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Financial Services and Markets Act 2000

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Status:

This version of this Act contains provisions that are prospective.

Changes to legislation:

There are outstanding changes not yet made by the legislation.gov.uk editorial team to Financial Services and Markets Act 2000. Any changes that have already been made by the team appear in the content and are referenced with annotations.

E+W+S+N.I.

Financial Services and Markets Act 2000

2000 CHAPTER 8

An Act to make provision about the regulation of financial services and markets; to provide for the transfer of certain statutory functions relating to building societies, friendly societies, industrial and provident societies and certain other mutual societies; and for connected purposes.

[14th June 2000]

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Annotations:

Modifications etc. (not altering text)

C1Act restricted (11.8.2001) by S.I. 2001/2659, art. 2(4)(c)

Act excluded (1.12.2001) by S.I. 2001/2617, arts. 2(b), 10(9); S.I. 2001/3538, art. 2(1)

Act: specified provisions excluded (1.12.2001) by S.I. 2001/2957, arts. 1, 13(8)(b); S.I. 2001/3538, art. 2(1)

Act restricted (1.12.2001) by S.I. 2001/3646, arts. 2(7)(b), 4(6)(b), 6(4)(b), 7(4)(c), 8(4)(b), 9(4)(b)

Act applied (with modifications) by S.I. 1994/188, reg. 4 (as amended (1.12.2001) by S.I. 2001/3649, arts. 1, 454)

C2Act modified (18.7.2002 for certain purposes and 21.8.2002 otherwise) by The Electronic Commerce Directive (Financial Services and Markets) Regulations 2002 (S.I. 2002/1775), regs. 1, 17

C3Act extended (E.W.S.) (1.1.2003) by 2000 c. 39, s. 15(2); S.I. 2002/2711, art. 2 (subject to arts. 3-5)

C4Act: power to modify, exclude or apply conferred (N.I.) (10.8.2004) by Open-Ended Investment Companies Act (Northern Ireland) 2002 (c. 13 (N.I.)), ss. 1(2)(l)(3)(b)(f)(4), 4; S.R. 2004/333, art. 2

C11Act restricted (E.W.) (1.3.2007) by National Health Service Act 2006 (c. 41), ss. 71(8), 277

Part IE+W+S+N.I. The Regulator

1 The Financial Services Authority.E+W+S+N.I.

(1)The body corporate known as the Financial Services Authority (“the Authority”) is to have the functions conferred on it by or under this Act.

(2)The Authority must comply with the requirements as to its constitution set out in Schedule 1.

(3)Schedule 1 also makes provision about the status of the Authority and the exercise of certain of its functions.

[F1(4)Section 249 of the Banking Act 2009 provides for references to functions of the Authority (whether generally or under this Act) to include references to functions conferred on the Authority by that Act (subject to any order under that section).]

Annotations:

Amendments (Textual)

F1S. 1(4) added (17.2.2009 for certain purposes and 21.2.2009 otherwise) by Banking Act 2009 (c. 1), ss. 249(4), 263(1) (with s. 247); S.I. 2009/296, arts. 2, 3, Sch. para. 9

Modifications etc. (not altering text)

C15S. 1(3) extended (17.8.2001) by S.I. 2001/2617, arts. 2(a), 4(3), 8, Sch. 2 para. 2

The Authority’s general dutiesE+W+S+N.I.

2 The Authority’s general duties.E+W+S+N.I.

(1)In discharging its general functions the Authority must, so far as is reasonably possible, act in a way—

(a)which is compatible with the regulatory objectives; and

(b)which the Authority considers most appropriate for the purpose of meeting those objectives.

(2)The regulatory objectives are—

(a)market confidence;

[F2(ab)financial stability;]

(b)F3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c)the protection of consumers; and

(d)the reduction of financial crime.

(3)In discharging its general functions the Authority must have regard to—

(a)the need to use its resources in the most efficient and economic way;

(b)the responsibilities of those who manage the affairs of authorised persons;

(c)the principle that a burden or restriction which is imposed on a person, or on the carrying on of an activity, should be proportionate to the benefits, considered in general terms, which are expected to result from the imposition of that burden or restriction;

(d)the desirability of facilitating innovation in connection with regulated activities;

(e)the international character of financial services and markets and the desirability of maintaining the competitive position of the United Kingdom;

(f)the need to minimise the adverse effects on competition that may arise from anything done in the discharge of those functions;

(g)the desirability of facilitating competition between those who are subject to any form of regulation by the Authority.

[F4(h)the desirability of enhancing the understanding and knowledge of members of the public of financial matters (including the UK financial system).]

(4)The Authority’s general functions are—

(a)its function of making rules under this Act (considered as a whole);

(b)its function of preparing and issuing codes under this Act (considered as a whole);

(c)its functions in relation to the giving of general guidance (considered as a whole); and

(d)its function of determining the general policy and principles by reference to which it performs particular functions.

(5)General guidance” has the meaning given in section 158(5).

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

C16S. 2(4)(a) restricted (17.8.2001) by S.I. 2001/2617, arts. 2(a), 4(3), Sch. 2 paras. 9, 11

The regulatory objectivesE+W+S+N.I.

3 Market confidence.E+W+S+N.I.

(1)The market confidence objective is: maintaining confidence in [F5the UK financial system].

(2)[F6In this Act “the UK financial system”] means the financial system operating in the United Kingdom and includes—

(a)financial markets and exchanges;

(b)regulated activities; and

(c)other activities connected with financial markets and exchanges.

Annotations:

Amendments (Textual)

[F73AFinancial stabilityE+W+S+N.I.

(1)The financial stability objective is: contributing to the protection and enhancement of the stability of the UK financial system.

(2)In considering that objective the Authority must have regard to—

(a)the economic and fiscal consequences for the United Kingdom of instability of the UK financial system;

(b)the effects (if any) on the growth of the economy of the United Kingdom of anything done for the purpose of meeting that objective; and

(c)the impact (if any) on the stability of the UK financial system of events or circumstances outside the United Kingdom (as well as in the United Kingdom).

(3)The Authority must, consulting the Treasury, determine and review its strategy in relation to the financial stability objective.]

Annotations:

Amendments (Textual)

4 Public awareness.E+W+S+N.I.

F8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Annotations:

Amendments (Textual)

5 The protection of consumers.E+W+S+N.I.

(1)The protection of consumers objective is: securing the appropriate degree of protection for consumers.

(2)In considering what degree of protection may be appropriate, the Authority must have regard to—

(a)the differing degrees of risk involved in different kinds of investment or other transaction;

(b)the differing degrees of experience and expertise that different consumers may have in relation to different kinds of regulated activity;

[F9(ba)any information which the consumer financial education body has provided to the Authority in the exercise of the consumer financial education function;]

(c)the needs that consumers may have for advice and accurate information; and

(d)the general principle that consumers should take responsibility for their decisions.

[F10(3)Sections 425A and 425B (meaning of “consumers”) apply for the purposes of this section.]

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

C18S. 5(3) modified (18.6.2001) by S.I. 2001/1821, arts. 1(1), 3(4)

6 The reduction of financial crime.E+W+S+N.I.

(1)The reduction of financial crime objective is: reducing the extent to which it is possible for a business carried on—

(a)by a regulated person, or

(b)in contravention of the general prohibition,

to be used for a purpose connected with financial crime.

(2)In considering that objective the Authority must, in particular, have regard to the desirability of—

(a)regulated persons being aware of the risk of their businesses being used in connection with the commission of financial crime;

(b)regulated persons taking appropriate measures (in relation to their administration and employment practices, the conduct of transactions by them and otherwise) to prevent financial crime, facilitate its detection and monitor its incidence;

(c)regulated persons devoting adequate resources to the matters mentioned in paragraph (b).

(3)Financial crime” includes any offence involving—

(a)fraud or dishonesty;

(b)misconduct in, or misuse of information relating to, a financial market; or

(c)handling the proceeds of crime.

(4)Offence” includes an act or omission which would be an offence if it had taken place in the United Kingdom.

(5)Regulated person” means an authorised person, a recognised investment exchange or a recognised clearing house.

[F11Enhancing public understanding of financial matters etcE+W+S+N.I.

Annotations:

Amendments (Textual)

F11S. 6A and preceding cross-heading inserted (8.4.2010) by Financial Services Act 2010 (c. 28), ss. 2(5), 26(1)(b)

6AEnhancing public understanding of financial matters etcE+W+S+N.I.

(1)The Authority must establish a body corporate (“the consumer financial education body”) whose function (“the consumer financial education function”) is to enhance—

(a)the understanding and knowledge of members of the public of financial matters (including the UK financial system); and

(b)the ability of members of the public to manage their own financial affairs.

(2)The consumer financial education function includes, in particular—

(a)promoting awareness of the benefits of financial planning;

(b)promoting awareness of the financial advantages and disadvantages in relation to the supply of particular kinds of goods or services;

(c)promoting awareness of the benefits and risks associated with different kinds of financial dealing (which includes informing the Authority and other bodies of those benefits and risks);

(d)the publication of educational materials or the carrying out of other educational activities; and

(e)the provision of information and advice to members of the public.

(3)Schedule 1A makes further provision about the consumer financial education body.]

Corporate governanceE+W+S+N.I.

7 Duty of Authority to follow principles of good governance.E+W+S+N.I.

In managing its affairs, the Authority must have regard to such generally accepted principles of good corporate governance as it is reasonable to regard as applicable to it.

Arrangements for consulting practitioners and consumersE+W+S+N.I.

8 The Authority’s general duty to consult.E+W+S+N.I.

The Authority must make and maintain effective arrangements for consulting practitioners and consumers on the extent to which its general policies and practices are consistent with its general duties under section 2.

Annotations:

Modifications etc. (not altering text)

C19S. 8 excluded (17.8.2001) by S.I. 2001/2617, arts. 2(a), 4(3), 8, Sch. 2 para. 5

9 The Practitioner Panel.E+W+S+N.I.

(1)Arrangements under section 8 must include the establishment and maintenance of a panel of persons (to be known as “the Practitioner Panel”) to represent the interests of practitioners.

(2)The Authority must appoint one of the members of the Practitioner Panel to be its chairman.

(3)The Treasury’s approval is required for the appointment or dismissal of the chairman.

(4)The Authority must have regard to any representations made to it by the Practitioner Panel.

(5)The Authority must appoint to the Practitioner Panel such—

(a)individuals who are authorised persons,

(b)persons representing authorised persons,

(c)persons representing recognised investment exchanges, and

(d)persons representing recognised clearing houses,

as it considers appropriate.

10 The Consumer Panel.E+W+S+N.I.

(1)Arrangements under section 8 must include the establishment and maintenance of a panel of persons (to be known as “the Consumer Panel”) to represent the interests of consumers.

(2)The Authority must appoint one of the members of the Consumer Panel to be its chairman.

(3)The Treasury’s approval is required for the appointment or dismissal of the chairman.

(4)The Authority must have regard to any representations made to it by the Consumer Panel.

(5)The Authority must appoint to the Consumer Panel such consumers, or persons representing the interests of consumers, as it considers appropriate.

[F12(5A)The Secretary of State may direct the Authority to appoint as a member of the Consumer Panel a person specified by the Secretary of State who—

(a)is a non-executive member of the National Consumer Council, and

(b)is nominated for the purposes of this subsection by the National Consumer Council after consultation with the Authority.

(5B)Only one person may, at any time, be a member of the Consumer Panel appointed in accordance with a direction under subsection (5A); but that does not prevent the Authority appointing as a member of the Consumer Panel any person who is also a member of the National Consumer Council.

(5C)A person appointed in accordance with a direction under subsection (5A) ceases to be a member of the Panel on ceasing to be a non-executive member of the National Consumer Council.]

(6)The Authority must secure that the membership of the Consumer Panel is such as to give a fair degree of representation to those who are using, or are or may be contemplating using, services otherwise than in connection with businesses carried on by them.

[F13(7)Sections 425A and 425B (meaning of “consumers”) apply for the purposes of this section, but the references to consumers in this section do not include consumers who are authorised persons.]

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

C20S. 10(7) modified (18.6.2001) by S.I. 2001/1821, arts. 1(1), 3(4)

11 Duty to consider representations by the Panels.E+W+S+N.I.

(1)This section applies to a representation made, in accordance with arrangements made under section 8, by the Practitioner Panel or by the Consumer Panel.

(2)The Authority must consider the representation.

(3)If the Authority disagrees with a view expressed, or proposal made, in the representation, it must give the Panel a statement in writing of its reasons for disagreeing.

ReviewsE+W+S+N.I.

12 Reviews.E+W+S+N.I.

(1)The Treasury may appoint an independent person to conduct a review of the economy, efficiency and effectiveness with which the Authority has used its resources in discharging its functions.

(2)A review may be limited by the Treasury to such functions of the Authority (however described) as the Treasury may specify in appointing the person to conduct it.

(3)A review is not to be concerned with the merits of the Authority’s general policy or principles in pursuing regulatory objectives or in exercising functions under Part VI.

(4)On completion of a review, the person conducting it must make a written report to the Treasury—

(a)setting out the result of the review; and

(b)making such recommendations (if any) as he considers appropriate.

(5)A copy of the report must be—

(a)laid before each House of Parliament; and

(b)published in such manner as the Treasury consider appropriate.

(6)Any expenses reasonably incurred in the conduct of a review are to be met by the Treasury out of money provided by Parliament.

(7)Independent” means appearing to the Treasury to be independent of the Authority.

Annotations:

Modifications etc. (not altering text)

C21S. 12 modified (17.8.2001) by S.I. 2001/2617, arts. 2(a), 4(3), 8, Sch. 2 para. 6

13 Right to obtain documents and information.E+W+S+N.I.

(1)A person conducting a review under section 12—

(a)has a right of access at any reasonable time to all such documents as he may reasonably require for purposes of the review; and

(b)may require any person holding or accountable for any such document to provide such information and explanation as are reasonably necessary for that purpose.

(2)Subsection (1) applies only to documents in the custody or under the control of the Authority.

(3)An obligation imposed on a person as a result of the exercise of powers conferred by subsection (1) is enforceable by injunction or, in Scotland, by an order for specific performance under section 45 of the M1Court of Session Act 1988.

Annotations:

Marginal Citations

InquiriesE+W+S+N.I.

14 Cases in which the Treasury may arrange independent inquiries.E+W+S+N.I.

(1)This section applies in two cases.

(2)The first is where it appears to the Treasury that—

(a)events have occurred in relation to—

(i)a collective investment scheme, or

(ii)a person who is, or was at the time of the events, carrying on a regulated activity (whether or not as an authorised person),

which posed or could have posed a grave risk to [F14the UK financial system] or caused or risked causing significant damage to the interests of consumers; and

(b)those events might not have occurred, or the risk or damage might have been reduced, but for a serious failure in—

(i)the system established by this Act [F15, or by any previous statutory provision,] for the regulation of such schemes or of such persons and their activities; or

(ii)the operation of that system.

(3)The second is where it appears to the Treasury that—

(a)events have occurred in relation to listed securities or an issuer of listed securities which caused or could have caused significant damage to holders of listed securities; and

(b)those events might not have occurred but for a serious failure [F16 in—

(i)the regulatory system established by Part 6 or by any previous statutory provision concerned with the official listing of securities; or

(ii)the operation of that system.]

(4)If the Treasury consider that it is in the public interest that there should be an independent inquiry into the events and the circumstances surrounding them, they may arrange for an inquiry to be held under section 15.

[F17(5)Sections 425A and 425B (meaning of “consumers”) apply for the purposes of this section.]

(5A)Event” does not include any event occurring before 1st December 2001 (but no such limitation applies to the reference in subsection (4) to surrounding circumstances).

(6)F18. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7)Listed securities” means anything which has been admitted to the official list under Part VI.

15 Power to appoint person to hold an inquiry.E+W+S+N.I.

(1)If the Treasury decide to arrange for an inquiry to be held under this section, they may appoint such person as they consider appropriate to hold the inquiry.

(2)The Treasury may, by a direction to the appointed person, control—

(a)the scope of the inquiry;

(b)the period during which the inquiry is to be held;

(c)the conduct of the inquiry; and

(d)the making of reports.

(3)A direction may, in particular—

(a)confine the inquiry to particular matters;

(b)extend the inquiry to additional matters;

(c)require the appointed person to discontinue the inquiry or to take only such steps as are specified in the direction;

(d)require the appointed person to make such interim reports as are so specified.

16 Powers of appointed person and procedure.E+W+S+N.I.

(1)The person appointed to hold an inquiry under section 15 may—

(a)obtain such information from such persons and in such manner as he thinks fit;

(b)make such inquiries as he thinks fit; and

(c)determine the procedure to be followed in connection with the inquiry.

(2)The appointed person may require any person who, in his opinion, is able to provide any information, or produce any document, which is relevant to the inquiry to provide any such information or produce any such document.

(3)For the purposes of an inquiry, the appointed person has the same powers as the court in respect of the attendance and examination of witnesses (including the examination of witnesses abroad) and in respect of the production of documents.

(4)Court” means—

(a)the High Court; or

(b)in Scotland, the Court of Session.

17 Conclusion of inquiry.E+W+S+N.I.

(1)On completion of an inquiry under section 15, the person holding the inquiry must make a written report to the Treasury—

(a)setting out the result of the inquiry; and

(b)making such recommendations (if any) as he considers appropriate.

(2)The Treasury may publish the whole, or any part, of the report and may do so in such manner as they consider appropriate.

(3)Subsection (4) applies if the Treasury propose to publish a report but consider that it contains material—

(a)which relates to the affairs of a particular person whose interests would, in the opinion of the Treasury, be seriously prejudiced by publication of the material; or

(b)the disclosure of which would be incompatible with an international obligation of the United Kingdom.

(4)The Treasury must ensure that the material is removed before publication.

(5)The Treasury must lay before each House of Parliament a copy of any report or part of a report published under subsection (2).

(6)Any expenses reasonably incurred in holding an inquiry are to be met by the Treasury out of money provided by Parliament.

18 Obstruction and contempt.E+W+S+N.I.

(1)If a person (“A”)—

(a)fails to comply with a requirement imposed on him by a person holding an inquiry under section 15, or

(b)otherwise obstructs such an inquiry,

the person holding the inquiry may certify the matter to the High Court (or, in Scotland, the Court of Session).

(2)The court may enquire into the matter.

(3)If, after hearing—

(a)any witnesses who may be produced against or on behalf of A, and

(b)any statement made by or on behalf of A,

the court is satisfied that A would have been in contempt of court if the inquiry had been proceedings before the court, it may deal with him as if he were in contempt.

Part IIE+W+S+N.I. Regulated And Prohibited Activities

The general prohibitionE+W+S+N.I.

19 The general prohibition.E+W+S+N.I.

(1)No person may carry on a regulated activity in the United Kingdom, or purport to do so, unless he is—

(a)an authorised person; or

(b)an exempt person.

(2)The prohibition is referred to in this Act as the general prohibition.

Requirement for permissionE+W+S+N.I.

20 Authorised persons acting without permission.E+W+S+N.I.

(1)If an authorised person carries on a regulated activity in the United Kingdom, or purports to do so, otherwise than in accordance with permission—

(a)given to him by the Authority under Part IV, or

(b)resulting from any other provision of this Act,

he is to be taken to have contravened a requirement imposed on him by the Authority under this Act.

(2)The contravention does not—

(a)make a person guilty of an offence;

(b)make any transaction void or unenforceable; or

(c)(subject to subsection (3)) give rise to any right of action for breach of statutory duty.

(3)In prescribed cases the contravention is actionable at the suit of a person who suffers loss as a result of the contravention, subject to the defences and other incidents applying to actions for breach of statutory duty.

Annotations:

Modifications etc. (not altering text)

C27S. 20 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 2}

Commencement Information

I1S. 20 wholly in force at 1.12.2001; s. 20 not in force at Royal Assent see s. 431(2); s. 20(3) in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b), Sch. Pt. 2; s. 20 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

Financial promotionE+W+S+N.I.

21 Restrictions on financial promotion.E+W+S+N.I.

(1)A person (“A”) must not, in the course of business, communicate an invitation or inducement to engage in investment activity.

(2)But subsection (1) does not apply if—

(a)A is an authorised person; or

(b)the content of the communication is approved for the purposes of this section by an authorised person.

(3)In the case of a communication originating outside the United Kingdom, subsection (1) applies only if the communication is capable of having an effect in the United Kingdom.

(4)The Treasury may by order specify circumstances in which a person is to be regarded for the purposes of subsection (1) as—

(a)acting in the course of business;

(b)not acting in the course of business.

