6Schemes of arrangement, etc.: power of Secretary of State to intervene
(1)In the 1975 Act, after section 17 there shall be inserted—
“17ASchemes of arrangement, etc.: power of Secretary of State to intervene
(1)This section applies where a company is a company in financial difficulties for the purposes of section 16 above by virtue of subsection (1)(c) of that section.
(2)The Secretary of State may, after consultation with the Board, exercise any power conferred on him by subsection (3) or (4) below for the purpose of safeguarding those who are qualifying persons in relation to the company, or any class or description of such persons, to any extent appearing to the Secretary of State to be appropriate, against relevant loss arising from the financial difficulties of the company.
(3)The Secretary of State may by notice in writing direct the Board to take any measures appearing to him to be necessary for securing or facilitating the transfer of all or any part of the insurance business carried on by the company to another insurance company to which this Act applies or an authorised friendly society, on terms (including terms reducing, or deferring payment of, any of the things to which any of those who are qualifying persons in relation to the company in financial difficulties are entitled in their capacity as such) appearing to him to be appropriate.
(4)In any case where it appears to the Secretary of State that it would be practicable to secure the purpose mentioned in subsection (2) above by the Board giving assistance to the company to enable it to continue to carry on insurance business, the Secretary of State may by notice in writing direct the Board to take such measures as appear to the Secretary of State to be necessary for giving such assistance.
(5)Without prejudice to the generality of subsection (4) above, a direction under that subsection may require the Board to make the giving of any assistance to the company conditional on the reduction of, or the deferment of the payment of, any of the things to which any of those who are qualifying persons in relation to the company are entitled in their capacity as such to any extent appearing to the Secretary of State to be appropriate.
(6)The Secretary of State shall send a copy of any notice under subsection (3) or (4) above to the company.
(7)A direction under subsection (3) or (4) above shall not have effect to require the Board to take any measures which, by virtue of section 16(6) or (8) or 17(1) above, they would be prevented from taking under section 16(3) or (4) above.
(8)Where it appears to the Board that a direction under subsection (3) or (4) above is affected by subsection (7) above, they shall—
(a)notify the Secretary of State in writing of that fact and of the reasons for their opinion, and
(b)send a copy of the notice to the company.
(9)In subsection (2) above, “relevant loss” means loss in connection with a matter by virtue of which a person is a qualifying person in relation to the company.
(10)Subsection (8C) of section 16 above shall apply for the purposes of this section as it applies for the purposes of that.”
(2)Schedule 3 to this Act (consequential amendments of the 1975 Act) shall have effect.