of 2010, and

(b)   

was valid, lawful or effectual by virtue of section 2 of that Act

(protection of things done or omitted in interim period).

5

(3)   

Subsection (2) is without prejudice to the operation of section 16 of the

Interpretation Act 1978 (general savings) in relation to the repeal by this Part

of the Act of 2010.

(4)   

In its application to the repeal by this Part of section 1 of the Act of 2010

(temporary validity of certain Orders in Council), section 16(1) of the Act of

10

1978 has effect as if—

(a)   

references to anything done, suffered, acquired, accrued or incurred

under section 1 of the Act of 2010 included references to anything done,

suffered, acquired, accrued or incurred under any Order deemed by

that section to have been validly made,

15

(b)   

the reference to any offence committed against that enactment were a

reference to any offence committed against any such Order, and

(c)   

at the end there were inserted “and as if the enactment had not been

due to cease to have effect on 31 December 2010”.

(5)   

Anything done or omitted to be done by the Treasury under the Terrorism

20

(United Nations Measures) Order 2009 (S.I. 2009/1747) is, if in force or effective

immediately before the coming into force of this Part, to have effect as if done

or omitted by the Treasury under any corresponding provision of this Part so

far as that is required for continuing its effect on and after the coming into force

of this Part.

25

(6)   

In particular—

(a)   

any direction made, licence granted, or request for information or

documents, by the Treasury under the Order of 2009 that is in force

immediately before the coming into force of this Part has effect, on or

after the coming into force of this Part, as a final designation, a licence

30

or (as the case may be) a request under any corresponding provision of

this Part so far as that is required for continuing its effect on and after

the coming into force of this Part, and

(b)   

any information obtained by the Treasury under that Order (including

any document so obtained and any copy or extract made of any

35

document so obtained) is to be treated for the purposes of section 23

(general power to disclose information) as obtained by the Treasury

under this Part.

(7)   

Subsections (5) and (6) have effect despite the fact that (following the repeal of

the Act of 2010) the Order concerned is not validly made under, or that any

40

provision of it is not within the power conferred by, section 1 of the United

Nations Act 1946.

(8)   

Any final designation that has effect by virtue of subsections (5) and (6) ceases

to have effect at the end of the period of three months after this Part comes into

force unless renewed (or revoked) by the Treasury under this Part.

45

(9)   

The references to offences under this Part in the new sub-paragraphs inserted

by way of substitution by Part 1 of Schedule 1 are to be read as including

references to any offences under—

 
 

Terrorist Asset-Freezing etc. Bill [HL]
Part 2 — Terrorist financing, money laundering etc.

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(a)   

article 7, 8 or 10 of the Terrorism (United Nations Measures) Order 2006

(S.I. 2006/2657), or

(b)   

article 10, 11, 12, 13, 14 or 16 of the Order of 2009,

   

that were committed while the Act of 2010 was in force.

(10)   

Without prejudice to the operation of section 16 of the Interpretation Act 1978,

5

the repeal by this Part of section 64(1)(e) of the Counter-Terrorism Act 2008

(meaning of UN terrorism orders) does not affect—

(a)   

any financial restrictions proceedings on an application made under

section 63 of the Act of 2008 before the coming into force of this Part, or

(b)   

any proceedings arising out of those proceedings.

10

47      

Power to repeal Part

(1)   

This section applies if the Security Council of the United Nations takes any

decision that has the effect of terminating (permanently and without

replacement) the operation of the relevant Security Council resolutions (in

whole or in part).

15

(2)   

The Treasury must lay before Parliament a draft order repealing this Part (in

whole or in part) in accordance with the decision.

(3)   

Any such order—

(a)   

may contain such incidental, consequential, supplementary,

transitional, transitory or saving provision as the Treasury consider

20

appropriate (including provision amending or repealing any

enactment, whether in this Part or elsewhere),

(b)   

must be made by statutory instrument, and

(c)   

is not to be made unless the draft is approved by a resolution of each

House of Parliament.

25

Part 2

Terrorist financing, money laundering etc.

Directions in particular cases

48      

Directions to branches of credit institutions and financial institutions

(1)   

In paragraph 5 of Schedule 7 to the Counter-Terrorism Act 2008 (directions in

30

relation to terrorist financing and money laundering etc: meaning of “credit

institution” and “financial institution”)—

(a)   

for sub-paragraph (1) substitute—

    “(1)  

“Credit institution” means a credit institution, as defined in

Article 4(1)(a) of the banking consolidation directive, when it

35

accepts deposits or other repayable funds from the public or

grants credits for its own account (within the meaning of that

directive).”,

(b)   

after sub-paragraph (2)(b) insert—

“(ba)   

a person equivalent to an insurance company within

40

paragraph (b) whose head office is located in a non-

EEA state, when carrying out activities of the kind

mentioned in paragraph (b);”,

 
 

Terrorist Asset-Freezing etc. Bill [HL]
Part 2 — Terrorist financing, money laundering etc.

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(c)   

omit sub-paragraph (2)(f), and

(d)   

after sub-paragraph (2) insert—

    “(3)  

The fact that an institution’s head office is located in a non-

EEA state does not prevent it from being a credit institution

or a financial institution for the purposes of this Schedule.”

5

(2)   

In paragraph 9 of that Schedule (requirements that may be imposed by a

direction), after sub-paragraph (5) insert—

   “(5A)  

Descriptions of transactions or business relationships for the

purposes of sub-paragraph (5)(b) may, in particular, include

transactions or business relationships of a particular branch (or

10

description of branch) of a relevant person.”

49      

Directions in relation to subsidiaries

(1)   

Paragraph 9 of Schedule 7 to the Counter-Terrorism Act 2008 (requirements

that may be imposed by a direction) is amended as follows.

(2)   

In sub-paragraph (1), after paragraph (c), insert—

15

“(d)   

a company that is a subsidiary of a company within

paragraph (a) or (c).”

(3)   

After sub-paragraph (6) insert—

    “(7)  

In this paragraph “subsidiary” has the meaning given by section 1159

of the Companies Act 2006 (and “company” has the same meaning as

20

in that section).”

General directions and other requirements

50      

Circumventing requirements of Schedule 7 directions

(1)   

Schedule 7 to the Counter-Terrorism Act 2008 is amended as follows.

(2)   

After paragraph 25 (civil penalties for failure to comply with requirements)

25

insert—

“25A  (1)  

An enforcement authority may impose a penalty of such amount as

it considers appropriate on a relevant person who has intentionally

participated in activities knowing that the object or effect of them

was (whether directly or indirectly) to circumvent a requirement

30

imposed by a direction under this Schedule.

      (2)  

In sub-paragraph (1) “appropriate” means effective, proportionate

and dissuasive.

      (3)  

A person on whom a penalty is imposed under this paragraph is not

liable to be proceeded against for an offence under paragraph 30A in

35

respect of participation in the same activities.”

(3)   

After paragraph 30 (offence of failing to comply with requirements) insert—

“Offences: relevant person circumventing requirements

30A   (1)  

A relevant person who intentionally participates in activities

knowing that the object or effect of them is (whether directly or

40

 
 

 
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