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Lord McIntosh of Haringey: Yes, my Lords. It is not in this grouping.

Lord Kingsland: My Lords, I am extremely pleased to hear that, because I was about to speak to it. I am much obliged.

On Question, amendment agreed to.

Clause 68 [Publication]:

Lord McIntosh of Haringey moved Amendment No. 117:


The noble Lord said: My Lords, in moving this amendment, I should like also to speak to Amendments Nos. 192 to 194. They are concerned with the publication of information concerning supervisory actions. It further underlines the basic presumption in favour of openness where that is consistent with fairness and the protection of consumers. On reflection, it occurs to me that perhaps we should have grouped these amendments with earlier amendments from the noble and learned Lord, Lord Fraser of Carmyllie, because they are on a similar subject. Perhaps that is one of the victims of oversight because of the speed with which we were doing things this morning.

However, one of the amendments also links into amendments we have already discussed and which address the question of when non-urgent supervisory decisions take effect. That is a point which has caused some concern to the Opposition.

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Amendment No. 193 defines what is meant by "open to review" for these purposes. A matter is still open to review if the period for referring the matter to a tribunal is still running; there is a reference before the tribunal currently; the period for making an appeal against a tribunal ruling is still running; or an appeal is pending.

That feeds back into the relevant procedural clauses, such as the first new clause after Clause 51, which was introduced by Amendment No. 109 which we have already debated, and Clauses 255, 264 and 278, with the effect that a non-urgent supervisory decision does not take effect while the matter is open to review.

Turning to the issue of publicity, Clause 386(2) requires that when the FSA decides not to proceed with a proposed action and issues a notice of discontinuance, that notice must state that the FSA may publish appropriate information about the matter if the person consents. Similarly, subsection (3) of that clause requires that any copy of a notice of discontinuance given to a third party in accordance with Clause 388(14) must be accompanied by a statement that the FSA may publish appropriate information about the matter if that person consents. The FSA may not publish any information about the matter without the appropriate consents. That supersedes Clause 68(2) which Amendment No. 117 deletes.

Amendment No. 192 makes it clear that, like a final notice, information about a supervisory notice may be published if appropriate, once the notice takes effect. However, the Bill provides that it may not be published if this would be unfair to the person concerned or prejudicial to the interests of consumers. So, if publicising a supervisory action might give rise to a general loss of confidence and therefore may result in damage to consumers, the FSA should not publicise it. Amendment No. 194 imports the definition of "supervisory notice" from Clause 390 for that purpose.

Before I move from this amendment perhaps I may return to the point raised by the noble and learned Lord, Lord Fraser of Carmyllie, when we considered the words "knowingly concerned" in Clause 65. I believe it was the noble and learned Lord, but it may have been someone else. I thought that he was asking about the effect of the word "or" in Clause 65. I said that the authority was entitled, when imposing a financial penalty, also to make a public statement. To be more accurate, what will happen is that the final notice imposing the penalty will itself be published under Clause 386(4), subject to the exceptions in subsection (5) of that clause. So the publication will not be under Clause 65(3)(b). The word "or" does indeed mean "or". If it is of any consolation to the noble and learned Lord, he was right in that respect. I beg to move.

On Question, amendment agreed to.

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Clause 71 [Actions for damages]:

Lord Fraser of Carmyllie moved Amendment No. 117A:


    Page 33, line 24, at end insert ("but shall in any event include natural persons and Scottish partnerships under section 4 of the Partnership Act 1890").

The noble and learned Lord said: My Lords, this is a very "tartanising" short point. As I understand Clause 71(2), the opportunity is provided that a "private person" will be defined and shall have,


    "such meaning as may be prescribed".

I seek to ensure that there is due acknowledgement of the fact that in Scotland a partnership enjoys the status of a separate legal persona. I should like to see some provision made to ensure that where a meaning is given to the words "private person" in such prescription, the separate legal persona of a Scottish partnership will be recognised. I beg to move.

