Financial Services and Markets Bill -
Amendments to be debated in the House of Lords
- continued
House of Lords

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Clause 72
 
  
BY THE LORD McINTOSH OF HARINGEY
 
168     Page 33, line 5, leave out ("Stock Exchange") and insert ("Authority") 
169     Page 33, line 6, at end insert--
 
    ("(  )  Schedule 6A modifies this Act in its application to the Authority when it acts as the competent authority.")
 
170     Page 33, line 10, leave out subsections (3) to (8) 
  
After Clause 72
 
  
BY THE LORD McINTOSH OF HARINGEY
 
171     Insert the following new Clause-- 
     (".--(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;
    (c)  the desirability of facilitating innovation in respect of listed securities;
    (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;
    (f)  the desirability of facilitating competition in relation to listed securities.
    (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.")
General duty of the competent authority.
  
Before Schedule 7
 
  
BY THE LORD McINTOSH OF HARINGEY
 
172     Insert the following new Schedule-- 
 ("SCHEDULE 6A 
 THE AUTHORITY AS COMPETENT AUTHORITY FOR PART VI 
 General 
     1. This Act applies in relation to the Authority when it is exercising functions under Part VI as the competent authority subject to the following modifications. 
 The Authority's general functions 
     2. In section 2--
    (a)  subsection (4)(a) does not apply to listing rules;
    (b)  subsection (4)(c) does not apply to general guidance given in relation to Part VI; and
    (c)  subsection (4)(d) does not apply to functions under Part VI.
 
 Duty to consult 
     3. Section 7 does not apply. 
 Rules 
     4.--(1) Sections 140, 144, 145 and 147 do not apply.
 
    (2)  Section 146 has effect as if--
    (a)  the reference in subsection (2)(c) to the general duties of the Authority under section 2 were a reference to its duty under section (General duty of the competent authority); and
    (b)  section 95 were included in the provisions referred to in subsection (9).
 
 Statements of policy 
     5.--(1) Paragraph 5 of Schedule 1 has effect as if the requirement to act through the Authority's governing body applied also to the exercise of its functions of publishing statements under section 89.
 
    (2)  Paragraph 1 of Schedule 1 has effect as if section 89 were included in the provisions referred to in sub-paragraph (2)(d).
 
 Penalties 
     6. Paragraph 16 of Schedule 1 does not apply in relation to penalties under Part VI (for which separate provision is made by section (Penalties)). 
 Fees 
     7. Paragraph 17 of Schedule 1 does not apply in relation to fees payable under Part VI (for which separate provision is made by section 95). 
 Exemption from liability in damages 
     8. Schedule 1 has effect as if paragraph 19 were omitted (similar provision being made in relation to the competent authority by section 97).") 
  
Schedule 7
 
  
BY THE LORD McINTOSH OF HARINGEY
 
173     Page 238, line 25, leave out from beginning to first ("that") in line 27 and insert--
    ("(b)  the Treasury are satisfied that the manner in which, or efficiency with which, the functions are discharged would be significantly improved if they were transferred to the transferee; or
    (c)  the Treasury are satisfied")
 
174     Page 238, line 29, leave out paragraphs 2 to 6 
175     Page 239, line 27, after ("VI") insert (", IX or XXVI") 
176     Page 239, line 28, at end insert--
    ("(  )  for reviews similar to that made, in relation to the Authority, by section 10;
    (  )  imposing on the new authority requirements similar to those imposed, in relation to the Authority, by sections 143, 146 and (Authority's duty to co-operate with others);
    (  )  as to the giving of guidance by the new authority;
    (  )  for the delegation by the new authority of the exercise of functions under Part VI and as to the consequences of delegation;")
 
177     Page 239, line 43, at end insert--
 
    ("  . If the Treasury have made an order under paragraph 1 ("the transfer order") they may, by a separate order made under this paragraph, make any provision of a kind that could have been included in the transfer order.")
 
  
Clause 73
 
  
BY THE LORD McINTOSH OF HARINGEY
 
178     Page 33, line 30, leave out ("continue to") 
  
Clause 76
 
  
BY THE LORD McINTOSH OF HARINGEY
 
179     Page 35, line 4, at end insert--
 
    ("(  )  If the competent authority discontinues or suspends the listing of any securities, the issuer may refer the matter to the Tribunal.")
 
  
Clause 83
 
  
BY THE LORD McINTOSH OF HARINGEY
 
180     Page 38, line 25, leave out subsection (6) 
  
After Clause 85
 
  
BY THE LORD McINTOSH OF HARINGEY
 
181     Insert the following new Clause-- 
 ("Sponsors 
     .--(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,
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.")
Sponsors.
  
Clause 87
 
  
BY THE LORD McINTOSH OF HARINGEY
 
182     Page 40, line 2, leave out from ("that") to end of line 12 and insert ("--
    (a)  an issuer of listed securities, or
    (b)  an applicant for listing,
has contravened any provision of listing rules, it may impose on him a penalty of such amount as it considers appropriate.
 
    (  )  If, in such a case, the competent authority considers that a person who was at the material time a director of the issuer or applicant was knowingly concerned in the contravention, it may impose on him a penalty of such amount as it considers appropriate.
 
    (  )  If the competent authority is entitled to impose a penalty on a person under this section in respect of a particular matter it may, instead of imposing a penalty on him in respect of that matter, publish a statement censuring him.
 
    (  )  Nothing in this section prevents the competent authority from taking any other steps which it has power to take under this Part.")
 
183     Page 40, line 14, leave out ("impose a penalty on a person under subsection (1)(b)") and insert ("take action against a person under this section") 
184     Page 40, line 16, at end insert ("unless proceedings against that person, in respect of the contravention, were begun before the end of that period") 
185     Page 40, line 19, at end insert ("; and
    (b)  proceedings against a person in respect of a contravention are to be treated as begun when a warning notice is given to him under section 88.")
 
