The Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018

Application of Part 11 of the Act (information gathering and investigations)

19.—(1) Part 11(1) of the Act (information gathering and investigations) applies with respect to the discharge by the FCA of its functions under Part 2 of these Regulations and the EU Benchmarks Regulation 2016 in respect of Miscellaneous BM persons, as it applies with respect to the discharge by the FCA of its functions under the Act, with the following modifications.

(2) Part 11 of the Act applies as if—

(a) each reference to the Act included a reference to these Regulations;

(b) each reference to a section or Part of, or Schedule to, the Act were a reference to that section, Part or Schedule as applied by these Regulations;

(c) each reference to an authorised person were a reference to a Miscellaneous BM person;

(d) each reference to the PRA were omitted;

(e) each reference to a regulator were a reference to the FCA, and each reference to either regulator were a reference to the FCA only.

(3) Section 165(2) of the Act (regulators’ power to require information: authorised persons etc.) applies as if subsections (4)(b) and (8A) were omitted.

(4) Sections 165A(3) (PRA’s power to require information: financial stability), 165B (safeguards etc. in relation to exercise of power under section 165A) and 165C (orders under section 165A(2)(d)) of the Act do not apply.

(5) Section 166A(4) of the Act (appointment of skilled person to collect and update information) applies as if—

(a) for subsection (1) there were substituted—

“(1) This section applies if the FCA considers that a Miscellaneous BM person has contravened a requirement imposed by or under the Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018 or the EU Benchmarks Regulation 2016 to collect, and keep up to date, information of a description specified in those regulations.”;

(6) subsection (10) were omitted.

(7) Section 167(5) of the Act (appointment of persons to carry out general investigations) applies as if—

(a) for subsection (1) there were substituted—

“(1) If it appears to the FCA that there is a good reason for doing so, the FCA may appoint one or more competent persons to conduct an investigation on its behalf into—

(a) the nature, conduct or state of the business of a Miscellaneous BM person in respect of whom a requirement is imposed by or under the EU Benchmarks Regulation 2016 (“a person subject to the 2016 Regulation”);

(b) a particular aspect of that business; or

(c) the ownership or control of a person subject to the 2016 Regulation.”;

(b) subsections (2)(c) and (3A) were omitted;

(c) for subsection (4) there were substituted—

“(4) The power conferred by this section may be exercised in relation to a person who was a person subject to the 2016 Regulation but only in relation to—

(a) business carried on when the person was a person subject to the 2016 Regulation; or

(b) the ownership or control of a person who was formerly a person subject to the 2016 Regulation at any time when the person was a person subject to the 2016 Regulation.”;

(d) subsections (5A) and (6) were omitted.

(8) Section 168(6) of the Act (appointment of persons to carry out investigations in particular cases) applies as if—

(a) for subsection (1) there were substituted—

“(1) Subsection (3) applies if it appears to the FCA that there are circumstances suggesting that—

(a) a Miscellaneous BM person may have contravened a requirement imposed by or under the EU Benchmarks Regulation 2016 or the Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018;

(b) a member of the management body of a person referred to in paragraph (a) or another member of the senior management of a person referred to in paragraph (a) may be responsible for the contravention of a requirement imposed by or under either of those Regulations; or

(c) a person may be guilty of an offence under either of those Regulations or under the Act as applied by these Regulations.”;

(b) subsections (2), (4) and (5) were omitted;

(c) for subsection (6) there were substituted—

“(6) “Investigating authority” means the FCA.”

(9) Section 169(7) of the Act (investigations etc. in support of overseas regulator) applies as if—

(a) subsection (2A) were omitted;

(b) for subsection (13) there were substituted—

“(13) “Overseas regulator” means an authority in a country or territory outside the United Kingdom which has functions corresponding to those of the FCA under the EU Benchmarks Regulation 2016.”.

(10) Section 169A(8) of the Act (support of overseas regulator with respect to financial stability) does not apply.

(11) Section 170(9) of the Act (investigations: general) applies as if—

(a) each reference to the investigating authority were a reference to the FCA;

(b) in subsection (1) “or (5)” were omitted;

(c) for subsection (3) there were substituted—

“(3) Subsections (2) and (9) do not apply if the investigator is appointed as a result of section 168(1) and the FCA believes that the notice required by subsection (2) or (9) would be likely to result in the investigation being frustrated.”;

(d) subsection (10) were omitted.

(12) Section 172 of the Act (additional power of persons appointed as a result of section 168(1) or (4)) applies as if in the heading and in subsection (4) “or (4)” were omitted.

(13) Section 174(10) of the Act (admissibility of statements made to investigators) applies as if—

(a) in subsection (2) “or in proceedings in relation to action to be taken against that person under section 123(11) to which this subsection applies” were omitted;

(b) in the list of offences in subsection (3), after paragraph (d), there was inserted—

“(e) under regulation 18 (misleading the FCA) of the Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018.”.

