C1Part 1The Pensions Regulator
Exercise of regulatory functions
93The Regulator’s procedure in relation to its regulatory functions
I31
The Regulator must determine the procedure that it proposes to follow in relation to the exercise of its regulatory functions.
2
For the purposes of this Part the “regulatory functions” of the Regulator are—
I3a
the power to issue an improvement notice under section 13,
I3b
the power to issue a third party notice under section 14,
F12ba
the power to appoint a skilled person in relation to a public service pension scheme under section 14A,
I3c
the reserved regulatory functions (see Schedule 2),
I3d
the power to issue a clearance statement under section 42,
I3e
the power to issue a notice under section 45(1) approving the details of arrangements,
I3f
the power to issue a clearance statement under section 46,
I3g
the power to vary or revoke under section 101 (to the extent that it does not fall within paragraph (c)),
I3h
the power to make an order under section 154(8),
I3i
the power to make an order under section 219(4),
I3j
the power to grant or revoke authorisation under section 288,
I3k
the power to grant or revoke approval under section 289,
I3l
the power to issue a notice under section 293(5),
I3m
the power by direction under section 2(3)(a) of the Welfare Reform and Pensions Act 1999 (c. 30) to refuse to register a scheme under section 2 of that Act,
I3n
the power to make an order under section 7 of the Pensions Act 1995 (c. 26) appointing a trustee (to the extent that it does not fall within paragraph (c)),
I3o
the power to make an order under section 23 of that Act appointing an independent trustee,
I3p
the power to give directions under section 72B of that Act (directions facilitating winding up), F15...
F14pa
F19pb
the power to give a direction under section 23(2) of the Pension Schemes Act 2021 (direction to obtain actuarial valuation or take other steps to remedy or mitigate failure in relation to a collective money purchase scheme),
pc
the power to give a notice under section 29(1) or (4) of that Act (risk notices),
pd
the power to give a direction under section 29(6) of that Act (direction to implement proposals in a resolution plan),
pe
the power to give a direction under section 39(4) of that Act (direction to submit implementation strategy), and
I1q
such other functions of the Regulator as may be prescribed.
I33
The Determinations Panel must determine the procedure to be followed by it in relation to any exercise by it on behalf of the Regulator of—
a
the power to determine whether to exercise a regulatory function, and
b
where the Panel so determines to exercise a regulatory function, the power to exercise the function in question.
I34
The procedure determined under this section—
a
must provide for the procedure required under—
i
section 96 (standard procedure), and
ii
section 98 (special procedure), and
b
may include such other procedural requirements as the Regulator or, as the case may be, the Panel considers appropriate.
I35
This section is subject to—
a
sections 99 to 104 (the remaining provisions concerning the procedure in relation to the regulatory functions), and
b
any regulations made by the Secretary of State under paragraph 19 of Schedule 1.
I594Publication of procedure in relation to regulatory functions
1
The Regulator must issue a statement of the procedure determined under section 93.
2
The Regulator must arrange for the statement to be published in the way appearing to it to be appropriate.
3
The Regulator may charge a reasonable fee for providing a person with a copy of the statement.
4
If the procedure determined under section 93 is changed in a material way, the Regulator must publish a revised statement.
5
The Regulator must, without delay, give the Secretary of State a copy of any statement which it issues under this section.
95Application of standard and special procedure
1
The Regulator must comply with the standard procedure (see section 96) or, where section 97 applies, the special procedure (see section 98) in a case where—
I6a
the Regulator considers that the exercise of one or more of the regulatory functions may be appropriate, or
b
an application is made under or by virtue of—
I6i
any of the provisions listed in section 10(6), or
ii
any prescribed provision of this or any other enactment,
for the Regulator to exercise a regulatory function.
I62
For the purposes of section 96, references to the regulatory action under consideration in a particular case are—
a
in a case falling within subsection (1)(a), references to the exercise of the one or more regulatory functions which the Regulator considers that it may be appropriate to exercise, and
b
in a case falling within subsection (1)(b), references to the exercise of the regulatory function which is the subject-matter of the application.
I63
Neither section 96 (standard procedure) nor section 98 (special procedure) apply in relation to a determination whether to exercise a regulatory function on a review under section 99 (compulsory review of regulatory action).
