Select Committee on Delegated Powers and Deregulation Sixteenth Report



ANNEX 1

FINANCIAL SERVICES AND MARKETS BILL

Further Memorandum by HM Treasury

Introduction

1.  The Financial Services and Markets Bill was brought from the House of Commons on 10 February 2000. The Treasury submitted its memorandum on delegated legislative powers conferred by the Bill on 11 February 2000. On 6 March 2000, the Treasury submitted a further memorandum, giving its response to the recommendations in the Committee's Seventh Report of 16 February 2000. The amendments that the Government undertook to bring forward to meet the Committee's recommendations have now been brought forward and incorporated into the Bill.

2.  The Treasury submitted further memoranda to the Committee on 14 March 2000 and 10 April 2000 explaining new and revised delegated powers proposed in its amendments at Committee and Report Stages.

3.  This further memorandum sets out and explains a number of additional amendments that the Government intends to make at Third Reading (and one that was amended slightly before being made on Report). Many of the new or amended powers seek to tidy up miscellaneous points in the Bill. The remainder seek to address matters that have been raised in debate during the Bill's passage through Parliament.

4.  Unless stated otherwise, the clause references are to the Third Reading print of the Bill.

PART II: REGULATED AND PROHIBITED ACTIVITIES

PART X: RULES AND GUIDANCE

PART XIII: INCOMING FIRMS: INTERVENTION BY THE AUTHORITY

CLAUSES 18, 145 AND 197

5.  In the light of Parliamentary debate, the Government has reconsidered the different provisions in the Bill dealing with rights of action where contraventions of requirements such as those that may be imposed under Parts IV, X and XIII are concerned. The aim is to enable the current pattern of rights of action as provided for under clauses 62 and 62A of the Financial Services Act 1986 to be reproduced as far as it is possible to do so given the different structure of the Bill.

6.  The Government will therefore bring forward at Third Reading amendments to clauses 18, 145 and 197.

7.  The amendments to clauses 18 and 197 will confer on the Treasury a power to prescribe in regulations cases in which a person may have a right of action as a result of a breach of a permission which he has by virtue of the bill or as a result of a breach of a requirement imposed under Part XIII.

8.  "Private person" will be defined by the Treasury in Regulations, in line with a recommendation of the Committee when it considered the draft Bill. Part X currently contains a further power for the Financial Services Authority ("the Authority") to specify in rules whether or not a breach of a rule by an authorised person attracts rights of action for private persons, and to specify that some classes of rules attract rights for non­private persons.

9.  The Government proposes to replace the Authority's power to specify circumstances in which a right of action would lie at the suit of a person other than a private person with a power for the Treasury, by Regulations, to prescribe circumstances in which a right of action that would be exercisable by a private person can be exercised by a non­private person. This would, for example, enable the Treasury to reproduce regulation 3 of the Financial Services Act 1986 (Restriction of Right of Action) Regulations 1991.

10.  The amendment to clause 145 will ensure that there is internal consistency within the Bill by aligning the power with the new provisions in clauses 18 and 197. The Government also propose to make a similar amendment to clause 69 which would enable the Treasury to prescribe circumstances where a contravention of any of the duties under clauses 54(6), 57(1), and 57(2) is actionable at the suit of a person who is not a private person, subject to the usual defences to such an action.

11.  The powers under clauses 18, 145 and 197, and the proposed power under clause 69, will be exercisable by statutory instrument subject to the negative resolution procedure.

PART VII: CONTROL OF BUSINESS TRANSFERS

NEW CLAUSE AFTER CLAUSE 113

12.  Part VII of the Bill makes arrangements for the regulatory control of business transfers that involve insurance or deposit-taking business. These provisions are necessary to ensure that consumers' interests are properly protected during a corporate restructuring. However, they also enable the transfer of certain rights and liabilities that would not otherwise ordinarily be capable of being transferred.

13.  On the Second day of Report Stage, the Opposition tabled an amendment that would disapply the procedures for business transfers in certain circumstances. The Government expressed concern with the approach adopted in the amendment, which left the application of the regulatory framework at the discretion of the authorised person. The effect of the amendment could also have prevented certain transfers from being able to proceed. However, the Government also agreed that there could be circumstances in which it might in future be necessary to disapply the whole of the Part or to modify it in its application to transfers of a particular kind. An example cited in debate was the case of the UK business of an overseas firm that was merging with another overseas firm. Such cases would require detailed legislation to ensure that jurisdiction of appropriate overseas authorities was respected while ensuring that:

    a) - consumers were adequately protected and

    b) - any such transfer had effect for the purposes of United Kingdom law.

