http://www.legislation.gov.uk/id/ukpga/1986/53

F1SCHEDULE 1

Annotations:

Amendments (Textual)

F1

Sch. 1 repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2) Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538, art. 2(1)

Status

1

The Commission shall be a body corporate.

The First Commissioner, etc.

2

The person who holds office as Chief Registrar may also hold the office of chairman of the Commission and any person who holds office as an assistant registrar may also hold office as a member of the Commission.

Tenure of office of member

3

1

Subject to the provisions of this paragraph, a person shall hold and vacate office as a member or the chairman or deputy chairman of the Commission in accordance with the terms of the instrument appointing him to that office.

2

A person may at any time resign office as a member or the chairman or deputy chairman of the Commission by giving the Treasury a signed notice stating that he resigns that office.

3

When a member becomes or ceases to be the chairman or deputy chairman, the Treasury may vary the terms of his appointment so as to alter the date on which he is to vacate office as a member.

4

If the chairman or deputy chairman ceases to be a member, he shall cease to be the chairman or deputy chairman, as the case may be.

5

If the Treasury are satisfied that a member—

a

has been absent from meetings of the Commission for a period longer than three consecutive months without the permission of the Commission, or

b

has become bankrupt or made an arrangement with his creditors, or

c

is incapacitated by physical or mental illness, or

d

is otherwise unable or unfit to discharge the functions of his office,

the Treasury may declare his office as a member vacant, and shall notify the declaration in such manner as they think fit; and thereupon the office shall become vacant.

4

No person who has attained the age of 70 years is eligible to be or to remain a part-time member of the Commission.

Remuneration and pensions, etc. for part-time members

C285

The Commission shall pay to its part-time members such fees for services and such allowances in respect of expenses as may be determined by the Treasury.

C296

1

If the Treasury so determines in the case of any person who is or has been a part-time member of the Commission, the Commission shall pay or make arrangements for the payment of such pensions to or in respect of that person as the Treasury may determine.

2

Where a person who is a part-time member of the Commission ceases to be a member otherwise than on the expiry of his term of office and it appears to the Treasury that there are special circumstances which make it right for that person to receive compensation, the Treasury may direct the Commission to make to that person a payment of such amount as the Treasury may determine.

Parliamentary disqualification

7

1

In part II of Schedule 1 to the M44House of Commons Disqualification Act 1975 (bodies of which all members are disqualified under that Act) there shall be inserted at the appropriate place the entry: “The Building Societies Commission".

2

A corresponding amendment shall be made in Part II of Schedule 1 to the M45Northern Ireland Assembly Disqualification Act 1975.

Staff

8

The Commission may appoint such staff as the chairman of the Commission thinks fit, subject to the approval of the Treasury as to numbers and as to terms and conditions of service.

Proceedings

9

The quorum of the Commission and the arrangements relating to its meeting shall be such as the Commission may determine.

10

The validity of any proceedings of the Commission shall not be affected by any vacancy among the members or by any defect in the appointment of a member.

Performance of functions

11

1

With the exception 34specified in sub-paragraph (2) below, the Commission may authorise

F224a

any member or members of the Commission,

b

any committee or sub-committee of the Commission, or

c

any officer, servant or agent of the Commission,

to perform on behalf of the Commission such of the Commission’s functions (including the power conferred by this paragraph) as are specified in the authorisation.

2

The Commission shall not delegate any power it has under this Act to make orders, rules or regulations by statutory instrument.

12

The M46Statutory Instruments Act 1946 shall apply to all powers of the Commission of making statutory instruments under this Act as if the Commission were a Minister of the Crown.

13F225. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Instruments

14

1

The fixing of the common seal of the Commission shall be authenticated by the signature of the chairman or deputy chairman or by some other person authorised by the Commission to act for that purpose.

15

1

A document purporting to be duly executed under the seal of the Commission shall be received in evidence and shall, unless the contrary is proved, be deemed to be so executed.

2

A document purporting to be signed on behalf of the Commission shall be received in evidence and shall, unless the contrary is proved, be deemed to be so signed.

C13 C34 SCHEDULE 2 Establishment, Incorporation and Constitution of Building Societies

Sections 5, 93, 94 and 97.

Annotations:

Modifications etc. (not altering text)

C13

Sch. 2 modified (3.1.1995) by 1994 c. 40, ss. 17(3), 82(2)

C34

Sch. 2 applied (with modifications) (7.4.2010) by The Building Societies (Financial Assistance) Order 2010 (S.I. 2010/1188), arts. 1(2), 8

Part I General

Requirements for establishment

1

Any ten or more persons may establish a society under this Act by taking the following steps—

a

agreeing upon the purpose or principal purpose of the society and upon the extent of its powers in a memorandum the provisions of which comply with the requirements of this Part of this Schedule;

b

4

The provisions of the memorandum of a building society, as read with the provisions of ths Act as in force for the time being, are binding upon—

a

each of the members and officers of the society; and

b

all persons claiming on account of a member or under the rules;

and all such members, officers and persons so claiming and all persons dealing with the society shall be taken to have notice of those provisions.

F55

Where any adoptable power conferred by virtue of an instrument under a provision of this Act ceases, by reason of the amendment or revocation of the instrument, to be available to building societies or building societies of any description, every society affected by the amendment or revocation shall annex to its memorandum a note of the fact that, as from the operative date of the instrument, it no longer has that power and shall send a copy of the note to the F6Authority which shall keep the copy in the public file of the society.

The rules

3

1

The rules of a building society shall provide for the matters specified in the Table in sub-paragraph (4) below.

2

The rules of a building society are binding upon each of the members and officers of the society and on all persons claiming on account of a member or under the rules; and all such members, officers and persons (but no others) shall be taken to have notice of the rules.

3

Nothing in this paragraph shall be taken to authorise any provision to be made which is inconsistent with this Act or an instrument made under it by F7. . . the Treasury or to affect the operation of any provision of this Act making rules void to any specified extent.

4

The Table referred to in sub-paragraph (1) above is as follows:—

TABLE OF MATTERS TO BE COVERED BY THE RULES

1. The name of the society and the address of its principal Office.
2. The manner in which the F8funds of the society are to be raised.
3. The manner in which the terms are to be determined on which shares are to be issued and the manner in which shareholders are to be informed of changes in the terms on which their shares are held.
4. Whether any preferential or deferred shares are to be issued and, if so, within what limits.
5. The manner in which F9loans are to be made and repaid, and the conditions on which a borrower may redeem the amount due from him before the end of the period for which the loan was made.
6. The manner in which losses are to be ascertained and provided for.
7. The manner in which membership is to cease.
8. The manner of remunerating the auditors.
9. As respects directors—
- (a) the manner of electing them and whether they may be co-opted;
- (b) any conditions which must be satisfied with respect to the holding of shares in the society if a person is to become, or is to remain, a director;
- (c) the manner of remunerating and, where it is not to be fixed by resolution at the annual general meeting, the maximum amount of the remuneration to be paid to, directors; and
- (d) the circumstances in which pensions may be awarded to persons by virtue of their office as director and the method of determining the terms of such pensions.
10. The powers and duties of the board of directors.
11. The custody of the mortgage deeds and other securities belonging to the society.
12. The form, custody and use of the society’s common seal.
13. The calling and holding of meetings and, in particular—
- (a) the right of members to requisition meetings;
- (b) the right of members to move resolutions at meetings;
- (c) the manner in which notice of any resolutions to be moved at meetings is to be given to members;
- (d) the procedure to be observed at meetings;
- (e) the form of notice for the convening of a meeting and the manner of its service;
- (f) the voting rights of members, the right to demand a poll and the manner in which a poll is to be taken.
14. The entitlement of members to participate in the distribution of any surplus assets after payments to creditors F480on the dissolution by consent of the society.
F48115. The entitlement of members, on the winding up of the society, to participate in the distribution of any surplus assets after payments are made in satisfaction of the society’s liabilities to creditors and shareholding members under the companies winding up legislation as modified by Parts 1 to 3 of Schedule 15 to this Act.

F2705

Nothing in the rules of a society shall prevent the service of a notice or other document by the society—

a

by sending it electronically to an electronic address notified for the purpose in accordance with express provision made by this Act; or

b

by its publication on a web site in accordance with any such provision.

If a building society fails to comply with sub-paragraph (2) above, the society shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale and so shall any officer who is also guilty of the offence.

Membership

5 F121

The rules of a building society shall provide that no person shall be a member of the society unless he is a shareholding member or a borrowing member or both.