(5)The Treasury may by order specify circumstances (which may include compliance with financial promotion rules) in which subsection (1) does not apply.

(6)An order under subsection (5) may, in particular, provide that subsection (1) does not apply in relation to communications—

(a)of a specified description;

(b)originating in a specified country or territory outside the United Kingdom;

(c)originating in a country or territory which falls within a specified description of country or territory outside the United Kingdom; or

(d)originating outside the United Kingdom.

(7)The Treasury may by order repeal subsection (3).

(8)Engaging in investment activity” means—

(a)entering or offering to enter into an agreement the making or performance of which by either party constitutes a controlled activity; or

(b)exercising any rights conferred by a controlled investment to acquire, dispose of, underwrite or convert a controlled investment.

(9)An activity is a controlled activity if—

(a)it is an activity of a specified kind or one which falls within a specified class of activity; and

(b)it relates to an investment of a specified kind, or to one which falls within a specified class of investment.

(10)An investment is a controlled investment if it is an investment of a specified kind or one which falls within a specified class of investment.

(11)Schedule 2 (except paragraph 26) applies for the purposes of subsections (9) and (10) with references to section 22 being read as references to each of those subsections.

(12)Nothing in Schedule 2, as applied by subsection (11), limits the powers conferred by subsection (9) or (10).

(13)Communicate” includes causing a communication to be made.

(14)Investment” includes any asset, right or interest.

(15)Specified” means specified in an order made by the Treasury.

Annotations:

Modifications etc. (not altering text)

C28S. 21(1) modified (31.10.2001) by S.I. 2001/3374, art. 1, Sch. para. 6

C33S. 21(2) modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

Commencement Information

I2S. 21 wholly in force at 1.12.2001; s. 21 not in force at Royal Assent see s. 431(2); s. 21 in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b), Sch. Pt. 2; s. 21 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

Regulated activitiesE+W+S+N.I.

22 The classes of activity and categories of investment.E+W+S+N.I.

(1)An activity is a regulated activity for the purposes of this Act if it is an activity of a specified kind which is carried on by way of business and—

(a)relates to an investment of a specified kind; or

(b)in the case of an activity of a kind which is also specified for the purposes of this paragraph, is carried on in relation to property of any kind.

(2)Schedule 2 makes provision supplementing this section.

(3)Nothing in Schedule 2 limits the powers conferred by subsection (1).

(4)Investment” includes any asset, right or interest.

(5)Specified” means specified in an order made by the Treasury.

Annotations:

Modifications etc. (not altering text)

C34S. 22 applied (1.9.2002) by 1974 c. 39, s. 16(6E)(a) (as inserted (1.9.2002) by 2001/544, arts. 2(2)(b), 90(2))

OffencesE+W+S+N.I.

23 Contravention of the general prohibition.E+W+S+N.I.

(1)A person who contravenes the general prohibition is guilty of an offence and liable—

(a)on summary conviction, to imprisonment for a term not exceeding six months or a fine not exceeding the statutory maximum, or both;

(b)on conviction on indictment, to imprisonment for a term not exceeding two years or a fine, or both.

(2)In this Act “an authorisation offence” means an offence under this section.

(3)In proceedings for an authorisation offence it is a defence for the accused to show that he took all reasonable precautions and exercised all due diligence to avoid committing the offence.

24 False claims to be authorised or exempt.E+W+S+N.I.

(1)A person who is neither an authorised person nor, in relation to the regulated activity in question, an exempt person is guilty of an offence if he—

(a)describes himself (in whatever terms) as an authorised person;

(b)describes himself (in whatever terms) as an exempt person in relation to the regulated activity; or

(c)behaves, or otherwise holds himself out, in a manner which indicates (or which is reasonably likely to be understood as indicating) that he is—

(i)an authorised person; or

(ii)an exempt person in relation to the regulated activity.

(2)In proceedings for an offence under this section it is a defence for the accused to show that he took all reasonable precautions and exercised all due diligence to avoid committing the offence.

(3)A person guilty of an offence under this section is liable on summary conviction to imprisonment for a term not exceeding six months or a fine not exceeding level 5 on the standard scale, or both.

(4)But where the conduct constituting the offence involved or included the public display of any material, the maximum fine for the offence is level 5 on the standard scale multiplied by the number of days for which the display continued.

25 Contravention of section 21.E+W+S+N.I.

(1)A person who contravenes section 21(1) is guilty of an offence and liable—

(a)on summary conviction, to imprisonment for a term not exceeding six months or a fine not exceeding the statutory maximum, or both;

(b)on conviction on indictment, to imprisonment for a term not exceeding two years or a fine, or both.

(2)In proceedings for an offence under this section it is a defence for the accused to show—

(a)that he believed on reasonable grounds that the content of the communication was prepared, or approved for the purposes of section 21, by an authorised person; or

(b)that he took all reasonable precautions and exercised all due diligence to avoid committing the offence.

Enforceability of agreementsE+W+S+N.I.

26 Agreements made by unauthorised persons.E+W+S+N.I.

(1)An agreement made by a person in the course of carrying on a regulated activity in contravention of the general prohibition is unenforceable against the other party.

(2)The other party is entitled to recover—

(a)any money or other property paid or transferred by him under the agreement; and

(b)compensation for any loss sustained by him as a result of having parted with it.

(3)Agreement” means an agreement—

(a)made after this section comes into force; and

(b)the making or performance of which constitutes, or is part of, the regulated activity in question.

(4)This section does not apply if the regulated activity is accepting deposits.

Annotations:

Modifications etc. (not altering text)

C38S. 26(1)(2) applied (1.12.2001) by S.I. 2001/2657, arts. 1(1), 5(1)(4) (which was revoked (8.10.2001) by S.I. 2001/3083, arts. 1(2), 23); S.I. 2001/3538, art. 2(1)

S. 26(1)(2) applied (1.12.2001) by S.I. 2001/3083, arts. 1(2), 5(1); S.I. 2001/3538, art. 2(1)

27 Agreements made through unauthorised persons.E+W+S+N.I.

(1)An agreement made by an authorised person (“the provider”)—

(a)in the course of carrying on a regulated activity (not in contravention of the general prohibition), but

(b)in consequence of something said or done by another person (“the third party”) in the course of a regulated activity carried on by the third party in contravention of the general prohibition,

is unenforceable against the other party.

(2)The other party is entitled to recover—

(a)any money or other property paid or transferred by him under the agreement; and

(b)compensation for any loss sustained by him as a result of having parted with it.

(3)Agreement” means an agreement—

(a)made after this section comes into force; and

(b)the making or performance of which constitutes, or is part of, the regulated activity in question carried on by the provider.

(4)This section does not apply if the regulated activity is accepting deposits.

Annotations:

Modifications etc. (not altering text)

C39S. 27(1)(2) applied (1.12.2001) by S.I. 2001/2657, arts. 1(1), 5(2)(5) (which was revoked (8.10.2001) by S.I. 2001/3083, arts. 1(2), 23); S.I. 2001/3538, art. 2(1)

S. 27(1)(2) applied (1.12.2001) by S.I. 2001/3083, arts. 1(2), 5(2); S.I. 2001/3538, art. 2(1)

28 Agreements made unenforceable by section 26 or 27.E+W+S+N.I.

(1)This section applies to an agreement which is unenforceable because of section 26 or 27.

(2)The amount of compensation recoverable as a result of that section is—

(a)the amount agreed by the parties; or

(b)on the application of either party, the amount determined by the court.

(3)If the court is satisfied that it is just and equitable in the circumstances of the case, it may allow—

(a)the agreement to be enforced; or

(b)money and property paid or transferred under the agreement to be retained.

(4)In considering whether to allow the agreement to be enforced or (as the case may be) the money or property paid or transferred under the agreement to be retained the court must—

(a)if the case arises as a result of section 26, have regard to the issue mentioned in subsection (5); or

(b)if the case arises as a result of section 27, have regard to the issue mentioned in subsection (6).

(5)The issue is whether the person carrying on the regulated activity concerned reasonably believed that he was not contravening the general prohibition by making the agreement.

(6)The issue is whether the provider knew that the third party was (in carrying on the regulated activity) contravening the general prohibition.

(7)If the person against whom the agreement is unenforceable—

(a)elects not to perform the agreement, or

(b)as a result of this section, recovers money paid or other property transferred by him under the agreement,

he must repay any money and return any other property received by him under the agreement.

(8)If property transferred under the agreement has passed to a third party, a reference in section 26 or 27 or this section to that property is to be read as a reference to its value at the time of its transfer under the agreement.

(9)The commission of an authorisation offence does not make the agreement concerned illegal or invalid to any greater extent than is provided by section 26 or 27.

Annotations:

Modifications etc. (not altering text)

C40S. 28 applied (with modifications) (1.12.2001) by S.I. 2001/2657, arts. 1(1), 5(6) (which was revoked (8.10.2001) by S.I. 2001/3083, arts. 1(2), 23); S.I. 2001/3538, art. 2(1)

S. 28 applied (with modifications) (1.12.2001) by S.I. 2001/3083, arts. 1(2), 5(6); S.I. 2001/3538, art. 2(1)

29 Accepting deposits in breach of general prohibition.E+W+S+N.I.

(1)This section applies to an agreement between a person (“the depositor”) and another person (“the deposit-taker”) made in the course of the carrying on by the deposit-taker of accepting deposits in contravention of the general prohibition.

(2)If the depositor is not entitled under the agreement to recover without delay any money deposited by him, he may apply to the court for an order directing the deposit-taker to return the money to him.

(3)The court need not make such an order if it is satisfied that it would not be just and equitable for the money deposited to be returned, having regard to the issue mentioned in subsection (4).

(4)The issue is whether the deposit-taker reasonably believed that he was not contravening the general prohibition by making the agreement.

(5)Agreement” means an agreement—

(a)made after this section comes into force; and

(b)the making or performance of which constitutes, or is part of, accepting deposits.

30 Enforceability of agreements resulting from unlawful communications.E+W+S+N.I.

(1)In this section—

  • unlawful communication” means a communication in relation to which there has been a contravention of section 21(1);

  • controlled agreement” means an agreement the making or performance of which by either party constitutes a controlled activity for the purposes of that section; and

  • controlled investment” has the same meaning as in section 21.

(2)If in consequence of an unlawful communication a person enters as a customer into a controlled agreement, it is unenforceable against him and he is entitled to recover—

(a)any money or other property paid or transferred by him under the agreement; and

(b)compensation for any loss sustained by him as a result of having parted with it.

(3)If in consequence of an unlawful communication a person exercises any rights conferred by a controlled investment, no obligation to which he is subject as a result of exercising them is enforceable against him and he is entitled to recover—

(a)any money or other property paid or transferred by him under the obligation; and

(b)compensation for any loss sustained by him as a result of having parted with it.

(4)But the court may allow—

(a)the agreement or obligation to be enforced, or

(b)money or property paid or transferred under the agreement or obligation to be retained,

if it is satisfied that it is just and equitable in the circumstances of the case.

(5)In considering whether to allow the agreement or obligation to be enforced or (as the case may be) the money or property paid or transferred under the agreement to be retained the court must have regard to the issues mentioned in subsections (6) and (7).

(6)If the applicant made the unlawful communication, the issue is whether he reasonably believed that he was not making such a communication.

(7)If the applicant did not make the unlawful communication, the issue is whether he knew that the agreement was entered into in consequence of such a communication.

(8)Applicant” means the person seeking to enforce the agreement or obligation or retain the money or property paid or transferred.

(9)Any reference to making a communication includes causing a communication to be made.

(10)The amount of compensation recoverable as a result of subsection (2) or (3) is—

(a)the amount agreed between the parties; or

(b)on the application of either party, the amount determined by the court.

(11)If a person elects not to perform an agreement or an obligation which (by virtue of subsection (2) or (3)) is unenforceable against him, he must repay any money and return any other property received by him under the agreement.

(12)If (by virtue of subsection (2) or (3)) a person recovers money paid or property transferred by him under an agreement or obligation, he must repay any money and return any other property received by him as a result of exercising the rights in question.

(13)If any property required to be returned under this section has passed to a third party, references to that property are to be read as references to its value at the time of its receipt by the person required to return it.

Part IIIE+W+S+N.I. Authorisation and Exemption

AuthorisationE+W+S+N.I.

31 Authorised persons.E+W+S+N.I.

(1)The following persons are authorised for the purposes of this Act—

(a)a person who has a Part IV permission to carry on one or more regulated activities;

(b)an EEA firm qualifying for authorisation under Schedule 3;

(c)a Treaty firm qualifying for authorisation under Schedule 4;

(d)a person who is otherwise authorised by a provision of, or made under, this Act.

(2)In this Act “authorised person” means a person who is authorised for the purposes of this Act.

Annotations:

Commencement Information

I3S. 31 wholly in force at 1.12.2001; s. 31 not in force at Royal Assent see s. 431(2); s. 31(1)(b) in force for specified purposes at 25.2.2001 by S.I. 2001/516, art. 2(c), Sch. Pt. 3; s. 31(1)(b) in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 31(1)(c) in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 31 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

32 Partnerships and unincorporated associations.E+W+S+N.I.

(1)If a firm is authorised—

(a)it is authorised to carry on the regulated activities concerned in the name of the firm; and

(b)its authorisation is not affected by any change in its membership.

(2)If an authorised firm is dissolved, its authorisation continues to have effect in relation to any [F19individual or] firm which succeeds to the business of the dissolved firm.

[F20(3)For the purposes of this section, an individual or firm is to be regarded as succeeding to the business of a dissolved firm only if succession is to the whole or substantially the whole of the business of the former firm.]

(4)Firm” means—

(a)a partnership; or

(b)an unincorporated association of persons.

(5)“Partnership” does not include a partnership which is constituted under the law of any place outside the United Kingdom and is a body corporate.

Ending of authorisationE+W+S+N.I.

33 Withdrawal of authorisation by the Authority.E+W+S+N.I.

(1)This section applies if—

(a)an authorised person’s Part IV permission is cancelled; and

(b)as a result, there is no regulated activity for which he has permission.

(2)The Authority must give a direction withdrawing that person’s status as an authorised person.

34 EEA firms.E+W+S+N.I.

(1)An EEA firm ceases to qualify for authorisation under Part II of Schedule 3 if it ceases to be an EEA firm as a result of—

(a)having its EEA authorisation withdrawn; or

(b)ceasing to have an EEA right in circumstances in which EEA authorisation is not required.

(2)At the request of an EEA firm, the Authority may give a direction cancelling its authorisation under Part II of Schedule 3.

(3)If an EEA firm has a Part IV permission, it does not cease to be an authorised person merely because it ceases to qualify for authorisation under Part II of Schedule 3.

Annotations:

Modifications etc. (not altering text)

35 Treaty firms.E+W+S+N.I.

(1)A Treaty firm ceases to qualify for authorisation under Schedule 4 if its home State authorisation is withdrawn.

(2)At the request of a Treaty firm, the Authority may give a direction cancelling its Schedule 4 authorisation.

(3)If a Treaty firm has a Part IV permission, it does not cease to be an authorised person merely because it ceases to qualify for authorisation under Schedule 4.

36 Persons authorised as a result of paragraph 1(1) of Schedule 5.E+W+S+N.I.

(1)At the request of a person authorised as a result of paragraph 1(1) of Schedule 5, the Authority may give a direction cancelling his authorisation as such a person.

(2)If a person authorised as a result of paragraph 1(1) of Schedule 5 has a Part IV permission, he does not cease to be an authorised person merely because he ceases to be a person so authorised.

Exercise of EEA rights by UK firmsE+W+S+N.I.

37 Exercise of EEA rights by UK firms.E+W+S+N.I.

Part III of Schedule 3 makes provision in relation to the exercise outside the United Kingdom of EEA rights by UK firms.

Annotations:

Commencement Information

I4S. 37 wholly in force at 1.12.2001; s. 37 not in force at Royal Assent see s. 431(2); s. 37 in force for specified purposes at 25.2.2001 by S.I. 2001/516, art. 2(c), Sch. Pt. 3; s. 37 in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 37 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2, Sch. Pt. 2; s. 37 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

ExemptionE+W+S+N.I.

38 Exemption orders.E+W+S+N.I.

(1)The Treasury may by order (“an exemption order”) provide for—

(a)specified persons, or

(b)persons falling within a specified class,

to be exempt from the general prohibition.

(2)But a person cannot be an exempt person as a result of an exemption order if he has a Part IV permission.

(3)An exemption order may provide for an exemption to have effect—

(a)in respect of all regulated activities;

(b)in respect of one or more specified regulated activities;

(c)only in specified circumstances;

(d)only in relation to specified functions;

(e)subject to conditions.

(4)Specified” means specified by the exemption order.

39 Exemption of appointed representatives.E+W+S+N.I.

(1)If a person (other than an authorised person)—

(a)is a party to a contract with an authorised person (“his principal”) which—

(i)permits or requires him to carry on business of a prescribed description, and

(ii)complies with such requirements as may be prescribed, and

(b)is someone for whose activities in carrying on the whole or part of that business his principal has accepted responsibility in writing,

he is exempt from the general prohibition in relation to any regulated activity comprised in the carrying on of that business for which his principal has accepted responsibility.

[F21(1A)But a person is not exempt as a result of subsection (1)—

(a)if his principal is an investment firm or a credit institution, and

(b)so far as the business for which his principal has accepted responsibility is investment services business,

unless he is entered on the applicable register.

(1B)The “applicable register” is—

(a)in the case of a person established in an EEA State (other than the United Kingdom) which permits investment firms authorised by the competent authority of that State to appoint tied agents, the register of tied agents maintained in that State pursuant to Article 23 of the markets in financial instruments directive;

(b)in the case of a person established in an EEA State which does not permit investment firms authorised as mentioned in paragraph (a) to appoint tied agents—

(i)if his principal has his relevant office in the United Kingdom, the record maintained by the Authority by virtue of section 347(1)(ha), and

(ii)if his principal is established in an EEA State (other than the United Kingdom) which permits investment firms authorised by the competent authority of the State to appoint tied agents, the register of tied agents maintained by that State pursuant to Article 23 of the markets in financial instruments directive; and

(c)in any other case, the record maintained by the Authority by virtue of section 347(1)(ha).]

(2)A person who is exempt as a result of subsection (1) is referred to in this Act as an appointed representative.

(3)The principal of an appointed representative is responsible, to the same extent as if he had expressly permitted it, for anything done or omitted by the representative in carrying on the business for which he has accepted responsibility.

(4)In determining whether an authorised person has complied with a provision contained in or made under this Act, [F22or with a provision contained in any directly applicable Community regulation made under the markets in financial instruments directive,] anything which a relevant person has done or omitted as respects business for which the authorised person has accepted responsibility is to be treated as having been done or omitted by the authorised person.

(5)Relevant person” means a person who at the material time is or was an appointed representative by virtue of being a party to a contract with the authorised person.

(6)Nothing in subsection (4) is to cause the knowledge or intentions of an appointed representative to be attributed to his principal for the purpose of determining whether the principal has committed an offence, unless in all the circumstances it is reasonable for them to be attributed to him.

[F23(7)A person carries on “investment services business” if—

(a)the business includes providing services or carrying on activities of the kind mentioned in Article 4.1.25 of the markets in financial instruments directive, and

(b)as a result of providing such services or carrying on such activities he is a tied agent or would be if he were established in an EEA State.

(8)In this section—

  • competent authority” has the meaning given in Article 4.1.22 of the markets in financial instruments directive;

  • credit institution” means—

    (a)

    a credit institution authorised under the banking consolidation directive, or

    (b)

    an institution which would satisfy the requirements for authorisation as a credit institution under that directive if it had its relevant office in an EEA State;

  • relevant office” means—

    (a)

    in relation to a body corporate, its registered office or, if it has no registered office, its head office, and

    (b)

    in relation to a person other than a body corporate, the person's head office.]

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

C48S. 39(2) modified (31.10.2001) by S.I. 2001/3374, art. 1, Sch. para. 7

Commencement Information

I5S. 39 wholly in force at 1.12.2001; s. 39 not in force at Royal Assent see s. 431(2); s. 39(1) in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b), Sch. Pt. 2; s. 39 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

[F2439ACertain tied agents operating outside United KingdomE+W+S+N.I.

(1)This section applies to an authorised person whose relevant office is in the United Kingdom if—

(a)he is a party to a contract with a person (other than an authorised person) who is established—

(i)in the United Kingdom, or

(ii)in an EEA State which does not permit investment firms authorised by the competent authority of the State to appoint tied agents; and

(b)the contract is a relevant contract.

