Financial Services and Markets Bill - continued        House of Lords
PART XVII, COLLECTIVE INVESTMENT SCHEMES - continued
Schemes constituted in other EEA States - continued

back to previous text
 
Power of Authority to suspend promotion of scheme.     263. - (1) Subsection (2) applies if it appears to the Authority that the operator of a scheme has communicated an invitation or inducement of a kind mentioned in section 234(1) in relation to the scheme in a manner contrary to financial promotion rules.
 
      (2) The Authority may direct that-
 
 
    (a) the exemption from subsection (1) of section 234 provided by subsection (4)(c) of that section is not to apply in relation to the scheme; and
 
    (b) subsection (5) of that section does not apply with respect to things done in relation to the scheme.
      (3) A direction under subsection (2) has effect-
 
 
    (a) for a specified period;
 
    (b) until the occurrence of a specified event; or
 
    (c) until specified conditions are complied with.
      (4) The Authority may, either on its own initiative or on the application of the operator of the scheme concerned, vary a direction given under subsection (2) if it appears to the Authority that the direction should take effect or continue in force in a different form.
 
      (5) The Authority may, either on its own initiative or on the application of the operator of the recognised scheme concerned, revoke a direction given under subsection (2) if it appears to the Authority-
 
 
    (a) that the conditions specified in the direction have been complied with; or
 
    (b) that it is no longer necessary for the direction to take effect or continue in force.
      (6) If an event is specified, the direction ceases to have effect (unless revoked earlier) on the occurrence of that event.
 
      (7) For the purposes of this section and sections 264 and 265-
 
 
    (a) the scheme's home State is the EEA State in which the scheme is constituted (within the meaning given by section 260);
 
    (b) the competent authorities in the scheme's home State are the authorities in that State who are responsible for the authorisation of collective investment schemes.
      (8) "Scheme" means a scheme which is a recognised scheme by virtue of section 260.
 
      (9) "Specified", in relation to a direction, means specified in it.
 
Procedure on giving directions under section 263 and varying them on Authority's own initiative.     264. - (1) A direction under section 263 takes effect-
 
 
    (a) immediately, if the notice given under subsection (3)(a) states that that is the case;
 
    (b) on such date as may be specified in the notice; or
 
    (c) if no date is specified in the notice, when the matter to which it relates is no longer open to review.
      (2) A direction may be expressed to take effect immediately (or on a specified date) only if the Authority, having regard to its reasons for exercising its power under section 263, considers that it is necessary for the direction to take effect immediately (or on that date).
 
      (3) If the Authority proposes to give a direction under section 263, or gives such a direction with immediate effect, it must-
 
 
    (a) give the operator of the scheme concerned written notice; and
 
    (b) inform the competent authorities in the scheme's home State of its proposal or (as the case may be) of the direction.
      (4) The notice must-
 
 
    (a) give details of the direction;
 
    (b) inform the operator of when the direction takes effect;
 
    (c) state the Authority's reasons for giving the direction and for its determination as to when the direction takes effect;
 
    (d) inform the operator that he may make representations to the Authority within such period as may be specified in it (whether or not he has referred the matter to the Tribunal); and
 
    (e) inform him of his right to refer the matter to the Tribunal.
      (5) The Authority may extend the period allowed under the notice for making representations.
 
      (6) Subsection (7) applies if, having considered any representations made by the operator, the Authority decides-
 
 
    (a) to give the direction in the way proposed, or
 
    (b) if it has been given, not to revoke the direction.
      (7) The Authority must-
 
 
    (a) give the operator of the scheme concerned written notice; and
 
    (b) inform the competent authorities in the scheme's home State of the direction.
      (8) Subsection (9) applies if, having considered any representations made by a person to whom the notice was given, the Authority decides-
 
 
    (a) not to give the direction in the way proposed,
 
    (b) to give the direction in a way other than that proposed, or
 
    (c) to revoke a direction which has effect.
      (9) The Authority must-
 
 
    (a) give the operator of the scheme concerned written notice; and
 
    (b) inform the competent authorities in the scheme's home State of its decision.
      (10) A notice given under subsection (7)(a) must inform the operator of his right to refer the matter to the Tribunal.
 
      (11) A notice under subsection (9)(a) given as a result of subsection (8)(b) must comply with subsection (4).
 