2

In this Act, in relation to a building society—

“borrowing member” means, subject to sub-paragraphs (2A) and (2B) and paragraph 29(2) below, an individual who is indebted to the society—
1. a
  in respect of a loan which is fully secured on land; or
2. b
  if the rules of the society so provide, in respect of a loan which is (within the meaning of the rules) substantially secured on land;
“shareholding member” means a person who holds a share in the society.

2A

If the rules of a building society so provide, an individual shall cease to be a borrowing member at any time if at that time the society—

a

takes possession of, or exercises its power of sale in relation to, the whole or any part of the land on which the loan is secured; or

b

obtains an order for foreclosure absolute or, in Scotland, foreclosure in respect of the whole or any part of that land.

2B

Unless the rules of a building society so provide, an individual shall not be a borrowing member at any time if at that time the loan is owed to the society in equity rather than at law.

3

A person who is a minor—

a

may, if the rules do not otherwise provide, be admitted as a member of a building society and give all necessary receipts; but

b

may not F13propose a resolution, vote or hold any office in the society; and

c

may not F14join in requisitioning a special meeting or nominate, or join in nominating, a person for election as a director of the society.

Liability of members

F156

1

The liability at any time of a shareholding member of a building society shall be limited to the amount which, at that time, has been actually paid, or is in arrear, on his shares in the society.

2

The liability at any time of a borrowing member of a building society shall be limited to the amount which, at that time, is payable under the mortgage or other security by which his indebtedness to the society in respect of the loan is secured.

Joint shareholders

7

1

Two or more persons may jointly hold shares in a building society and the following provisions of this paragraph shall apply to any shares so held.

2

In this paragraph, in relation to any shares jointly held, “representative joint holder” means that one of the joint holders who is named first in the records of the society.

3

Except where the rules of the society otherwise provide, any notice or other document may be given or sent by the society to the joint holders by being given or sent to the representative joint holder; but this sub-paragraph shall not prevent any of the joint holders from exercising the rights under this Act of a member of a building society to obtain from the society on demand a copy of F465... the annual accounts and the annual business statement.

4

For the purpose of determining—

a

who is entitled to vote in an election of directors of the society;

b

who is qualified to vote on a resolution of the society, and

c

where it is relevant, the number of votes a person may then give,

the shares shall be treated as held by the representative joint holder alone; and accordingly a person who is a member of the society by reason only of being a joint holder of those shares (other than the representative joint holder) shall not be entitled to vote in any such election or qualified to vote on any such resolution.

5

For the purposes of sections 87 and 93 to 102 the shares shall be treated as held by the representative joint holder alone; and accordingly a person who is a member of the society by reason only of being a joint holder of those shares (other than the representative joint holder) shall not be regarded as a member of the society for the purposes of those sections.

F165A

In its application to section 100, sub-paragraph (5) above shall have effect subject to the provisions of section 102A.

6

The representative joint holder (but none of the other joint holders) shall have the right to join in making an application under section 56 and any reference in that section to the total membership of a building society shall be construed accordingly.

7

In the register to be maintained under paragraph 13 below the entry of that one of the joint holders who is the representative joint holder shall indicate that fact.

8

The joint holders shall be entitled to choose the order in which they are named in the records of the society.

Joint borrowers

8

1

Where F17a loan secured on land is made by a building society to two or more persons jointly the following provisions of this paragraph shall apply to their rights as borrowing members of the society.

2

In this paragraph, in relation to any rights of theirs as borrowing members, “representative joint borrowers” means that one of the joint borrowers who is named first in the records of the society.

3

Except where the rules of the society otherwise provide, any notice or other document may be given or sent by the society to the joint borrowers by being given or sent to the representative joint borrowers; but this sub-paragraph shall not prevent any of the joint borrowers from exercising the rights under this Act of a borrowing member of a building society to obtain from the society on demand a copy of F466... the annual accounts and the annual business statement.

4

For the purpose of determining—

a

who is entitled to vote in any election of directors of the society, and

b

who is qualified to vote on a resolution of the society,

the rights of the joint borrowers as borrowing members of the society shall be treated as the rights of the representative joint borrower alone; and accordingly a person who is a member of the society by reason only of being a joint borrower (other than the representative joint borrower) shall not be entitled to vote in any such election or qualified to vote on any such resolution.

5

For the purposes of sections 87 and 93 to 102 the rights of the joint borrowers as borrowing members of the society shall be treated as the rights of the representative joint borrower alone; and accordingly a person who is a member of the society by reason only of being a joint borrower (other than the representative joint borrower) shall not be regarded as a borrowing member of the society for the purposes of those sections.

6

The representative joint borrower (but none of the other joint borrowers) shall have the right to join in making an application under section 56 and any reference in that section to the total membership of a building society shall be construed accordingly.

7

In the register to be maintained under paragraph 13 below the entry of that one of the joint borrowers who is the representative joint borrower shall indicate that fact.

8

The joint borrowers shall be entitled to choose the order in which they are named in the records of the society.

Use and change of name

9

1

The common seal of a building society shall bear the registered name of the society.

F182

Every building society shall paint or affix, and keep painted or affixed, its registered name on the outside of every office or place in which its business is carried on, in a conspicuous position and in letters easily legible.

2A

Every building society shall state its registered name in legible characters in all of the following documents, F271in every electronic communication containing any of the following documents and on every web site on which any of the following documents is published, namely—

a

its business letters;

b

its account statements, including those relating to deposit, share, loan or mortgage accounts;

c

its passbooks;

d

its notices and publications, including all documents sent to members;

e

its invoices and receipts;

f

its letters of credit and any instruments creating or acknowledging its indebtedness;

g

its contracts, agreements, mortgages and deeds; and

h

its bills of exchange, promissory notes, endorsements, cheques and orders for money or goods.

3

A building society may change its name by special resolution.

4

Where a society changes its name in accordance with this paragraph notice of the change of name shall be sent to the F388FCA and, unless the F388FCA is of the opinion that the changed name is undesirable, the F388FCA shall register the notice of the change of name and give the society a certificate of registration.

5

A change of name shall take effect on the date on which the certificate of registration under sub-paragraph (4) above is issued or on such later date as may be specified in the certificate.

6

The F388FCA shall keep a copy of the certificate of registration issued under sub-paragraph (4) above in the public file of the society.

7

A change of name shall not affect the rights and obligations of the society or of any of its members or of any other person concerned.

F198

For the purposes of this paragraph and paragraphs 10 to 10C below “registered name”, in relation to a building society, means the name of the society which is for the time being registered with the F388FCA .

Offences relating to society’s name

F2010

1

If a building society does not—

a

paint or affix its registered name; or

b

keep its registered name painted or affixed,

as required by paragraph 9(2) above, the society shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale.

2

A building society which, without reasonable excuse, does not comply with paragraph 9(2A) above shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale.

3

If an officer of a building society or a person on its behalf issues or authorises the issue of any document mentioned in paragraph 9(2A)(a) to (g) above, in which the society’s registered name is not stated as required by that paragraph, he shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale.

4

If an officer of a building society or a person on its behalf signs or authorises to be signed on behalf of the building society any document mentioned in paragraph 9(2A)(h) above in which the society’s registered name is not stated as required by that paragraph—

a

he shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale; and

b

he shall be further personally liable to the holder of the bill of exchange, promissory note, cheque or order for money or goods for the amount of it (unless it is duly paid by the building society).

5

If a building society fails to send to the F389FCA a notice which it is required to send to it under paragraph 9(4) above, the society shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale and so shall any officer who is also guilty of the offence.

F23Restrictions on business names

Annotations:

Amendments (Textual)

F23

Cross-heading inserted (1.12.1997) by 1997 c. 32, s. 36(4); S.I. 1997/2668, art. 2, Sch. Pt. I(h)

Annotations:

Amendments (Textual)

F26

Cross-heading inserted (1.12.1997) by 1997 c. 32, s. 36(4); S.I. 1997/2668, art. 2, Sch. Pt. I(h)

F2410B

1

Paragraph 9(2A) above shall have effect as if after the words “in legible characters” there were inserted the words “ which are reasonably prominent ”.

2

The society shall in all documents mentioned in paragraph 9(2A) above state in legible characters an address in the United Kingdom at which service of any document relating in any way to the business will be effective.

3

The society shall also in any premises where the business is carried on and to which the members of the society, the customers of the business or suppliers of any goods or services to the business have access, display in a prominent position so that it may easily be read by such persons a notice containing the society’s registered name and the address mentioned in sub-paragraph (2) above.

