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Banking (Special Provisions) Bill


Banking (Special Provisions) Bill

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(c)   

any securities issued by the company.

(5)   

The following provisions apply in relation to an order under subsection (2) or

(4) with any necessary modifications—

(a)   

sections 3(2) to (4) and 4, together with Schedule 1, so apply in relation

to an order making provision for or in connection with, or in

5

consequence of, the transfer of any securities;

(b)   

section 6(2) to (5), together with Schedule 2, so apply in relation to an

order making provision for or in connection with, or in consequence of,

the transfer of any property, rights or liabilities.

(6)   

The Treasury may by order make provision, in relation to any description of

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order under subsection (2) or (4), for determining the amount of any

consideration payable by the transferee in respect of any securities, or any

property, rights and liabilities, transferred by or under any such order under

that subsection.

(7)   

A person to whom anything is transferred by or under an order under section

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3 or 6 is not to be regarded as precluded by subsection (2) or (4) from making

any contractual or other disposition of, or relating to, anything falling within

those subsections.

Supplementary

9       

Supplementary provision about compensation schemes etc.

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(1)   

An order under section 5, 7 or 8(6) may in particular make provision—

(a)   

for the manner in which any compensation or consideration is to be

assessed, including provision as to methods of calculation, valuation

dates and matters to be taken into, or left out of, account in making

valuations;

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(b)   

for the assessment to be made by an independent valuer appointed by

the Treasury;

(c)   

as to the procedure in relation to the assessment of any compensation

or consideration, including provision enabling any such valuer to make

rules as to that procedure;

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(d)   

for decisions relating to the assessment of any compensation or

consideration to be reconsidered by the person who made those

decisions (including any such provision as to procedure as is

mentioned in paragraph (c));

(e)   

for enabling persons to apply for decisions relating to the assessment of

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any compensation or consideration to be reviewed by the Financial

Services and Markets Tribunal or a tribunal appointed by the Treasury

for the purposes of the order;

(f)   

as to the powers of a relevant tribunal (that is to say, the Financial

Services and Markets Tribunal or a tribunal appointed by the Treasury

40

for the purposes of the order);

(g)   

as to the procedure for applying for any review to a relevant tribunal,

including provision enabling the tribunal to make rules as to that

procedure;

(h)   

as to remuneration and expenses of any independent valuer, or of any

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tribunal, appointed by the Treasury for the purposes of the order;

 
 

Banking (Special Provisions) Bill

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(i)   

as to the appointment of any staff of any such valuer (including

provision as to their terms and conditions of employment and as to

their pensions, allowances or gratuities).

(2)   

The provision that may be made by virtue of subsection (1)(a) includes the

making of assumptions as to any matter, including in particular the making of

5

one or more of the following assumptions about the authorised UK deposit-

taker in question—

(a)   

that it is unable to continue as a going concern;

(b)   

that it is in administration;

(c)   

that it is being wound up.

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(3)   

Subsection (1)(a) is subject to sections 5(4) and 7(3), but those subsections do

not—

(a)   

prevent the inclusion of provision requiring the making of the

assumptions mentioned in those subsections in any case where they are

not required to be made by either of those subsections; or

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(b)   

otherwise restrict the provision that may be made by virtue of

subsection (1)(a).

(4)   

In subsection (1)(a) the reference to valuation dates includes—

(a)   

valuation dates falling before the day on which this Act is passed; and

(b)   

valuation dates falling before the day on which the relevant event takes

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place.

(5)   

In subsection (1)(e)—

(a)   

the reference to persons includes the Treasury; and

(b)   

the reference to decisions relating to the assessment of any

compensation or consideration includes decisions following any such

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reconsideration as is mentioned in subsection (1)(d).

(6)   

The provision that may be made by virtue of subsection (1)(f)—

(a)   

includes provision enabling a relevant tribunal, where satisfied that the

decision in question was not a reasonable decision, to send the matter

back to the person who made the decision for reconsideration in

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accordance with such directions (if any) as it considers appropriate; but

(b)   

does not include provision enabling a relevant tribunal to substitute its

own decision for that of the person who made the decision.