  
Clause 88
 
  
BY THE LORD SAATCHI
THE LORD KINGSLAND
 
185A     Page 40, line 30, at end insert--
 
    ("(  )  If the competent authority decides to impose a penalty on a person under section 87, it must give him a decision notice.")
 
  
Clause 89
 
  
BY THE LORD McINTOSH OF HARINGEY
 
186     Page 40, line 31, leave out ("publish") and insert ("issue") 
187     Page 40, line 34, at end insert--
 
    ("(  )  The Authority's policy in determining what the amount of a penalty should be must include having regard to--
    (a)  the seriousness of the contravention in question in relation to the nature of the requirement contravened;
    (b)  the extent to which that contravention was deliberate or reckless; and
    (c)  whether the person on whom the penalty is to be imposed is an individual.")
 
  
Clause 91
 
  
BY THE LORD McINTOSH OF HARINGEY
 
     The Lord McIntosh of Haringey gives notice of his intention to oppose the Question that Clause 91 stand part of the Bill. 
  
Clause 93
 
  
BY THE LORD McINTOSH OF HARINGEY
 
188     Page 42, line 7, leave out from beginning to ("if") in line 10 
189     Page 42, line 10, after ("information,") insert ("they may include provision") 
  
After Clause 93
 
  
BY THE LORD McINTOSH OF HARINGEY
 
190     Insert the following new Clause-- 
     ("  .--(1)  Subsection (2) applies if it appears to the competent authority that there are circumstances suggesting that--
    (a)  there may have been a breach of listing rules;
    (b)  a person who was at the material time a director of an issuer of listed securities has been knowingly concerned in a breach of listing rules by that issuer;
    (c)  a person who was at the material time a director of a person applying for the admission of securities to the official list has been knowingly concerned in a breach of listing rules by that applicant;
    (d)  there may have been a contravention of section 81, 83 or 94.
    (2)  The competent authority may appoint one or more competent persons to conduct an investigation on its behalf.
 
    (3)  Part XI applies to an investigation under subsection (2) as if--
    (a)  the investigator were appointed under section 158(1);
    (b)  references to the investigating authority in relation to him were to the competent authority;
    (c)  references to the offences mentioned in section 159 were to those mentioned in subsection (1)(d);
    (d)  references to an authorised person were references to the person under investigation.")
Appointment by competent authority of persons to carry out investigations.
  
Clause 95
 
  
BY THE LORD McINTOSH OF HARINGEY
 
191     Page 43, line 1, at end insert--
    ("(  )  applications under section (Sponsors) for approval as a sponsor; and
    (  )  continued inclusion of sponsors in the list of sponsors.
    (2)  In exercising its powers under subsection (1), the competent authority may set such fees as it considers will (taking account of the income it expects as the competent authority) enable it--
    (a)  to meet expenses incurred in carrying out its functions under this Part or for any incidental purpose;
    (b)  to maintain adequate reserves; and
    (c)  in the case of the Authority, to repay the principal of, and pay any interest on, any money which it has borrowed and which has been used for the purpose of meeting expenses incurred in relation to--
          (i)  its assumption of functions from the London Stock Exchange Limited in relation to the official list; and
          (ii)  its assumption of functions under this Part.
    (3)  In fixing the amount of any fee which is to be payable to the competent authority, no account is to be taken of any sums which it receives, or expects to receive, by way of penalties imposed by it under this Part.
 
    (4)  Subsection (2)(c) applies whether expenses were incurred before or after the coming into force of this Part.
 
    (5)  Any fee which is owed to the competent authority under any provision made by or under this Part may be recovered as a debt due to it.")
 
  
After Clause 95
 
  
BY THE LORD McINTOSH OF HARINGEY
 
192     Insert the following new Clause-- 
     (".--(1) In determining its policy with respect to the amount of penalties to be imposed by it under this Part, the competent authority must take no account of the expenses which it incurs, or expects to incur, in discharging its functions under this Part.
 
    (2)  The competent authority must prepare and operate a scheme for ensuring that the amounts paid to it by way of penalties imposed under this Part are applied for the benefit of issuers of securities admitted to the official list.
 
    (3)  The scheme may, in particular, make different provision with respect to different classes of issuer.
 
    (4)  Up to date details of the scheme must be set out in a document ("the scheme details").
 
    (5)  The scheme details must be published by the competent authority in the way appearing to it to be best calculated to bring them to the attention of the public.
 
    (6)  Before making the scheme, the competent authority must publish a draft of the proposed scheme in the way appearing to it to be best calculated to bring it to the attention of the public.
 
    (7)  The draft must be accompanied by notice that representations about the proposals may be made to the competent authority within a specified time.
 
    (8)  Before making the scheme, the competent authority must have regard to any representations made to it under subsection (7).
 
    (9)  If the competent authority makes the proposed scheme, it must publish an account, in general terms, of--
    (a)  the representations made to it in accordance with subsection (7); and
    (b)  its response to them.
    (10)  If the scheme differs from the draft published under subsection (6) in a way which is, in the opinion of the competent authority, significant the competent authority must (in addition to complying with subsection (9)) publish details of the difference.
 
    (11)  The competent authority must, without delay, give the Treasury a copy of any scheme details published by it.
 
    (12)  The competent authority may charge a reasonable fee for providing a person with a copy of--
    (a)  a draft published under subsection (6);
    (b)  scheme details.
    (13)  Subsections (6) to (10) and (12) apply also to a proposal to alter or replace the scheme.")
Penalties.
 
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