4

The society shall secure that the registered name and the address mentioned in sub-paragraph (2) above is immediately given, by written notice, to any person with whom anything is done or discussed in the course of the business and who asks for the registered name or the address.

C35

The F25Treasury may, by regulations require a notice under sub-paragraph (3) or (4) above to be displayed or given in a specified form.

F29Use of business names: supplementary

Annotations:

Amendments (Textual)

F29

Cross-heading inserted (1.12.1997) by 1997 c. 32, s. 36(4); S.I. 1997/2668, art. 2, Sch. Pt. I(h)

F2710C

1

A building society which contravenes paragraph 10A(2) above shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale.

2

A building society which, without reasonable excuse, does not comply with paragraph 9(2A) or 10B(2), (3) or (4) above, or any regulations made under paragraph 10B(5) above, shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale.

3

Where paragraph 10A above applies any legal proceedings brought by the society to enforce a right arising out of a contract made in the course of the business in respect of which the society was, at the time the contract was made, in breach of paragraph 9(2A) or 10B(2), (3) or (4) above shall be dismissed if the defendant (or, in Scotland, the defender) to the proceedings shows—

a

that he has a claim against the plaintiff (pursuer) arising out of that contract which he has been unable to pursue by reason of the plaintiff’s (pursuer’s) breach of paragraph 9(2A) or 10B(2), (3) or (4) above, or

b

that he has suffered some financial loss in connection with the contract by reason of the latter’s breach of paragraph 9(2A) or 10B(2), (3) or (4) above,

unless the court before which the proceedings are brought is satisfied that it is just and equitable to let the proceedings continue.

4

Sub-paragraph (3) above is without prejudice to the right of any person to enforce such rights as he may have against another person in any proceedings brought by that person.

5

Regulations made under paragraph 10A(3) or 10B(5) above shall be made by statutory instrument subject to annulment by resolution of either House of Parliament.

C46

Such regulations may contain such transitional provisions and savings as the F28Treasury think fit, and may make different provision for different cases or classes of case.

Change of principal office

11

Register of members

1

A building society is not obliged by any provision of this Act or its rules to send a notice or other document to a member in whose case the society has reason to believe that communications sent to him at his registered address are unlikely to be received by him.

2

Where the requirement relates to notice of a meeting or postal ballot of the society, the society must, instead, comply with the advertising requirements of paragraph 35 below.

Right of members to obtain particulars from the register

15 F331

At any time when a building society—

a

has had its F34permission under F396Part 4A of the Financial Services and Markets Act 2000 to accept deposits cancelled; and

b

F46Part II Capacity of society and power of directors to bind it

Annotations:

Amendments (Textual)

F46

Sch. 2 Pt. II substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 3(2), 47(3), Sch. 1; S.I. 1997/2668, art. 2, Sch. Pt. II(c)

F41 Capacity of society not limited by its memorandum

Annotations:

Amendments (Textual)

F41

Sch. 2 Pt. II substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 3(2), 47(3), Sch. 1; S.I. 1997/2668, art. 2, Sch. Pt. II(c)

F4016

1

The validity of an act done by a building society shall not be called into question on the ground of lack of capacity by reason of anything included in the society’s memorandum.

2

A member of a building society may bring proceedings to restrain the doing of an act which but for sub-paragraph (1) above would be beyond the society’s capacity; but no such proceedings shall lie in respect of an act to be done in fulfilment of a legal obligation arising from a previous act of the society.

3

It remains the duty of the directors of a building society to observe any limitations on their powers flowing from the society’s memorandum; and action by the directors which but for sub-paragraph (1) above would be beyond the society’s capacity may only be ratified by the society by special resolution.

4

A resolution ratifying such action shall not affect any liability incurred by the directors or any other person; relief from any such liability must be agreed to separately by special resolution.

F43 Power of directors to bind society

Annotations:

Amendments (Textual)

F43

Sch. 2 Pt. II substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 3(2), 47(3), Sch. 1; S.I. 1997/2668, art. 2, Sch. Pt. II(c)

F4217

1

In favour of a person dealing with a building society in good faith, the power of the board of directors to bind the society, or authorise others to do so, shall not be limited by reason of anything included in the society’s constitution, that is to say, its memorandum and rules.

2

For this purpose—

a

a person deals with a building society if he is a party to any transaction or other act to which the society is a party;

b

a person shall not be regarded as acting in bad faith by reason only of his knowing that an act is beyond the powers of the directors under the society’s constitution; and

c

a person shall be presumed to have acted in good faith unless the contrary is proved.

3

The references above to limitations on the directors’ powers under the society’s constitution include limitations deriving from a resolution of the society passed at a general meeting or special meeting or on a postal F276or electronic ballot, or from any agreement between the members of the society.

4

Notwithstanding anything in paragraph 3(2) above, sub-paragraph (1) above applies in relation to members of the society, and to persons claiming on account of members or under the rules of the society, as it applies in relation to other persons.

5

Sub-paragraph (1) above does not affect any right of a member of the society to bring proceedings to restrain the doing of an act which is beyond the powers of the directors; but no such proceedings shall lie in respect of an act to be done in fulfilment of a legal obligation arising from a previous act of the society.

6

Nor does that sub-paragraph affect any liability incurred by the directors, or any other person, by reason of the directors’ exceeding their powers.

F45 No duty to enquire as to capacity of society etc.

Annotations:

Amendments (Textual)

F45

Sch. 2 Pt. II substituted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 3(2), 47(3), Sch. 1; S.I. 1997/2668, art. 2, Sch. Pt. II(c)

F4418

1

A party to a transaction with a building society is not bound to enquire as to whether it is permitted by the society’s constitution or as to any limitation on the powers of the board of directors to bind the society or authorise others to do so.

2

Notwithstanding anything in paragraph 3(2) above, sub-paragraph (1) above applies in relation to members of the society as it applies in relation to other persons.

Powers of central office

19

1

The central office, on receiving from a building society the declaration required by and the other documents referred to in paragraph 16 above, shall refer to the Commission for its determination the question whether or not the alteration of the society’s powers is to be registered.

2

On a reference to the Commission of the question whether or not the alteration of a society’s powers is to be registered—

a

if the declaration contains the statement specified in paragraph 16(3)(a) above and the Commission has no reasonable cause to believe that the society in question has carried on any activity comprised in the power to which the obligation imposed by paragraph 16 above extends at any time during the period which began one year before the specified date and expired on the date on which it considers the reference, the Commission shall direct the central office to register the alteration, and

b

in any other case, the Commission may, as it thinks fit, direct the central office to register, or not to register, the alteration.

3

The Commission, in deciding, in a case falling within subparagraph (2)(b) above, whether or not to direct the registration of the alteration of a society’s powers may have regard to all the circumstances of the case.

4

No registration of an alteration shall be effected by the central office under paragraph 4(4) above before the expiry of the period of 21 days beginning with the date on which it receives the declaration required by and the other documents referred to in paragraph 16 above.

5

If the central office, in pursuance of a direction of the Commission under sub-paragraph (2) above, refuses registration of the alteration of a society’s powers under sub-paragraph (1) above it shall serve on the society a notice—

a

recording its refusal,

b

specifying the activity which is believed to constitute a breach of the society’s obligation, and

c

directing the society to make an application to the Commission under section 38 for a determination under that section whether the activity was or was not within the powers of the society at the time specified under sub-paragraph (b) above,

and shall send a copy of the notice to the Commission.

6

The central office shall comply with any direction as regards the registration of the alteration of the society’s powers given to it by the Commission consequent on the Commission’s determination of the society’s powers under section 38.

7

In this paragraph “the specified date” has the same meaning as in paragraph 4 above.

C11 C12Part III Meetings, Resolutions and Postal Ballots

Annotations:

Modifications etc. (not altering text)

C11

Sch. 2 Pt. III (paras. 20–36) excluded (temp.) by S.I. 1986/2168, art. 3(1)(2)

C12

Sch. 2 Pt. III (paras. 20–36) modified by S.I. 1987/426, art. 4

Annual general meeting

20

1

Subject to sub-paragraph (2) below, every building society shall hold a meeting in the first four months of each financial year as its annual general meeting (in addition to any other meetings in that year) and shall specify the meeting as such in the notices calling it.

2

Sub-paragraph (1) above does not require a building society to hold an annual general meeting in the calendar year in which it is incorporated.

3

If default is made in holding a meeting in accordance with sub-paragraph (1) above, the F397FCA may—

a

call, or direct the calling of, an annual general meeting in that financial year, and

b

give such ancillary or consequential directions as it thinks expedient, including directions modifying or supplementing the operation of the rules of the society in relation to the calling, holding and conducting of the meeting.