96Standard procedure
I71
The procedure determined under section 93 must make provision for the standard procedure.
F21A
In any case where—
a
a warning notice is given to any person in respect of a contribution notice under section 38, and
b
the contribution notice under consideration would be issued wholly or partly by reference to the Regulator's opinion that the material detriment test F16, the employer insolvency test or the employer resources test is met in relation to an act or failure,
the standard procedure must provide for the following matters.
1B
The matters are—
a
a requirement for the warning notice to explain the general effect of section 38B, F1738D or 38F (as the case may be) and
b
a requirement for the person to be given an opportunity before the contribution notice is issued to show the matters mentioned in F18section 38B(2), 38D(2) and (3) or 38F(2) (as the case may be).
I72
The “standard procedure” is a procedure which provides for—
a
the giving of notice to such persons as it appears to the Regulator would be directly affected by the regulatory action under consideration (a “warning notice”),
b
those persons to have an opportunity to make representations,
c
the consideration of any such representations and the determination whether to take the regulatory action under consideration,
d
the giving of notice of the determination to such persons as appear to the Regulator to be directly affected by it (a “determination notice”),
e
the determination notice to contain details of the right of referral to the Tribunal under subsection (3),
f
the form and further content of warning notices and determination notices and the manner in which they are to be given, and
g
the time limits to be applied at any stage of the procedure.
I73
Where the standard procedure applies, the determination which is the subject-matter of the determination notice may be referred to the Tribunal F7... by—
a
any person to whom the determination notice is given as required under subsection (2)(d), and
b
any other person who appears to the Tribunal to be directly affected by the determination.
I74
Subsection (3) does not apply where the determination which is the subject-matter of the determination notice is a determination to issue a clearance statement under section 42 or 46.
I75
Where the determination which is the subject-matter of the determination notice is a determination to exercise a regulatory function and subsection (3) applies, the Regulator must not exercise the function—
a
during the period within which the determination may be referred to the Tribunal F8..., and
b
if the determination is so referred, until the reference, and any appeal against the Tribunal’s determination, has been finally disposed of.
6
Subsection (5) does not apply where the determination is a determination to exercise any of the following functions—
a
the power to make a direction under section 76(8) extending the retention period for documents taken into possession under section 75;
b
the power to make a direction under section 78(10) extending the retention period for documents taken into possession under that section;
c
the power to make an order under section 154(8);
d
the power to make an order under section 219(4);
e
the power to grant or revoke authorisation under section 288;
f
the power to grant or revoke approval under section 289;
g
the power to issue a notice under section 293(5);
h
the power to make an order under section 3(1) of the Pensions Act 1995 (c. 26) prohibiting a person from being a trustee;
i
the power to make an order under section 3(3) of that Act revoking such an order;
F10ia
the power under section 3A(3) of that Act to give a notice waiving a prohibition;
j
the power to make an order under section 4(1) of that Act suspending a trustee;
k
the power to make an order under section 4(2) of that Act extending the period for which an order under section 4(1) of that Act has effect;
l
the power to make an order under section 4(5) of that Act revoking an order under section 4(1) of that Act suspending a trustee;
m
the power to make an order under section 7 of that Act appointing a trustee;
n
the power under section 9 of that Act to exercise by order the same jurisdiction and powers as the High Court or the Court of Session for vesting property in, or transferring property to, trustees in consequence of the appointment or removal of a trustee;
o
the power to make an order under section 23 of that Act appointing an independent trustee;
p
the power under section 29(5) of that Act to give a notice waiving a disqualification under section 29 of that Act;
q
the power under section 30(2) of that Act to exercise by order the same jurisdiction and powers as the High Court or the Court of Session for vesting property in, or transferring property to, the trustees where a trustee becomes disqualified under section 29 of that Act;
r
the power to give directions under section 72B of that Act facilitating a winding up;
s
the power by direction under section 99(4) of the Pension Schemes Act 1993 (c. 48) to grant an extension of the period within which the trustees or managers of a scheme are to carry out certain duties;
t
the power by direction under section 101J(2) of that Act to extend the period for compliance with a transfer notice;
u
such other regulatory functions as may be prescribed;
v
the power under section 101(1)(b) to vary or revoke in relation to the exercise of any of the regulatory functions mentioned in paragraphs (a) to (u) other than those mentioned in paragraph (i) or (l).