(7)   

The power of any valuer or tribunal to make provision as to procedure by

virtue of subsection (1)(c), (d) or (g) includes power to make different provision

35

for different cases or circumstances.

(8)   

In this section “the relevant event” means the transfer or (as the case may be)

extinguishment of rights made by or under the order to which the order

mentioned in subsection (1) relates.

10      

Tax consequences

40

(1)   

The Treasury may by regulations make provision for or in connection with

varying the way in which any relevant tax would, apart from the regulations,

have effect in relation to, or in connection with, any of the following—

(a)   

anything done for the purpose of, in relation to, or by or under or in

consequence of, a relevant order;

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Banking (Special Provisions) Bill

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(b)   

any securities, or any property, rights or liabilities, which are

transferred, extinguished or otherwise affected by any provision made

by or under a relevant order;

(c)   

any securities issued by, or any property, rights or liabilities of, any

transferee which have not been transferred by or under a relevant

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order;

(d)   

any securities issued by, or any property, rights or liabilities of, any

relevant institution which have not been so transferred.

(2)   

The provision that may be made by the regulations includes provision for or in

connection with any of the following—

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(a)   

a tax provision not to apply, or to apply with modifications, in

prescribed cases or circumstances;

(b)   

anything done to have or not to have a specified consequence for the

purposes of a tax provision in prescribed cases or circumstances;

(c)   

any securities, or any property, rights or liabilities, to be treated in a

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specified way for the purposes of a tax provision in prescribed cases or

circumstances (whether or not affected by any provision made by or

under a relevant order);

(d)   

the withdrawal of relief (whether or not granted by virtue of the

regulations), and the charging of any relevant tax, in prescribed cases

20

or circumstances;

(e)   

requiring or enabling the Treasury to determine or to specify the

method to be used for determining anything (including amounts or

values, or times or periods of time) which needs to be determined for

the purposes of any tax provision (whether or not modified by the

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regulations) as it applies in relation to, or in connection with, any of the

matters mentioned in subsection (1)(a) to (d).

(3)   

In this section—

“prescribed” means prescribed by or determined in accordance with

regulations under this section;

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“relevant institution” means any body in relation to which a relevant

order is made;

“relevant order” means an order under section 3, 4, 6 or 8;

“relevant tax” means corporation tax, income tax, capital gains tax, stamp

duty, stamp duty reserve tax and stamp duty land tax;

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“tax provision” means any enactment relating to any relevant tax;

“transferee” means any person to whom any securities, or any property,

rights or liabilities, are transferred by or under a relevant order.

Building societies

11      

Modification of legislation applying in relation to building societies

40

(1)   

The Treasury may by order make such modifications of any enactment as they

consider appropriate for or in connection with facilitating the provision of

relevant financial assistance by the Bank of England to building societies.

(2)   

In this section “relevant financial assistance” means any financial assistance

provided for the purpose of maintaining the stability of the financial system in

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the United Kingdom.

 
 

Banking (Special Provisions) Bill

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(3)   

An order under this section may in particular make provision for or in

connection with modifying the operation of any of the following—

(a)   

sections 5, 6 and 7 of, and Schedule 2 to, the Building Societies Act 1986

(c. 53) (establishment, constitution and powers, the lending limit and

the funding limit);

5

(b)   

any other provision of that Act which might otherwise prevent any

relevant financial assistance from being provided by the Bank of

England to building societies or affect the amount of any such

assistance;

(c)   

sections 8, 9A and 9B of the Building Societies Act 1986 (restrictions on

10

raising funds and borrowing, on transactions involving derivative

instruments etc. and on creation of floating charges);

(d)   

any other provision of that Act which might otherwise prevent

building societies from entering into any transaction in connection with

the provision of financial assistance by the Bank of England to building

15

societies.

(4)   

An order under this section may in particular—

(a)   

disapply (to such extent as is specified) any specified statutory

provision;

(b)   

provide for any specified statutory provision that would not otherwise

20

apply in relation to building societies to apply in relation to them with

specified modifications.

(5)   

In this section “building society” means a building society incorporated (or

deemed to be incorporated) under the Building Societies Act 1986.