4

Notwithstanding anything in the rules of a building society, the business which may be dealt with at the annual general meeting shall include any resolution whether special or not.

5

In any case where default is made—

a

in holding an annual general meeting in accordance with sub-paragraph (1) above, or

b

in complying with any directions of the F397FCA given under sub-paragraph (3) above,

the building society shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale and so shall any officer who is also guilty of the offence.

F52Special meeting on members’ requisition

Annotations:

Amendments (Textual)

F52

Sch. 2 Pt. III para. 20A and cross-heading inserted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 25, 47(3); S.I. 1997/2668, art. 2, Sch. Pt. II(q)

F4720A

1

On a members’ requisition, a building society shall—

a

duly call a special meeting, and specify the meeting as such in the notice calling it; and

b

i

to have been a shareholding member for a specified period and to hold, or to have held at any time during that period, shares in the society to such value (not greater than the prescribed amount) as is specified in the rules; and

ii

to have been a borrowing member for a specified period and to owe to the society, or to have owed to the society at any time during that period, a mortgage debt of such amount (not greater than the prescribed amount) as is so specified; and

c

and that provision shall not be taken to confer any rights on members, or to impose any duties on a building society, in respect of a statement which does not relate directly to the affairs of the society.

11

Where sub-paragraph (1)(b) above requires copies of a statement to be sent to members entitled to receive notice of a meeting, the proceedings at the meeting are not invalidated by—

a

the accidental omission to send a copy of the statement to a member entitled to receive one, or

b

the non-receipt of such a copy by such a member.

F27811A

Where, in a case in which sub-paragraph (1A)(b) is relied on for compliance with a requirement of sub-paragraph (1)(b)—

a

a statement is published for a part, but not all, of the period mentioned in subparagraph (1B)(d), but

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

the failure shall not invalidate the proceedings at the meeting.

12

The F398appropriate authority shall hear and determine any dispute arising under sub-paragraph (10)(a) above, whether on the application of the society or of any other person who claims to be aggrieved.

C613

The F49Treasury may, by order substitute—

a

for the number specified in sub-paragraph (2) above; or

b

for the sum specified in sub-paragraph (7) above,

such other number or sum as appears to F50them to be appropriate; and an order under this subsection may make such supplementary, transitional and saving provision as appears to the F51Treasury to be necessary or expedient.

14

The power to make an order under sub-paragraph (13) above is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

F54Failure to comply with members’ requisition

Annotations:

Amendments (Textual)

F54

Sch. 2 Pt. III para. 20B and cross-heading inserted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 26, 47(3); S.I. 1997/2668, art. 2, Sch. Pt. II(r)

F5320B

1

This paragraph applies where a members’ requisition is deposited at a building society’s principal office and the society is not relieved of the obligation to call a special meeting by paragraph 20A(9)(a) above.

2

Subject to sub-paragraph (5) below, if the society does not within 28 days from the date of the deposit of the requisition duly call a meeting to be held within 63 days from that date—

a

the requisitionists, or any proportion of them exceeding one half, may themselves call a meeting to be held within five months from that date; and

b

no business shall be conducted at a meeting so called other than that stated in the notice calling it or (where applicable) that mentioned in paragraph 20A(8)(b) above.

3

A meeting called under sub-paragraph (2) above by requisitionists shall be called in the same manner, as nearly as may be, as that in which meetings are to be called by the society.

4

If—

a

paragraph 20A(1)(b) above requires the society to send to each member entitled to receive notice of the meeting a copy of a statement of not more than 500 words with respect to the matters to be dealt with at the meeting; and

b

subject to sub-paragraph (5) below, that requirement is not complied with within 28 days from the date of the deposit of the requisition,

the requisitionists, or any proportion of them exceeding one half, may themselves send a copy of the statement to each such member.

5

If the rules of the society make such provision as is mentioned in paragraph 20A(9)(b) above, any days falling within the period there mentioned shall be disregarded in determining any period for the purposes of sub-paragraph (2) or (4)(b) above.

6

Any reasonable expenses incurred by the requisitionists by reason of the failure of the society to call a meeting, or to comply with such a requirement as is mentioned in sub-paragraph (4) above, shall be repaid to the requisitionists by the society.

7

Any sum so repaid shall be recoverable by the society from such of the directors of the society as were responsible for the failure (whether by the retention of fees or other remuneration in respect of services or otherwise).

Length of notice for calling meetings

21

1

Any provision contained in the rules of a building society shall be void to the extent that it provides for the calling of a meeting of the society (other than an adjourned meeting) by less than 21 days’ notice expiring with the date of the meeting or, if earlier, the date specified by the society, under its rules, as the final date for the receipt of F280appointments of proxies to vote at the meeting.

2

A meeting of a building society may be called by 21 days’ notice, unless the rules provide for longer notice of the meeting to be given.

3

Where notice of a meeting is given in accordance with sub-paragraph (2) above, the notice shall be taken for the purposes of this Act or any other enactment to have been duly given according to the rules of the building society.

Persons entitled to notice of meetings

C722

1

Subject to the provisions of this Part of this Schedule, notice of a meeting of a building society shall be given to every member of the society who would be eligible to vote at the meeting if the meeting were held on the date of the notice.

F552

Notice of the meeting shall, subject to those provisions, be given also to every person—

a

who becomes a shareholding or borrowing member of the society after the date of the notice under sub-paragraph (1) above and before the specified date; or

b

who, being such a member at the date of that notice, attains the age of 18 after that date and on or before the date of the meeting,

and who would (in either case) be eligible to vote at the meeting if he remained such a member until the date of the meeting.

2A

In sub-paragraph (2) above “the specified date” means the date specified by the society as the final date for the receipt of F281appointments of proxies to vote at the meeting.

3

Accidental omission to give notice of a meeting to, or non-receipt of notice of a meeting by, any person entitled to receive notice of the meeting does not invalidate the proceedings at that meeting.

F268Transmission of notice of meeting to an electronic address

Annotations:

Amendments (Textual)

F268

Sch. 2 paras. 22A, 22B and cross-headings inserted (20.3.2003) by The Building Societies Act 1986 (Electronic Communications) Order 2003 (S.I. 2003/404), arts. 1(1), 14

22A

c

b

rule 19D.3.49 of the Senior Management Arrangements, Systems and Controls sourcebook made by the Financial Conduct Authority under that Act,

of making ineffective a demand for a poll on any such question which is made by not less than ten members having the right to vote at the meeting.

2

F288Any appointment of a proxy to vote at a meeting of a building society shall be taken also to confer authority to demand or join in demanding a poll; and for the purposes of sub-paragraph (1) above a demand by a person as proxy of a member shall be the same as the demand by the member.

Special resolutions

26

No resolution of a building society shall be passed as a special resolutionF60, or as a shareholding members’ resolution, unless it is required to be so passed by or under any provision of this Act or by the rules of the society.

27

1

A resolution of a building society shall be a special resolution when it has been passed by not less than three-quarters of the number of the members of the society qualified to vote on a special resolution and voting either—

a

in person or by proxy on a poll on the resolution at a meeting of the society of which notice specifying the intention to move the resolution as a special resolution has been duly given; or

b

in a postal F289or electronic ballot on the resolution of which notice specifying that the resolution will not be effective unless it is passed as a special resolution has been duly given.

2

In any rules made by a building society on or after 1st October 1960, whether before or after the commencement of this Act, “special resolution”, unless the context otherwise requires, means a special resolution as defined in this paragraph.

F6127A

A resolution of a building society shall be a shareholding members’ resolution when it has been passed by not less than three-quarters of the number of the shareholding members of the society—

a

qualified to vote on a shareholding members’ resolution; and

b

voting in person or by proxy on a poll on the resolution at a meeting of the society of which notice specifying the intention to move the resolution as a shareholding members’ resolution has been duly given.

Borrowing members’ resolutions

28

No resolution of a building society shall be passed as a borrowing members’ resolution unless it is required to be so passed by or under any provision of this Act or by the rules of the society.

29 F621

A resolution of a building society shall be a borrowing members’ resolution when it has been passed by a majority of the borrowing members of the society voting in person or by proxy on a poll on the resolution at a meeting of the society of which notice specifying the intention to move the resolution as a borrowing members’ resolution has been duly given.

F632

For the purposes of this Part of this Schedule, an individual who is indebted to a building society in respect of a loan fully secured on land is not a borrowing member of the society at any time if at that time the amount of his mortgage debt is less than the prescribed amount.