F96A
Subsection (6B) applies in relation to a warning notice given to a person—
a
in respect of a contribution notice under section 38, or
b
in respect of a financial support direction under section 43.
6B
Regulations may provide that no determination notice in respect of the contribution notice or the financial support direction may be given after the end of the prescribed period beginning with the day on which the warning notice is given.
F67
In this section “the Tribunal”, in relation to any reference under subsection (3), means—
a
the First-tier Tribunal, in any case where it is determined by or under Tribunal Procedure Rules that the First-tier Tribunal is to hear the reference;
b
the Upper Tribunal, in any other case.
97Special procedure: applicable cases
I41
The special procedure in section 98 (and not the standard procedure) applies to—
a
a case falling within subsection (2),
b
a case falling within subsection (3), and
c
a case falling within subsection (4).
I42
A case falls within this subsection if—
a
the Regulator considers that it may be necessary to exercise a regulatory function listed in subsection (5) immediately because there is, or the Regulator considers it likely that if a warning notice were to be given there would be, an immediate risk to—
i
the interests of members under an occupational or personal pension scheme, or
ii
the assets of such a scheme,
b
the Regulator accordingly dispenses with the giving of a warning notice and an opportunity to make representations as described in section 96(2)(a) and (b), and
c
the Regulator determines to exercise the function immediately on the basis that it is necessary to do so because there is, or the Regulator considers it likely that if the function were not exercised immediately there would be, an immediate risk to—
i
the interests of members under an occupational or personal pension scheme, or
ii
the assets of such a scheme.
I43
A case falls within this subsection if—
a
the Regulator gives a warning notice as described in section 96(2)(a) in relation to a determination whether to exercise a regulatory function listed in subsection (5), and
b
before it has considered the representations of those persons to whom the warning notice is given, the Regulator determines to exercise the function immediately on the basis that it is necessary to do so because there is, or the Regulator considers it likely that if the function were not exercised immediately there would be, an immediate risk to—
i
the interests of members under an occupational or personal pension scheme, or
ii
the assets of such a scheme.
I44
A case falls within this subsection if the Regulator—
a
gives a warning notice as described in section 96(2)(a) in relation to a determination whether to exercise a regulatory function which—
i
is listed in subsection (5), and
ii
is not a function listed in section 96(6) (functions which may be exercised immediately under the standard procedure),
b
considers the representations of those persons to whom the warning notice is given, and
c
determines to exercise the function immediately on the basis that it is necessary to do so because there is, or the Regulator considers it likely that if the function were not exercised immediately there would be, an immediate risk to—
i
the interests of members under an occupational or personal pension scheme, or
ii
the assets of such a scheme.