(2)A contract is a “relevant contract” if it satisfies conditions A to C.

(3)Condition A is that the contract permits or requires the person mentioned in subsection (1)(a) (the “agent”) to carry on investment services business.

(4)Condition B is that either—

(a)it is a condition of the contract that such business may only be carried on by the agent in an EEA State other than the United Kingdom; or

(b)in a case not falling within paragraph (a), the Authority is satisfied that no such business is, or is likely to be, carried on by the agent in the United Kingdom.

(5)Condition C is that the business is of a description that, if carried on in the United Kingdom, would be prescribed for the purposes of section 39(1)(a)(i).

(6)An authorised person to whom this section applies who—

(a)enters into or continues to perform a relevant contract with an agent which does not comply with the applicable requirements,

(b)enters into or continues to perform a relevant contract without accepting or having accepted responsibility in writing for the agent's activities in carrying on investment services business,

(c)enters into a relevant contract with an agent who is not entered on the record maintained by the Authority by virtue of section 347(1)(ha), or

(d)continues to perform a relevant contract with an agent when he knows or ought to know that the agent is not entered on that record,

is to be taken for the purposes of this Act to have contravened a requirement imposed on him by or under this Act.

(7)The “applicable requirements” are the requirements prescribed for the purposes of subsection (1)(a)(ii) of section 39 which have effect in the case of a person to whom subsection (1A) of that section applies.

(8)A person carries on “investment services business” if—

(a)his business includes providing services or carrying on activities of the kind mentioned in Article 4.1.25 of the markets in financial instruments directive, and

(b)as a result of providing such services or carrying on such activities he is a tied agent.

(9)In this section—

  • competent authority” has the meaning given in Article 4.1.22 of the markets in financial instruments directive;

  • relevant office” means—

    (a)

    in relation to a body corporate, its registered office or, if it has no registered office, its head office, and

    (b)

    in relation to a person other than a body corporate, the person's head office.]

Annotations:

Amendments (Textual)

Part IVE+W+S+N.I. Permission to Carry on Regulated Activities

Annotations:

Modifications etc. (not altering text)

C53Pt. IV (ss. 40-55) extended (1.12.2001) by S.I. 2001/2636, arts. 1(2)(b), 3-24; S.I. 2001/3538, art. 2(1)

Pt. IV (ss. 40-55) extended (with modifications) (1.12.2001) by S.I. 2001/2636, arts. 1(2)(b), 35(5)(a); S.I. 2001/3538, art. 2(1)

Pt. IV (ss. 40-50) excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 107(2) (with art. 23(2))

Pt. IV (ss. 40-55) modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 114(3)(a), 121(3), 128(3)(a) (with art. 23(2))

Application for permissionE+W+S+N.I.

40 Application for permission.E+W+S+N.I.

(1)An application for permission to carry on one or more regulated activities may be made to the Authority by—

(a)an individual;

(b)a body corporate;

(c)a partnership; or

(d)an unincorporated association.

(2)An authorised person may not apply for permission under this section if he has a permission—

(a)given to him by the Authority under this Part, or

(b)having effect as if so given,

which is in force.

(3)An EEA firm may not apply for permission under this section to carry on a regulated activity which it is, or would be, entitled to carry on in exercise of an EEA right, whether through a United Kingdom branch or by providing services in the United Kingdom.

(4)A permission given by the Authority under this Part or having effect as if so given is referred to in this Act as “a Part IV permission”.

Annotations:

Modifications etc. (not altering text)

C55S. 40 extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 3, 98 (with art. 23(2))

C57S. 40(2) excluded (10.8.2001) by S.I. 2001/2636, arts. 1(2)(a), 63(3)

S. 40(2) modified (31.10.2001) by S.I. 2001/3374, art. 1, Sch. para. 3

41 The threshold conditions.E+W+S+N.I.

(1)The threshold conditions”, in relation to a regulated activity, means the conditions set out in Schedule 6.

(2)In giving or varying permission, or imposing or varying any requirement, under this Part the Authority must ensure that the person concerned will satisfy, and continue to satisfy, the threshold conditions in relation to all of the regulated activities for which he has or will have permission.

(3)But the duty imposed by subsection (2) does not prevent the Authority, having due regard to that duty, from taking such steps as it considers are necessary, in relation to a particular authorised person, in order to secure its regulatory objective of the protection of consumers.

Annotations:

Modifications etc. (not altering text)

Commencement Information

I6S. 41 wholly in force at 3.9.2001; s. 41 not in force at Royal Assent see s. 431(2); s. 40(1) in force at 25.2.2001 by S.I. 2001/516, art. 2(a), Sch. Pt. 1; s. 41(2)(3) in force at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2

PermissionE+W+S+N.I.

42 Giving permission.E+W+S+N.I.

(1)The applicant” means an applicant for permission under section 40.

(2)The Authority may give permission for the applicant to carry on the regulated activity or activities to which his application relates or such of them as may be specified in the permission.

(3)If the applicant—

(a)in relation to a particular regulated activity, is exempt from the general prohibition as a result of section 39(1) or an order made under section 38(1), but

(b)has applied for permission in relation to another regulated activity,

the application is to be treated as relating to all the regulated activities which, if permission is given, he will carry on.

(4)If the applicant—

(a)in relation to a particular regulated activity, is exempt from the general prohibition as a result of section 285(2) or (3), but

(b)has applied for permission in relation to another regulated activity,

the application is to be treated as relating only to that other regulated activity.

(5)If the applicant—

(a)is a person to whom, in relation to a particular regulated activity, the general prohibition does not apply as a result of Part XIX, but

(b)has applied for permission in relation to another regulated activity,

the application is to be treated as relating only to that other regulated activity.

(6)If it gives permission, the Authority must specify the permitted regulated activity or activities, described in such manner as the Authority considers appropriate.

(7)The Authority may—

(a)incorporate in the description of a regulated activity such limitations (for example as to circumstances in which the activity may, or may not, be carried on) as it considers appropriate;

(b)specify a narrower or wider description of regulated activity than that to which the application relates;

(c)give permission for the carrying on of a regulated activity which is not included among those to which the application relates.

Annotations:

Modifications etc. (not altering text)

C66S. 42 modified (31.10.2001) by S.I. 2001/3374, art. 1, Sch. para. 3

C71S. 42 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3} (subject to Sch. para. 7)

C72S. 42(3)(4)(5) amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(4); S.I. 2001/3538, art. 2(1)

Commencement Information

I7S. 42 wholly in force at 1.12.2001; s. 42 not in force at Royal Assent see s. 431(2); s. 42 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 42 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

43 Imposition of requirements.E+W+S+N.I.

(1)A Part IV permission may include such requirements as the Authority considers appropriate.

(2)A requirement may, in particular, be imposed—

(a)so as to require the person concerned to take specified action; or

(b)so as to require him to refrain from taking specified action.

(3)A requirement may extend to activities which are not regulated activities.

(4)A requirement may be imposed by reference to the person’s relationship with—

(a)his group; or

(b)other members of his group.

(5)A requirement expires at the end of such period as the Authority may specify in the permission.

(6)But subsection (5) does not affect the Authority’s powers under section 44 or 45.

Annotations:

Modifications etc. (not altering text)

C73S. 43 modified (31.10.2001) by S.I. 2001/3374, art. 1, Sch. para. 3

S. 43 extended (1.12.2001) by S.I. 2001/2636, arts. 1(2)(b), 34-54; S.I. 2001/3538, art. 2(1)

S. 43 extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 4(2)(3) (with art. 23(2))

S. 43 extended (1.12.2001) by S.I. 2001/3647, art. 4, Sch. 2 para. 4(2)

C78S. 43 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

Commencement Information

I8S. 43 wholly in force at 1.12.2001; s. 43 not in force at Royal Assent see s. 431(2); s. 43 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 43 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

Variation and cancellation of Part IV permissionE+W+S+N.I.

44 Variation etc. at request of authorised person.E+W+S+N.I.

(1)The Authority may, on the application of an authorised person with a Part IV permission, vary the permission by—

(a)adding a regulated activity to those for which it gives permission;

(b)removing a regulated activity from those for which it gives permission;

(c)varying the description of a regulated activity for which it gives permission;

(d)cancelling a requirement imposed under section 43; or

(e)varying such a requirement.

(2)The Authority may, on the application of an authorised person with a Part IV permission, cancel the permission.

(3)The Authority may refuse an application under this section if it appears[F25to it that it is desirable to refuse the application in order to meet any of its regulatory objectives.]

(4)If, as a result of a variation of a Part IV permission under this section, there are no longer any regulated activities for which the authorised person concerned has permission, the Authority must, once it is satisfied that it is no longer necessary to keep the permission in force, cancel it.

(5)The Authority’s power to vary a Part IV permission under this section extends to including any provision in the permission as varied that could be included if a fresh permission were being given in response to an application under section 40.

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

C80S. 44 modified (31.10.2001) by S.I. 2001/3374, art. 1, Sch. para. 3

S. 44 extended (1.12.2001) by S.I. 2001/2636, arts. 1(2)(b), 46(3); S.I. 2001/3538, art. 2(1)

S. 44 extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 3, 4(1)(3), 8, 28(2) (with art. 23(2))

S. 44 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

C88S. 44(1)(4)(5) modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

Commencement Information

I9S. 44 wholly in force at 1.12.2001; s. 44 not in force at Royal Assent see s. 431(2); s. 44 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 44 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

45 Variation etc. on the Authority’s own initiative.E+W+S+N.I.

(1)The Authority may exercise its power under this section in relation to an authorised person if it appears to it that—

(a)he is failing, or is likely to fail, to satisfy the threshold conditions;

(b)he has failed, during a period of at least 12 months, to carry on a regulated activity for which he has a Part IV permission; or

[F26(c)it is desirable to exercise the power in order to meet any of its regulatory objectives.]

[F27(1A)For the purposes of subsection (1)(c) it does not matter whether there is a relationship between the authorised person and the persons whose interests will be protected by the exercise of the power under this section.]

(2)The Authority’s power under this section is the power to vary a Part IV permission in any of the ways mentioned in section 44(1) or to cancel it.

[F28(2A)Without prejudice to the generality of subsections (1) and (2), the Authority may, in relation to an authorised person who is an investment firm, exercise its power under this section to cancel the Part IV permission of the firm if it appears to it that—

(a)the firm has failed, during a period of at least six months, to carry on a regulated activity which is an investment service or activity for which it has a Part IV permission;

(b)the firm obtained the Part IV permission by making a false statement or by other irregular means;

(c)the firm no longer satisfies the requirements for authorisation pursuant to Chapter I of Title II of the markets in financial instruments directive, or pursuant to or contained in any [F29EU] legislation made under that Chapter, in relation to a regulated activity which is an investment service or activity for which it has a Part IV permission; or

(d)the firm has seriously and systematically infringed the operating conditions pursuant to Chapter II of Title II of the markets in financial instruments directive, or pursuant to or contained in any [F29EU] legislation made under that Chapter, in relation to a regulated activity which is an investment service or activity for which it has a Part IV permission.

(2B)For the purposes of subsection (2A) a regulated activity is an investment service or activity if it falls within the definition of “investment services and activities” in section 417(1).]

(3)If, as a result of a variation of a Part IV permission under this section, there are no longer any regulated activities for which the authorised person concerned has permission, the Authority must, once it is satisfied that it is no longer necessary to keep the permission in force, cancel it.

(4)The Authority’s power to vary a Part IV permission under this section extends to including any provision in the permission as varied that could be included if a fresh permission were being given in response to an application under section 40.

(5)The Authority’s power under this section is referred to in this Part as its own-initiative power.

Annotations:

Amendments (Textual)

F29Words in s. 45(2A)(c)(d) substituted (22.4.2011 with application in accordance with art. 3 of the amending S.I.) by virtue of The Treaty of Lisbon (Changes in Terminology) Order 2011 (S.I. 2011/1043), art. 6(2)-(5)

Modifications etc. (not altering text)

C89S. 45 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 45 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

C93S. 45(1)(b) excluded (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

Commencement Information

I10S. 45 wholly in force at 1.12.2001; s. 45 not in force at Royal Assent see s. 431(2); s. 45 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 45 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

46 Variation of permission on acquisition of control.E+W+S+N.I.

(1)This section applies if it appears to the Authority that—

(a)a person has acquired control over a UK authorised person who has a Part IV permission; but

(b)there are no grounds for exercising its own-initiative power.

(2)If it appears to the Authority that the likely effect of the acquisition of control on the authorised person, or on any of its activities, is uncertain the Authority may vary the authorised person’s permission by—

(a)imposing a requirement of a kind that could be imposed under section 43 on giving permission; or

(b)varying a requirement included in the authorised person’s permission under that section.

(3)Any reference to a person having acquired control is to be read in accordance with Part XII.

Annotations:

Modifications etc. (not altering text)

C95S. 46 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 46 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

Commencement Information

I11S. 46 wholly in force at 1.12.2001; s. 46 not in force at Royal Assent see s. 431(2); s. 46 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 46 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

47 Exercise of power in support of overseas regulator.E+W+S+N.I.

(1)The Authority’s own-initiative power may be exercised in respect of an authorised person at the request of, or for the purpose of assisting, a regulator who is—

(a)outside the United Kingdom; and

(b)of a prescribed kind.

(2)Subsection (1) applies whether or not the Authority has powers which are exercisable in relation to the authorised person by virtue of any provision of Part XIII.

(3)If a request to the Authority for the exercise of its own-initiative power has been made by a regulator who is—

(a)outside the United Kingdom,

(b)of a prescribed kind, and

(c)acting in pursuance of provisions of a prescribed kind,

the Authority must, in deciding whether or not to exercise that power in response to the request, consider whether it is necessary to do so in order to comply with [F30an EU] obligation.

(4)In deciding in any case in which the Authority does not consider that the exercise of its own-initiative power is necessary in order to comply with [F30an EU] obligation, it may take into account in particular—

(a)whether in the country or territory of the regulator concerned, corresponding assistance would be given to a United Kingdom regulatory authority;

(b)whether the case concerns the breach of a law, or other requirement, which has no close parallel in the United Kingdom or involves the assertion of a jurisdiction not recognised by the United Kingdom;

(c)the seriousness of the case and its importance to persons in the United Kingdom;

(d)whether it is otherwise appropriate in the public interest to give the assistance sought.

(5)The Authority may decide not to exercise its own-initiative power, in response to a request, unless the regulator concerned undertakes to make such contribution towards the cost of its exercise as the Authority considers appropriate.

(6)Subsection (5) does not apply if the Authority decides that it is necessary for it to exercise its own-initiative power in order to comply with [F30an EU] obligation.

(7)In subsections (4) and (5) “request” means a request of a kind mentioned in subsection (1).

Annotations:

Amendments (Textual)

F30Words in s. 47(3)(4)(6) substituted (22.4.2011 with application in accordance with art. 3 of the amending S.I.) by virtue of The Treaty of Lisbon (Changes in Terminology) Order 2011 (S.I. 2011/1043), art. 6(1)(3)(4)

Modifications etc. (not altering text)

C98S. 47 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 47 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

Commencement Information

I12S. 47 wholly in force at 1.12.2001; s. 47 not in force at Royal Assent see s. 431(2); s. 47(1)(3) in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b), Sch. Pt. 2; s. 47 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 47 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

48 Prohibitions and restrictions.E+W+S+N.I.

(1)This section applies if the Authority—

(a)on giving a person a Part IV permission, imposes an assets requirement on him; or

(b)varies an authorised person’s Part IV permission so as to alter an assets requirement imposed on him or impose such a requirement on him.

(2)A person on whom an assets requirement is imposed is referred to in this section as “A”.

(3)Assets requirement” means a requirement under section 43—

(a)prohibiting the disposal of, or other dealing with, any of A’s assets (whether in the United Kingdom or elsewhere) or restricting such disposals or dealings; or

(b)that all or any of A’s assets, or all or any assets belonging to consumers but held by A or to his order, must be transferred to and held by a trustee approved by the Authority.

(4)If the Authority—

(a)imposes a requirement of the kind mentioned in subsection (3)(a), and

(b)gives notice of the requirement to any institution with whom A keeps an account,

the notice has the effects mentioned in subsection (5).

(5)Those effects are that—

(a)the institution does not act in breach of any contract with A if, having been instructed by A (or on his behalf) to transfer any sum or otherwise make any payment out of A’s account, it refuses to do so in the reasonably held belief that complying with the instruction would be incompatible with the requirement; and

(b)if the institution complies with such an instruction, it is liable to pay to the Authority an amount equal to the amount transferred from, or otherwise paid out of, A’s account in contravention of the requirement.

(6)If the Authority imposes a requirement of the kind mentioned in subsection (3)(b), no assets held by a person as trustee in accordance with the requirement may, while the requirement is in force, be released or dealt with except with the consent of the Authority.

(7)If, while a requirement of the kind mentioned in subsection (3)(b) is in force, A creates a charge over any assets of his held in accordance with the requirement, the charge is (to the extent that it confers security over the assets) void against the liquidator and any of A’s creditors.

(8)Assets held by a person as trustee (“T”) are to be taken to be held by T in accordance with a requirement mentioned in subsection (3)(b) only if—

(a)A has given T written notice that those assets are to be held by T in accordance with the requirement; or

(b)they are assets into which assets to which paragraph (a) applies have been transposed by T on the instructions of A.

(9)A person who contravenes subsection (6) is guilty of an offence and liable on summary conviction to a fine not exceeding level 5 on the standard scale.

(10)Charge” includes a mortgage (or in Scotland a security over property).

(11)Subsections (6) and (8) do not affect any equitable interest or remedy in favour of a person who is a beneficiary of a trust as a result of a requirement of the kind mentioned in subsection (3)(b).

Annotations:

Modifications etc. (not altering text)

C101S. 48 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 48 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

Connected personsE+W+S+N.I.

49 Persons connected with an applicant.E+W+S+N.I.

(1)In considering—

(a)an application for a Part IV permission, or

(b)whether to vary or cancel a Part IV permission,

the Authority may have regard to any person appearing to it to be, or likely to be, in a relationship with the applicant or person given permission which is relevant.

(2)Before—

(a)giving permission in response to an application made by a person who is connected with an EEA firm [F31(other than an EEA firm falling within paragraph 5(e) of Schedule 3 (insurance and reinsurance intermediaries))], or

[F32(b)varying any permission given by the Authority to such a person, where the effect of the variation is to grant permission for the purposes of a single market directive other than the one for the purposes of which the existing permission was granted,]

the Authority must consult the firm’s home state regulator.

[F33(2A)But subsection (2) does not apply to the extent that the permission relates to—

(a)an insurance mediation activity (within the meaning given by paragraph 2(5) of Schedule 6); or

(b)a regulated activity involving a regulated mortgage contract [F34, a regulated home reversion plan [F35, a regulated home purchase plan or a regulated sale and rent back agreement]].]

(3)A person (“A”) is connected with an EEA firm if—

(a)A is a subsidiary undertaking of the firm; or

(b)A is a subsidiary undertaking of a parent undertaking of the firm.

[F36(4)In subsection (2A)(b) “regulated mortgage contract”, “regulated home reversion plan”, “regulated home purchase plan” and “regulated sale and rent back agreement” shall be construed in accordance with—

(a)section 22;

(b)any relevant order under that section; and

(c)Schedule 2.]

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

Additional permissionsE+W+S+N.I.

50 Authority’s duty to consider other permissions etc.E+W+S+N.I.

(1)Additional Part IV permission” means a Part IV permission which is in force in relation to an EEA firm, a Treaty firm or a person authorised as a result of paragraph 1(1) of Schedule 5.

(2)If the Authority is considering whether, and if so how, to exercise its own-initiative power under this Part in relation to an additional Part IV permission, it must take into account—

(a)the home State authorisation of the authorised person concerned;

(b)any relevant directive; and

(c)relevant provisions of the Treaty.

Annotations:

Modifications etc. (not altering text)

C114S. 50 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 50 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

ProcedureE+W+S+N.I.

51 Applications under this Part.E+W+S+N.I.

(1)An application for a Part IV permission must—

(a)contain a statement of the regulated activity or regulated activities which the applicant proposes to carry on and for which he wishes to have permission; and

(b)give the address of a place in the United Kingdom for service on the applicant of any notice or other document which is required or authorised to be served on him under this Act.

(2)An application for the variation of a Part IV permission must contain a statement—

(a)of the desired variation; and

(b)of the regulated activity or regulated activities which the applicant proposes to carry on if his permission is varied.

