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[F1PART 3 U.K.Powers of the FCA]

Textual Amendments

Power of FCA to require information from a person who is not authorisedU.K.

3.—[F2(1) In this regulation and in regulation 4—

“non-authorised counterparty” means a person, other than an authorised person or a recognised body, who is a party to a financial collateral arrangement referred to in the second sub-paragraph of Article 3(2) of the CSD regulation;

“participant” means a participant in a securities settlement system as defined in Article 2(1)(19) of the CSD regulation, other than—

(a)

an authorised person, or

(b)

a recognised body.]

(2) Paragraph (3) applies where—

(a)a non-authorised counterparty is subject to an obligation under the CSD regulation; or

(b)it is necessary for the FCA to determine whether a person is a non-authorised counterparty.

(3) The FCA may, by notice in writing, require the counterparty or person—

(a)to provide specified information or information of a specified description; or

(b)to produce specified documents or documents of a specified description,

so that it can verify whether the non-authorised counterparty has complied with the CSD regulation or whether the person is a non-authorised counterparty.

[F3(3A) Paragraph (3B) applies where a participant is subject to an obligation under Article 38(5) and (6) of the CSD regulation.]

[F3(3B) The FCA may, by notice in writing, require the participant—

(a)to provide specified information or information of a specified description; or

(b)to provide specified documents or documents of a specified description,

so that it can verify whether the participant has complied with Article 38(5) and (6) of the CSD regulation.]

(4) The information or documents must be provided or produced—

(a)before the end of such reasonable period as may be specified;

(b)at such place as may be specified.

(5) This regulation applies only to information and documents reasonably required in connection with the exercise by the FCA of its functions under the CSD regulation.

(6) The FCA may require any information provided under this regulation to be provided in such a form as it may reasonably require.

(7) The FCA may require—

(a)any information provided, whether in a document or otherwise, to be verified in such a manner, or

(b)any document produced to be authenticated in such a manner,

as it may reasonably require.

(8) A requirement imposed under this regulation is a “relevant requirement” for the purposes of sections 380 M1 (injunctions) and 382 M2 (restitution orders) of the Act.

(9) In this regulation, “specified” means specified in the notice.

Textual Amendments

Marginal Citations

M1Section 380 was amended by paragraph 19 of Schedule 9 to the Financial Services Act 2012 (c.21), paragraph 3 of Schedule 10 to the Financial Services (Banking Reform) Act 2013 (c.33), and S.I. 2013/1773.

M2Section 382 was amended by paragraph 21 of Schedule 9 to the Financial Services Act 2012, paragraph 3 of Schedule 10 the Financial Services (Banking Reform) Act 2013, and S.I. 2013/1773.

Penalties and statementsU.K.

4.—(1) If the FCA considers that—

(a)a non-authorised counterparty [F4, participant] or any other person has contravened a relevant requirement imposed on it; or

(b)a non-authorised counterparty [F5or participant] has contravened a requirement imposed by or under the CSD regulation,

the FCA may publish a statement to that effect or impose on it a penalty, in respect of the contravention, of such amount as the FCA considers appropriate.

(2) If the FCA considers that a non-authorised counterparty [F6, participant] or any other person has in purported compliance with a relevant requirement knowingly or recklessly given the FCA information which is false or misleading in a material particular, the FCA may publish a statement to that effect or impose on it a penalty of such amount as it considers appropriate.

(3) Where the FCA has published a statement or imposed a penalty under paragraph (1) or (2), it must comply with the requirements of Article 62 of the CSD regulation.

(4) A penalty under paragraph (1) or (2) is payable to the FCA.

(5) The FCA must in respect of each of its financial years pay to the Treasury any amounts received by it during the year by way of penalties imposed under this regulation.

(6) The Treasury may give directions to the FCA as to how the FCA is to comply with its duty under paragraph (5).

(7) The directions may in particular—

(a)specify the time when any payment is required to be made to the Treasury, or

(b)require the FCA to provide the Treasury at specified times with information relating to penalties that the FCA has imposed under this regulation.

