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Lord McIntosh of Haringey moved Amendment No. 222:


On Question, amendment agreed to.

[Amendment No. 222A not moved.]

Lord McIntosh of Haringey moved Amendment No. 223:


    Page 55, line 27, leave out ("impose a penalty on") and insert ("take action against").

On Question, amendment agreed to.

Clause 117, as amended, agreed to.

Clauses 118 to 120 agreed to.

Clause 121 [Guidance]:

Lord McIntosh of Haringey moved Amendment No. 224:


    Page 56, leave out lines 37 and 38.

The noble Lord said: This clause provides a power for Treasury Ministers, together with the Attorney-General and the Secretary of State, to produce guidance for the purpose of helping the relevant authorities--that is, the FSA and the various prosecuting authorities--to determine the action to be taken in cases where behaviour occurs which could potentially be either prosecuted as a criminal offence, or dealt with under the market abuse provisions. Perhaps I may ask the noble and learned Lord, Lord Donaldson, whether we had better start to call these "either way" offences. Insider dealing might be an example of this, since it is a criminal offence under Section 52 of the Criminal Justice Act 1993 and will come within the test in Clause 109(2)(a).

We have made it clear all along that where behaviour comes within the criminal offences, it is the firm intention of Ministers that, provided the evidential test and public interest tests for a prosecution are met, then criminal prosecutions should be taken.

The FSA is currently working with the Serious Fraud Office, the Attorney-General's Office, the DTI, the Crown Prosecution Service, the Association of Chief Police Officers and the Scottish Executive to agree guidelines on the handling of cases in which one or more of these other agencies may have an interest. The Treasury is represented on these groups. Once these guidelines have been finalised, it is envisaged that they will be published.

I also emphasise that this is very much a reserve power. We do not envisage formal guidance being given as a matter of course for any part of the UK when the Bill comes into force. Only if the agencies concerned could not agree among themselves how to handle particular cases would we expect guidance to be given. But I stress that we have no reason to believe that such a situation is likely to arise.

In England, Wales and Northern Ireland there are a number of different prosecuting authorities with powers over the offences specified in Clause 121,

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including the Secretary of State, the Serious Fraud Office, the Director of Public Prosecutions and the FSA itself. It is therefore appropriate that the Treasury should take on the responsibility for giving guidance in consultation with the Secretary of State and with the Attorney-General, who has ministerial responsibility for the DPP and the SFO.

In Scotland, however, the position is somewhat different. The Lord Advocate is the sole prosecuting authority in Scotland for all criminal offences. Given that, and given his position as head of the Scottish criminal prosecution system, it would be inappropriate for him to be subject to guidance issued by the Treasury. These two amendments therefore provide that in Scotland it is for the Lord Advocate to issue any necessary guidance to the authority after consultation with the Treasury.

Finally, since these amendments deal with the responsibilities of the Lord Advocate, who is a Minister of the Scottish Executive, we have, of course, discussed them in advance with the Executive and they have confirmed that they are content with the proposed approach. I beg to move.

On Question, amendment agreed to.

Lord McIntosh of Haringey moved Amendment No. 225:


    Page 56, line 41, at end insert--


("( ) Subsections (1) to (3) do not apply to Scotland.
( ) In relation to Scotland, the Lord Advocate may from time to time, after consultation with the Treasury, issue written guidance for the purpose of helping the Authority to determine the action to be taken in cases where behaviour mentioned in subsection (1) occurs.").

On Question, amendment agreed to.

Clause 121, as amended, agreed to.

Clauses 122 and 123 agreed to.

Schedule 12 [The Financial Services and Markets Tribunal]:

Lord McIntosh of Haringey moved Amendment No. 226:


    Page 254, line 7, leave out sub-paragraph (6).

On Question, amendment agreed to.

Schedule 12, as amended, agreed to.

Clause 124 [Proceedings: general provision]:

Lord Kingsland moved Amendment No. 226A:


    Page 57, line 30, at beginning insert ("The Authority shall not take any action pursuant to a decision notice during the period referred to in subsection (1) and").