(3)Any application under this Part must—

(a)be made in such manner as the Authority may direct; and

(b)contain, or be accompanied by, such other information as the Authority may reasonably require.

(4)At any time after receiving an application and before determining it, the Authority may require the applicant to provide it with such further information as it reasonably considers necessary to enable it to determine the application.

(5)Different directions may be given, and different requirements imposed, in relation to different applications or categories of application.

(6)The Authority may require an applicant to provide information which he is required to provide under this section in such form, or to verify it in such a way, as the Authority may direct.

Annotations:

Modifications etc. (not altering text)

C120S. 51(4) extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 26(6) (with art. 23(2))

Commencement Information

I13S. 51 wholly in force at 3.9.2001; s. 51 not in force at Royal Assent see s. 431(2); s. 51(3) in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 51 in force at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2

52 Determination of applications.E+W+S+N.I.

(1)An application under this Part must be determined by the Authority before the end of the period of six months beginning with the date on which it received the completed application.

(2)The Authority may determine an incomplete application if it considers it appropriate to do so; and it must in any event determine such an application within twelve months beginning with the date on which it received the application.

(3)The applicant may withdraw his application, by giving the Authority written notice, at any time before the Authority determines it.

(4)If the Authority grants an application for, or for variation of, a Part IV permission, it must give the applicant written notice.

(5)The notice must state the date from which the permission, or the variation, has effect.

(6)If the Authority proposes—

(a)to give a Part IV permission but to exercise its power under section 42(7)(a) or (b) or 43(1), or

(b)to vary a Part IV permission on the application of an authorised person but to exercise its power under any of those provisions (as a result of section 44(5)),

it must give the applicant a warning notice.

(7)If the Authority proposes to refuse an application made under this Part, it must (unless subsection (8) applies) give the applicant a warning notice.

(8)This subsection applies if it appears to the Authority that—

(a)the applicant is an EEA firm; and

(b)the application is made with a view to carrying on a regulated activity in a manner in which the applicant is, or would be, entitled to carry on that activity in the exercise of an EEA right whether through a United Kingdom branch or by providing services in the United Kingdom.

(9)If the Authority decides—

(a)to give a Part IV permission but to exercise its power under section 42(7)(a) or (b) or 43(1),

(b)to vary a Part IV permission on the application of an authorised person but to exercise its power under any of those provisions (as a result of section 44(5)), or

(c)to refuse an application under this Part,

it must give the applicant a decision notice.

Annotations:

Modifications etc. (not altering text)

C124S. 52 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 52 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

S. 52 extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 9 (with art. 23(2))

C127S. 52 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

C129S. 52(1)(2) modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 26(6) (with art. 23(2))

C132S. 52(2) restricted (1.12.2001) by S.I. 2001/3592, arts. 1(2), 26(4)(5) (with art. 23(2))

C133S. 52(9) excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 110(2), 115(2), 122(2), 129 (with art. 23(2))

C134S. 52(9)(c) extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 5(3)(4) (with art. 23(2))

53 Exercise of own-initiative power: procedure.E+W+S+N.I.

(1)This section applies to an exercise of the Authority’s own-initiative power to vary an authorised person’s Part IV permission.

(2)A variation takes effect—

(a)immediately, if the notice given under subsection (4) states that that is the case;

(b)on such date as may be specified in the notice; or

(c)if no date is specified in the notice, when the matter to which the notice relates is no longer open to review.

(3)A variation may be expressed to take effect immediately (or on a specified date) only if the Authority, having regard to the ground on which it is exercising its own-initiative power, reasonably considers that it is necessary for the variation to take effect immediately (or on that date).

(4)If the Authority proposes to vary the Part IV permission, or varies it with immediate effect, it must give the authorised person written notice.

(5)The notice must—

(a)give details of the variation;

(b)state the Authority’s reasons for the variation and for its determination as to when the variation takes effect;

(c)inform the authorised person that he may make representations to the Authority within such period as may be specified in the notice (whether or not he has referred the matter to the Tribunal);

(d)inform him of when the variation takes effect; and

(e)inform him of his right to refer the matter to the Tribunal.

(6)The Authority may extend the period allowed under the notice for making representations.

(7)If, having considered any representations made by the authorised person, the Authority decides—

(a)to vary the permission in the way proposed, or

(b)if the permission has been varied, not to rescind the variation,

it must give him written notice.

(8)If, having considered any representations made by the authorised person, the Authority decides—

(a)not to vary the permission in the way proposed,

(b)to vary the permission in a different way, or

(c)to rescind a variation which has effect,

it must give him written notice.

(9)A notice given under subsection (7) must inform the authorised person of his right to refer the matter to the Tribunal.

(10)A notice under subsection (8)(b) must comply with subsection (5).

(11)If a notice informs a person of his right to refer a matter to the Tribunal, it must give an indication of the procedure on such a reference.

(12)For the purposes of subsection (2)(c), whether a matter is open to review is to be determined in accordance with section 391(8).

Annotations:

Modifications etc. (not altering text)

C135S. 53 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 53 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

S. 53 excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 61(1), 110(1), 115(1), 122(1), 129 (with art. 23(2))

C137S. 53 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

C139S. 53(2)(c) excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 15(3), 18(5), 29(5) (with art. 23(2))

C140S. 53(4) extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 10, 14, 18(1)(a), 29, 30-34 (with art. 23(2))

S. 53(4) modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 72(2) (with art. 23(2))

C141S. 53(8) extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 16(1) (with art. 23(2))

Commencement Information

I14S. 53 wholly in force at 1.12.2001; s. 53 not in force at Royal Assent see s. 431(2); s. 53 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 53 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

54 Cancellation of Part IV permission: procedure.E+W+S+N.I.

(1)If the Authority proposes to cancel an authorised person’s Part IV permission otherwise than at his request, it must give him a warning notice.

(2)If the Authority decides to cancel an authorised person’s Part IV permission otherwise than at his request, it must give him a decision notice.

Annotations:

Modifications etc. (not altering text)

C142S. 54 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 54 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

S. 54 excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 61(1), 110(1), 115(1), 122(1), 129 (with art. 23(2))

C145S. 54 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

C147S. 54(2) modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 71(2) (with art. 23(2))

Commencement Information

I15S. 54 wholly in force at 1.12.2001; s. 54 not in force at Royal Assent see s. 431(2); s. 54 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 54 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

References to the TribunalE+W+S+N.I.

55 Right to refer matters to the Tribunal.E+W+S+N.I.

(1)An applicant who is aggrieved by the determination of an application made under this Part may refer the matter to the Tribunal.

(2)An authorised person who is aggrieved by the exercise of the Authority’s own-initiative power may refer the matter to the Tribunal.

Annotations:

Modifications etc. (not altering text)

C148S. 55 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 55 modified (17.8.2001 for certain purposes otherwise 1.12.2001) by 1992 c. 40, s. 85(4C) (as inserted (17.8.2001 for certain purposes otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(1), Sch. 5 Pt. I para. 95 (with art. 13(3), Sch. 5)); S.I. 2001/3538, art. 2(1)

S. 55 modified (17.8.2001 for certain purposes otherwise 1.12.2001) by 1986 c. 53, s. 93(6B) (as substituted (17.8.2001 for certain purposes otherwise 1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(1), Sch. 5 Pt. II para. 177(d) (with art. 13(3), Sch. 5)); S.I. 2001/3538, art. 2(1)

S. 55 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

S. 55 excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 61(1), 110(1), 115(1), 122(1), 129 (with art. 23(2))

C150S. 55 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

Part VE+W+S+N.I. Performance of Regulated Activities

Annotations:

Modifications etc. (not altering text)

C154Pt. V (ss. 56-71) modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 114(3)(a), 128(3)(a) (with art. 23(2))

Prohibition ordersE+W+S+N.I.

56 Prohibition orders.E+W+S+N.I.

(1)Subsection (2) applies if it appears to the Authority that an individual is not a fit and proper person to perform functions in relation to a regulated activity carried on by an authorised person.

(2)The Authority may make an order (“a prohibition order”) prohibiting the individual from performing a specified function, any function falling within a specified description or any function.

(3)A prohibition order may relate to—

(a)a specified regulated activity, any regulated activity falling within a specified description or all regulated activities;

(b)authorised persons generally or any person within a specified class of authorised person.

(4)An individual who performs or agrees to perform a function in breach of a prohibition order is guilty of an offence and liable on summary conviction to a fine not exceeding level 5 on the standard scale.

(5)In proceedings for an offence under subsection (4) it is a defence for the accused to show that he took all reasonable precautions and exercised all due diligence to avoid committing the offence.

(6)An authorised person must take reasonable care to ensure that no function of his, in relation to the carrying on of a regulated activity, is performed by a person who is prohibited from performing that function by a prohibition order.

(7)The Authority may, on the application of the individual named in a prohibition order, vary or revoke it.

(8)This section applies to the performance of functions in relation to a regulated activity carried on by—

(a)a person who is an exempt person in relation to that activity, and

(b)a person to whom, as a result of Part XX, the general prohibition does not apply in relation to that activity,

as it applies to the performance of functions in relation to a regulated activity carried on by an authorised person.

(9)Specified” means specified in the prohibition order.

Annotations:

Modifications etc. (not altering text)

C155S. 56 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 56 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

S. 56 extended (1.12.2001) by S.I. 2001/2636, arts. 1(2)(b), 79(1); S.I. 2001/3538, art. 2(1)

C158S. 56(7) extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 55(5) (with art. 23(2))

C159S. 56(8) amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(4); S.I. 2001/3538, art. 2(1)

Commencement Information

I16S. 56 wholly in force at 1.12.2001; s. 56 not in force at Royal Assent see s. 431(2); s. 56 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 56 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

57 Prohibition orders: procedure and right to refer to Tribunal.E+W+S+N.I.

(1)If the Authority proposes to make a prohibition order it must give the individual concerned a warning notice.

(2)The warning notice must set out the terms of the prohibition.

(3)If the Authority decides to make a prohibition order it must give the individual concerned a decision notice.

(4)The decision notice must—

(a)name the individual to whom the prohibition order applies;

(b)set out the terms of the order; and

(c)be given to the individual named in the order.

(5)A person against whom a decision to make a prohibition order is made may refer the matter to the Tribunal.

Annotations:

Modifications etc. (not altering text)

C160S. 57 excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 110(3) (with art. 23(2))

C162S. 57(1) extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 55(1) (with art. 23(2))

Commencement Information

I17S. 57 wholly in force at 1.12.2001; s. 57 not in force at Royal Assent see s. 431(2); s. 57 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 57 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

58 Applications relating to prohibitions: procedure and right to refer to Tribunal.E+W+S+N.I.

(1)This section applies to an application for the variation or revocation of a prohibition order.

(2)If the Authority decides to grant the application, it must give the applicant written notice of its decision.

(3)If the Authority proposes to refuse the application, it must give the applicant a warning notice.

(4)If the Authority decides to refuse the application, it must give the applicant a decision notice.

(5)If the Authority gives the applicant a decision notice, he may refer the matter to the Tribunal.

Annotations:

Modifications etc. (not altering text)

C163S. 58 excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 110(3) (with art. 23(2))

Commencement Information

I18S. 58 wholly in force at 1.12.2001; s. 58 not in force at Royal Assent see s. 431(2); s. 58 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 58 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

ApprovalE+W+S+N.I.

59 Approval for particular arrangements.E+W+S+N.I.

(1)An authorised person (“A”) must take reasonable care to ensure that no person performs a controlled function under an arrangement entered into by A in relation to the carrying on by A of a regulated activity, unless the Authority approves the performance by that person of the controlled function to which the arrangement relates.

(2)An authorised person (“A”) must take reasonable care to ensure that no person performs a controlled function under an arrangement entered into by a contractor of A in relation to the carrying on by A of a regulated activity, unless the Authority approves the performance by that person of the controlled function to which the arrangement relates.

(3)Controlled function” means a function of a description specified in rules.

(4)The Authority may specify a description of function under subsection (3) only if, in relation to the carrying on of a regulated activity by an authorised person, it is satisfied that the first, second or third condition is met.

(5)The first condition is that the function is likely to enable the person responsible for its performance to exercise a significant influence on the conduct of the authorised person’s affairs, so far as relating to the regulated activity.

(6)The second condition is that the function will involve the person performing it in dealing with customers of the authorised person in a manner substantially connected with the carrying on of the regulated activity.

(7)The third condition is that the function will involve the person performing it in dealing with property of customers of the authorised person in a manner substantially connected with the carrying on of the regulated activity.

(8)Neither subsection (1) nor subsection (2) applies to an arrangement which allows a person to perform a function if the question of whether he is a fit and proper person to perform the function is reserved under any of the single market directives to an authority in a country or territory outside the United Kingdom.

(9)In determining whether the first condition is met, the Authority may take into account the likely consequences of a failure to discharge that function properly.

(10)“Arrangement”—

(a)means any kind of arrangement for the performance of a function of A which is entered into by A or any contractor of his with another person; and

(b)includes, in particular, that other person’s appointment to an office, his becoming a partner or his employment (whether under a contract of service or otherwise).

(11)Customer”, in relation to an authorised person, means a person who is using, or who is or may be contemplating using, any of the services provided by the authorised person.

Annotations:

Modifications etc. (not altering text)

C165S. 59 extended (1.12.2001) by S.I. 2001/2636, arts. 1(2)(b), 74(2), 76(2); S.I. 2001/3538, art. 2(1)

S. 59 extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 49(1) (with art. 23(2))

C166S. 59 modified (29.9.2008 at 8.00 a.m.) by The Bradford & Bingley plc Transfer of Securities and Property etc. Order 2008 (S.I. 2008/2546), art. 15(1)

C167S. 59 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

C168S. 59 modified (1.1.2010) by The Northern Rock plc Transfer Order 2009 (S.I. 2009/3226), arts. 1(2)(b), 10

Commencement Information

I19S. 59 wholly in force at 1.12.2001; s. 59 not in force at Royal Assent see s. 431(2); s. 59 in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 59 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 59 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

60 Applications for approval.E+W+S+N.I.

(1)An application for the Authority’s approval under section 59 may be made by the authorised person concerned.

(2)The application must—

(a)be made in such manner as the Authority may direct; and

(b)contain, or be accompanied by, such information as the Authority may reasonably require.

(3)At any time after receiving the application and before determining it, the Authority may require the applicant to provide it with such further information as it reasonably considers necessary to enable it to determine the application.

(4)The Authority may require an applicant to present information which he is required to give under this section in such form, or to verify it in such a way, as the Authority may direct.

(5)Different directions may be given, and different requirements imposed, in relation to different applications or categories of application.

(6)The authorised person concerned” includes a person who has applied for permission under Part IV and will be the authorised person concerned if permission is given.

Annotations:

Modifications etc. (not altering text)

C170S. 60 amended (temp. from 3.9.2001 to 1.12.2001) by S.I. 2001/2659, arts. 1(2), 3(3); S.I. 2001/3538, art. 2(1)

S. 60 modified (temp. from 31.10.2001) by S.I. 2001/3374, arts. 1, 11

S. 60: “the authorised person concerned” extended (1.12.2001) by S.I. 2001/2511, regs. 1(1), 10; S.I. 2001/3538, art. 2(1)

S. 60 extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 50(1), 51(1), 53(1) (with art. 23(2))

C172S. 60 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

C174S. 60(3) extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 50(5) (with art. 23(2))

Commencement Information

I20S. 60 wholly in force at 1.12.2001; s. 60 not in force at Royal Assent see s. 431(2); s. 60(2)(4) in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 60 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 60 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

61 Determination of applications.E+W+S+N.I.

(1)The Authority may grant an application made under section 60 only if it is satisfied that the person in respect of whom the application is made (“the candidate”) is a fit and proper person to perform the function to which the application relates.

(2)In deciding that question, the Authority may have regard (among other things) to whether the candidate, or any person who may perform a function on his behalf—

(a)has obtained a qualification,

(b)has undergone, or is undergoing, training, or

(c)possesses a level of competence,

required by general rules in relation to persons performing functions of the kind to which the application relates.

(3)The Authority must, before the end of the period of three months beginning with the date on which it receives an application made under section 60 (“the period for consideration”), determine whether—

(a)to grant the application; or

(b)to give a warning notice under section 62(2).

(4)If the Authority imposes a requirement under section 60(3), the period for consideration stops running on the day on which the requirement is imposed but starts running again—

(a)on the day on which the required information is received by the Authority; or

(b)if the information is not provided on a single day, on the last of the days on which it is received by the Authority.

(5)A person who makes an application under section 60 may withdraw his application by giving written notice to the Authority at any time before the Authority determines it, but only with the consent of—

(a)the candidate; and

(b)the person by whom the candidate is to be retained to perform the function concerned, if not the applicant.

Annotations:

Modifications etc. (not altering text)

C175S. 61 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

C177S. 61(3) modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 49(3), 53(2) (with art. 23(2))

Commencement Information

I21S. 61 wholly in force at 1.12.2001; s. 61 not in force at Royal Assent see s. 431(2); s. 61 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 61 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

62 Applications for approval: procedure and right to refer to Tribunal.E+W+S+N.I.

(1)If the Authority decides to grant an application made under section 60 (“an application”), it must give written notice of its decision to each of the interested parties.

(2)If the Authority proposes to refuse an application, it must give a warning notice to each of the interested parties.

(3)If the Authority decides to refuse an application, it must give a decision notice to each of the interested parties.

(4)If the Authority decides to refuse an application, each of the interested parties may refer the matter to the Tribunal.

(5)“The interested parties”, in relation to an application, are—

(a)the applicant;

(b)the person in respect of whom the application is made (“A”); and

(c)the person by whom A’s services are to be retained, if not the applicant.

Annotations:

Modifications etc. (not altering text)

C180S. 62 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}

Commencement Information

I22S. 62 wholly in force at 1.12.2001; s. 62 not in force at Royal Assent see s. 431(2); s. 62 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 62 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

63 Withdrawal of approval.E+W+S+N.I.

(1)The Authority may withdraw an approval given under section 59 if it considers that the person in respect of whom it was given is not a fit and proper person to perform the function to which the approval relates.

(2)When considering whether to withdraw its approval, the Authority may take into account any matter which it could take into account if it were considering an application made under section 60 in respect of the performance of the function to which the approval relates.

(3)If the Authority proposes to withdraw its approval, it must give each of the interested parties a warning notice.

(4)If the Authority decides to withdraw its approval, it must give each of the interested parties a decision notice.

(5)If the Authority decides to withdraw its approval, each of the interested parties may refer the matter to the Tribunal.

(6)“The interested parties”, in relation to an approval, are—

(a)the person on whose application it was given (“A”);

(b)the person in respect of whom it was given (“B”); and

(c)the person by whom B’s services are retained, if not A.

Annotations:

Modifications etc. (not altering text)

C185S. 63(1)(3)-(6) excluded (1.12.2001) by S.I. 2001/3592, arts. 1(2), 61(2) (with art. 23(2))

C186S. 63(3) extended (1.12.2001) by S.I. 2001/3592, arts. 1(2), 52(2) (with art. 23(2))

C187S. 63(4) modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 75(2) (with art. 23(2))

Commencement Information

I23S. 63 wholly in force at 1.12.2001; s. 63 not in force at Royal Assent see s. 431(2); s. 63 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 63 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

[F37Performance of controlled functions without approvalE+W+S+N.I.

Annotations:

Amendments (Textual)

F37Ss. 63A-63D and preceding cross-heading inserted (8.6.2010) by Financial Services Act 2010 (c. 28), ss. 11, 26(2)(b)

63APower to impose penaltiesE+W+S+N.I.

(1)If the Authority is satisfied that—

(a)a person (“P”) has at any time performed a controlled function without approval, and

(b)at that time P knew, or could reasonably be expected to have known, that P was performing a controlled function without approval,

it may impose a penalty on P of such amount as it considers appropriate.

(2)For the purposes of this section P performs a controlled function without approval at any time if at that time—

(a)P performs a controlled function under an arrangement entered into by an authorised person (“A”), or by a contractor of A, in relation to the carrying on by A of a regulated activity; and

(b)the performance by P of the function was not approved under section 59.

(3)The Authority may not impose a penalty under this section after the end of the limitation period unless, before the end of that period, it has given a warning notice to the person concerned under section 63B(1).

(4)The limitation period” means the period of three years beginning with the first day on which the Authority knew that the person concerned had performed a controlled function without approval.