General

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12      

Consequential and supplementary provision

(1)   

The Treasury may by order make—

(a)   

such supplementary, incidental or consequential provision, or

(b)   

such transitory, transitional or saving provision,

   

as they consider appropriate for the general purposes, or any particular

30

purposes, of this Act or in consequence of any provision made by or under this

Act, or for giving full effect to this Act or any such provision.

(2)   

An order under this section may in particular—

(a)   

disapply (to such extent as is specified) any specified statutory

provision or rule of law;

35

(b)   

provide for any specified statutory provision to apply (whether or not

it would otherwise apply) with specified modifications;

(c)   

make provision for or in connection with any of the matters mentioned

in subsection (3).

(3)   

Those matters are—

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(a)   

imposing a moratorium on the commencement or continuation of

proceedings or other legal processes of any specified description in

relation to any body or property of any such description;

(b)   

providing exceptions from any provision made in pursuance of

paragraph (a), whether framed by reference to—

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Banking (Special Provisions) Bill

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(i)   

the leave of the court or the consent of the Treasury or the Bank

of England, or

(ii)   

instruments or transactions of specified descriptions,

   

or otherwise;

(c)   

the dissolution of any relevant deposit-taker or of any UK undertaking

5

which is a subsidiary undertaking of any relevant deposit-taker;

(d)   

exempting directors of any relevant deposit-taker, or of any group

undertaking of any relevant deposit-taker, from liability in connection

with acts or omissions in relation to the deposit-taker or undertaking;

(e)   

the payment of any compensation by the Treasury to persons affected

10

by an order under this section.

(4)   

An order under this section may, in connection with the payment of any such

compensation, make provision for any matter for which provision is or may be

made by or under section 5, 7 or 9.

(5)   

In this section “relevant deposit-taker” means any authorised UK deposit-taker

15

in relation to which an order is being, or has been, made under section 3 or 6.

13      

Orders and regulations: general

(1)   

Orders and regulations under this Act are to be made by statutory instrument.

(2)   

Such orders and regulations—

(a)   

may make different provision for different cases or circumstances;

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(b)   

may make such supplementary, incidental, consequential, transitory,

transitional or saving provision as the Treasury consider appropriate.

(3)   

A statutory instrument containing an order under this Act is subject to

annulment in pursuance of a resolution of either House of Parliament.

(4)   

A statutory instrument containing regulations under section 10 is subject to

25

annulment in pursuance of a resolution of the House of Commons.

(5)   

Nothing in any provision of this Act that authorises the making of any order or

regulations, or the making of any particular kind of provision by any order or

regulations, affects the generality of any other such provision of this Act.

14      

Orders and regulations: retrospective provisions

30

(1)   

Subsections (2) and (3) apply to any order made under section 3, 4, 6 or 12 (a

“relevant order”).

(2)   

A relevant order may—

(a)   

provide for any provision made by the order to have retrospective

effect as from any appropriate time or any specified later time;

35

(b)   

make provision for or in connection with, or in consequence of,

nullifying the effect of transactions or events taking place after the time

in question.

(3)   

“Appropriate time”, in relation to a relevant order, means —

(a)   

the specified time on the date of a statement published by the Treasury

40

of their intention to make an order that would have the same general

effect as the relevant order;

(b)   

the specified time on the date on which any transfer was effected by or

under a previous relevant order.

 
 

Banking (Special Provisions) Bill

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(4)   

It is immaterial whether the statement mentioned in subsection (3)(a) is

published before or after the passing of this Act.

(5)   

Regulations under section 10 may provide for any of their provisions to have

retrospective effect as from any time which is not earlier than 3 months before

the day on which this Act is passed.