(8) The Treasury must pay into the Consolidated Fund any sums received by them under this regulation.

(9) In this regulation, a “relevant requirement” means a requirement imposed under regulation 3.

Textual Amendments

Procedure in relation to regulation 4U.K.

5.—(1) If the FCA proposes to take action against a person under regulation 4, it must give the person concerned a warning notice.

(2) A warning notice about a proposal to impose a penalty must state the amount of the penalty.

(3) A warning notice about a proposal to publish a statement must set out the terms of the proposed statement.

(4) If, having considered any representations made in response to the warning notice, the FCA decides to take action against a person under regulation 4, it must without delay give the person concerned a decision notice.

(5) A decision notice about the imposition of a penalty must state the amount of the penalty.

(6) A decision notice about the publication of a statement must set out the terms of the statement.

(7) If the FCA decides to take action against a person under regulation 4, the person may refer the matter to the Tribunal M3.

(8) Sections 210 M4 (statements of policy) and 211 M5 (statements of policy: procedure) of the Act apply in respect of the imposition of penalties under regulation 4 and the amount of such penalties as they apply in respect of the imposition of penalties under Part 14 of the Act (disciplinary measures) and the amount of penalties under that Part.

(9) After a statement under regulation 4 is published, the FCA must send a copy of it to the person concerned and to any person to whom a copy of the decision notice was given under section 393(4) M6 of the Act (as applied by paragraph (10)).

(10) Sections 387(1), (2) and (3) M7 (warning notices), 388 M8 (decision notices), 389 M9 (notices of discontinuance), 390 M10 (final notices), 393 M11 (third party rights) and 394 M12 (access to FCA or PRA material) of the Act apply in relation to a warning notice or decision notice under this regulation.

(11) Section 391 of the Act M13 (publication) applies in relation to a warning notice, decision notice or final notice under this regulation subject to Article 62 of the CSD regulation.

(12) Part 9 of the Act (hearings and appeals) applies to references to the Tribunal under this regulation as it applies to references to the Tribunal under the Act as if a decision to publish a statement or impose a penalty under regulation 4 was a “disciplinary reference” for the purposes of section 133 of the Act M14.

Marginal Citations

M3Defined in section 417(1) of the Act.

M4Section 210 was amended by paragraph 20 of Schedule 2 to the Financial Services Act 2010 (c.28) and paragraph 17 of Schedule 9 to the Financial Services Act 2012.

M5Section 211 was amended by paragraph 18 of Schedule 9 to the Financial Services Act 2012.

M6Section 393(4) was amended by paragraph 32 of Schedule 9 to the Financial Services Act 2012.

M7Section 387(1), (2) and (3) was amended by paragraph 26 of Schedule 9 to the Financial Services Act 2012.

M8Section 388 was amended by paragraph 27 of Schedule 9 to the Financial Services Act 2012 and paragraph 13 of Schedule 3 to the Financial Services (Banking Reform) Act 2013.

M9Section 389 was amended by paragraph 28 of Schedule 9 to the Financial Services Act 2012.

M10Section 390 was amended by paragraph 29 of Schedule 9 to the Financial Services Act 2012 and S.I. 2010/22.

M11Section 393 was amended by paragraph 32 of Schedule 9 to the Financial Services Act 2012.

M12Section 394 was amended by paragraph 11 of Schedule 4 to the Regulation of Investigatory Powers Act 2000 (c.23) and paragraph 33 of Schedule 9 to the Financial Services Act 2012.

M13Section 391 was amended by sections 13 and 24 of the Financial Services Act 2010, section 24 of and paragraph 30 of Schedule 9 to the Financial Services Act 2012, section 4 of the Financial Services (Banking Reform) Act 2013 and S.I. 2012/916, 2013/1388 and 2013/3115.

M14Section 133 was substituted by S.I. 2010/22, and amended by section 23 of the Financial Services Act 2012, section 4 of the Financial Services (Banking Reform) Act 2013, paragraph 83 of Schedule 9 to the Crime and Courts Act 2013 (c.22), and S.I. 2013/1388.