(5)For this purpose the Authority is to be treated as knowing that a person has performed a controlled function without approval if it has information from which that can reasonably be inferred.

(6)Any expression which is used both in this section and section 59 has the same meaning in this section as in that section.

63BProcedure and right to refer to TribunalE+W+S+N.I.

(1)If the Authority proposes to impose a penalty on a person under section 63A, it must give the person a warning notice.

(2)A warning notice must state the amount of the penalty.

(3)If the Authority decides to impose a penalty on a person under section 63A, it must give the person a decision notice.

(4)A decision notice must state the amount of the penalty.

(5)If the Authority decides to impose a penalty on a person under section 63A, the person may refer the matter to the Tribunal.

63CStatement of policyE+W+S+N.I.

(1)The Authority must prepare and issue a statement of its policy with respect to—

(a)the imposition of penalties under section 63A; and

(b)the amount of penalties under that section.

(2)The Authority's policy in determining whether a penalty should be imposed, and what the amount of a penalty should be, must include having regard to—

(a)the conduct of the person on whom the penalty is to be imposed;

(b)the extent to which the person could reasonably be expected to have known that a controlled function was performed without approval;

(c)the length of the period during which the person performed a controlled function without approval; and

(d)whether the person on whom the penalty is to be imposed is an individual.

(3)The Authority's policy in determining whether a penalty should be imposed on a person must also include having regard to the appropriateness of taking action against the person instead of, or in addition to, taking action against an authorised person.

(4)A statement issued under this section must include an indication of the circumstances in which the Authority would expect to be satisfied that a person could reasonably be expected to have known that the person was performing a controlled function without approval.

(5)The Authority may at any time alter or replace a statement issued under this section.

(6)If a statement issued under this section is altered or replaced, the Authority must issue the altered or replaced statement.

(7)The Authority must, without delay, give the Treasury a copy of any statement which it publishes under this section.

(8)A statement issued under this section must be published by the Authority in the way appearing to the Authority to be best calculated to bring it to the attention of the public.

(9)The Authority may charge a reasonable fee for providing a person with a copy of the statement.

(10)In exercising, or deciding whether to exercise, its power under section 63A in the case of any particular person, the Authority must have regard to any statement of policy published under this section and in force at a time when the person concerned performed a controlled function without approval.

63DStatement of policy: procedureE+W+S+N.I.

(1)Before issuing a statement under section 63C, the Authority must publish a draft of the proposed statement in the way appearing to the Authority to be best calculated to bring it to the attention of the public.

(2)The draft must be accompanied by notice that representations about the proposal may be made to the Authority within a specified time.

(3)Before issuing the proposed statement, the Authority must have regard to any representations made to it in accordance with subsection (2).

(4)If the Authority issues the proposed statement it must publish an account, in general terms, of—

(a)the representations made to it in accordance with subsection (2); and

(b)its response to them.

(5)If the statement differs from the draft published under subsection (1) in a way which is, in the opinion of the Authority, significant, the Authority must (in addition to complying with subsection (4)) publish details of the difference.

(6)The Authority may charge a reasonable fee for providing a person with a copy of a draft published under subsection (1).

(7)This section also applies to a proposal to alter or replace a statement.]

Conduct [F38of approved persons]E+W+S+N.I.

Annotations:

Amendments (Textual)

F38Words in cross-heading before s. 64 inserted (8.6.2010) by Financial Services Act 2010 (c. 28), ss. 24(1), 26(2)(d)(e), Sch. 2 para. 7

64 Conduct: statements and codes.E+W+S+N.I.

(1)The Authority may issue statements of principle with respect to the conduct expected of approved persons.

(2)If the Authority issues a statement of principle under subsection (1), it must also issue a code of practice for the purpose of helping to determine whether or not a person’s conduct complies with the statement of principle.

(3)A code issued under subsection (2) may specify—

(a)descriptions of conduct which, in the opinion of the Authority, comply with a statement of principle;

(b)descriptions of conduct which, in the opinion of the Authority, do not comply with a statement of principle;

(c)factors which, in the opinion of the Authority, are to be taken into account in determining whether or not a person’s conduct complies with a statement of principle.

(4)The Authority may at any time alter or replace a statement or code issued under this section.

(5)If a statement or code is altered or replaced, the altered or replacement statement or code must be issued by the Authority.

(6)A statement or code issued under this section must be published by the Authority in the way appearing to the Authority to be best calculated to bring it to the attention of the public.

(7)A code published under this section and in force at the time when any particular conduct takes place may be relied on so far as it tends to establish whether or not that conduct complies with a statement of principle.

(8)Failure to comply with a statement of principle under this section does not of itself give rise to any right of action by persons affected or affect the validity of any transaction.

(9)A person is not to be taken to have failed to comply with a statement of principle if he shows that, at the time of the alleged failure, it or its associated code of practice had not been published.

(10)The Authority must, without delay, give the Treasury a copy of any statement or code which it publishes under this section.

(11)The power under this section to issue statements of principle and codes of practice—

(a)includes power to make different provision in relation to persons, cases or circumstances of different descriptions; and

(b)is to be treated for the purposes of section 2(4)(a) as part of the Authority’s rule-making functions.

(12)The Authority may charge a reasonable fee for providing a person with a copy of a statement or code published under this section.

(13)Approved person” means a person in relation to whom the Authority has given its approval under section 59.

65 Statements and codes: procedure.E+W+S+N.I.

(1)Before issuing a statement or code under section 64, the Authority must publish a draft of it in the way appearing to the Authority to be best calculated to bring it to the attention of the public.

(2)The draft must be accompanied by —

(a)a cost benefit analysis; and

(b)notice that representations about the proposal may be made to the Authority within a specified time.

(3)Before issuing the proposed statement or code, the Authority must have regard to any representations made to it in accordance with subsection (2)(b).

(4)If the Authority issues the proposed statement or code it must publish an account, in general terms, of—

(a)the representations made to it in accordance with subsection (2)(b); and

(b)its response to them.

(5)If the statement or code differs from the draft published under subsection (1) in a way which is, in the opinion of the Authority, significant—

(a)the Authority must (in addition to complying with subsection (4)) publish details of the difference; and

(b)those details must be accompanied by a cost benefit analysis.

(6)Neither subsection (2)(a) nor subsection (5)(b) applies if the Authority considers—

(a)that, making the appropriate comparison, there will be no increase in costs; or

(b)that, making that comparison, there will be an increase in costs but the increase will be of minimal significance.

(7)Subsections (1) to (6) do not apply if the Authority considers that the delay involved in complying with them would prejudice the interests of consumers.

(8)A statement or code must state that it is issued under section 64.

(9)The Authority may charge a reasonable fee for providing a copy of a draft published under subsection (1).

(10)This section also applies to a proposal to alter or replace a statement or code.

(11)Cost benefit analysis” means an estimate of the costs together with an analysis of the benefits that will arise—

(a)if the proposed statement or code is issued; or

(b)if subsection (5)(b) applies, from the statement or code that has been issued.

(12)The appropriate comparison” means—

(a)in relation to subsection (2)(a), a comparison between the overall position if the statement or code is issued and the overall position if it is not issued;

(b)in relation to subsection (5)(b), a comparison between the overall position after the issuing of the statement or code and the overall position before it was issued.

66 Disciplinary powers.E+W+S+N.I.

(1)The Authority may take action against a person under this section if—

(a)it appears to the Authority that he is guilty of misconduct; and

(b)the Authority is satisfied that it is appropriate in all the circumstances to take action against him.

(2)A person is guilty of misconduct if, while an approved person—

(a)he has failed to comply with a statement of principle issued under section 64; or

(b)he has been knowingly concerned in a contravention by the relevant authorised person of a requirement imposed on that authorised person by or under this Act [F39or by any directly applicable Community regulation [F40or decision] made under the markets in financial instruments directive][F41or the UCITS directive].

(3)If the Authority is entitled to take action under this section against a person, [F42it may do one or more of the following—]

(a)impose a penalty on him of such amount as it considers appropriate;

[F43(aa)suspend, for such period as it considers appropriate, any approval of the performance by him of any function to which the approval relates;

(ab)impose, for such period as it considers appropriate, such limitations or other restrictions in relation to the performance by him of any function to which any approval relates as it considers appropriate;] or

(b)publish a statement of his misconduct.

[F44(3A)The period for which a suspension or restriction is to have effect may not exceed two years.

(3B)A suspension or restriction may have effect in relation to part of a function.

(3C)A restriction may, in particular, be imposed so as to require any person to take, or refrain from taking, specified action.

(3D)The Authority may—

(a)withdraw a suspension or restriction; or

(b)vary a suspension or restriction so as to reduce the period for which it has effect or otherwise to limit its effect.]

(4)The Authority may not take action under this section after the end of the period of [F45three years] beginning with the first day on which the Authority knew of the misconduct, unless proceedings in respect of it against the person concerned were begun before the end of that period.

(5)For the purposes of subsection (4)—

(a)the Authority is to be treated as knowing of misconduct if it has information from which the misconduct can reasonably be inferred; and

(b)proceedings against a person in respect of misconduct are to be treated as begun when a warning notice is given to him under section 67(1).

[F46(5A)Approval” means an approval given under section 59.]

(6)Approved person” has the same meaning as in section 64.

(7)Relevant authorised person”, in relation to an approved person, means the person on whose application approval F47. . . was given.

[F48(8)In relation to any time while a suspension is in force under subsection (3)(aa) in relation to part of a function, any reference in section 59 or 63A to the performance of a function includes the performance of part of a function.

(9)If at any time a restriction imposed under subsection (3)(ab) is contravened, the approval in relation to the person concerned is to be treated for the purposes of sections 59 and 63A as if it had been withdrawn at that time.]

Annotations:

Amendments (Textual)

F40Words in s. 66(2)(b) inserted (1.7.2011) by The Undertakings for Collective Investment in Transferable Securities Regulations 2011 (S.I. 2011/1613), reg. 2(2)(a)

F41Words in s. 66(2)(b) inserted (1.7.2011) by The Undertakings for Collective Investment in Transferable Securities Regulations 2011 (S.I. 2011/1613), reg. 2(2)(b)

Modifications etc. (not altering text)

C190S. 66 modified (1.12.2001) by S.I. 2001/2657, arts. 1(1), 9 (which was revoked (8.10.2001) by S.I. 2001/3083, arts. 1(2), 23); S.I. 2001/3538, art. 2(1)

S. 66 modified (1.12.2001) by S.I. 2001/3083, arts. 1(2), 9; S.I. 2001/3538, art. 2(1)

C192Ss. 66-70 applied (with modifications) (11.2.2010) by The Cross-Border Payments in Euro Regulations 2010 (S.I. 2010/89), reg. 19, Sch. para. 1

C194S. 66(3)(a) restricted (1.12.2001) by S.I. 2001/3592, arts. 1(2), 60(2) (with art. 23(2))

67 Disciplinary measures: procedure and right to refer to Tribunal.E+W+S+N.I.

(1)If the Authority proposes to take action against a person under section 66, it must give him a warning notice[F49; and if it proposes to take action under subsection (3)(aa) or (ab) of that section, it must also give each of the other interested parties a warning notice.]

(2)A warning notice about a proposal to impose a penalty must state the amount of the penalty.

[F50(2A)A warning notice about a proposal—

(a)to suspend an approval, or

(b)to impose a restriction in relation to the performance of a function,

must state the period for which the suspension or restriction is to have effect.]

(3)A warning notice about a proposal to publish a statement must set out the terms of the statement.

(4)If the Authority decides to take action against a person under section 66, it must give him a decision notice[F51; and if it decides to take action under subsection (3)(aa) or (ab) of that section, it must also give each of the other interested parties a decision notice.]

(5)A decision notice about the imposition of a penalty must state the amount of the penalty.

[F52(5A)A decision notice about—

(a)the suspension of an approval, or

(b)the imposition of a restriction in relation to the performance of a function,

must state the period for which the suspension or restriction is to have effect.]

(6)A decision notice about the publication of a statement must set out the terms of the statement.

(7)If the Authority decides to take action against a person under section 66, he may refer the matter to the Tribunal[F53; and if the Authority decides to take action under section 66(3)(aa) or (ab), each of the other interested parties may also refer the matter to the Tribunal.]

[F54(8)Approval” means an approval given under section 59.

(9)Other interested parties”, in relation to an approved person (“A”), are—

(a)the person on whose application the approval was given (“B”); and

(b)the person by whom A's services are retained, if not B.

The reference in this subsection to an approved person has the same meaning as in section 64.]

68 Publication.E+W+S+N.I.

After a statement under section 66 is published, the Authority must send a copy of it to the person concerned and to any person to whom a copy of the decision notice was given.

Annotations:

Modifications etc. (not altering text)

C201Ss. 66-70 applied (with modifications) (11.2.2010) by The Cross-Border Payments in Euro Regulations 2010 (S.I. 2010/89), reg. 19, Sch. para. 1

69 Statement of policy.E+W+S+N.I.

(1)The Authority must prepare and issue a statement of its policy with respect to—

[F55(a)the imposition of penalties, suspensions or restrictions under section 66;

(b)the amount of penalties under that section; and

(c)the period for which suspensions or restrictions under that section are to have effect.]

(2)The Authority’s policy in determining what the amount of a penalty should be [F56, or what the period for which a suspension or restriction is to have effect should be,] must include having regard to—

(a)the seriousness of the misconduct in question in relation to the nature of the principle or requirement concerned;

(b)the extent to which that misconduct was deliberate or reckless; and

(c)whether [F57the person against whom action is to be taken] is an individual.

(3)The Authority may at any time alter or replace a statement issued under this section.

(4)If a statement issued under this section is altered or replaced, the Authority must issue the altered or replacement statement.

(5)The Authority must, without delay, give the Treasury a copy of any statement which it publishes under this section.

(6)A statement issued under this section must be published by the Authority in the way appearing to the Authority to be best calculated to bring it to the attention of the public.

(7)The Authority may charge a reasonable fee for providing a person with a copy of the statement.

(8)In exercising, or deciding whether to exercise, its power under section 66 in the case of any particular misconduct, the Authority must have regard to any statement of policy published under this section and in force at the time when the misconduct in question occurred.

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

C204Ss. 66-70 applied (with modifications) (11.2.2010) by The Cross-Border Payments in Euro Regulations 2010 (S.I. 2010/89), reg. 19, Sch. para. 1

C205S. 69 applied (with modifications) (7.6.2010) by The Credit Rating Agencies Regulations 2010 (S.I. 2010/906), reg. 22(1)

70 Statements of policy: procedure.E+W+S+N.I.

(1)Before issuing a statement under section 69, the Authority must publish a draft of the proposed statement in the way appearing to the Authority to be best calculated to bring it to the attention of the public.

(2)The draft must be accompanied by notice that representations about the proposal may be made to the Authority within a specified time.

(3)Before issuing the proposed statement, the Authority must have regard to any representations made to it in accordance with subsection (2).

(4)If the Authority issues the proposed statement it must publish an account, in general terms, of—

(a)the representations made to it in accordance with subsection (2); and

(b)its response to them.

(5)If the statement differs from the draft published under subsection (1) in a way which is, in the opinion of the Authority, significant, the Authority must (in addition to complying with subsection (4)) publish details of the difference.

(6)The Authority may charge a reasonable fee for providing a person with a copy of a draft published under subsection (1).

(7)This section also applies to a proposal to alter or replace a statement.

Annotations:

Modifications etc. (not altering text)

C208Ss. 66-70 applied (with modifications) (11.2.2010) by The Cross-Border Payments in Euro Regulations 2010 (S.I. 2010/89), reg. 19, Sch. para. 1

C209S. 70 applied (with modifications) (7.6.2010) by The Credit Rating Agencies Regulations 2010 (S.I. 2010/906), reg. 22(1)

Breach of statutory dutyE+W+S+N.I.

71 Actions for damages.E+W+S+N.I.

(1)A contravention of section 56(6) or 59(1) or (2) is actionable at the suit of a private person who suffers loss as a result of the contravention, subject to the defences and other incidents applying to actions for breach of statutory duty.

(2)In prescribed cases, a contravention of that kind which would be actionable at the suit of a private person is actionable at the suit of a person who is not a private person, subject to the defences and other incidents applying to actions for breach of statutory duty.

(3)Private person” has such meaning as may be prescribed.

Annotations:

Commencement Information

I24S. 71 wholly in force at 1.12.2001; s. 71 not in force at Royal Assent see s. 431(2); s. 71(2)(3) in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b), Sch. Pt. 2; s. 71 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

Part VIE+W+S+N.I. Official Listing

Annotations:

Modifications etc. (not altering text)

C211Pt. VI (ss. 72-103) applied (with modifications) (1.12.2001) by S.I. 1995/1537, Sch. 4 (as amended (1.12.2001) by S.I. 2001/3649, arts. 1, 511)

The competent authorityE+W+S+N.I.

72 The competent authority.E+W+S+N.I.

(1)On the coming into force of this section, the functions conferred on the competent authority by this Part are to be exercised by the Authority.

(2)Schedule 7 modifies this Act in its application to the Authority when it acts as the competent authority.

(3)But provision is made by Schedule 8 allowing some or all of those functions to be transferred by the Treasury so as to be exercisable by another person.

73 General duty of the competent authority.E+W+S+N.I.

(1)In discharging its general functions the competent authority must have regard to—

(a)the need to use its resources in the most efficient and economic way;

(b)the principle that a burden or restriction which is imposed on a person should be proportionate to the benefits, considered in general terms, which are expected to arise from the imposition of that burden or restriction;

[F58(c)the desirability of facilitating innovation in respect of listed securities and in respect of financial instruments which have otherwise been admitted to trading on a regulated market or for which a request for admission to trading on such a market has been made;]

(d)the international character of capital markets and the desirability of maintaining the competitive position of the United Kingdom;

(e)the need to minimise the adverse effects on competition of anything done in the discharge of those functions;

[F59(f)the desirability of facilitating competition in relation to listed securities and in relation to financial instruments which have otherwise been admitted to trading on a regulated market or for which a request for admission to trading on such a market has been made.]

[F60(1A)To the extent that those general functions are functions under or relating to transparency rules, subsection (1)(c) and (f) have effect as if the references to a regulated market were references to a market.]

(2)The competent authority’s general functions are—

(a)its function of making rules under this Part (considered as a whole);

(b)its functions in relation to the giving of general guidance in relation to this Part (considered as a whole);

(c)its function of determining the general policy and principles by reference to which it performs particular functions under this Part.

[F6173APart 6 RulesE+W+S+N.I.

(1)The competent authority may make rules (“Part 6 rules”) for the purposes of this Part.

(2)Provisions of Part 6 rules expressed to relate to the official list are referred to in this Part as “listing rules”.

(3)Provisions of Part 6 rules expressed to relate to disclosure of information in respect of financial instruments which have been admitted to trading on a regulated market or for which a request for admission to trading on such a market has been made, are referred to in this Part as “disclosure rules”.

[F62(4)Provisions of Part 6 rules expressed to relate to transferable securities are referred to in this Part as “prospectus rules”.

(5)In relation to prospectus rules, the purposes of this Part include the purposes of the prospectus directive.]

[F63(6)Transparency rules and corporate governance rules are not listing rules, disclosure rules or prospectus rules, but are Part 6 rules.]]

The official listE+W+S+N.I.

74 The official list.E+W+S+N.I.

(1)The competent authority must maintain the official list.

(2)The competent authority may admit to the official list such securities and other things as it considers appropriate.

(3)But—

(a)nothing may be admitted to the official list except in accordance with this Part; and

(b)the Treasury may by order provide that anything which falls within a description or category specified in the order may not be admitted to the official list.

(4)F64. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)In the following provisions of this Part—

  • F65. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

  • listing” means being included in the official list in accordance with this Part.

Annotations:

Amendments (Textual)

F65S. 74(5): definition of "security" omitted (1.7.2005) by virtue of The Prospectus Regulations 2005 (S.I. 2005/1433), reg. 2(1), Sch. 1 para. 2

Modifications etc. (not altering text)

Commencement Information

I25S. 74 wholly in force at 1.12.2001; s. 74 not in force at Royal Assent see s. 431(2); s. 74(4)(5) in force at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 74 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

ListingE+W+S+N.I.

75 Applications for listing.E+W+S+N.I.

(1)Admission to the official list may be granted only on an application made to the competent authority in such manner as may be required by listing rules.

(2)No application for listing may be entertained by the competent authority unless it is made by, or with the consent of, the issuer of the securities concerned.

(3)No application for listing may be entertained by the competent authority in respect of securities which are to be issued by a body of a prescribed kind.