It may also be the case that experience will show that there are other circumstances in which it is unnecessary to apply the full procedures under Part VII to a business transfer scheme and so as a deregulatory measure the Treasury might wish to relax certain of the controls under this Part.

14.  The new powers to be introduced by the new clause after clause 113 would enable the Treasury to make regulations which would modify the application of Part VII in particular cases or to amend it so as to ensure it operates more effectively.

15.  Paragraph 13 above gives examples of when such changes might be desirable or necessary. It is thought that not only will a power to make Regulations give a greater degree of flexibility to respond to difficulties that may emerge over time, but also that the level of detail that may be needed to deal with certain issues that might arise would be more appropriately set out in secondary legislation. It should also be noted that while these arrangements are well established for transfers of insurance business, the extension to banking business transfers is new and may need to be adapted in the light of operational experience.

16.  In all cases, the Treasury propose that the negative resolution procedure should apply to the exercise of the powers to make Regulations under this new clause. This is because the changes introduced by these powers will, in practice, be technical and limited in their scope.

PART X: RULES AND GUIDANCE

CLAUSE 142: CONTROL OF INFORMATION RULES

17.  The Bill was amended at Report stage in the Lords in order to give the Authority the power to make control of information rules with regard to authorised persons. These rules are commonly known as "Chinese walls rules". Chinese walls are barriers in the form of procedures, systems, management and physical separation which firms may employ in order to ensure that information obtained by one part of a firm is not communicated in inappropriate circumstances to another part of the firm (for example, where it would advantage one client at the expense of another).

18.  The purpose of these rules is to protect investors from potentially harmful conflicts of interest and to protect firms by allowing them to deal with multiple clients without breaching regulatory or fiduciary obligations they may otherwise have to disclose information. This power is broadly in line with that currently contained in section 48(2)(h) of the Financial Services Act 1986.

19.  As clause 142 currently stands, the Authority may only make rules requiring an authorised person to withhold information from a person for or with whom he does business in the course of carrying on any regulated or other activity. The Government's amendments to clause 142 will enable the Authority to make rules about the withholding of information by an authorised person (rather than limited to rules which will require information to be withheld). This power may be used in particular to make rules specifying circumstances in which an authorised person may withhold information which he would otherwise have to disclose to his clients.

20.  These amendments bring the clause into closer alignment with section 48(2)(h) of the 1986 Act, which provides a power to make rules enabling or requiring the withholding of information in the circumstances outlined in that subsection. Clause 142 (as amended) will then allow the Authority to make rules which are similar in effect to rules currently adopted under that Act.

21.  Other minor adjustments are contemplated. We aim to address a problem that clause 142(3) would cause as well as make a technical clarifying amendment to subsection (2)(a). Neither of these amendments, however, affect the scope of the power.

PART XV: THE FINANCIAL SERVICES COMPENSATION SCHEME

CLAUSES 208, 209 AND 219

22.  Part XV makes provision about the establishment and operation of a single compensation scheme to replace a number of existing schemes organised on sectoral lines. The purpose of the scheme is to pay compensation to consumers in the event of an authorised person being unable, or likely to be unable, to meet its liabilities.

23.  The scheme will be compulsory for authorised persons carrying on regulated activities. However, clause 208(10) provides that EEA firms exercising passporting rights in accordance with Schedule 3 need not participate in the scheme unless they elect to do so under clause 209(5). Clauses 208(10) and 209(5) are intended to ensure that the scheme complies with EC Directive requirements. The Investor Compensation Directive and the Deposit Guarantee Directive provide that EEA firms that participate in deposit and investor compensation schemes in their home State cannot be required to join a compensation scheme in another member State, but that they should have the option of joining such schemes on a voluntary basis for the business carried on in that State.

24.  However, the Directives only deal with certain types of product and service, essentially deposit taking and certain categories of investment. Notably, there is no Directive requirement for member States to have compensation arrangements for insurance and the existing arrangements under the Policyholder Protection Acts therefore require incoming firms to participate in the UK scheme. It is intended that such protection should continue under the new scheme. However, the exclusion for EEA firms under clause 208(10) currently applies to all passported firms, including those not covered by relevant directives. This could mean that some consumers - including third-party and beneficiaries of insurance policies, who will have no say in the choice of the insurer on which they will rely - would have no protection in the event of a failure by an authorised person.