Lord McIntosh of Haringey: My Lords, this amendment would limit the Treasury's discretion when defining a "private person" for the purposes of Clause 71 which is concerned with rights of action. Our intention is to reproduce the regulations under the Financial Services Act 1986. The regulations do not include in the definition people acting in a professional capacity.

Lord Fraser of Carmyllie: My Lords, I am grateful to the noble Lord for that answer. I shall reflect on it. I am sure that there are also professionals who will reflect on it with even greater care than I. Although the amendment concerned partnerships rather than the status of professional persons, that of itself is revealing. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 76 [Decision on application]:

Lord McIntosh of Haringey moved Amendment No. 118:


    Page 35, line 19, leave out ("refused") and insert ("decided to refuse").

On Question, amendment agreed to.

Lord Bach moved Amendment No. 119:


    Page 35, line 19, at end insert--


("( ) If the competent authority decides to grant an application for listing, it must give the applicant written notice.
( ) If the competent authority proposes to refuse an application for listing, it must give the applicant a warning notice.
( ) If the competent authority decides to refuse an application for listing, it must give the applicant a decision notice.
( ) If the competent authority decides to refuse an application for listing, the applicant may refer the matter to the Tribunal.").

The noble Lord said: My Lords, on behalf of my noble friend, in moving this amendment I speak also to Amendments Nos. 120, 123 and 124. We introduced a number of changes to Part VI of the Bill in Committee as a result of the transfer of the competent authority function from the London Stock Exchange to the FSA. My noble friend said then that the missing elements of the package concerned the procedures that the competent authority has to follow when coming to

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a decision, and the right to refer competent authority decisions to the tribunal to be established under the Bill. This set of amendments deals with these matters.

Amendment No. 119 to Clause 76 provides that the competent authority must give an applicant for listing a written notice if the application is accepted. If the competent authority proposes, however, to refuse an application, the amendment sets out the warning notice and decision notice procedures that it must go through. Additional provision on warning notices and decision notices is contained in Part XXVI of the Bill. The amendment also provides that if the competent authority decides to refuse an application for listing, the applicant may refer the matter to the tribunal.

Amendment No. 120 introduces a new clause after Clause 77 which sets out the procedures to be followed if the competent authority proposes to suspend or discontinue the listing of listed securities. These decisions are supervisory in nature rather than disciplinary, and the procedures are broadly in line with those which the FSA must follow when exercising its own-initiative powers under Part IV of the Bill.

The new clause provides that if the competent authority proposes to discontinue or suspend listing, or does so with immediate effect, it must give the issuer of the securities written notice, setting out its reasons, and informing him of the right to make representations and to refer the matter to the tribunal.

Having considered any representations, the competent authority then has to decide whether to continue with its proposal, or if it has suspended or discontinued listing with immediate effect, whether to continue with the suspension or discontinuance. Whatever it decides, it must give the issuer written notice, again informing him of his right to refer the matter to the tribunal.

The clause also deals with applications by issuers for the cancellation of suspensions which are in place. The procedures are the same as for refusal of an application for listing. The clause also provides for a right to refer a competent authority decision to refuse to lift a suspension to the tribunal.

The amendments to Clause 90 set out the steps that the competent authority must go through when it proposes to impose a penalty on someone or publish a statement censuring him under Clause 89. These are, of course, disciplinary sanctions. The first amendment, Amendment No. 123, simply replaces the reference to "imposing a penalty" with one to "taking action against". That is consequential on the introduction in Committee of the intermediate power of issuing a public censure against directors and ex-directors as well as against issuers.

The second amendment to Clause 90--Amendment No. 124--aligns the procedures for warning notices and decision notices with those that we are applying to the Financial Services Authority more generally when it proposes to impose a penalty or make a statement.

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We have debated those already. Subsection (7) of the amendment provides the right to refer a decision of the competent authority to the tribunal. I beg to move.


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