(1)On an application duly made by a friendly society (“the society”), the Commission shall, subject to section 37 below, grant unconditional or conditional authorisation, or refuse to grant authorisation, in accordance with the following provisions of this section.
[F1(1A)The Commission shall refuse to grant authorisation to a society which is or, if authorisation were granted, would be a society to which section 37(2) or (3) below applies if it appears to the Commission that the principal place of business of the society is outside the United Kingdom.
F1(1B)The Commission shall also refuse to grant authorisation to a society which is or, if authorisation were granted, would be a society to which section 37(2) or (3) below applies if it appears to the Commission that—
(a)the society is an undertaking which is closely linked with any person; and
(b)the society’s close links with that person, or any matters relating to any non-EEA laws or administrative provisions to which that person is subject, are such as would prevent the effective exercise by the Commission of its functions under this Act in relation to the society;
and in this subsection “non-EEA laws" means laws of a country or territory outside the European Economic Area and “non-EEA administrative provisions" shall be construed accordingly.]
(2)[F1Subject to subsections (1A) and (1B) above,]The Commission shall grant unconditional authorisation if it is satisfied that—
(a)the chairman of the committee of management, the secretary and the chief executive of the society are each fit and proper persons to hold their respective offices [F2and, in the case of a society to which section 37(2) or (3) below applies, each controller of the society is a fit and proper person to be such a controller];
(b)the members of the committee of management, with the secretary and chief executive, have the capacity and intention to direct the affairs of the society in accordance with the criteria of prudent management;
(c)the society is likely to comply with any requirements of this Act which relate to the business to be covered by the authorisation; and
(d)the interests of the members of the society will be adequately protected without the imposition of conditions.
(3)Subject to subsection (4) below, if the Commission is not satisfied as mentioned in subsection (2) above, it shall refuse to grant authorisation.
(4)[F1Subject to subsections (1A) and (1B) above,]Where the Commission is not satisfied as mentioned in subsection (2)(b), (c) and (d) above but is satisfied that the imposition of conditions will secure—
(a)the direction of the affairs of the society in accordance with the criteria of prudent management;
(b)the likelihood of compliance by the society with any requirements of this Act which relate to the business to be covered by the authorisation; and
(c)the adequate protection of the interests of the members of the society,
it shall grant authorisation subject to such conditions as it thinks fit for securing those objects.
(5)The conditions that may be so imposed may—
(a)relate to any class (or part of a class) or description of business in respect of which authorisation is sought;
(b)require the society to take steps or to refrain from adopting a particular course of action or to restrict the scope of its business in a particular way;
(c)require the society to take steps with regard to the activities of any subsidiary or body jointly controlled by the society.
(6)Without prejudice to the generality of subsection (5) above, conditions imposed under subsection (4) above may—
(a)impose limitations on the effecting of contracts of insurance or contracts for non-insurance benefits or the accepting of new members;
(b)require the removal of an officer of the society or of any registered branch;
(c)where the society has branches, require the society to take steps with regard to the activities of any registered branch.
(7)Conditions imposed under subsection (4) above—
(a)may be added to or varied from time to time by agreement between the Commission and the society; and
(b)may be revoked at any time by the Commission if it is satisfied that they are no longer needed for the purpose for which they were imposed;
and, on adding to, varying or revoking any such conditions, the Commission shall (unless it considers it unnecessary to do so by reason of the nature of the changes) send to the secretary of the society a statement of the terms of all the subsisting conditions to which its authorisation is subject.
(8)[F3Subsections (1A) to (7) above]above apply in relation to applications for authorisation made under section 33 above with the omission—
(a)of subsection (2)(a) and (b);
(b)of the reference to subsection (2)(b) in subsection (4); and
(c)of subsection (4)(a).
(9)[F3Subsections (1A) to (7) above] above apply in relation to a society applying for authorisation to carry on both long term and general business by virtue of section 37(8) below—
(a)with the substitution, in subsection (2), for the words “unconditional authorisation", of the words “ authorisation subject only to the conditions required by section 37 below ”;
(b)with the insertion in subsections (2)(d) and (4), after the words “imposition of", of the word “ further ”.
Textual Amendments
F1S. 34(1A)(1B) inserted (18.7.1996) by S.I. 1996/1669, reg. 15(1)
Words in s. 34(2)(4) inserted (18.7.1996) by S.I.1996/1669, reg. 15(1)
F2Words in s. 34(2)(a) inserted (1.9.1994) by S.I. 1994/1984 reg. (5)
F3Words in s. 34(8) substituted (18.7.1996) by S.I. 1996/1669, reg. 15(2)
Words in s. 34(9) substituted (18.7.1996) by S.I. 1996/1669, reg. 15(2)
Commencement Information