Memorandum from HM Treasury
2003 (S.I. 2003/488)
1. The Joint Committee has asked for clarification
of Regulation 3(1) of the above Statutory Instrument.
2. The CrossBorder Payments in Euro Regulations
("the Regulations"), laying down sanctions for breach
of the EC Regulation of 19 December 2001 on Crossborder
Payments in euro ("the EC Regulation") were laid before
Parliament on 4 March 2003 and come into force on 25 March 2003.
3. Regulation 3 of the Regulations makes provision
for a person to bring civil proceedings, subject to the defences
and other incidents applying to actions for breach of statutory
duty, where that person suffers loss as a result of an institution's
contravention of Article 3 of the EC Regulation. The main purpose
of Article 3 of the EC Regulation 2001 is to prohibit institutions
from charging customers more for making crossborder payments
in euro than they would be charged for making equivalent domestic
payments in euro.
4. The Joint Committee on Statutory Instruments considered
the Regulations at their meeting of 17 March and have requested
an explanatory memorandum explaining the nature of the "defences
and other incidents" referred to in Regulation 3(1) of the
5. The effect of the use of the expression "defences
and other incidents" is to incorporate the relevant common
law principles that have been established in the case law governing
actions for the breach of statutory duty.
6. The use of this term in Regulation 3(1) reflects
that fact that, as a matter of common law, where a person has
allegedly breached a statutory duty and civil proceedings are
brought against him there are a number of defences open to him.
The defences generally available against claims for damages for
breach of statutory duty are:
- any defences that the statute itself specifically
- that the claimant's own negligence was the effective
cause of the damage suffered;
- contributory negligence;
- that the claimant had voluntarily assumed the
- that the loss suffered by the claimant resulted
from an act of an independent third party that the defendant could
not reasonably have foreseen; and
- acts of God.
1. Which of those defences are in fact available
to the defendant in a particular case will depend on the duty
breached and of course, the construction of the relevant statute.
2. This term covers the other elements, which are
not defences, of the cause of action for breach of statutory duty
that are established as a matter of common law. Its use reflects
the fact that a person must meet certain qualifying conditions
in order to bring civil proceedings under either Regulation 3(1)(a)
or (b) of the Regulations. A potential claimant will need to show
firstly, that there has been a breach of a statutory obligation
which, on a proper construction of that statute, was intended
to be a grounds of civil liability to a class of person of whom
he is one. Secondly, he will need to prove that the damage that
he has suffered was of the kind that the statute was designed
to protect against and thirdly, that the breach of the obligation
materially contributed to that damage.
3. The Financial Secretary to the Treasury has approved