3

Where a borrowing member’s resolution approving a transfer of engagements by a building society is moved, only those borrowing members whose mortgages are to be transferred shall be entitled to vote on the resolution.

4

In any rules made by a building society after the commencement of this paragraph, “borrowing members’ resolution”, unless the context otherwise requires, means a borrowing members’ resolution as defined in this paragraph.

Transfer resolutions

C30 C3230

1

The transfer resolutions required for the purposes of section 97 for the approval by members of a building society of a transfer of its business are two resolutions, of which—

a

one is passed as a borrowing members’ resolution, and

A direction under this sub-paragraph is a direction that, for the purposes of the transfer of business specified in the direction, the requisite shareholders’ resolution is to be effective if it is passed as a F71shareholding members’ resolution.

6

The Treasury F72. . . may by order amend sub-paragraph (2)(b), (3)(a) or (3)(b) above so as to substitute for the percentage for the time being specified in the subparagraph such other percentage as F73they think appropriate.

7

The power to make orders under sub-paragraph (6) above is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

8

In this paragraph “voting date”, with reference to a requisite shareholders’ resolution, has the same meaning as in paragraph 23(6) above.

Members’ right to propose and circulate resolutions

31

1

If at least the requisite number of qualified members of a building society give notice to the society of their intention to have moved on their behalf a resolution, other than F74a shareholding members’ resolution or a borrowing members’ resolution, specified in the notice at an annual general meeting of the society, it shall be the duty of the society, subject to sub-paragraphs (4), (5) and (6) below—

a

to include in the notice of the annual general meeting a notice specifying the intention to have the resolution moved on their behalf at the meeting and, where applicable, the intention to move it as a special resolution;

b

at the request of the members intending to have the resolution moved on their behalf, to send to each member entitled to receive notice of the meeting a copy of any statement of not more than F75500 words with respect to the matter referred to in the resolution.

2

For the purposes of sub-paragraph (1) above—

a

“the requisite number”—

F76i

in the case of a society in relation to which the difference between the total assets of the society as shown in the accounts last prepared by it under F340section 72A or 72E immediately before the date on which the members gave notice to the society under sub-paragraph (1) above and the aggregate of—

aa

the liquid assets of the society as shown in those accounts in pursuance of regulations F341under section 72C or 72G or in accordance with F556UK-adopted international accounting standards, as appropriate; and

bb

the fixed assets of the society as so shown,

exceeds £100 million, is F77five hundred or such lesser number as is specified for the purpose in the rules of the society, and

ii

in the case of any other society is F78one hundred or such lesser number as is specified for the purpose in the rules of the society;

b

every member of a building society is a “qualified member” unless the rules make other provision for the purpose which is not rendered void under sub-paragraph (3) below.

3

Any provision contained in the rules of a building society shall be void to the extent that it would have the effect of requiring a qualified member, for the purposes of sub-paragraph (1) above,—

F79a

to have been a member for more than two years ending with the qualifying date; or

b

if he claims eligibility as a shareholding member, to hold, or to have held at any time, shares in the society to a value greater than the prescribed amount in force on the qualifying date; or

c

if he claims eligibility as a borrowing member, to owe to the society, or to have owed to the society at any time, a mortgage debt of an amount greater than the prescribed amount in force on the qualifying date;

and for the purposes of this sub-paragraph the qualifying date is the date on which the notice is given to the society under sub-paragraph (1) above.

4

Sub-paragraph (1) above does not require a building society to send notices of a resolution or copies of a statement to members of the society in any case where—

a

publicity for the resolution or, as the case may be, the statement would be likely to diminish substantially the confidence in the society of investing members of the public; or

b

the rights conferred by sub-paragraph (1) are being abused to seek needless publicity for defamatory matter or for frivolous or vexatious purposes;

C84

The F80Treasury may by order vary—

a

the definition of “requisite number” or “qualified member” in sub-paragraph (2) of paragraph 31 above, or

b

the descriptions of provisions which are rendered void by sub-paragraph (3) of that paragraph.

whether by the addition of any description or other provision or by the substitution or deletion of any definition, description or other provision for the time being specified or contained in that paragraph.

5

An order under sub-paragraph (4) above shall be made by statutory instrument subject to annulment in pursu" ance of a resolution of either House of Parliament.

C86

An order under sub-paragraph (4) above may contain transitional, consequential or supplementary provision.

Postal ballots

33

1

The rules of a building society may provide for the voting in an election of directors or on any resolution of the society F81(other than a shareholding members’ resolution or a borrowing members’ resolution) to be conducted in all, or in any particular, circumstances by postal ballot; F293...

F2941A

Rules made pursuant to sub-paragraph (1) may also make provision in relation to the use of electronic communications in the conduct of a postal ballot.

2

Where, under the rules of a society, a postal ballot is to take place, the following provisions of this paragraph have effect.

3

Notice of a postal ballot shall be given not less than 21 nor more than 56 days before the date which the society specifies as the final date for the receipt of completed ballot papers (referred to in this paragraph as “the voting day”).

4

Subject to the provisions of this Part of this Schedule, notice of a postal ballot shall be given to every member of the society who would be entitled to vote in the election or on the resolution if the voting date for the election or the resolution fell on the date of the notice.

F825

Notice of the postal ballot shall, subject to those provisions, be given also to every person—

a

who becomes a shareholding or borrowing member of the society after the date of the notice under sub-paragraph (4) above and before the voting day; or

b

who, being such a member at the date of that notice, attains the age of 18 after that date and on or before the voting day,

and who would (in either case) be eligible to vote in the election or on the resolution if he remained such a member until that day.

F2955A

Where a notice of a postal ballot is required to be given to a person by sub-paragraph (4) or (5), the notice may be sent to him electronically only if it is sent to an electronic address notified by the person to the society for the purpose.

5B

In a case in which notice of a postal ballot is sent electronically to an electronic address in accordance with sub-paragraph (5A), the notice is to be treated as given to a person on the day on which it is transmitted.

5C

A requirement of sub-paragraph (4) or (5) to send a notice of a postal ballot shall also be treated as satisfied if—

a

the society and the person have agreed that notices which are required to be sent to him may instead be accessed by him on a web site;

b

the agreement applies to the notice in question

c

that person is notified F464... of—

i

the publication of the notice on a web site,

ii

the address of that web site, and

iii

the place on that web site where the notice may be accessed, and how it may be accessed; and

d

the notice is published continuously on that web site throughout the period beginning with the giving of that notification and ending with the voting date (within the meaning of section 60(17)).

in a case where notice of that ballot is given on a web site in accordance with subparagraph (5C), the requirement to send the related notice or accompanying document to that person shall also be treated as satisfied if the conditions set out in sub-paragraph (6B) are satisfied.

6B

The conditions of this sub-paragraph are satisfied in the case of a related notice or accompanying document if—

a

the society and that member have agreed that information which is required to be sent to him may instead be accessed by him on a web site;

b

the agreement applies to the related notice or accompanying document in question;

c

at the same time and in the same manner as the society notifies that person of the publication of the notice of the postal ballot, it notifies him of—

i

the publication of the related notice or accompanying document on a web site,

ii

the address of that web site,

iii

the place on that web site where that statement or notification may be accessed, and how it may be accessed; and

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

the failure shall not invalidate the postal ballot.

F269Electronic ballots

Annotations:

Amendments (Textual)

F269

Sch. 2 para 33A and cross-heading inserted (20.3.2003) by The Building Societies Act 1986 (Electronic Communications) Order 2003 (S.I. 2003/404), arts. 1(1), 18

33A

1

Where—

a

the rules of a building society provide for a postal ballot to be conducted in any circumstances in the case of an election or resolution, and

b

those rules do not expressly prohibit the conduct of an electronic ballot in those circumstances,

the ballot in the case of that election or resolution may, in those circumstances, be an electronic ballot instead of a postal ballot.

2

A ballot in the case of an election or resolution is an electronic ballot if it is conducted—

a

in accordance with the following provisions of this paragraph as to electronic voting; and

b

in so far as it is not conducted with those provisions, as if it were a postal ballot.

3

But voting in the case of an election or resolution may not be conducted by an electronic ballot in which all the voting is electronic voting in accordance with sub-paragraphs (8) to (10) unless the rules of the society expressly permit it.

4

The rules of a building society may provide for voting in the case of—

a

an election of directors, or

b

to vote in a postal F302or electronic ballot, or

c

b

every voting facility provided by it on a web site is accompanied by such a declaration,

for completion or confirmation by the member purporting to exercise his right to vote.

4

If a building society fails to comply with the requirements of sub-paragraph (3) above, the society shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale and so shall any officer who is also guilty of the offence.