5

15      

Interpretation

(1)   

In this Act—

“authorised UK deposit-taker” has the meaning given by section 1;

“body corporate” includes a body incorporated outside the United

Kingdom, but does not include the Bank of England;

10

“company” means a company within the meaning of section 1 of the

Companies Act 2006 (c. 46);

“director”, in relation to a body corporate whose affairs are managed by

its members, means a member of the body corporate;

“enactment” includes—

15

(a)   

an enactment comprised in subordinate legislation within the

meaning of the Interpretation Act 1978 (c. 30),

(b)   

an enactment contained in, or in an instrument made under, an

Act of the Scottish Parliament, and

(c)   

an enactment contained in, or in an instrument made under,

20

Northern Ireland legislation within the meaning of the

Interpretation Act 1978;

“financial assistance”, in relation to any person, includes—

(a)   

assistance provided by way of loan, guarantee or indemnity,

(b)   

assistance provided by way of any transaction which equates, in

25

substance, to a transaction for lending money at interest (such

as a transaction involving the sale and repurchase of securities

or other assets), and

(c)   

assistance falling within paragraph (a) or (b) provided

indirectly to or otherwise for the benefit of the person

30

(including the provision of assistance within paragraph (a) or

(b) to any group undertaking of that person),

whether provided in pursuance of an agreement or otherwise and

whether provided before or after the passing of this Act;

“FSMA 2000” means the Financial Services and Markets Act 2000 (c. 8);

35

“group undertaking” has the meaning given by section 1161 of the

Companies Act 2006;

“indemnity” includes any undertaking or other arrangement entered into

for the purpose of indemnifying any person or for any similar purpose;

“liabilities” includes obligations;

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“modifications” includes omissions, additions and alterations, and

“modify” has a corresponding meaning;

“pension scheme” means a scheme or other arrangements for the

provision of benefits to or in respect of people—

(a)   

on retirement,

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(b)   

on death,

(c)   

on having reached a particular age,

(d)   

on the onset of any serious ill-health or incapacity, or

 
 

Banking (Special Provisions) Bill

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(e)   

in similar circumstances;

“relevant guarantee arrangements”, in relation to any authorised UK

deposit-taker, has the meaning given by section 2(6);

“securities” includes—

(a)   

shares and stock,

5

(b)   

debentures, including debenture stock, loan stock, bonds,

certificates of deposit and other instruments creating or

acknowledging indebtedness, and

(c)   

warrants or other instruments entitling the holder to subscribe

for, or otherwise acquire, securities falling within paragraph (a)

10

or (b),

and see also subsection (2);

“specified”, in relation to any order or regulations under this Act, means

specified in the order or regulations;

“statutory provision” means any provision made by or under an

15

enactment (whenever passed or made);

“subsidiary undertaking” has the meaning given by section 1162 of the

Companies Act 2006 (c. 46);

“UK undertaking” means an undertaking which is incorporated in, or

formed under the law of any part of, the United Kingdom;

20

“undertaking” has the meaning given by section 1161 of the Companies

Act 2006 (except in the definition of “indemnity”);

“wholly owned”, in relation to the Bank of England or the Treasury, is to

be construed in accordance with subsection (6);

“wholly-owned subsidiary” has the meaning given by section 1159 of the

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Companies Act 2006.

(2)   

In this Act any reference (however expressed) to securities issued by any

authorised UK deposit-taker includes a reference to rights granted by the

deposit-taker which form part of its own funds for the purposes of Section 1 of

Chapter 2 of Title V of the Banking Consolidation Directive (and which would

30

not otherwise be securities by virtue of subsection (1)).

(3)   

In subsection (2) “the Banking Consolidation Directive” means Directive 2006/

48/EC of the European Parliament and of the Council of 14 June 2006 relating

to the taking up and pursuit of the business of credit institutions (recast).

(4)   

For the purposes of this Act any undertaking that was an authorised UK

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deposit-taker immediately before the making of the first order under section 3

or 6 in relation to the undertaking is to be regarded as continuing to be an

authorised UK deposit-taker, whether or not it would be one apart from this

subsection.

(5)   

For the purposes of this Act any reference (however expressed) to an

40

undertaking which is—

(a)   

a group undertaking of an authorised UK deposit-taker, or

(b)   

a subsidiary undertaking of an authorised UK deposit-taker,

   

includes, in relation to any time after the making of the first order under section

3 or 6 in relation to the deposit-taker (“the relevant time”), a reference to an

45

undertaking which was a group or subsidiary undertaking of the deposit-taker

immediately before the making of that order but is not one at the relevant time.

(6)   

For the purposes of this Act—

 
 

 
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