The Financial Services Act 2010 (Commencement No. 1 and Transitional Provision) Order 2010

EXPLANATORY NOTE

(This note is not part of the Order)

This Order is the first commencement order for the Financial Services Act 2010 (c. 28) (“the Act”).

This Order brings into force on 12^th October 2010 the following provisions—

(a) sections 2(2) to (4) of the Act, which remove public awareness from the objectives of the Financial Services Authority (“the FSA”) set out in section 2 of the Financial Services and Markets Act 2000 (c. 8) (“the 2000 Act”), require that the FSA take into account the desirability of improving public knowledge of financial matters when discharging its general functions and insert into its consumer protection objective a requirement to have regard to information which the consumer financial education body (“the CFEB”) has provided;

(b) section 13 of the Act, which amends section 391 of the 2000 Act to widen the categories of supervisory notices given by the FSA that may be published;

(c) section 14 of the Act, which amends the 2000 Act by replacing section 404 of that Act with new sections 404 to 404G. These sections provide for the FSA to be able to make a “consumer redress scheme”. This is a scheme consisting of rules which are made for the purpose of obtaining redress for consumers in respect of losses resulting from a widespread or regular failure by financial services firms;

(d) section 17 of the Act, which inserts a new Part 15A into the 2000 Act which extends the scope of the Financial Services Compensation Scheme manager’s powers;

(e) section 24(1) and (2) of the Act, which introduces the consequential amendments in Schedule 2 to the Act in so far as relating to the provisions listed in paragraphs (f) and (g);

(f) paragraphs 21, 23 and 24(3) of Schedule 2, which amend Part 15 of the 2000 Act to make reference to the new Part 15A; and

(g) paragraph 33(2) of Schedule 2, which provides for an order which changes the categories of firms or consumers that may be subject to a consumer redress scheme to be made by the affirmative resolution procedure.

This Order also brings into force on 1st April 2011 the following provisions—

(h) paragraph 13 of Schedule 1A to the 2000 Act (set out in Schedule 1 to the Act, as introduced by section 2(6)) which gives the Office of Fair Trading the power to impose a levy on consumer credit licensees or applicants to meet a proportion of the CFEB’s costs; and

(i) paragraphs 15 and 16 of that Schedule which allow the FSA to appoint an independent person to review the economy, effectiveness and efficiency of the CFEB, and give that person a right to access documents for the purpose of making the review.

Article 3 contains a transitional provision relating to section 13 of the Act.