(4)The competent authority may not grant an application for listing unless it is satisfied that—

(a)the requirements of listing rules (so far as they apply to the application), and

(b)any other requirements imposed by the authority in relation to the application,

are complied with.

(5)An application for listing may be refused if, for a reason relating to the issuer, the competent authority considers that granting it would be detrimental to the interests of investors.

(6)An application for listing securities which are already officially listed in another EEA State may be refused if the issuer has failed to comply with any obligations to which he is subject as a result of that listing.

Annotations:

Modifications etc. (not altering text)

Commencement Information

I26S. 75 wholly in force at 1.12.2001; s. 75 not in force at Royal Assent see s. 431(2); s. 75(3) in force for specified purposes at 25.2.2001 by S.I. 2001/516, art. 2(b), Sch. Pt. 2; s. 75(1) in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 75 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

76 Decision on application.E+W+S+N.I.

(1)The competent authority must notify the applicant of its decision on an application for listing—

(a)before the end of the period of six months beginning with the date on which the application is received; or

(b)if within that period the authority has required the applicant to provide further information in connection with the application, before the end of the period of six months beginning with the date on which that information is provided.

(2)If the competent authority fails to comply with subsection (1), it is to be taken to have decided to refuse the application.

(3)If the competent authority decides to grant an application for listing, it must give the applicant written notice.

(4)If the competent authority proposes to refuse an application for listing, it must give the applicant a warning notice.

(5)If the competent authority decides to refuse an application for listing, it must give the applicant a decision notice.

(6)If the competent authority decides to refuse an application for listing, the applicant may refer the matter to the Tribunal.

(7)If securities are admitted to the official list, their admission may not be called in question on the ground that any requirement or condition for their admission has not been complied with.

Annotations:

Modifications etc. (not altering text)

77 Discontinuance and suspension of listing.E+W+S+N.I.

(1)The competent authority may, in accordance with listing rules, discontinue the listing of any securities if satisfied that there are special circumstances which preclude normal regular dealings in them.

(2)The competent authority may, in accordance with listing rules, suspend the listing of any securities.

[F66(2A)The competent authority may discontinue under subsection (1) or suspend under subsection (2) the listing of any securities on its own initiative or on the application of the issuer of those securities.]

(3)If securities are suspended under subsection (2) they are to be treated, for the purposes of sections 96 and 99, as still being listed.

(4)This section applies to securities whenever they were admitted to the official list.

(5)If the competent authority discontinues or suspends the listing of any securities, [F67on its own initiative,] the issuer may refer the matter to the Tribunal.

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

Commencement Information

I27S. 77 wholly in force at 1.12.2001; s. 77 not in force at Royal Assent see s. 431(2); s. 77(1)(2)(4) in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 77 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

78 Discontinuance or suspension: procedure.E+W+S+N.I.

(1)A discontinuance or suspension [F68by the competent authority on its own initiative] takes effect—

(a)immediately, if the notice under subsection (2) states that that is the case;

(b)in any other case, on such date as may be specified in that notice.

(2)If [F69on its own initiative] the competent authority—

(a)proposes to discontinue or suspend the listing of securities, or

(b)discontinues or suspends the listing of securities with immediate effect,

it must give the issuer of the securities written notice.

(3)The notice must—

(a)give details of the discontinuance or suspension;

(b)state the competent authority’s reasons for the discontinuance or suspension and for choosing the date on which it took effect or takes effect;

(c)inform the issuer of the securities that he may make representations to the competent authority within such period as may be specified in the notice (whether or not he has referred the matter to the Tribunal);

(d)inform him of the date on which the discontinuance or suspension took effect or will take effect; and

(e)inform him of his right to refer the matter to the Tribunal.

(4)The competent authority may extend the period within which representations may be made to it.

(5)If, having considered any representations made by the issuer of the securities, the competent authority decides—

(a)to discontinue or suspend the listing of the securities, or

(b)if the discontinuance or suspension has taken effect, not to cancel it,

the competent authority must give the issuer of the securities written notice.

(6)A notice given under subsection (5) must inform the issuer of the securities of his right to refer the matter to the Tribunal.

(7)If a notice informs a person of his right to refer a matter to the Tribunal, it must give an indication of the procedure on such a reference.

(8)If the competent authority decides—

(a)not to discontinue or suspend the listing of the securities, or

(b)if the discontinuance or suspension has taken effect, to cancel it,

the competent authority must give the issuer of the securities written notice.

(9)The effect of cancelling a discontinuance is that the securities concerned are to be readmitted, without more, to the official list.

(10)If the competent authority has suspended the listing of securities [F70on its own initiative] and proposes to refuse an application by the issuer of the securities for the cancellation of the suspension, it must give him a warning notice.

(11)The competent authority must, having considered any representations made in response to the warning notice—

(a)if it decides to refuse the application, give the issuer of the securities a decision notice;

(b)if it grants the application, give him written notice of its decision.

(12)If the competent authority decides to refuse an application for the cancellation of the suspension of listed securities, the applicant may refer the matter to the Tribunal.

(13)Discontinuance” means a discontinuance of listing under section 77(1).

(14)Suspension” means a suspension of listing under section 77(2).

[F7178ADiscontinuance or suspension at the request of the issuer: procedureE+W+S+N.I.

(1)A discontinuance or suspension by the competent authority on the application of the issuer of the securities takes effect—

(a)immediately, if the notice under subsection (2) states that this is the case;

(b)in any other case, on such date as may be specified in that notice.

(2)If the competent authority discontinues or suspends the listing of securities on the application of the issuer of the securities it must give him written notice.

(3)The notice must—

(a)give details of the discontinuance or suspension;

(b)inform the issuer of the securities of the date on which the discontinuance or suspension took effect or will take effect; and

(c)inform the issuer of his right to apply for the cancellation of the suspension.

(4)If the competent authority proposes to refuse an application by the issuer of the securities for the discontinuance or suspension of the listing of the securities, it must give him a warning notice.

(5)The competent authority must, having considered any representations made in response to the warning notice, if it decides to refuse the application, give the issuer of the securities a decision notice.

(6)If the competent authority decides to refuse an application by the issuer of the securities for the discontinuance or suspension of the listing of the securities, the issuer may refer the matter to the Tribunal.

(7)If the competent authority has suspended the listing of securities on the application of the issuer of the securities and proposes to refuse an application by the issuer for the cancellation of the suspension, it must give him a warning notice.

(8)The competent authority must, having considered any representations made in response to the warning notice—

(a)if it decides to refuse the application for the cancellation of the suspension, give the issuer of the securities a decision notice;

(b)if it grants the application, give him written notice of its decision.

(9)If the competent authority decides to refuse an application for the cancellation of the suspension of listed securities, the applicant may refer the matter to the Tribunal.

(10)Discontinuance” means a discontinuance of listing under section 77(1).

(11)Suspension” means a suspension of listing under section 77(2).]

Listing particularsE+W+S+N.I.

79 Listing particulars and other documents.E+W+S+N.I.

(1)Listing rules may provide that securities F72. . . of a kind specified in the rules may not be admitted to the official list unless—

(a)listing particulars have been submitted to, and approved by, the competent authority and published; or

(b)in such cases as may be specified by listing rules, such document (other than listing particulars or a prospectus of a kind required by listing rules) as may be so specified has been published.

(2)Listing particulars” means a document in such form and containing such information as may be specified in listing rules.

(3)For the purposes of this Part, the persons responsible for listing particulars are to be determined in accordance with regulations made by the Treasury.

[F73(3A)Listing rules made under subsection (1) may not specify securities of a kind for which an approved prospectus is required as a result of section 85.]

(4)Nothing in this section affects the competent authority’s general power to make listing rules.

Annotations:

Amendments (Textual)

Modifications etc. (not altering text)

Commencement Information

I28S. 79 wholly in force at 18.6.2001; s. 79 not in force at Royal Assent see s. 431(2); s. 79(3) in force at 25.2.2001 by S.I. 2001/516, art. 2(a), Sch. Pt. 1; s. 79 in force so far as not already in force at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.

80 General duty of disclosure in listing particulars.E+W+S+N.I.

(1)Listing particulars submitted to the competent authority under section 79 must contain all such information as investors and their professional advisers would reasonably require, and reasonably expect to find there, for the purpose of making an informed assessment of—

(a)the assets and liabilities, financial position, profits and losses, and prospects of the issuer of the securities; and

(b)the rights attaching to the securities.

(2)That information is required in addition to any information required by—

(a)listing rules, or

(b)the competent authority,

as a condition of the admission of the securities to the official list.

(3)Subsection (1) applies only to information—

(a)within the knowledge of any person responsible for the listing particulars; or

(b)which it would be reasonable for him to obtain by making enquiries.

(4)In determining what information subsection (1) requires to be included in listing particulars, regard must be had (in particular) to—

(a)the nature of the securities and their issuer;

(b)the nature of the persons likely to consider acquiring them;

(c)the fact that certain matters may reasonably be expected to be within the knowledge of professional advisers of a kind which persons likely to acquire the securities may reasonably be expected to consult; and

(d)any information available to investors or their professional advisers as a result of requirements imposed on the issuer of the securities by a recognised investment exchange, by listing rules or by or under any other enactment.

81 Supplementary listing particulars.E+W+S+N.I.

(1)If at any time after the preparation of listing particulars which have been submitted to the competent authority under section 79 and before the commencement of dealings in the securities concerned following their admission to the official list—

(a)there is a significant change affecting any matter contained in those particulars the inclusion of which was required by—

(i)section 80,

(ii)listing rules, or

(iii)the competent authority, or

(b)a significant new matter arises, the inclusion of information in respect of which would have been so required if it had arisen when the particulars were prepared,

the issuer must, in accordance with listing rules, submit supplementary listing particulars of the change or new matter to the competent authority, for its approval and, if they are approved, publish them.

(2)Significant” means significant for the purpose of making an informed assessment of the kind mentioned in section 80(1).

(3)If the issuer of the securities is not aware of the change or new matter in question, he is not under a duty to comply with subsection (1) unless he is notified of the change or new matter by a person responsible for the listing particulars.

(4)But it is the duty of any person responsible for those particulars who is aware of such a change or new matter to give notice of it to the issuer.

(5)Subsection (1) applies also as respects matters contained in any supplementary listing particulars previously published under this section in respect of the securities in question.

Annotations:

Modifications etc. (not altering text)

Commencement Information

I29S. 81 wholly in force at 1.12.2001; s. 81 not in force at Royal Assent see s. 431(2); s. 81(1)(5) in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 81 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

82 Exemptions from disclosure.E+W+S+N.I.

(1)The competent authority may authorise the omission from listing particulars of any information, the inclusion of which would otherwise be required by section 80 or 81, on the ground—

(a)that its disclosure would be contrary to the public interest;

(b)that its disclosure would be seriously detrimental to the issuer; or

(c)in the case of securities of a kind specified in listing rules, that its disclosure is unnecessary for persons of the kind who may be expected normally to buy or deal in securities of that kind.

(2)But—

(a)no authority may be granted under subsection (1)(b) in respect of essential information; and

(b)no authority granted under subsection (1)(b) extends to any such information.

(3)The Secretary of State or the Treasury may issue a certificate to the effect that the disclosure of any information (including information that would otherwise have to be included in listing particulars for which they are themselves responsible) would be contrary to the public interest.

(4)The competent authority is entitled to act on any such certificate in exercising its powers under subsection (1)(a).

(5)This section does not affect any powers of the competent authority under listing rules made as a result of section 101(2).

(6)Essential information” means information which a person considering acquiring securities of the kind in question would be likely to need in order not to be misled about any facts which it is essential for him to know in order to make an informed assessment.

(7)Listing particulars” includes supplementary listing particulars.

Annotations:

Commencement Information

I30S. 82 wholly in force at 1.12.2001; s. 82 not in force at Royal Assent see s. 431(2); s. 82(1)(5)(7) in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 82 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

83 Registration of listing particulars.E+W+S+N.I.

F74. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Annotations:

Amendments (Textual)

[F75Transferable securities: public offers and admission to trading]E+W+S+N.I.

Annotations:

Amendments (Textual)

F75Ss. 84-87R and cross-headings substituted for ss. 84-87 (1.7.2005) by The Prospectus Regulations 2005 (S.I. 2005/1433), reg. 2(1), Sch. 1 para. 5

[F7684Matters which may be dealt with by prospectus rulesE+W+S+N.I.

(1)Prospectus rules may make provision as to—

(a)the required form and content of a prospectus (including a summary);

(b)the cases in which a summary need not be included in a prospectus;

(c)the languages which may be used in a prospectus (including a summary);

(d)the determination of the persons responsible for a prospectus;

(e)the manner in which applications to the competent authority for the approval of a prospectus are to be made.

(2)Prospectus rules may also make provision as to—

(a)the period of validity of a prospectus;

(b)the disclosure of the maximum price or of the criteria or conditions according to which the final offer price is to be determined, if that information is not contained in a prospectus;

(c)the disclosure of the amount of the transferable securities which are to be offered to the public or of the criteria or conditions according to which that amount is to be determined, if that information is not contained in a prospectus;

(d)the required form and content of other summary documents (including the languages which may be used in such a document);

(e)the ways in which a prospectus that has been approved by the competent authority may be made available to the public;

(f)the disclosure, publication or other communication of such information as the competent authority may reasonably stipulate;

(g)the principles to be observed in relation to advertisements in connection with an offer of transferable securities to the public or admission of transferable securities to trading on a regulated market and the enforcement of those principles;

(h)the suspension of trading in transferable securities where continued trading would be detrimental to the interests of investors;

(i)elections under section 87 or under Article 2.1(m)(iii) of the prospectus directive as applied for the purposes of this Part by section 102C.

(3)Prospectus rules may also make provision as to—

(a)access to the register of investors maintained under section 87R; and

(b)the supply of information from that register.

(4)Prospectus rules may make provision for the purpose of dealing with matters arising out of or related to any provision of the prospectus directive.

(5)In relation to cases where the home State in relation to an issuer of transferable securities is an EEA State other than the United Kingdom, prospectus rules may make provision for the recognition of elections made in relation to such securities under the law of that State in accordance with Article 1.3 or 2.1(m)(iii) of the prospectus directive.

(6)In relation to a document relating to transferable securities issued by an issuer incorporated in a non-EEA State and drawn up in accordance with the law of that State, prospectus rules may make provision as to the approval of that document as a prospectus.

(7)Nothing in this section affects the competent authority's general power to make prospectus rules.]

Annotations:

Amendments (Textual)

F76Ss. 84-87R and cross-headings substituted for ss. 84-87 (1.7.2005) by The Prospectus Regulations 2005 (S.I. 2005/1433), reg. 2(1), Sch. 1 para. 5

[F7785Prohibition of dealing etc. in transferable securities without approved prospectusE+W+S+N.I.

(1)It is unlawful for transferable securities to which this subsection applies to be offered to the public in the United Kingdom unless an approved prospectus has been made available to the public before the offer is made.

(2)It is unlawful to request the admission of transferable securities to which this subsection applies to trading on a regulated market situated or operating in the United Kingdom unless an approved prospectus has been made available to the public before the request is made.

(3)A person who contravenes subsection (1) or (2) is guilty of an offence and liable—

(a)on summary conviction, to imprisonment for a term not exceeding 3 months or a fine not exceeding the statutory maximum or both;

(b)on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine or both.

(4)A contravention of subsection (1) or (2) is actionable, at the suit of a person who suffers loss as a result of the contravention, subject to the defences and other incidents applying to actions for breach of statutory duty.

(5)Subsection (1) applies to all transferable securities other than—

(a)those listed in Schedule 11A;

(b)such other transferable securities as may be specified in prospectus rules.

(6)Subsection (2) applies to all transferable securities other than—

(a)those listed in Part 1 of Schedule 11A;

(b)such other transferable securities as may be specified in prospectus rules.

(7)Approved prospectus” means, in relation to transferable securities to which this section applies, a prospectus approved by the competent authority of the home State in relation to the issuer of the securities.]

Annotations:

Amendments (Textual)

F77Ss. 84-87R and cross-headings substituted for ss. 84-87 (1.7.2005) by The Prospectus Regulations 2005 (S.I. 2005/1433), reg. 2(1), Sch. 1 para. 5

[F7886Exempt offers to the publicE+W+S+N.I.

(1)A person does not contravene section 85(1) if—

(a)the offer is made to or directed at qualified investors only;

(b)the offer is made to or directed at fewer than [F79150 persons], other than qualified investors, per EEA State;

(c)the minimum consideration which may be paid by any person for transferable securities acquired by him pursuant to the offer is at least 50,000 euros (or an equivalent amount);

(d)the transferable securities being offered are denominated in amounts of at least 50,000 euros (or equivalent amounts); or

(e)the total consideration for the transferable securities being offered cannot exceed 100,000 euros (or an equivalent amount).

(2)Where—

(a)a person who is not a qualified investor (“the client”) has engaged a qualified investor falling within Article 2.1(e)(i) of the prospectus directive to act as his agent, and

(b)the terms on which the qualified investor is engaged enable him to make decisions concerning the acceptance of offers of transferable securities on the client's behalf without reference to the client,

an offer made to or directed at the qualified investor is not to be regarded for the purposes of subsection (1) as also having been made to or directed at the client.

(3)For the purposes of subsection (1)(b), the making of an offer of transferable securities to—

(a)trustees of a trust,

(b)members of a partnership in their capacity as such, or

(c)two or more persons jointly,

is to be treated as the making of an offer to a single person.

(4)In determining whether subsection (1)(e) is satisfied in relation to an offer (“offer A”), offer A is to be taken together with any other offer of transferable securities of the same class made by the same person which—

(a)was open at any time within the period of 12 months ending with the date on which offer A is first made; and

(b)had previously satisfied subsection (1)(e).

(5)For the purposes of this section, an amount (in relation to an amount denominated in euros) is an “equivalent amount” if it is an amount of equal value denominated wholly or partly in another currency or unit of account.

(6)The equivalent is to be calculated at the latest practicable date before (but in any event not more than 3 working days before) the date on which the offer is first made.

(7)Qualified investor” means—

(a)an entity falling within Article 2.1(e)(i), (ii) or (iii) of the prospectus directive;

(b)an investor registered on the register maintained by the competent authority under section 87R;

(c)an investor authorised by an EEA State other than the United Kingdom to be considered as a qualified investor for the purposes of the prospectus directive.]

Annotations:

Amendments (Textual)

F78Ss. 84-87R and cross-headings substituted for ss. 84-87 (1.7.2005) by The Prospectus Regulations 2005 (S.I. 2005/1433), reg. 2(1), Sch. 1 para. 5

[F8087Election to have prospectusE+W+S+N.I.

(1)A person who proposes—

(a)to issue transferable securities to which this section applies,

(b)to offer to the public transferable securities to which this section applies, or

(c)to request the admission to a regulated market of transferable securities to which this section applies,

may elect, in accordance with prospectus rules, to have a prospectus in relation to the securities.

(2)If a person makes such an election, the provisions of this Part and of prospectus rules apply in relation to those transferable securities as if, in relation to an offer of the securities to the public or the admission of the securities to trading on a regulated market, they were transferable securities for which an approved prospectus would be required as a result of section 85.

(3)Listing rules made under section 79 do not apply to securities which are the subject of an election.

(4)The transferable securities to which this section applies are those which fall within any of the following paragraphs of Schedule 11A—

(a)paragraph 2,

(b)paragraph 4,

(c)paragraph 8, or

(d)paragraph 9,

where the United Kingdom is the home State in relation to the issuer of the securities.]

Annotations:

Amendments (Textual)

F80Ss. 84-87R and cross-headings substituted for ss. 84-87 (1.7.2005) by The Prospectus Regulations 2005 (S.I. 2005/1433), reg. 2(1), Sch. 1 para. 5

Modifications etc. (not altering text)

C219S. 87 extended (1.12.2001) by S.I. 2001/2957, arts. 1, 6(4); S.I. 2001/3538, art. 2(1)

[F81Approval of prospectusE+W+S+N.I.

Annotations:

Amendments (Textual)

F81Ss. 84-87R and cross-headings substituted for ss. 84-87 (1.7.2005) by The Prospectus Regulations 2005 (S.I. 2005/1433), reg. 2(1), Sch. 1 para. 5

87ACriteria for approval of prospectus by competent authorityE+W+S+N.I.

(1)The competent authority may not approve a prospectus unless it is satisfied that—

(a)the United Kingdom is the home State in relation to the issuer of the transferable securities to which it relates,

(b)the prospectus contains the necessary information, and

(c)all of the other requirements imposed by or in accordance with this Part or the prospectus directive have been complied with (so far as those requirements apply to a prospectus for the transferable securities in question).