      (12) If a notice informs a person of his right to refer a matter to the Tribunal, it must give an indication of the procedure on such a reference.
 
      (13) This section applies to the variation of a direction on the Authority's own initiative as it applies to the giving of a direction.
 
Procedure on application for variation or revocation of direction.     265. - (1) If, on an application under subsection (4) or (5) of section 263, the Authority proposes-
 
 
    (a) to vary a direction otherwise than in accordance with the application, or
 
    (b) to refuse the application,

it must give the operator of the scheme concerned a warning notice.

      (2) If, on such an application, the Authority decides-
 
 
    (a) to vary a direction otherwise than in accordance with the application, or
 
    (b) to refuse the application,

it must give the operator of the scheme concerned a decision notice.

      (3) If, on such an application, the Authority decides to grant the application it must give the operator of the scheme concerned written notice.
 
      (4) If the Authority decides on its own initiative to revoke a direction given under section 263 it must give the operator of the scheme concerned written notice.
 
      (5) The Authority must inform the competent authorities in the scheme's home State of any notice given under this section.
 
 
Schemes authorised in designated countries or territories
Schemes authorised in designated countries or territories.     266. - (1) A collective investment scheme which is not a recognised scheme by virtue of section 260 but is managed in, and authorised under the law of, a country or territory outside the United Kingdom is a recognised scheme if-
 
 
    (a) that country or territory is designated for the purposes of this section by an order made by the Treasury;
 
    (b) the scheme is of a class specified by the order;
 
    (c) the operator of the scheme has given written notice to the Authority that he wishes it to be recognised; and
 
    (d) either-
 
      (i) the Authority, by written notice, has given its approval to the scheme's being recognised; or
 
      (ii) two months, beginning with the date on which notice was given under paragraph (c), have expired without the operator receiving a warning notice from the Authority under section 267.
      (2) The Treasury may not make an order designating any country or territory for the purposes of this section unless satisfied-
 
 
    (a) that the law and practice under which relevant collective investment schemes are authorised and supervised in that country or territory affords to investors in the United Kingdom protection at least equivalent to that provided for them by or under this Part in the case of comparable authorised schemes; and
 
    (b) that adequate arrangements exist, or will exist, for co-operation between the authorities of the country or territory responsible for the authorisation and supervision of relevant collective investment schemes and the Authority.
      (3) "Relevant collective investment schemes" means collective investment schemes of the class or classes to be specified by the order.
 
      (4) "Comparable authorised schemes" means whichever of the following the Treasury consider to be the most appropriate, having regard to the class or classes of scheme to be specified by the order-
 
 
    (a) authorised unit trust schemes;
 
    (b) authorised open-ended investment companies;
 
    (c) both such unit trust schemes and such companies.
      (5) If the Treasury are considering whether to make an order designating a country or territory for the purposes of this section-
 
 
    (a) the Treasury must ask the Authority for a report-
 
      (i) on the law and practice of that country or territory in relation to the authorisation and supervision of relevant collective investment schemes,
 
      (ii) on any existing or proposed arrangements for co-operation between it and the authorities responsible in that country or territory for the authorisation and supervision of relevant collective investment schemes,

having regard to the Treasury's need to be satisfied as mentioned in subsection (2);
 
    (b) the Authority must provide the Treasury with such a report; and
 
    (c) the Treasury must have regard to it in deciding whether to make the order.
      (6) The notice to be given by the operator under subsection (1)(c)-
 
 
    (a) must contain the address of a place in the United Kingdom for the service on the operator of notices or other documents required or authorised to be served on him under this Act; and
 
    (b) must contain or be accompanied by such information and documents as may be specified by the Authority.
Procedure.     267. - (1) If the Authority proposes to refuse approval of a scheme's being a recognised scheme by virtue of section 266, it must give the operator of the scheme a warning notice.
 
      (2) To be valid the warning notice must be received by the operator before the end of two months beginning with the date on which notice was given under section 266(1)(c).
 
      (3) If, having given a warning notice, the Authority decides to refuse approval-
 
 
    (a) it must give the operator of the scheme a decision notice; and
 
    (b) the operator may refer the matter to the Tribunal.
 
previous section contents continue
 
House of Lords home page Houses of Parliament home page House of Commons home page search page enquiries

© Parliamentary copyright 2000
Prepared 31 March 2000