25.  The amendment to clause 208 therefore allows the Treasury to prescribe in regulations the scope of the exclusion under subsection (10), so that it can properly reflect the coverage of Directive arrangements. The amendments to clause 209 allow corresponding changes to be made, again through regulations made by the Treasury, to the scope of the provision under which such firms will be able to opt back into the UK scheme. Defining the scope of the exclusion and the opt-in through regulations will ensure that they can be made to adapt appropriately in the event of changes to EC Directive requirements.

26.  Clause 219 confers on the scheme manager powers to inspect certain documents held by the Official Receiver where they relate to an authorised person in financial difficulties. The amendment to clause 219(4) would enable the Treasury by regulations to specify the extent to which that provision applies to EEA firms. This is consequential on the powers conferred on the Treasury by the amendments to clauses 208 and 209.

27.  The exercise of the powers under clause 208(10), 209(5), and 219(4) will be subject to the negative resolution procedure. The amended provisions will make it clear that the exemption can only be made in relation to firms that qualify for authorisation under Schedule 3. It is anticipated that the categories of person prescribed under the powers in clause 208(10), 209(5) and 219(4) will usually be the same.

PART XVIII: RECOGNISED INVESTMENT EXCHANGES AND CLEARING HOUSES

NEW CLAUSE AFTER CLAUSE 294

28.  Part XIII of the Bill establishes the Financial Services and Markets Tribunal ("the Tribunal") to consider regulatory action that the Authority proposes to take against authorised firms and other members of the regulatory community.

29.  This new clause creates a power for the Treasury by order to extend the jurisdiction of the Tribunal to cover certain types of disciplinary proceedings brought by recognised investment exchanges or recognised clearing houses. It has been brought in response to points raised in debate at report stage.

30.  The general policy underlying the regime created for recognised investment exchanges and clearing houses is to allow them a good deal of discretion as to how they organise internal affairs, and carry out their day to day activities. This discretion extends to their disciplinary arrangements. These arrangements will of course need to be both effective and fair; and it is intended that the recognition requirements which will be set by regulations made by the Treasury under clause 281 should address this issue. Nevertheless, recognised bodies will still be left with a degree of discretion.

31.  While the Treasury do not see a role for the Tribunal in many of the types of disciplinary case that may arise, there is one possible exception, which this new clause is intended to deal with. This concerns those cases where a member of an exchange or clearing house engages in behaviour which is alleged to amount to both

    a)   market abuse (for which the Authority has responsibility under clause 114) and

    b)   a breach of the rules of the recognised body concerned (for which the relevant recognised body has enforcement responsibility).

32.  In such a case, the FSA would have to make a choice between taking market abuse proceedings against the person in question, or leaving the matter to be dealt with internally, as a breach of the rules, by the recognised exchange or clearing house concerned. So far as the individual involved was concerned, in the former case he would have the right to refer the matter to the Financial Services and Markets Tribunal, but in the latter he would not.

33.  The key concern therefore is that misbehaviour could be dealt with by one of two different procedures. Clearly it is desirable that there should be consistency between these procedures, and it may be that this will in practice prove to be the case. If, however, experience shows that there is a danger that there would be an inappropriate degree of inconsistency in approach, the power introduced by this clause would enable the Treasury by order to provide for any disciplinary cases of this kind to be considered by the Tribunal.

34.  The power to make orders under this new clause will be subject to the negative resolution procedure.

PART XIX: LLOYD'S

35.  Paragraphs 12 to 16 above describe certain powers to be taken in relation to the control of transfers of insurance business under Part VII of the Bill. The new clause to be inserted after clause 316 confers on the Treasury a power, by order, to apply those arrangements to insurance business underwritten at Lloyd's. This will enable the Treasury to give full effect to the relevant requirements of the EC insurance directives as they relate to Lloyd's underwriting.