(2)The necessary information is the information necessary to enable investors to make an informed assessment of—

(a)the assets and liabilities, financial position, profits and losses, and prospects of the issuer of the transferable securities and of any guarantor; and

(b)the rights attaching to the transferable securities.

(3)The necessary information must be presented in a form which is comprehensible and easy to analyse.

(4)The necessary information must be prepared having regard to the particular nature of the transferable securities and their issuer.

(5)The prospectus must include a summary (unless the transferable securities in question are ones in relation to which prospectus rules provide that a summary is not required).

(6)The summary must, briefly and in non-technical language, convey the essential characteristics of, and risks associated with, the issuer, any guarantor and the transferable securities to which the prospectus relates.

(7)Where the prospectus for which approval is sought does not include the final offer price or the amount of transferable securities to be offered to the public, the applicant must inform the competent authority in writing of that information as soon as that element is finalised.

(8)“Prospectus” (except in subsection (5)) includes a supplementary prospectus.

87BExemptions from disclosureE+W+S+N.I.

(1)The competent authority may authorise the omission from a prospectus of any information, the inclusion of which would otherwise be required, on the ground—

(a)that its disclosure would be contrary to the public interest;

(b)that its disclosure would be seriously detrimental to the issuer, provided that the omission would be unlikely to mislead the public with regard to any facts or circumstances which are essential for an informed assessment of the kind mentioned in section 87A(2); or

(c)that the information is only of minor importance for a specific offer to the public or admission to trading on a regulated market and unlikely to influence an informed assessment of the kind mentioned in section 87A(2).

(2)The Secretary of State or the Treasury may issue a certificate to the effect that the disclosure of any information would be contrary to the public interest.

(3)The competent authority is entitled to act on any such certificate in exercising its powers under subsection (1)(a).

(4)This section does not affect any powers of the competent authority under prospectus rules.

(5)Prospectus” includes a supplementary prospectus.

87CConsideration of application for approvalE+W+S+N.I.

(1)The competent authority must notify the applicant of its decision on an application for approval of a prospectus before the end of the period for consideration.

(2)The period for consideration—

(a)begins with the first working day after the date on which the application is received; but

(b)if the competent authority gives a notice under subsection (4), is to be treated as beginning with the first working day after the date on which the notice is complied with.

(3)The period for consideration is—

(a)except in the case of a new issuer, 10 working days; or

(b)in that case, 20 working days.

(4)The competent authority may by notice in writing require a person who has applied for approval of a prospectus to provide—

(a)specified documents or documents of a specified description, or

(b)specified information or information of a specified description.

(5)No notice under subsection (4) may be given after the end of the period, beginning with the first working day after the date on which the application is received, of—

(a)except in the case of a new issuer, 10 working days; or

(b)in that case, 20 working days.

(6)Subsection (4) applies only to information and documents reasonably required in connection with the exercise by the competent authority of its functions in relation to the application.

(7)The competent authority may require any information provided under this section to be provided in such form as it may reasonably require.

(8)The competent authority may require—

(a)any information provided, whether in a document or otherwise, to be verified in such manner, or

(b)any document produced to be authenticated in such manner,

as it may reasonably require.

(9)The competent authority must notify the applicant of its decision on an application for approval of a supplementary prospectus before the end of the period of 7 working days beginning with the date on which the application is received; and subsections (4) and (6) to (8) apply to such an application as they apply to an application for approval of a prospectus.

(10)The competent authority's failure to comply with subsection (1) or (9) does not constitute approval of the application in question.

(11)New issuer” means an issuer of transferable securities which—

(a)does not have transferable securities admitted to trading on any regulated market; and

(b)has not previously offered transferable securities to the public.

87DProcedure for decision on application for approvalE+W+S+N.I.

(1)If the competent authority approves a prospectus, it must give the applicant written notice.

(2)If the competent authority proposes to refuse to approve a prospectus, it must give the applicant written notice.

(3)The notice must state the competent authority's reasons for the proposed refusal.

(4)If the competent authority decides to refuse to approve a prospectus, it must give the applicant written notice.

(5)The notice must—

(a)give the competent authority's reasons for refusing the application; and

(b)inform the applicant of his right to refer the matter to the Tribunal.

(6)If the competent authority refuses to approve a prospectus, the applicant may refer the matter to the Tribunal.

(7)In this section “prospectus” includes a supplementary prospectus.

Transfer of application for approval of a prospectusE+W+S+N.I.

87ETransfer by competent authority of application for approvalE+W+S+N.I.

(1)The competent authority may transfer an application for the approval of a prospectus or a supplementary prospectus to the competent authority of another EEA State (“the transferee authority”).

(2)Before doing so, the competent authority must obtain the agreement of the transferee authority.

(3)The competent authority must inform the applicant of the transfer within 3 working days beginning with the first working day after the date of the transfer.

(4)On making a transfer under subsection (1), the competent authority ceases to have functions under this Part in relation to the application transferred.

87FTransfer to competent authority of application for approvalE+W+S+N.I.

(1)Where the competent authority agrees to the transfer to it of an application for the approval of a prospectus made to the competent authority of another EEA State—

(a)the United Kingdom is to be treated for the purposes of this Part as the home State in relation to the issuer of the transferable securities to which the prospectus relates, and

(b)this Part applies to the application as if it had been made to the competent authority but with the modification in subsection (2).

(2)Section 87C applies as if the date of the transfer were the date on which the application was received by the competent authority.

Supplementary prospectusE+W+S+N.I.

87GSupplementary prospectusE+W+S+N.I.

(1)Subsection (2) applies if, during the relevant period, there arises or is noted a significant new factor, material mistake or inaccuracy relating to the information included in a prospectus approved by the competent authority.

(2)The person on whose application the prospectus was approved must, in accordance with prospectus rules, submit a supplementary prospectus containing details of the new factor, mistake or inaccuracy to the competent authority for its approval.

(3)The relevant period begins when the prospectus is approved and ends—

(a)with the closure of the offer of the transferable securities to which the prospectus relates; or

(b)when trading in those securities on a regulated market begins.

(4)Significant” means significant for the purposes of making an informed assessment of the kind mentioned in section 87A(2).

(5)Any person responsible for the prospectus who is aware of any new factor, mistake or inaccuracy which may require the submission of a supplementary prospectus in accordance with subsection (2) must give notice of it to—

(a)the issuer of the transferable securities to which the prospectus relates, and

(b)the person on whose application the prospectus was approved.

(6)A supplementary prospectus must provide sufficient information to correct any mistake or inaccuracy which gave rise to the need for it.

(7)Subsection (1) applies also to information contained in any supplementary prospectus published under this section.

PassportingE+W+S+N.I.

87HProspectus approved in another EEA StateE+W+S+N.I.

(1)A prospectus approved by the competent authority of an EEA State other than the United Kingdom is not an approved prospectus for the purposes of section 85 unless that authority has provided the competent authority with—

(a)a certificate of approval;

(b)a copy of the prospectus as approved; and

(c)if requested by the competent authority, a translation of the summary of the prospectus.

(2)A document is not a certificate of approval unless it states that the prospectus—

(a)has been drawn up in accordance with the prospectus directive; and

(b)has been approved, in accordance with that directive, by the competent authority providing the certificate.

(3)A document is not a certificate of approval unless it states whether (and, if so, why) the competent authority providing it authorised, in accordance with the prospectus directive, the omission from the prospectus of information which would otherwise have been required to be included.

(4)Prospectus” includes a supplementary prospectus.

87IProvision of information to host Member StateE+W+S+N.I.

(1)The competent authority must, if requested to do so, supply the competent authority of a specified EEA State with—

(a)a certificate of approval;

(b)a copy of the specified prospectus (as approved by the competent authority); and

(c)a translation of the summary of the specified prospectus (if the request states that one has been requested by the other competent authority).

(2)Only the following may make a request under this section—

(a)the issuer of the transferable securities to which the specified prospectus relates;

(b)a person who wishes to offer the transferable securities to which the specified prospectus relates to the public in an EEA State other than (or as well as) the United Kingdom;

(c)a person requesting the admission of the transferable securities to which the specified prospectus relates to a regulated market situated or operating in an EEA State other than (or as well as) the United Kingdom.

(3)A certificate of approval must state that the prospectus—

(a)has been drawn up in accordance with this Part and the prospectus directive; and

(b)has been approved, in accordance with those provisions, by the competent authority.

(4)A certificate of approval must state whether (and, if so, why) the competent authority authorised, in accordance with section 87B, the omission from the prospectus of information which would otherwise have been required to be included.

(5)The competent authority must comply with a request under this section—

(a)if the prospectus has been approved before the request is made, within 3 working days beginning with the date of the request; or

(b)if the request is submitted with an application for the approval of the prospectus, on the first working day after the date on which it approves the prospectus.

(6)Prospectus” includes a supplementary prospectus.

(7)Specified” means specified in a request made for the purposes of this section.

Transferable securities: powers of competent authorityE+W+S+N.I.

87JRequirements imposed as condition of approvalE+W+S+N.I.

(1)As a condition of approving a prospectus, the competent authority may by notice in writing—

(a)require the inclusion in the prospectus of such supplementary information necessary for investor protection as the competent authority may specify;

(b)require a person controlling, or controlled by, the applicant to provide specified information or documents;

(c)require an auditor or manager of the applicant to provide specified information or documents;

(d)require a financial intermediary commissioned to assist either in carrying out the offer to the public of the transferable securities to which the prospectus relates or in requesting their admission to trading on a regulated market, to provide specified information or documents.

(2)Specified” means specified in the notice.

(3)Prospectus” includes a supplementary prospectus.

87KPower to suspend or prohibit offer to the publicE+W+S+N.I.

(1)This section applies where a person (“the offeror”) has made an offer of transferable securities to the public in the United Kingdom (“the offer”).

(2)If the competent authority has reasonable grounds for suspecting that an applicable provision has been infringed, it may—

(a)require the offeror to suspend the offer for a period not exceeding 10 working days;

(b)require a person not to advertise the offer, or to take such steps as the authority may specify to suspend any existing advertisement of the offer, for a period not exceeding 10 working days.

(3)If the competent authority has reasonable grounds for suspecting that it is likely that an applicable provision will be infringed, it may require the offeror to withdraw the offer.

(4)If the competent authority finds that an applicable provision has been infringed, it may require the offeror to withdraw the offer.

(5)An applicable provision” means—

(a)a provision of this Part,

(b)a provision contained in prospectus rules,

(c)any other provision made in accordance with the prospectus directive,

applicable in relation to the offer.

87LPower to suspend or prohibit admission to trading on a regulated marketE+W+S+N.I.

(1)This section applies where a person has requested the admission of transferable securities to trading on a regulated market situated or operating in the United Kingdom.

(2)If the competent authority has reasonable grounds for suspecting that an applicable provision has been infringed and the securities have not yet been admitted to trading on the regulated market in question, it may—

(a)require the person requesting admission to suspend the request for a period not exceeding 10 working days;

(b)require a person not to advertise the securities to which it relates, or to take such steps as the authority may specify to suspend any existing advertisement in connection with those securities, for a period not exceeding 10 working days.

(3)If the competent authority has reasonable grounds for suspecting that an applicable provision has been infringed and the securities have been admitted to trading on the regulated market in question, it may—

(a)require the market operator to suspend trading in the securities for a period not exceeding 10 working days;

(b)require a person not to advertise the securities, or to take such steps as the authority may specify to suspend any existing advertisement in connection with those securities, for a period not exceeding 10 working days.

(4)If the competent authority finds that an applicable provision has been infringed, it may require the market operator to prohibit trading in the securities on the regulated market in question.

(5)An applicable provision” means—

(a)a provision of this Part,

(b)a provision contained in prospectus rules,

(c)any other provision made in accordance with the prospectus directive,

applicable in relation to the admission of the transferable securities to trading on the regulated market in question.

87MPublic censure of issuerE+W+S+N.I.

(1)If the competent authority finds that—

(a)an issuer of transferable securities,

(b)a person offering transferable securities to the public, or

(c)a person requesting the admission of transferable securities to trading on a regulated market,

is failing or has failed to comply with his obligations under an applicable provision, it may publish a statement to that effect.

(2)If the competent authority proposes to publish a statement, it must give the person a warning notice setting out the terms of the proposed statement.

(3)If, after considering any representations made in response to the warning notice, the competent authority decides to make the proposed statement, it must give the person a decision notice setting out the terms of the statement.

(4)An applicable provision” means—

(a)a provision of this Part,

(b)a provision contained in prospectus rules,

(c)any other provision made in accordance with the prospectus directive,

applicable to a prospectus in relation to the transferable securities in question.

(5)Prospectus” includes a supplementary prospectus.

87NRight to refer matters to the TribunalE+W+S+N.I.

(1)A person to whom a decision notice is given under section 87M may refer the matter to the Tribunal.>

(2)A person to whom a notice is given under section 87O may refer the matter to the Tribunal.

87OProcedure under sections 87K and 87LE+W+S+N.I.

(1)A requirement under section 87K or 87L takes effect—

(a)immediately, if the notice under subsection (2) states that that is the case;

(b)in any other case, on such date as may be specified in that notice.

(2)If the competent authority—

(a)proposes to exercise the powers in section 87K or 87L in relation to a person, or

(b)exercises any of those powers in relation to a person with immediate effect,

it must give that person written notice.

(3)The notice must—

(a)give details of the competent authority's action or proposed action;

(b)state the competent authority's reasons for taking the action in question and choosing the date on which it took effect or takes effect;

(c)inform the recipient that he may make representations to the competent authority within such period as may be specified by the notice (whether or not he has referred the matter to the Tribunal);

(d)inform him of the date on which the action took effect or takes effect; and

(e)inform him of his right to refer the matter to the Tribunal.

(4)The competent authority may extend the period within which representations may be made to it.

(5)If, having considered any representations made to it, the competent authority decides to maintain, vary or revoke its earlier decision, it must give written notice to that effect to the person mentioned in subsection (2).

(6)A notice given under subsection (5) must inform that person, where relevant, of his right to refer the matter to the Tribunal.

(7)If a notice informs a person of his right to refer a matter to the Tribunal, it must give an indication of the procedure on such a reference.

(8)If a notice under this section relates to the exercise of the power conferred by section 87L(3), the notice must also be given to the person at whose request the transferable securities were admitted to trading on the regulated market.

87PExercise of powers at request of competent authority of another EEA StateE+W+S+N.I.

(1)This section applies if—

(a)the competent authority of an EEA State other than the United Kingdom has approved a prospectus,

(b)the transferable securities to which the prospectus relates have been offered to the public in the United Kingdom or their admission to trading on a regulated market has been requested, and

(c)that competent authority makes a request that the competent authority assist it in the performance of its functions under the law of that State in connection with the prospectus directive.

(2)For the purpose of complying with the request mentioned in subsection (1)(c), the powers conferred by sections 87K and 87L may be exercised as if the prospectus were one which had been approved by the competent authority.

(3)Section 87N does not apply to an exercise of those powers as a result of this section.

(4)Section 87O does apply to such an exercise of those powers but with the omission of subsections (3)(e), (6) and (7).

Rights of investorsE+W+S+N.I.

87QRight of investor to withdrawE+W+S+N.I.

(1)Where a person agrees to buy or subscribe for transferable securities in circumstances where the final offer price or the amount of transferable securities to be offered to the public is not included in the prospectus, he may withdraw his acceptance before the end of the withdrawal period.

(2)The withdrawal period—

(a)begins with the investor's acceptance; and

(b)ends at the end of the second working day after the date on which the competent authority is informed of the information in accordance with section 87A(7).

(3)Subsection (1) does not apply if the prospectus contains—

(a)in the case of the amount of transferable securities to be offered to the public, the criteria or conditions (or both) according to which that element will be determined, or

(b)in the case of price, the criteria or conditions (or both) according to which that element will be determined or the maximum price.

(4)Where a supplementary prospectus has been published and, prior to the publication, a person agreed to buy or subscribe for transferable securities to which it relates, he may withdraw his acceptance before the end of the period of 2 working days beginning with the first working day after the date on which the supplementary prospectus was published.

Registered investorsE+W+S+N.I.

87RRegister of investorsE+W+S+N.I.

(1)The competent authority must establish and maintain, in accordance with this section and prospectus rules, a register of investors for the purposes of section 86.

(2)An individual may not be entered in the register unless—

(a)he is resident in the United Kingdom; and

(b)he meets at least two of the criteria mentioned in Article 2.2 of the prospectus directive.

(3)A company may not be entered in the register unless—

(a)it falls within the meaning of “small and medium-sized enterprises” in Article 2.1 of the prospectus directive; and

(b)its registered office is in the United Kingdom.

(4)A person who does not fall within subsection (2) or (3) may not be entered in the register.]

SponsorsE+W+S+N.I.

88 Sponsors.E+W+S+N.I.

(1)Listing rules may require a person to make arrangements with a sponsor for the performance by the sponsor of such services in relation to him as may be specified in the rules.

(2)Sponsor” means a person approved by the competent authority for the purposes of the rules.

(3)Listing rules made by virtue of subsection (1) may—

(a)provide for the competent authority to maintain a list of sponsors;

(b)specify services which must be performed by a sponsor;

(c)impose requirements on a sponsor in relation to the provision of services or specified services;

(d)specify the circumstances in which a person is qualified for being approved as a sponsor.

(4)If the competent authority proposes—

(a)to refuse a person’s application for approval as a sponsor, or

(b)to cancel a person’s approval as a sponsor [F82otherwise than at his request],

it must give him a warning notice.

(5)If, after considering any representations made in response to the warning notice, the competent authority decides—

(a)to grant the application for approval, or

(b)not to cancel the approval,

it must give the person concerned, and any person to whom a copy of the warning notice was given, written notice of its decision.

(6)If, after considering any representations made in response to the warning notice, the competent authority decides—

(a)to refuse to grant the application for approval, or

(b)to cancel the approval,

it must give the person concerned a decision notice.

(7)A person to whom a decision notice is given under this section may refer the matter to the Tribunal.

Annotations:

Amendments (Textual)

Commencement Information

I31S. 88 wholly in force at 1.12.2001; s. 88 not in force at Royal Assent see s. 431(2); s. 88(1)-(3) in force at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 88 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

89 Public censure of sponsor.E+W+S+N.I.

(1)Listing rules may make provision for the competent authority, if it considers that a sponsor has contravened a requirement imposed on him by rules made as a result of section 88(3)(c), to publish a statement to that effect.

(2)If the competent authority proposes to publish a statement it must give the sponsor a warning notice setting out the terms of the proposed statement.

(3)If, after considering any representations made in response to the warning notice, the competent authority decides to make the proposed statement, it must give the sponsor a decision notice setting out the terms of the statement.

(4)A sponsor to whom a decision notice is given under this section may refer the matter to the Tribunal.

Annotations:

Modifications etc. (not altering text)

C220S. 89(2)-(4) applied (with modifications) (1.12.2001) by S.I. 2001/2957, arts. 1, 10(3), 12, 13; S.I. 2001/3538, art. 2(1)

Commencement Information

I32S. 89 wholly in force at 1.12.2001; s. 89 not in force at Royal Assent see s. 431(2); s. 89(1) in force at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; s. 89 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

[F83Transparency obligationsE+W+S+N.I.

Annotations:

Amendments (Textual)

F83Ss. 89A-89G and cross-heading inserted (8.11.2006) by Companies Act 2006 (c. 46), ss. 1266(1), 1300(1)(a) (with s. 1266(2))

89ATransparency rulesE+W+S+N.I.

(1)The competent authority may make rules for the purposes of the transparency obligations directive.

(2)The rules may include provision for dealing with any matters arising out of or related to any provision of the transparency obligations directive.

(3)The competent authority may also make rules—

(a)for the purpose of ensuring that voteholder information in respect of voting shares traded on a UK market other than a regulated market is made public or notified to the competent authority;

(b)providing for persons who hold comparable instruments (see section 89F(1)(c)) in respect of voting shares to be treated, in the circumstances specified in the rules, as holding some or all of the voting rights in respect of those shares.