(c) subsection (3A) were omitted;

(d) in subsection (4) the words from “or (5),” to the end were omitted.

(14) Section 175(12) of the Act (information and documents: supplemental provisions) applies as if in subsection (8) “or (5)” were omitted.

(15) Section 176(13) of the Act (entry of premises under warrant) applies as if—

(a) for subsection (1) there were substituted—

“(1) A justice of the peace may issue a warrant under this section if satisfied on information on oath given by or on behalf of the FCA or an investigator that there are reasonable grounds for believing that the first, second or third set of conditions is satisfied.”;

(b) in subsection (3)(a) “or an appointed representative” were omitted;

(c) in subsection (10) “or (5)” were omitted;

(d) in subsection (11)(a) “87C, 87J,” and “,165A, 169A” were omitted.

(16) In section 191G(14) of the Act (interpretation) after the definition of “credit institution” there was inserted—

““Miscellaneous BM person” means a person who is not an authorised person as defined by section 31 and is—

(a)

involved in the provision of, or contribution of input data to, a benchmark;

(b)

a service provider to whom functions, or any relevant services or activities in the provision of a benchmark have been outsourced;

(c)

a person who is not the service provider but who is or has been party to a contract in relation to the outsourcing of functions, or any relevant services, or activities in the provision of a benchmark;

(d)

a legal representative of an administrator located in a third country which has obtained or has applied for prior recognition as referred to in Article 32(1) and as provided for in Article 32(3) of the EU Benchmarks Regulation 2016;

(e)

a person who administers a benchmark relying on Article 51(4) of the EU Benchmarks Regulation 2016; or

(f)

a supervised entity, as defined in Article 3(1)(17) of the EU Benchmarks Regulation 2016;”.

(1)

Part 11 was amended by paragraph 54 of Schedule 26 to the Criminal Justice Act 2003 (c. 44), paragraph 33 of Schedule 7 to the Counter Terrorism Act 2008 (c. 28), section 18 of and Schedule 2 to the Financial Services Act 2010 (c. 28), Schedule 12 to and paragraph 8 of Schedule 18 to the Financial Services Act 2012, paragraphs 36 and 37 of Schedule 2 to the Bank of England and Financial Services Act 2016 (c. 14), paragraph 9 of Schedule 2 to the Investigatory Powers Act 2016 (c. 25), S.I. 2001/1090, 2005/11433, 2007/126, 2011/1043, 2012/2554, 2013/1773, 2015/575 and 2016/680. There are other amendments but none is relevant.

(2)

Section 165 was amended by Schedule 2 to the Financial Services Act 2010, Schedule 12 to the Financial Services Act 2012, S.I. 2013/1773 and S.I. 2015/575.

(3)

Section 165A was inserted by section 18(2) of the Financial Services Act 2010, and amended by Schedule 12(1) to the Financial Services Act 2012 and Schedule 2(2) to the Bank of England and Financial Services Act 2016 (c.14).

(4)

Section 166A was inserted by paragraph 6 of Schedule 12(1) to the Financial Services Act 2012.

(5)

Section 167 was amended by paragraph 7(2) of Schedule 12 to the Financial Services and Markets Act 2000, S.I. 2007/126 and S.I. 2015/575.

(6)

Section 168 was amended by S.I. 2007/126, paragraph 33(3) of Schedule 7(7) to the Counter-Terrorism Act 2008 (c.28) Schedule 2(1) to the Financial Services Act 2010, Schedule 12(1) to the Financial Services Act 2012 (c.21), paragraph 11 of Schedule 3 to the Pension Schemes Act 2015 (c.8) and S.I. 2016/680

(7)

Section 169 was amended by S.I. 2011/1043 and Schedule 12(1) to the Financial Services Act 2012 (c.21).

(8)

Section 169A was inserted by section 18(3) of the Financial Services Act 2010 and amended by paragraph 10 of Schedule 12(1) to the Financial Services Act 2012.

(9)

Section 170 was amended by paragraph 11, Schedule 12(1) to the Financial Services Act 2012.

(10)

Section 174 was amended by paragraph 12 of Schedule 12(1) to the Financial Services Act 2012 and S.I. 2016/680. There are other amendments but none is relevant.

(11)

Section 123 was substituted by regulation 9(1) of S.I. 2016/680.

(12)

Section 175 was amended by paragraph 13 of Schedule 12(1) to the Financial Services Act 2012.

(13)

Section 176 was amended by paragraphs 14 and 17 of Schedule 12(1) to the Financial Services Act 2012.

(14)

Section 191G was inserted by S.I. 2009/534, and amended by section 26(12) of Part 2 of the Financial Services Act 2012 and S.I. 2013/3115.