5
The regulatory functions referred to in subsections (2), (3) and (4) are—
a
the power to make or extend a restraining order under section 20;
b
the power to make a freezing order under section 23;
c
the power to make an order under section 25(3) extending the period for which a freezing order has effect;
d
the power to make an order under section 26 validating action taken in contravention of a freezing order;
e
the power to make an order under section 28 directing that specified steps are taken;
f
the power to make an order under section 30 giving a direction where a freezing order ceases to have effect;
g
the power to make an order under section 31(3) directing the notification of members;
h
the power to make an order under section 231 modifying a scheme, giving directions or imposing a schedule of contributions;
i
the power to make an order under section 3(1) of the Pensions Act 1995 (c. 26) prohibiting a person from being a trustee;
j
the power to make an order under section 3(3) of that Act revoking such an order;
F11ja
the power under section 3A(3) of that Act to give a notice waiving a prohibition;
k
the power to make an order under section 4(1) of that Act suspending a trustee;
l
the power to make an order under section 4(5) of that Act revoking such an order;
m
the power to make an order under section 7 of that Act appointing a trustee;
n
the power under section 9 of that Act to exercise by order the same jurisdiction and powers as the High Court or the Court of Session for vesting property in, or transferring property to, trustees in consequence of the appointment or removal of a trustee;
o
the power to make an order under section 11 of that Act directing or authorising an occupational pension scheme to be wound up;
p
the power to make an order under section 23 of that Act appointing an independent trustee;
q
the power under section 29(5) of that Act to give a notice waiving a disqualification under section 29 of that Act;
r
the power under section 30(2) of that Act to exercise by order the same jurisdiction and powers as the High Court or the Court of Session for vesting property in, or transferring property to, the trustees where a trustee becomes disqualified under section 29 of that Act;
s
the power to make an order under section 67G(2) of that Act by virtue of which any modification of, or grant of rights under, an occupational pension scheme is void to any extent;
t
the power to make an order under section 67H(2) of that Act prohibiting, or specifying steps to be taken in relation to, the exercise of a power to modify an occupational pension scheme;
F1ta
a power under section 24H of the Pension Schemes Act 1993;
F13tb
the power to withdraw authorisation of a Master Trust scheme under section 19 of the Pension Schemes Act 2017;
tc
the power to make a pause order under section 31 of that Act;
td
the power to make an order under paragraph 2(2) of Schedule 1 to that Act extending the period for which a pause order has effect;
te
the power to make an order under paragraph 3 of that Schedule validating action taken in contravention of a pause order;
tf
the power to make an order under paragraph 4(3) of that Schedule directing the notification of members or employers;
F20tg
the power under section 30 of the Pension Schemes Act 2021 to withdraw authorisation of a collective money purchase scheme;
th
the power to make a pause order under section 44 of that Act;
ti
the power to make an order under paragraph 2(2) of Schedule 2 to that Act extending the period for which a pause order has effect;
tj
the power to make an order under paragraph 3 of that Schedule validating action taken in contravention of a pause order;
tk
the power to make an order under paragraph 4(3) of that Schedule directing the notification of members or employers;
I2u
such other regulatory functions as may be prescribed;
v
the power under section 101(1)(b) to vary or revoke in relation to the exercise of any of the regulatory functions mentioned in paragraphs (a) to (u) other than those mentioned in paragraph (j) or (l).
I898Special procedure
1
The procedure determined under section 93 must make provision for the special procedure.
2
The “special procedure” is a procedure which provides for—
a
the giving of notice of the determination to exercise the regulatory function to such persons as appear to the Regulator to be directly affected by it (a “determination notice”),
b
the determination notice to contain details of the requirement for the Regulator to review the determination under section 99(1) and of any subsequent right of referral to the Tribunal under section 99(7),
c
the persons to whom the determination notice was given (as required under paragraph (a)) to have an opportunity to make representations in relation to the determination before it is reviewed under section 99(1),
d
the consideration of any such representations before the determination on the review,
e
the giving of a notice in accordance with section 99(4) of the determination on the review (a “final notice”),
f
the final notice to contain details of the right of referral to the Tribunal under section 99(7),
g
the form and further content of determination notices and final notices and the manner in which they are to be given, and
h
the time limits to be applied at any stage of the procedure.
I999Compulsory review
1
In a case where the special procedure applies, the Regulator must review the determination to exercise the regulatory function.
2
The review must be determined as soon as reasonably practicable.
3
The Regulator’s powers on a review under this section include power to—
a
confirm, vary or revoke the determination,
b
confirm, vary or revoke any order, notice or direction made, issued or given as a result of the determination,
c
substitute a different determination, order, notice or direction,
d
deal with the matters arising on the review as if they had arisen on the original determination, and
e
make savings and transitional provision.
4
When the Regulator has completed a review under this section a notice of its determination on the review must be given to such persons as appear to it to be directly affected by its determination on the review.
5
If the final notice contains a determination to exercise a different regulatory function to the function which was the subject-matter of the determination notice, then the final notice may not be given unless—
a
such persons as appear to the Regulator to be directly affected by the exercise of the regulatory function have been given an opportunity to make representations, and
b
the Regulator has considered any such representations before it makes its determination on the review.