The noble Lord said: The Committee will be aware that Clause 124(5) provides that a decision which is referred to the tribunal is not to have effect until the reference has been disposed of. I am concerned about what happens in the period before the decision is referred, which may be as long as 28 days. It is important that the authority does not jump the gun (if I may use that colloquial expression) and put a decision into effect while the defendant is still thinking about whether or not to refer the decision to the tribunal.

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As I understand it, the Treasury agreed at Committee stage in another place that it intended Clause 124(5) also to cover that earlier period, in the same way that Clause 376(6) excludes the ability to publicise any information while the decision is open to review. This amendment achieves the same result. I beg to move.

Lord McIntosh of Haringey: The Government entirely understand the concerns expressed by the noble Lord. This point was debated in some depth in another place, as the noble Lord recognised. As Ministers made clear, it is not our intention that the FSA should be able to demand the payment of penalties during the period when the person concerned has a right to refer the matter to the tribunal.

I had hoped that today we would table amendments relating to the decision-making procedures in the Bill generally. There will be an opportunity to debate those next week. Among those amendments is one which addresses exactly this concern. We propose a new clause after Clause 376 in Part XXVI which creates the concept of a "final notice". It will be that notice which gives effect to any decision; for example, by requiring the payment of a financial penalty. The FSA will not be able to issue a final notice during the period following the issue of the decision notice in which the person concerned has a right to refer the matter to the tribunal. We shall return to Clause 124 on Report to make that clear here as well.

If the matter is referred, the final notice must give effect to the determination made by the tribunal or, if the decision is appealed, to the judgment of the higher courts. There will be no question of the FSA being able to require a penalty to be paid or to make a public statement in the period allowed for the decision to be referred to the tribunal or appealed to the higher courts. However, I should make it clear that some decisions will be capable of taking effect ahead of any reference to the tribunal. The amendments that we shall table draw a distinction between those decisions to which the full warning and decision notice procedure should apply and those where provision must be made for more urgent action to be taken. I made the distinction between disciplinary and supervisory action.

All decisions which are essentially disciplinary in nature--to impose financial penalties or to make public statements of censure--will be covered by warning and decision notice procedures, and the decisions will not take effect until all the procedures have been completed. The same will apply to decisions which permanently exclude persons from carrying on various activities or fulfilling particular roles: cancellation of permission, authorisation, approval or recognition under Parts IV, V, XVII or XVIII, and the making of prohibition orders under Part V. But where the powers are essentially supervisory rather than disciplinary in nature, the need to avert some potential harm to the interests of consumers may make it necessary for the decision to take effect on a faster time-scale. This principle has been widely endorsed in discussions in another place.

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In due course we shall also amend Schedule 12 to make it clear that the tribunal procedure rules to be made by the Lord Chancellor under Clause 123 may make provision to give the tribunal discretion to suspend any decision which has taken effect before it has considered the matter. In light of those assurances, I hope that the noble Lord will agree to withdraw his amendment.

Lord Jenkin of Roding: I intervene today for the first time because I had other commitments in the House earlier today. I do not want to comment on the substance of what the Minister has just told the Committee, but I really do feel that the House must make a protest about the way in which it is being asked to legislate. Steady progress has been made on the Bill by my noble friends and by other noble Lords, but at the same time one is given the impression that the Government are having to run very hard indeed to keep up with the progress in the Committee.

I am reminded of nothing so much as those western films. There is the train, steaming steadily along the railway track and there are the Government, driving their coach and four, desperately trying to keep up, whizzing across a level crossing. The train goes steadily on. Sometimes the Government get behind and amendments cannot be tabled until the next stage of the Bill or until next week. It is a hell of a way to legislate.

The Minister, who has already apologised for the number of amendments, owes the Committee an apology for the way in which they have been tabled. My noble friends on the Front Bench should not be asked to deal with the matter in this way. If the previous government had done that, and the noble Lord, Lord McIntosh, was sitting on this side of the Committee, I have no doubt whatever that he would have been every bit as critical as I have been, but with a great deal more eloquence. I think it is shocking.


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