5

In this paragraph—

F305“authenticity” and “integrity”, with reference to an electronic communication, must be construed in accordance with section 15(2) of the Electronic Communications Act 2000;
“electronic signature” has the same meaning as in section 7(2) of that Act;
“qualifying shareholding” shall be construed in accordance with paragraph 23(5) above;
“qualifying shareholding date” has the same meaning as it has for the purposes of paragraph 23 above; and
“voting date” has the meaning given by paragraph 23(6) above.

F57134A

1

Nothing in this Part of this Schedule is to be taken to preclude the holding and conducting of a meeting of a building society in such a way that persons who are not present together at the same place may by electronic means attend, speak and vote at it.

2

The use of electronic means for the purpose of enabling participation in such a meeting may be made subject only to such requirements and restrictions as are—

a

necessary to ensure the identification of those attending and the security of the electronic communication, and

b

proportionate to the achievement of those objectives.

Advertising requirements in lieu of notice of meetings, etc.

35

1

The advertising requirements referred to in paragraph 14 above, in relation to notices of meetings or postal F306or electronic ballots of building societies, are as follows.

2

Notice of the holding of the meeting or of the postal ballot must be given either—

a

by displaying a notice in a prominent position in every branch office, or

b

by advertisement in one or more newspapers circulating in the areas in which the members of the society reside,

according as the rules of the society provide.

3

The notice must be given not later than 21 days before the date of the proposed meeting or, as the case may be, the final date for the receipt of completed ballot papers F307or for the registration of votes in an electronic ballot (as the case may be).

4

The notice shall state where members may obtain copies of the resolutions and any statements with respect to the matter referred to in a resolution, forms relating to voting by proxy and, in the case of a postal ballot, the ballot papersF308, or, in the case of an electronic ballot, how members may access electronic voting facilities.

The prescribed amount

36 C101

For the purposes of this Part of this Schedule, the “prescribed amount” is £100 or such other amount as the F84Treasury by order specify for the time being.

2

The power to make an order under sub-paragraph (1) above shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

C103

An order under sub-paragraph (1) above may contain transitional, consequential or supplementary provision.

F86SCHEDULE 2A Discharge of mortgages: supplementary provisions

Annotations:

Amendments (Textual)

F86

Sch. 2A inserted (1.12.1997) by 1997 c. 32, s. 7(2), Sch. 2; S.I. 1997/2668, art. 2, Sch. Pt. I(a)

Main provisions

1

When all money intended to be secured by a mortgage given to a building society has been fully paid or discharged, the society may endorse on or annex to the mortgage one or other of the following—

a

a receipt in the prescribed form signed by any person acting under the authority of the board of directors;

b

a reconveyance of the mortgaged property to the mortgagor;

c

a reconveyance of the mortgaged property to such person of full age, and on such trusts (if any), as the mortgagor may direct.

2

Where in pursuance of sub-paragraph (1) above a receipt is endorsed on or annexed to a mortgage, not being a ~~F328charge or incumbrance registered under the~~ M4~~Land Registration Act 1925~~F328registered charge (within the meaning of the Land Registration Act 2002), the receipt shall operate in accordance with section 115(1), (3), (6) and (8) of the M5Law of Property Act 1925 (discharge of mortgages by receipt) in the like manner as a receipt which fulfils all the requirements of subsection (1) of that section.

3

Section 115(9) of the Law of Property Act 1925 shall not apply to a receipt in the prescribed form endorsed or annexed by a building society in pursuance of sub-paragraph (1) above; and in the application of that subsection to a receipt so endorsed or annexed which is not in that form, the receipt shall be taken to be executed in the manner required by the statute relating to the society if it is signed as mentioned in sub-paragraph (1)(a) above.

4

~~F329The foregoing sub-paragraphs shall, in the case of a mortgage of registered land, have effect without prejudice to the operation of the Land Registration Act 1925 or any rules in force under it.~~

5

In this paragraph—

“mortgage” includes a further charge;
“the mortgagor”, in relation to a mortgage, means the person for the time being entitled to the equity of redemption; ~~F330and~~
“~~registered land” has the same meaning as in the Land Registration Act 1925.~~

6

This paragraph does not extend to Scotland.

Application of paragraph 1 to Northern Ireland

2

1

In its application to Northern Ireland, paragraph 1 above shall have effect with the following modifications.

2

In sub-paragraph (1) after the words “on such trusts” there shall be inserted the words “ or uses ”.

3

In sub-paragraph (2)—

a

for the words from “charge” to “Property Act 1925” there shall be substituted the words “ charge on registered land, the receipt shall operate in accordance with Article 3(1), (7) and (9) of the M6Property (Discharge of Mortgage by Receipt) (Northern Ireland) Order 1983 ”; and

b

for the words “subsection (1) of that section” there shall be substituted the words “ paragraph (1) of that Article ”.

4

For sub-paragraphs (3) and (4) there shall be substituted the following sub-paragraphs—

3
If the mortgage is registered in accordance with the M7Registration of Deeds Act (Northern Ireland) 1970, the registrar under that Act shall—
a
on production of the receipt mentioned in sub-paragraph (1) above make a note in the Abstract Book against the entry relating to the mortgage that the mortgage is satisfied; and
b
grant a certificate, either on the mortgage or separately, that the mortgage is satisfied.
4
The certificate granted under sub-paragraph (3)(b) above shall—
a
be received in all courts and proceedings without further proof; and
b
have the effect of clearing the register of the mortgage.

5

In sub-paragraph (5) for the definition of “registered land” there shall be substituted the following definition—

“registered land” means land the title to which is registered under Part III of the M8Land Registration Act (Northern Ireland) 1970.

Power to prescribe form of documents

3 C141

The F85Treasury may make rules for prescribing anything authorised or required by paragraph 1 above to be prescribed; and in this Schedule “prescribed” means prescribed by rules made under this paragraph.

2

The power to make rules under this paragraph shall be exercisable by statutory instrument.

F87SCHEDULE 3

Annotations:

Amendments (Textual)

F87

Sch. 3 repealed (1.12.2001) by 2000 c. 8, ss. 334, 336, 338, 432(3), Sch. 18 Pt. III para. 18, Sch. 22; S.I. 2001/3538, art. 2(1)

Part I Preliminary

1

In this Schedule—

“authorisation” means authorisation under section 9 or on renewal under section 41 or reauthorisation under section 44;
“conditions” means conditions to be complied with by a building society and imposed on the grant of authorisation under section 9, on the renewal of authorisation under section 41, on reauthorisation under section 44 or under section 42;
“revocation", with reference to authorisation, means revocation under section 43.

Part II Authorisation

Procedure for authorisation

2

5

1

This paragraph applies where the Commission has decided to impose conditions but proposes to impose conditions different from and more onerous than those stated in the notice served by the Commission under paragraph 4(1) above.

2

The Commission shall serve on the society and, subject to paragraph 10 below, on every director of the society and its chief executive, a notice stating—

a

what conditions the Commission proposes to impose;

b

the grounds for the imposition of those conditions instead of the conditions stated in the notice under paragraph 4(1) above; and

c

that the society may make representations with respect to the conditions the Commission proposes to impose within such period of not less than seven days as may be specified in the notice and that, if the society so requests, the Commission will afford to it an opportunity of being heard by the Commission within that period.

3

If any condition proposed to be imposed on the society includes a requirement for the removal from office of any officer of the society the Commission shall also serve the notice specified in sub-paragraph (2) above on the officer whose removal is proposed giving him the like right to make representations and to be heard with respect to his proposed removal from office.

4

The Commission shall, before reaching a decision on whether to impose conditions different from those stated in the notice served under paragraph 4(1) above and, if so, what conditions, consider any representations made in accordance with sub-paragraph (2) or (3) above and shall serve on the society and subject to paragraph 10 below, on every director of and the chief executive of the society and every other person on whom a notice was served under sub-paragraph (3) above, a notice stating its decision.

5

If the Commission decides to impose conditions the notice under sub-paragraph (4) above shall—

a

specify the conditions, and

b

state the grounds for their imposition.

6

The Commission may not impose conditions on grounds other than those stated, or grounds included in those stated, in the notice served by it under sub-paragraph (2) above.

Part IV Revocation of Authorisation

Procedure for revocation

6

1

If the Commission proposes to revoke a society’s authorisation it shall serve on the society and, subject to paragraph 10 below, on every director and its chief executive a notice stating—

a

that the Commission proposes to revoke the authorisation

b

the grounds for the proposed revocation; and

c

that the society may make representations with respect to the proposed revocation within such period of not less than 14 days as may be specified in the notice and that, if the society so requests, it will be afforded an opportunity of being heard by the Commission within that period.