(4)Rules under this section may, in particular, make provision—

(a)specifying how the proportion of—

(i)the total voting rights in respect of shares in an issuer, or

(ii)the total voting rights in respect of a particular class of shares in an issuer,

held by a person is to be determined;

(b)specifying the circumstances in which, for the purposes of any determination of the voting rights held by a person (“P”) in respect of voting shares in an issuer, any voting rights held, or treated by virtue of subsection (3)(b) as held, by another person in respect of voting shares in the issuer are to be regarded as held by P;

(c)specifying the nature of the information which must be included in any notification;

(d)about the form of any notification;

(e)requiring any notification to be given within a specified period;

(f)specifying the manner in which any information is to be made public and the period within which it must be made public;

(g)specifying circumstances in which any of the requirements imposed by rules under this section does not apply.

(5)Rules under this section are referred to in this Part as “transparency rules”.

(6)Nothing in sections 89B to 89G affects the generality of the power to make rules under this section.

89BProvision of voteholder informationE+W+S+N.I.

(1)Transparency rules may make provision for voteholder information in respect of voting shares to be notified, in circumstances specified in the rules—

(a)to the issuer, or

(b)to the public,

or to both.

(2)Transparency rules may make provision for voteholder information notified to the issuer to be notified at the same time to the competent authority.

(3)In this Part “voteholder information” in respect of voting shares means information relating to the proportion of voting rights held by a person in respect of the shares.

(4)Transparency rules may require notification of voteholder information relating to a person—

(a)initially, not later than such date as may be specified in the rules for the purposes of the first indent of Article 30.2 of the transparency obligations directive, and

(b)subsequently, in accordance with the following provisions.

(5)Transparency rules under subsection (4)(b) may require notification of voteholder information relating to a person only where there is a notifiable change in the proportion of—

(a)the total voting rights in respect of shares in the issuer, or

(b)the total voting rights in respect of a particular class of share in the issuer,

held by the person.

(6)For this purpose there is a “notifiable change” in the proportion of voting rights held by a person when the proportion changes—

(a)from being a proportion less than a designated proportion to a proportion equal to or greater than that designated proportion,

(b)from being a proportion equal to a designated proportion to a proportion greater or less than that designated proportion, or

(c)from being a proportion greater than a designated proportion to a proportion equal to or less than that designated proportion.

(7)In subsection (6) “designated” means designated by the rules.

89CProvision of information by issuers of transferable securitiesE+W+S+N.I.

(1)Transparency rules may make provision requiring the issuer of transferable securities, in circumstances specified in the rules—

(a)to make public information to which this section applies, or

(b)to notify to the competent authority information to which this section applies,

or to do both.

(2)In the case of every issuer, this section applies to—

(a)information required by Article 4 of the transparency obligations directive;

(b)information relating to the rights attached to the transferable securities, including information about the terms and conditions of those securities which could indirectly affect those rights; and

(c)information about new loan issues and about any guarantee or security in connection with any such issue.

(3)In the case of an issuer of debt securities, this section also applies to information required by Article 5 of the transparency obligations directive.

(4)In the case of an issuer of shares, this section also applies to—

(a)information required by Article 5 of the transparency obligations directive;

(b)information required by Article 6 of that directive;

(c)voteholder information—

(i)notified to the issuer, or

(ii)relating to the proportion of voting rights held by the issuer in respect of shares in the issuer;

(d)information relating to the issuer's capital; and

(e)information relating to the total number of voting rights in respect of shares or shares of a particular class.

89DNotification of voting rights held by issuerE+W+S+N.I.

(1)Transparency rules may require notification of voteholder information relating to the proportion of voting rights held by an issuer in respect of voting shares in the issuer—

(a)initially, not later than such date as may be specified in the rules for the purposes of the second indent of Article 30.2 of the transparency obligations directive, and

(b)subsequently, in accordance with the following provisions.

(2)Transparency rules under subsection (1)(b) may require notification of voteholder information relating to the proportion of voting rights held by an issuer in respect of voting shares in the issuer only where there is a notifiable change in the proportion of—

(a)the total voting rights in respect of shares in the issuer, or

(b)the total voting rights in respect of a particular class of share in the issuer,

held by the issuer.

(3)For this purpose there is a “notifiable change” in the proportion of voting rights held by a person when the proportion changes—

(a)from being a proportion less than a designated proportion to a proportion equal to or greater than that designated proportion,

(b)from being a proportion equal to a designated proportion to a proportion greater or less than that designated proportion, or

(c)from being a proportion greater than a designated proportion to a proportion equal to or less than that designated proportion.

(4)In subsection (3) “designated” means designated by the rules.

89ENotification of proposed amendment of issuer's constitutionE+W+S+N.I.

Transparency rules may make provision requiring an issuer of transferable securities that are admitted to trading on a regulated market to notify a proposed amendment to its constitution—

(a)to the competent authority, and

(b)to the market on which the issuer's securities are admitted,

at times and in circumstances specified in the rules.

89FTransparency rules: interpretation etcE+W+S+N.I.

(1)For the purposes of sections 89A to 89G—

(a)the voting rights in respect of any voting shares are the voting rights attached to those shares,

(b)a person is to be regarded as holding the voting rights in respect of the shares—

(i)if, by virtue of those shares, he is a shareholder within the meaning of Article 2.1(e) of the transparency obligations directive;

(ii)if, and to the extent that, he is entitled to acquire, dispose of or exercise those voting rights in one or more of the cases mentioned in Article 10(a) to (h) of the transparency obligations directive;

(iii)if he holds, directly or indirectly, a financial instrument which results in an entitlement to acquire the shares and is an Article 13 instrument, and

(c)a person holds a “comparable instrument” in respect of voting shares if he holds, directly or indirectly, a financial instrument in relation to the shares which has similar economic effects to an Article 13 instrument (whether or not the financial instrument results in an entitlement to acquire the shares).

(2)Transparency rules under section 89A(3)(b) may make different provision for different descriptions of comparable instrument.

(3)For the purposes of sections 89A to 89G two or more persons may, at the same time, each be regarded as holding the same voting rights.

(4)In those sections—

  • Article 13 instrument” means a financial instrument of a type determined by the European Commission under Article 13.2 of the transparency obligations directive;

  • [F84financial instrument” has the meaning given in Article 4.1(17) of Directive 2004/39/EC on markets in financial instruments;]

  • UK market” means a market that is situated or operating in the United Kingdom;

  • voting shares” means shares of an issuer to which voting rights are attached.

Annotations:

Amendments (Textual)

F84S. 89F(4): definition of "financial instrument" inserted (31.1.2009) by The Definition of Financial Instrument Order 2008 (S.I. 2008/3053), art. 2(2)

89GTransparency rules: other supplementary provisionsE+W+S+N.I.

(1)Transparency rules may impose the same obligations on a person who has applied for the admission of transferable securities to trading on a regulated market without the issuer's consent as they impose on an issuer of transferable securities.

(2)Transparency rules that require a person to make information public may include provision authorising the competent authority to make the information public in the event that the person fails to do so.

(3)The competent authority may make public any information notified to the authority in accordance with transparency rules.

(4)Transparency rules may make provision by reference to any provision of any rules made by the Panel on Takeovers and Mergers under Part 28 of the Companies Act 2006.

(5)Sections 89A to 89F and this section are without prejudice to any other power conferred by this Part to make Part 6 rules.]

[F85Power of competent authority to call for informationE+W+S+N.I.

Annotations:

Amendments (Textual)

F85Ss. 89H-89J and cross-heading inserted (8.11.2006) by Companies Act 2006 (c. 46), ss. 1267, 1300(1)(a)

89HCompetent authority's power to call for informationE+W+S+N.I.

(1)The competent authority may by notice in writing given to a person to whom this section applies require him—

(a)to provide specified information or information of a specified description, or

(b)to produce specified documents or documents of a specified description.

(2)This section applies to—

(a)an issuer in respect of whom transparency rules have effect;

(b)a voteholder;

(c)an auditor of—

(i)an issuer to whom this section applies, or

(ii)a voteholder;

(d)a person who controls a voteholder;

(e)a person controlled by a voteholder;

(f)a director or other similar officer of an issuer to whom this section applies;

(g)a director or other similar officer of a voteholder or, where the affairs of a voteholder are managed by its members, a member of the voteholder.

(3)This section applies only to information and documents reasonably required in connection with the exercise by the competent authority of functions conferred on it by or under sections 89A to 89G (transparency rules).

(4)Information or documents required under this section must be provided or produced—

(a)before the end of such reasonable period as may be specified, and

(b)at such place as may be specified.

(5)If a person claims a lien on a document, its production under this section does not affect the lien.

89IRequirements in connection with call for informationE+W+S+N.I.

(1)The competent authority may require any information provided under section 89H to be provided in such form as it may reasonably require.

(2)The competent authority may require—

(a)any information provided, whether in a document or otherwise, to be verified in such manner as it may reasonably require;

(b)any document produced to be authenticated in such manner as it may reasonably require.

(3)If a document is produced in response to a requirement imposed under section 89H, the competent authority may—

(a)take copies of or extracts from the document; or

(b)require the person producing the document, or any relevant person, to provide an explanation of the document.

(4)In subsection (3)(b) “relevant person”, in relation to a person who is required to produce a document, means a person who—

(a)has been or is a director or controller of that person;

(b)has been or is an auditor of that person;

(c)has been or is an actuary, accountant or lawyer appointed or instructed by that person; or

(d)has been or is an employee of that person.

(5)If a person who is required under section 89H to produce a document fails to do so, the competent authority may require him to state, to the best of his knowledge and belief, where the document is.

89JPower to call for information: supplementary provisionsE+W+S+N.I.

(1)The competent authority may require an issuer to make public any information provided to the authority under section 89H.

(2)If the issuer fails to comply with a requirement under subsection (1), the competent authority may, after seeking representations from the issuer, make the information public.

(3)In sections 89H and 89I (power of competent authority to call for information)—

  • “control” and “controlled” have the meaning given by subsection (4) below;

  • specified” means specified in the notice;

  • voteholder” means a person who—

    (a)

    holds voting rights in respect of any voting shares for the purposes of sections 89A to 89G (transparency rules), or

    (b)

    is treated as holding such rights by virtue of rules under section 89A(3)(b).

(4)For the purposes of those sections a person (“A”) controls another person (“B”) if—

(a)A holds a majority of the voting rights in B,

(b)A is a member of B and has the right to appoint or remove a majority of the members of the board of directors (or, if there is no such board, the equivalent management body) of B,

(c)A is a member of B and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in B, or

(d)A has the right to exercise, or actually exercises, dominant influence or control over B.

(5)For the purposes of subsection (4)(b)—

(a)any rights of a person controlled by A, and

(b)any rights of a person acting on behalf of A or a person controlled by A,

are treated as held by A.]

[F86Powers exercisable in case of infringement of transparency obligationE+W+S+N.I.

Annotations:

Amendments (Textual)

F86Ss. 89K-89N and cross-heading inserted (8.11.2006) by Companies Act 2006 (c. 46), ss. 1268, 1300(1)(a)

89KPublic censure of issuerE+W+S+N.I.

(1)If the competent authority finds that an issuer of securities admitted to trading on a regulated market is failing or has failed to comply with an applicable transparency obligation, it may publish a statement to that effect.

(2)If the competent authority proposes to publish a statement, it must give the issuer a warning notice setting out the terms of the proposed statement.

(3)If, after considering any representations made in response to the warning notice, the competent authority decides to make the proposed statement, it must give the issuer a decision notice setting out the terms of the statement.

(4)A notice under this section must inform the issuer of his right to refer the matter to the Tribunal (see section 89N) and give an indication of the procedure on such a reference.

(5)In this section “transparency obligation” means an obligation under—

(a)a provision of transparency rules, or

(b)any other provision made in accordance with the transparency obligations directive.

(6)In relation to an issuer whose home State is a member State other than the United Kingdom, any reference to an applicable transparency obligation must be read subject to section 100A(2).

89LPower to suspend or prohibit trading of securitiesE+W+S+N.I.

(1)This section applies to securities admitted to trading on a regulated market.

(2)If the competent authority has reasonable grounds for suspecting that an applicable transparency obligation has been infringed by an issuer, it may—

(a)suspend trading in the securities for a period not exceeding 10 days,

(b)prohibit trading in the securities, or

(c)make a request to the operator of the market on which the issuer's securities are traded—

(i)to suspend trading in the securities for a period not exceeding 10 days, or

(ii)to prohibit trading in the securities.

(3)If the competent authority has reasonable grounds for suspecting that a provision required by the transparency obligations directive has been infringed by a voteholder of an issuer, it may—

(a)prohibit trading in the securities, or

(b)make a request to the operator of the market on which the issuer's securities are traded to prohibit trading in the securities.

(4)If the competent authority finds that an applicable transparency obligation has been infringed, it may require the market operator to prohibit trading in the securities.

(5)In this section “transparency obligation” means an obligation under—

(a)a provision contained in transparency rules, or

(b)any other provision made in accordance with the transparency obligations directive.

(6)In relation to an issuer whose home State is a member State other than the United Kingdom, any reference to an applicable transparency obligation must be read subject to section 100A(2).

89MProcedure under section 89LE+W+S+N.I.

(1)A requirement under section 89L takes effect—

(a)immediately, if the notice under subsection (2) states that that is the case;

(b)in any other case, on such date as may be specified in the notice.

(2)If the competent authority—

(a)proposes to exercise the powers in section 89L in relation to a person, or

(b)exercises any of those powers in relation to a person with immediate effect,

it must give that person written notice.

(3)The notice must—

(a)give details of the competent authority's action or proposed action;

(b)state the competent authority's reasons for taking the action in question and choosing the date on which it took effect or takes effect;

(c)inform the recipient that he may make representations to the competent authority within such period as may be specified by the notice (whether or not he had referred the matter to the Tribunal);

(d)inform him of the date on which the action took effect or takes effect;

(e)inform him of his right to refer the matter to the Tribunal (see section 89N) and give an indication of the procedure on such a reference.

(4)The competent authority may extend the period within which representations may be made to it.

(5)If, having considered any representations made to it, the competent authority decides to maintain, vary or revoke its earlier decision, it must give written notice to that effect to the person mentioned in subsection (2).

89NRight to refer matters to the TribunalE+W+S+N.I.

A person—

(a)to whom a decision notice is given under section 89K (public censure), or

(b)to whom a notice is given under section 89M (procedure in connection with suspension or prohibition of trading),

may refer the matter to the Tribunal.]

[F87Corporate governanceE+W+S+N.I.

Annotations:

Amendments (Textual)

F87S. 89O and cross-heading inserted (8.11.2006) by Companies Act 2006 (c. 46), ss. 1269, 1300(1)(a)

89OCorporate governance rulesE+W+S+N.I.

(1)The competent authority may make rules (“corporate governance rules”)—

(a)for the purpose of implementing, enabling the implementation of or dealing with matters arising out of or related to, any [F88EU] obligation relating to the corporate governance of issuers who have requested or approved admission of their securities to trading on a regulated market;

(b)about corporate governance in relation to such issuers for the purpose of implementing, or dealing with matters arising out of or related to, any [F88EU] obligation.

(2)Corporate governance”, in relation to an issuer, includes—

(a)the nature, constitution or functions of the organs of the issuer;

(b)the manner in which organs of the issuer conduct themselves;

(c)the requirements imposed on organs of the issuer;

(d)the relationship between the different organs of the issuer;

(e)the relationship between the organs of the issuer and the members of the issuer or holders of the issuer's securities.

(3)The burdens and restrictions imposed by rules under this section on foreign-traded issuers must not be greater than the burdens and restrictions imposed on UK-traded issuers by—

(a)rules under this section, and

(b)listing rules.

(4)For this purpose—

  • foreign-traded issuer” means an issuer who has requested or approved admission of the issuer's securities to trading on a regulated market situated or operating outside the United Kingdom;

  • UK-traded issuer” means an issuer who has requested or approved admission of the issuer's securities to trading on a regulated market situated or operating in the United Kingdom.

(5)This section is without prejudice to any other power conferred by this Part to make Part 6 rules.]

Annotations:

Amendments (Textual)

F88Words in s. 89O(1)(a)(b) substituted (22.4.2011 with application in accordance with art. 3 of the amending S.I.) by virtue of The Treaty of Lisbon (Changes in Terminology) Order 2011 (S.I. 2011/1043), art. 6(1)(3)(4)

[F89Compensation for false or misleading statements etc]E+W+S+N.I.

Annotations:

Amendments (Textual)

F89S. 90 cross-heading substituted (8.11.2006) by Companies Act 2006 (c. 46), ss. 1272, 1300(1)(a), Sch. 15 para. 4

90[F90Compensation for statements in listing particulars or prospectus]E+W+S+N.I.

(1)Any person responsible for listing particulars is liable to pay compensation to a person who has—

(a)acquired securities to which the particulars apply; and

(b)suffered loss in respect of them as a result of—

(i)any untrue or misleading statement in the particulars; or

(ii)the omission from the particulars of any matter required to be included by section 80 or 81.

(2)Subsection (1) is subject to exemptions provided by Schedule 10.

(3)If listing particulars are required to include information about the absence of a particular matter, the omission from the particulars of that information is to be treated as a statement in the listing particulars that there is no such matter.

(4)Any person who fails to comply with section 81 is liable to pay compensation to any person who has—

(a)acquired securities of the kind in question; and

(b)suffered loss in respect of them as a result of the failure.

(5)Subsection (4) is subject to exemptions provided by Schedule 10.

(6)This section does not affect any liability which may be incurred apart from this section.

(7)References in this section to the acquisition by a person of securities include references to his contracting to acquire them or any interest in them.

(8)No person shall, by reason of being a promoter of a company or otherwise, incur any liability for failing to disclose information which he would not be required to disclose in listing particulars in respect of a company’s securities—

(a)if he were responsible for those particulars; or

(b)if he is responsible for them, which he is entitled to omit by virtue of section 82.

(9)The reference in subsection (8) to a person incurring liability includes a reference to any other person being entitled as against that person to be granted any civil remedy or to rescind or repudiate an agreement.

(10)Listing particulars”, in subsection (1) and Schedule 10, includes supplementary listing particulars.

[F91(11)This section applies in relation to a prospectus as it applies to listing particulars, with the following modifications—

(a)references in this section or in Schedule 10 to listing particulars, supplementary listing particulars or sections 80, 81 or 82 are to be read, respectively, as references to a prospectus, supplementary prospectus and sections 87A, 87G and 87B;

(b)references in Schedule 10 to admission to the official list are to be read as references to admission to trading on a regulated market;

(c)in relation to a prospectus, “securities” means “transferable securities”.

(12)A person is not to be subject to civil liability solely on the basis of a summary in a prospectus unless the summary is misleading, inaccurate or inconsistent when read with the rest of the prospectus; and, in this subsection, a summary includes any translation of it.]

Annotations:

Amendments (Textual)

F90S. 90 words in heading substituted (8.11.2006) by Companies Act 2006 (c. 46), ss. 1272, 1300(1)(a), Sch. 15 para. 5

Modifications etc. (not altering text)

C221S. 90 restricted (1.12.2001) by S.I. 2001/2957, arts. 1, 7(3); S.I. 2001/3538, art. 2(1)

[F9290ZALiability for key investor informationE+W+S+N.I.

(1)A person is not to be subject to civil liability solely on the basis of the key investor information produced in relation to a collective investment scheme or a sub-fund of such a scheme in accordance with rules or other provisions implementing Chapter IX of the UCITS directive, or of any translation of that information, unless the key investor information is misleading, inaccurate or inconsistent with the relevant parts of the prospectus published for that collective investment scheme or sub-fund in accordance with rules made by the Authority under section 248 of this Act.

(2)In this section, a reference to a sub-fund of a collective investment scheme is a reference to a part of the property of the collective investment scheme which forms a separate pool where—

(a)the collective investment scheme provides arrangements for separate pooling of the contributions of the participants and the profits and income out of which payments are made to them; and

(b)the participants are entitled to exchange rights in one pool for rights in another.]

Annotations:

Amendments (Textual)

F92S. 90ZA inserted (1.7.2011) by The Undertakings for Collective Investment in Transferable Securities Regulations 2011 (S.I. 2011/1613), reg. 2(3)

[F9390AAmendments to the Financial Services and Markets Act 2000E+W+S+N.I.

Schedule 10A makes provision about the liability of issuers of securities to pay compensation to persons who have suffered loss as a result of—

(a)a misleading statement or dishonest omission in certain published information relating to the securities, or

(b)a dishonest delay in publishing such information.]

Annotations:

Amendments (Textual)

F94S. 90A substituted (1.10.2010 with effect in accordance with reg. 3(1) of the amending S.I.) by The Financial Services and Markets Act 2000 (Liability of Issuers) Regulations 2010 (S.I. 2010/1192), reg. 2(2) (with reg. 3(2))

90B