36.  The Treasury do not propose a radical change to the arrangements that should apply to transfers of Lloyd's underwriting compared with the present position under section 85 of the Insurance Companies Act 1982. Those arrangements differ from the arrangements for insurance companies since they confer certain powers on the Council of Lloyd's to exercise control over such transfers. This is necessary because of the potential implications for the Society as a whole, and particularly for its central fund which underpins the security of Lloyd's policies, when business is transferred from one of its members (or former members). The Treasury do however propose a small change so that the control of business transfer arrangements will extend to transfers between members. The effect of this will be to permit intra-member transfers. The effect of the relevant provisions of the 1982 Act is that members may only transfer business to insurers outside Lloyd's. Internal "transfers" can only be achieved by way of reinsurance.

37.  The Treasury is concerned that the rapid rate of recent development in the way business is conducted at Lloyd's, particularly the shift from private to corporate capital, may give rise to a need to make changes in the way Part VII arrangements are applied to Lloyd's in the future. Taking an enabling power to provide for such flexibility is consistent with the approach to Part XIX of the Bill generally which has be structured in such a way as to accommodate developments in the market.

38.  The power to make orders under this clause would be subject to the negative resolution procedure.

PART XXI: MUTUAL SOCIETIES

CLAUSES 327 TO 332

39.  Clauses 327 to 332 confer a number of powers on the Treasury, by Order, to transfer functions from the bodies responsible for the regulation of mutual societies to the Financial Services Authority or the Treasury. Those clauses also confer powers to provide for the dissolution of the relevant statutory authorities, and also the Building Societies Investor Protection Board (which will be replaced by the Financial Services Compensation Scheme). These powers were explained in some detail in the Treasury's memorandum dated 11 February 2000.

40.  The Government has brought forward a number of amendments to these order-making powers with a view to clarifying the way in which they may be used. The amendment to clause 327 and the similar amendments to clauses 328, 329 and 330 are intended to make it clear that a dissolution order may make provision for the dissolution to be triggered by an event specified in the order. The purpose for this change is to enable the Treasury to require the relevant regulatory bodies to produce and lay before Parliament a final report of their activities and to enable the dissolution of the body to take place on the day after the report is submitted.

41.  The various enactments relating to mutual societies (listed in the provisions of Part XXI) refer in different ways to the Registry of Friendly Societies. They may for example confer functions on the Chief Registrar, one of the assistant registrars or the central office. The remaining amendments to clause 328 seek to make it clear that the functions of the office of assistant registrar for the central area (England and Wales, and in some cases Northern Ireland, the Isle of Man and the Channel Islands) may be transferred and that the office may be abolished.

42.  Clause 332 confers supplemental powers on the Treasury when making an order under clauses 327 to 331. The amendment to clause 332(1) is intended to make it clear that supplemental provision may be made where a function is conferred on an employee or agent of one of the relevant bodies or office holders specified in Part XXI. This will ensure that it is possible to transfer such functions. The amendments to clause 332(2) ensure that there is power, when dissolving a body or office under this Part, to make adequate transitional provision in relation to the completion of proceedings, investigations or other things under way at the time of dissolution, or for bodies other than the Authority or the Treasury (for example the compensation scheme) to be substituted.

43.  The final amendment to clause 332 inserts a new subsection to make it clear that the Treasury may make a further order making supplemental, incidental, transitional and consequential provision after a transfer of functions or dissolution order has been made. This would enable the Treasury to deal with any difficulties that might arise after the transfer or dissolution had taken place. This could be necessary if a provision in other legislation had been overlooked at the time the original order was made.

44.  These amendments to the powers under Part XXI therefore tidy the provisions to ensure that they are capable of delivering effective arrangements for the necessary transfers of functions and the dissolution of the appropriate bodies.

PART XXIV: INSOLVENCY

CLAUSE 348: INTERPRETATION

45.  The Government is bringing forward a number of amendments that will replace a number of insurance related terms. They will substitute for references in Part XXIV to bodies carrying on insurance business.

46.  The existing provisions in the 1982 Act cover both authorised and unauthorised insurers and the definition of "insurance company" in that Act covers not just bodies corporate but also individuals and unincorporated associations. It would also potentially cover friendly societies, which are separately excluded from the relevant provisions of the Act. The proposed power to make regulations in the definition of insurer to be introduced to clause 348 is necessary to allow the Treasury to clarify in the case of each relevant provision of Part XXIV the kind of body to which that provision relates.