2

If the grounds for the proposed revocation include the ground that any officer of the society is not a fit and proper person to hold office in the society the Commission shall also serve the notice specified in sub-paragraph (1) above on the officer concerned giving him the like right to make representations and to be heard with respect to his fitness and propriety for office.

3

The Commission shall, before reaching a decision on whether to revoke the authorisation, consider any representations made to it in accordance with sub-paragraph (1) or (2) above and, except where paragraph 7 below applies the Commission shall serve on the society and, subject to paragraph 10 below, on every director of and the chief executive of the society and every other person on whom a notice was served under sub-paragraph (2) above, a notice stating its decision.

4

If the Commission decides to revoke a society’s authorisation, the notice under sub-paragraph (3) above shall state the grounds for the decision.

5

The Commission may not revoke a society’s authorisation on grounds other than those stated, or grounds included in those stated, in the notice served under sub-paragraph (1) above.

7

1

This paragraph applies where the Commission proposes, instead of revoking a society’s authorisation, to impose conditions.

2

The Commission shall serve on the society and, subject to paragraph 10 below, on every director of the society and its chief executive a notice stating—

a

that it proposes to impose conditions instead of revoking the society’s authorisation;

b

what conditions it proposes to impose;

c

the grounds for the imposition of conditions instead of revoking the society’s authorisation; and

d

that the society may make representations with respect to the conditions the Commission proposes to impose within such period of not less than seven days as may be specified in the notice and that, if the society so requests, it will be afforded an opportunity of being heard by the Commission within that period.

3

If any condition proposed to be imposed on the society includes a requirement for the removal from office of any officer of the society, the Commission shall also serve the notice specified in sub-paragraph (2) above on the officer whose removal is proposed giving him a like right to make representations and to be heard with respect to his proposed removal from office.

4

The Commission shall, before reaching a decision on whether to impose conditions and, if so, what conditions, consider any representations made in accordance with sub-paragraph (2) or (3) above and, except where paragraph 8 below applies, the Commission shall serve on the society and, subject to paragraph 10 below, on every director of and the chief executive of the society and every other person on whom a notice was served under sub-paragraph (3) above, a notice stating its decision.

5

If the Commission decides to impose conditions the notice under sub-paragraph (4) above shall—

a

specify the conditions, and

b

state the grounds for their imposition.

6

The Commission may not impose conditions on grounds other than those stated, or grounds included in those stated, in the notice served by the Commission under sub-paragraph (2) above.

8

1

This paragraph applies where the Commission has decided, instead of revoking a society’s authorisation, to impose conditions but proposes to impose conditions different from and more onerous than those stated in the notice served by the Commission under paragraph 7(2) above.

2

The Commission shall serve on the society and, subject to paragraph 10 below, on every director of the society and its chief executive, a notice stating—

a

what conditions it proposes to impose;

b

the grounds for the imposition of those conditions instead of the conditions stated in the notice under paragraph 7(2) above; and

c

that the society may make representations with respect to the conditions the Commission proposes to impose within such period of not less than seven days as may be specified in the notice and that, if the society so requests, the Commission will afford to it an opportunity of being heard by the Commission within that period.

3

If any condition proposed to be imposed on the society includes a requirement for the removal from office of any officer of the society the Commission shall also serve the notice specified in sub-paragraph (2) above on the officer whose removal is proposed giving him the like right to make representations and to be heard with respect to his proposed removal from office.

4

The Commission shall, before reaching a decision on whether to impose conditions different from those stated in the notice served under paragraph 7(2) above and, if so, what conditions, consider any representations made in accordance with sub-paragraph (2) or (3) above and shall serve on the society and, subject to paragraph 10 below, on every director of and the chief executive of the society and every other person on whom a notice was served under sub-paragraph (3) above, a notice stating its decision.

5

If the Commission decides to impose conditions the notice under sub-paragraph (4) above shall—

a

specify the conditions, and

b

state the grounds for their imposition.

6

The Commission may not impose conditions on grounds other than those stated, or grounds included in those stated, in the notice served by it under sub-paragraph (2) above.

Part V Supplementary

Imposition of conditions on appeal

9

1

The modifications of the provisions of Part III of this Schedule in their application to the imposition of conditions by the Commission in pursuance of a direction of an appeal tribunal under section 47(6) or (7) are as follows.

2

The notice under paragraph 4(1) shall be served on the society and the other persons there specified within the period of 14 days beginning with the date on which the Commission received notice of the tribunal’s decision under subsection (10) of that section; and a copy shall also be sent within that period to the tribunal.

3

The notice under paragraph 4(1) may specify, as the period within which representations may be made, a period of not less than 7 days.

4

If the Commission serves a notice under paragraph 5(2) on the society and the other persons there specified it shall send a copy of the notice to the tribunal.

Notice to directors and chief executives

10

Where any provision of this Schedule requires notice of any matter to be served on every director of a building society that requirement is satisfied by serving notice on each director whose appointment has been officially notified and the non-receipt of a notice of a matter by a director or the chief executive does not affect the validity of any action on the part of the Commission.

F88SCHEDULE 4

Annotations:

Amendments (Textual)

F88

Sch. 4 repealed (1.12.1997) by 1997 c. 32, s. 12(1)(a); S.I. 1997/2668, art. 2, Sch. Pt. I(b)(o)(i)

Provisions as to sale of mortgaged property

1

Where any land has been mortgaged to a building society as security for an advance and a person sells the land in the exercise of a power (whether statutory or express) exercisable by virtue of the mortgage, it shall be his duty—

a

in exercising that power, to take reasonable care to ensure that the price at which the land is sold is the best price that can reasonably be obtained, and

b

within 28 days from the completion of the sale, to send to the mortgagor at his last-known address by the recorded delivery service a notice containing the prescribed particulars of the sale.

F2261A

Sub-paragraph (1)(b) above shall not apply where the person selling the land has reasonable cause to believe that communications sent to the mortgagor at his last-known address are unlikely to be received by him.

2

In so far as any agreement relieves, or may have the effect of relieving, a building society or any other person from the obligation imposed by sub-paragraph (1)(a) above, the agreement shall be void.

3

Breach by a building society or any other person of the duty imposed by sub-paragraph (1)(b) above, if without reasonable excuse, shall be an offence.

4

Any person guilty of an offence under sub-paragraph (3) above shall be liable on summary conviction—

a

to a fine not exceeding level 2 on the standard scale and

b

to an additional fine for each week during which the offence continues not exceeding £10,

and, in relation to such an offence on the part of a building society, so shall any officer who is also guilty of the offence.

5

Nothing in this section shall affect the operation of any rule of law relating to the duty of a mortgagee to account to his mortgagor.

6

In sub-paragraph (1) above “mortgagor”, in relation to a mortgage in favour of a building society, includes any person to whom, to the knowledge of the person selling the land, any of the rights or liabilities of the mortgagor under the mortgage have passed, whether by operation of law or otherwise.

Discharge of mortgages

2

1

When all money intended to be secured by a mortgage given to a building society has been fully paid or discharged, the society may endorse on or annex to the mortgage one or other of the following—

a

a receipt in the prescribed form under the society’s seal, countersigned by any person acting under the authority of the board of directors;

b

a reconveyance of the mortgaged property to the mortgagor;

c

a reconveyance of the mortgaged property to such person of full age, and on such trusts (if any), as the mortgagor may direct.

2

Where in pursuance of sub-paragraph (1) above a receipt is endorsed on or annexed to a mortgage, not being a charge or incumberance registered under the M47Land Registration Act 1925, the receipt shall operate in accordance with section 115(1), (3), (6) and (8) of the M48Law of Property Act 1925 (discharge of mortgages by receipt) in the like manner as a receipt which fulfills all the requirements of subsection (1) of that section.

3

Section 115(9) of the Law of Property Act 1925 shall not apply to a receipt in the prescribed form endorsed or annexed by a building society in pursuance of sub-paragraph (1) above; and in the application of that subsection to a receipt so endorsed or annexed which is not in that form, the receipt shall be taken to be executed in the manner required by the statute relating to the society if it is under the society’s seal and countersigned as mentioned in sub-paragraph (1)(a) above.

4

The foregoing sub-paragraphs shall, in the case of a mortgage of registered land, have effect without prejudice to the operation of the M49Land Registration Act 1925 or any rules in force under it.