6
Subsection (5) does not apply if the regulatory function is listed in section 97(5) and the Regulator determines to exercise it immediately on the basis that it is necessary to do so because there is, or the Regulator considers it likely that if the function were not exercised immediately there would be, an immediate risk to—
a
the interests of members under an occupational or personal pension scheme, or
b
the assets of such a scheme.
7
The determination which is the subject-matter of a final notice may be referred to the Tribunal F4... by—
a
any person to whom the final notice is given as required under subsection (4), and
b
any other person who appears to the Tribunal to be directly affected by the determination.
8
Where that determination is a determination to exercise a different regulatory function to the function which was the subject-matter of the determination notice, the Regulator must not exercise the regulatory function—
a
during the period within which the determination may be referred to the Tribunal F5..., and
b
if the determination is so referred, until the reference, and any appeal against the Tribunal’s determination, has been finally disposed of.
9
Subsection (8) does not apply where—
a
the regulatory function in question is a function listed in section 96(6) (functions which may be exercised immediately under the standard procedure), or
b
the regulatory function in question is a function listed in section 97(5) (functions which may be exercised immediately under the special procedure) and the Regulator determines to exercise it immediately on the basis described in subsection (6).
10
The functions of the Regulator under this section are exercisable on behalf of the Regulator by the Determinations Panel (and are not otherwise exercisable by or on behalf of the Regulator).
11
The Panel must determine the procedure that it proposes to follow in relation to the exercise of those functions.
12
Section 94 (publication of Regulator’s procedure) applies in relation to the procedure determined under subsection (11) as it applies to the procedure determined under section 93 (procedure in relation to the regulatory functions).
F313
In this section “the Tribunal”, in relation to any reference under subsection (7), means—
a
the First-tier Tribunal, in any case where it is determined by or under Tribunal Procedure Rules that the First-tier Tribunal is to hear the reference;
b
the Upper Tribunal, in any other case.
I10100Duty to have regard to the interests of members etc
1
The Regulator must have regard to the matters mentioned in subsection (2)—
a
when determining whether to exercise a regulatory function—
i
in a case where the requirements of the standard or special procedure apply, or
ii
on a review under section 99, and
b
when exercising the regulatory function in question.
2
Those matters are—
a
the interests of the generality of the members of the scheme to which the exercise of the function relates, and
b
the interests of such persons as appear to the Regulator to be directly affected by the exercise.
101Powers to vary or revoke orders, notices or directions etc
I111
The Regulator may vary or revoke—
a
any determination by the Regulator whether to exercise a regulatory function, or
b
any order, notice or direction made, issued or given by the Regulator in the exercise of a regulatory function.
2
Subsection (1)(b) does not apply to—
I11a
an order under section 3(3) of the Pensions Act 1995 (c. 26) revoking a prohibition order under that section,
I11b
an order under section 4(5) of that Act revoking a suspension order under that section,
I11c
a direction under section 2(3) of the Welfare Reform and Pensions Act 1999 (c. 30) refusing to register a scheme under section 2 of that Act or removing a scheme from the register of stakeholder pension schemes, or
d
such other orders, notices or directions made, issued or given by the Regulator, in the exercise of a regulatory function, as may be prescribed.
I113
A variation or revocation of an order, a notice or a direction must be made by an order, a notice or a direction (as the case may be).
I114
A variation or revocation made under this section must take effect from a specified time which must not be a time earlier than the time when the variation or revocation is made.
I115
The power to vary or revoke under this section—
a
is not to be treated for the purposes of subsection (1) as a regulatory function, and
b
is in addition to any such power which is conferred on the Regulator by, or by virtue of, this or any other enactment.
Pt. 1 applied in part (with modifications) (20.7.2005 for specified purposes, 1.9.2005 for specified purposes, 5.12.2005 for specified purposes) by The Financial Assistance Scheme Regulations 2005 (S.I. 2005/1986), regs. 1(1), 4, Sch. 1 Pt. 1 (as amended (17.7.2008) by The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2008 (S.I. 2008/1903), regs. 1, 5(2), 13; (10.7.2009) by The Financial Assistance Scheme (Miscellaneous Provisions) Regulations 2009 (S.I. 2009/1851), regs. 1, 5, 18; (2.4.2010) by The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010 (S.I. 2010/1149), regs. 1, 5, 15)