PART XXVIII: MISCELLANEOUS

CLAUSE 397: REVIEWS OF PAST BUSINESS

47.  Clause 397 allows the Treasury by Order to require firms to review past business and where appropriate make compensation. Such schemes would, in prescribed circumstances, provide an alternative mechanism for redress to rights of action for damages by private persons who suffer a loss as a result of a regulatory contravention by an authorised person. This clause was explained in greater detail in the Treasury's memorandum of 10 April 2000.

48.  The amendment to clause 397 will allow the Treasury to prescribe in regulations circumstances in which losses suffered by a non­private person acting in a fiduciary or other prescribed capacity will be treated as having been suffered by a private person. The amendment will ensure that the arrangements for reviews of past business could also extend to cover certain losses suffered by a person who is acting on behalf of a private person (such as a trustee acting for a trust beneficiary). The amendment to clause 397 therefore maintains consistency with the arrangements for rights of action.

CLAUSE 402: GIBRALTAR

49.  Clause 402 enables the Treasury, by order, to extend the "passport" arrangements for authorisation of EEA firms to firms based in Gibraltar whose authorisation in Gibraltar falls within the scope of the single market directives in banking, investment services and insurance.

50.  The UK Government has responsibility for monitoring Gibraltar's compliance with European law generally. Under the clause, the Treasury's responsibilities include assessing Gibraltar legislation in relation to collective investment schemes.

51.  As the Bill stands, clause 402(4)(b) defines the collective investment schemes on which passporting rights may be conferred by an order made by Treasury by reference to an assessment by the Authority of whether the provisions of Gibraltar law give effective to Council Directive 85/116/EEC (on the coordination of laws, regulations and administrative provisions relating to undertakings collective investment in transferable securities). The proposed amendment would ensure that it would be for the Treasury rather than the Authority to assess the question of compliance with European law, in line with the United Kingdom's international obligations. This is consistent with the position under existing legislation.

NEW CLAUSE AFTER CLAUSE 408: REPEAL OF ENACTMENTS RELATING TO INDUSTRIAL ASSURANCE AND CERTAIN OTHER ENACTMENTS

52.  The new clause will provide for certain legislation - namely enactments relating to industrial assurance and the Insurance Brokers (Registration) Act 1977 - to cease to have effect. The clause also provides for the dissolution of certain bodies listed in subsection (2). Express provision is needed for these changes because, while they are part of the wide package of regulatory reform, they are not technically consequential upon it. The powers under clause 418 would not therefore be adequate to achieve the effects of this clause.

53.  Subsection (3) of the new clause confers on the Treasury a power needed to make further provision by order in consequence of the repeals and dissolutions brought about by the clause.

54.  The Industrial Assurance Acts confer certain rights on policyholders. Once those acts have been repealed, the terms of future industrial assurance policies will be a contractual matter between the insurer and the customer. However, it will be necessary to make provision to protect existing statutory rights of existing policyholders.

55.  While subsection (2) provides for the dissolution of the bodies mentioned in it, further provision will be needed to provide for the orderly disposal or transfer of the assets and liabilities of those bodies. In defining the scope of the power conferred, subsection (3) makes express reference to the powers under clause 332 of the Bill which makes supplemental provision for the changes to the arrangements for regulation of mutual societies. Many of the issues that are likely to arise in dissolving the bodies in subsection (2) of the new clause will be paralleled in the dissolution of bodies such as the Building Societies Commission. For convenience, therefore, subsection (3) therefore makes it clear that the power under the clause includes power to do anything that would be permitted in an order under clause 332. The Committee has already considered the scope of those powers, subject to the modifications outlined in paragraphs 39 to 45 above.

PART XXIX: INTERPRETATION

AFTER CLAUSE 415: INSURANCE

56.  The Government has tabled a number of amendments at Third Reading to excise from the Bill insurance terminology that relies on definitions contained in the Insurance Companies Act 1982 and instead to describe concepts using terminology that fits more neatly with fundamental concepts used in the Bill. Those terms will be defined by reference to the order made under clause 20(1) of the Bill that will prescribe regulated activities for the purposes of the Bill.

57.  However, there are some concepts ("policy" and "policyholder") on which the Bill must rely which cannot be defined by reference to the order made under clause 20(1), though their meaning will often derive from the relevant meanings as prescribed in that order. It will be necessary to ensure that those definitions track the definition of "insurance" under the order under clause 20(1). The clause therefore provides for the Treasury to define those terms in regulations.

58.  Subsection (3) of the clause deals with the law applicable to contracts of insurance and is intended to carry forward the effect of section 94B of, and Schedule 3A to, the Insurance Companies Act 1982. Different provisions apply depending on whether the contract is one of general insurance or long term insurance.

PART XXX: SUPPLEMENTAL

CLAUSE 418: CONSEQUENTIAL AND SUPPLEMENTAL PROVISION

59.  Schedule 19 contains certain consequential amendments. In addition clause 418 confers a general power for the Treasury by order to make incidental, consequential, transitional or supplemental provision. It therefore includes power to make such consequential amendments as they consider necessary or expedient for the giving full effect to the Bill.

60.  The Government proposes to make a small number of amendment to clause 418 to ensure that any necessary provision can be made under the clause. In particular, the amendments would enable other Government Departments to make certain consequential amendments to legislation within their responsibility. The new clause is intended in particular to enable other legislation to be amended on a case by case basis where that legislation depends on terms that are defined in one of the financial regulatory enactments that are to be repealed. For example, "insurance company" has different meanings in different contexts. In some cases, it is material to the application of the relevant provision whether the company is authorised to do insurance business. In other cases, "company" may need to include bodies - such as an industrial and provident society - established other than under the Companies Acts. The precise meaning depends therefore on the context and a simple substitution of the expression "a company with permission to effect and carry out contracts of insurance for the purposes of the Financial Services and Markets Act 2000" may not produce the desired result in every case. Similar issues arise with the definition of terms such as "bank" (as to whether or not it should include a building society or credit union) and investments that are defined by reference to Schedule 1 of the Financial Services Act 1982.

61.  The Treasury has concluded that this issue should be addressed by providing for the possibility of other relevant Departments amending their own legislation so as to provide the appropriate meaning in the context of each particular case. This would also enable those Departments to update definitions from time to time. While the effect of the amendment is to confer on Ministers of the Crown the full range of powers conferred on the Treasury by clause 418, in practice the scope of the powers conferred on them is limited by the context in which they may be exercised. This will ensure that the power can only be used by other Ministers of the Crown to make amendments to the legislation for which they are responsible and which arise directly out of the specific concepts which underpin the Bill (such as the meaning of "investment" or "accepting deposits").

62.  While the effect of the amendment is to confer on Ministers of the Crown the full range of powers conferred on the Treasury by clause 418, in practice the scope of the powers conferred on them will be limited by the context in which they may be exercised.

63.  The powers will be exercisable subject to the negative resolution procedure, whether they are exercised by the Treasury or Ministers of the Crown.

CLAUSE 419: TRANSITIONAL PROVISIONS

64.  In its memorandum dated 10 April 2000, the Treasury gave details of a new clause (Transitional Provisions) to be inserted into Part XXX of the Bill at Report Stage. The purpose of the provision (now clause 419) was to enable the Treasury by order to specify transitional arrangements that would apply when the Bill was brought into force.

65.  The Treasury substituted the original new clause, following the submission of the memorandum, so as to extend slightly its coverage. In particular the clause now enables an order under that clause to include transitional arrangements for the establishment of the single compensation scheme and ombudsman scheme under the Bill. It will for example be necessary to ensure that the new schemes will be able to deal with claims and complaints that would otherwise have fallen to their predecessor schemes.

CLAUSE 422: EXTENT

66.  Some legislation that will be affected by the Bill currently extends outside the United Kingdom. For example, the Industrial Assurance Acts 1923-48, which it is proposed should be largely repealed, apply also to the Isle of Man and the Channel Islands. In addition, the legislation relating to the formation and registration of mutual societies in some cases also applies to those islands.

67.  The territorial extent of the relevant legislation will have implications for the Bill and provision to be made under it. We need to ensure that the effect of the Bill when it is brought into force works for the Islands. This could involve retaining certain legislation in force as it relates to the Islands, even if the equivalent legislation is amended or repealed for the United Kingdom. In other cases, repeals and amendments will need to have the same effect in those territories as they do in the United Kingdom. The outcome in each case will depend on the proposals and the difficulties that may be raised for the relevant islands, and the solution may not be the same in every case.

68.  The new powers introduced by the amendment of clause 419 are therefore intended to enable necessary or desirable changes to be made by Order in Council. Clearly such orders will only be prepared and the powers will only be exercised after appropriate consultation and agreement with the respective Island governments.

11 May 2000


 
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