(5) In this paragraph—

“mortgage” includes a further charge;
“the mortgagor”, in relation to a mortgage, means the person for the time being entitled to the equity of redemption; and
“registered land” has the same meaning as in the Land Registration Act 1925.

6

This paragraph does not apply to Scotland.

7

In the application of this paragraph to Northern Ireland—

a

in sub-paragraph (1) for the words “on such trusts" there shall be subsituted the words “on such uses";

b

in sub-paragraph (2)—

i

for the words from “charge" to “Property Act 1925" there shall be substituted the words “on registered land, the receipt to operate (N.I.9). in accordance with Article 3(1), (7) and (9) of the M50Property (Discharge of Mortgage by Receipt) (Northern Ireland) Order 1983"; and

ii

for the words “subsection (1) of that section" there shall be subsituted the words “paragraph (1) of that Article";

c

for sub-paragraphs (3) and (4) there shall be substituted—

3
If the mortgage is registered in accordance with the Registration of Deeds Act (Northern Ireland) 1970, the registrar under that act shall—
a
on production of the receipt mentioned in sub-paragraph (1) above make a note in the Abstract Book against the entry relating to the mortgage that the mortgage is satisfied; and
b
grant a certificate, either on the mortgage or separately, that the mortgage is satisfied.
4
The certificate granted under sub-paragraph (3)(b) above shall—
a
be received in all courts and proceedings without
further proof; and
b
have the effect of clearing the register of the mortgage.

d

in sub-paragraph (5) for the definition of “registered land" there shall be substituted the following definition—

“registered land” means land the title to which is registered under Part III of the Land Registration Act (Northern Ireland) 1970;

Power to prescribe form of documents

3

1

The Chief Registrar may make rules for prescribing anything authorised or required by any provision of this Schedule to be prescribed; and in this Schedule “prescribed” means prescribed by rules made under this paragraph.

2

The power to make rules under this paragraph shall be exercisable by statutory instrument.

F89SCHEDULE 5

Annotations:

Amendments (Textual)

F89

Sch. 5 repealed (1.12.2001) by S.I. 2001/2617 arts. 2(b), 13(2), Sch. 4 (with art. 13(3) Sch. 5); S.I. 2001/3538, art. 2

Constitution

1

The Board shall consist of seven members as follows, namely—

a

the First Commissioner for the time being, who shall be the chairman of the Board,

b

two members appointed by the First Commissioner from among the other members of the Commission, and

c

four other members appointed under sub-paragraph (2) below;

3

The Board shall pay to each member such allowances in respect of expenses as the Board may, with the consent of the Treasury, determine.

Proceedings

4

1

The Board shall determine its own procedure, including the quorum necessary for its meetings.

2

The validity of any proceedings of the Board shall not be affected by any vacancy among the members or by any defect in the appointment of any member.

5

1

The fixing of the common seal of the Board shall be authenticated by the signature of the chairman of the Board or some other person authorised by the Board to act for that purpose.

2

A document purporting to be duly executed under the seal of the Board shall be received in evidence and deemed to be so executed, unless the contrary is proved.

F228Performance of functions

Annotations:

Amendments (Textual)

F228

Sch. 5 para. 5A and cross-heading preceding it inserted (9.6.1997) by 1997 c. 32, s. 43, Sch. 7 para. 58; S.I. 1997/1427, art. 2(k)(n)(xvi)

F2295A

The Board may authorise—

a

any member or members of the Board,

b

any committee or sub-committee of the Board, or

c

any officer, servant or agent of the Board,

to perform on behalf of the Board such of the Board’s functions (including the power conferred by this paragraph) as are specified in the authorisation.

Accounts, audit and annual report

6

1

The Board may determine its own financial year.

2

It shall be the duty of the Board—

a

to keep proper accounts and proper records in relation to the accounts; and

b

to prepare in respect of any period (referred to in this paragraph as “the initial period”) beginning with the commencement date for section 24 and ending with the beginning of the Board’s first financial year and in respect of each of its financial years a statement of accounts showing the state of affairs and income and expenditure of the Board.

3

A statement of accounts prepared in accordance with sub-paragraph (2)(b) above shall be audited by auditors appointed by the Board and the auditors shall report to the Board stating whether in their opinion the provisions of sub-paragraph (2) above have been complied with.

F2274

A person shall not be appointed as auditor by the Board unless he is eligible for appointment as a company auditor under section 25 of the Companies Act 1989.

5

It shall be the duty of the Board, as soon as possible after the end of the initial period and of each of its financial years, to prepare a report on the discharge of its functions during that period or, as the case may be, during that financial year.

6

It shall be the duty of the Board to publish, in such manner as it thinks appropriate, every statement of account prepared in accordance with sub-paragraph (2)(b) above and every report prepared in accordance with sub-paragraph (5) above.

F90SCHEDULE 6

Annotations:

Amendments (Textual)

F90

Where an investment is made by a person whose business is the provision of professional services or the carrying on of investment business (within the meaning of the Financial Services Act 1986) with money held to the account of clients of his, each of them shall be treated as having a separate investment of an amount equal to so much of the amount of the investment as represents money held to his account as a client.

6

The Board may decline to make any payment under section 27 in respect of an investment until the person claiming to be entitled to it informs the Board of the capacity in which he is entitled to the investment; and if it appears to the Board—

a

that the persons entitled to an investment are so entitled as trustees, or

b

that paragraph 3 above applies to an investment, or

c

that two or more persons are jointly entitled to an investment other than as trustees, or

d

that paragraph 5 above applies to an investment,

the Board may decline to make any payment in respect of the investment until sufficient information has been disclosed to it to enable it to determine what payment (if any) should be made under that section and to whom.

7

In this Schedule “jointly entitled” means—

a

in England and Wales and Northern Ireland, beneficially entitled as joint tenants, tenants in common or as coparceners, and

b

in Scotland, beneficially entitled as joint owners or owners in common.

F2308

In the application of this Schedule in relation to investments in an office of a building society in another EEA State, references to persons entitled in any of the following capacities, namely—

a

as trustees;

b

as partners; or

c

as persons jointly entitled other than as trustees,

shall be construed as references to persons entitled under the law of that State in a capacity appearing to the Board to correspond as nearly as may be to that capacity.

SCHEDULE 7 Investors: Special Provisions

Section 32.

Members or depositors dying

1

The provisions of this paragraph have effect where a member of, or depositor with, a building society dies, testate or intestate, domiciled in any part of the United Kingdom leaving a sum of money in the funds of the society not exceeding £5000.

2

If a person claiming to be beneficially entitled to the sum of money under the will or the applicable law of intestacy furnishes to the society—

a

satisfactory evidence of the death, and

b

a statutory declaration that the member or depositor has died and that the person claiming the amount is beneficially entitled under the will or the applicable law of intestacy to receive it,

the society may, without probate of the will or the grant of letters of administration or confirmation, as the case may be, pay the sum of money to that person.

3

Where a building society has paid a sum of money to any person in reliance on evidence of death and a statutory declaration furnished as mentioned in sub-paragraph (2) above, the payment shall be valid and effectual with respect to any demand against the funds of the society from any other person claiming to be entitled to it but without prejudice to that other person’s pursuing his remedy for the amount against the person who received it.

4

The Treasury may from time to time by order direct that this paragraph shall have effect as if for the reference in sub-paragraph (1) above to £5,000 there were substituted a reference to such higher amount as may be specified in the order.

5

An order under sub-paragraph (4) above shall apply in relation to deaths occurring after the expiration of a period of one month beginning with the date on which the order comes into force.

6

The power to make an order under sub-paragraph (4) above is exercisable by statutory instrument but no such order shall be made unless a draft of it has been laid before and approved by a resolution of each House of Parliament.

Receipts by depositors under age

2

Any receipt or acknowledgment given to a building society by a person who is a minor in respect of the payment to him of any sum due in respect of a deposit made by him with the society, shall not be invalid on the ground of his minority.

F91SCHEDULE 7A

Annotations:

Amendments (Textual)

F91

Sch. 7A repealed (1.12.2001) by S.I. 2001/2617 arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538 art. 2

Preliminary

Where any provision of this Schedule requires notice of any matter to be served on every director of a building society, that requirement is satisfied by serving notice on each director whose appointment has been officially notified and the non-receipt of a notice of a matter by a director or the chief executive does not affect the validity of any action on the part of the Commission.

SCHEDULE 8 Powers to Provide Services

Section 34.

F92Part I The Services

Annotations:

Amendments (Textual)

F92

Parts of Sch. 8 varied by S.I. 1988/1141, arts. 5, 6, Sch. 5 so as to have effect as set out in that Sch. 5

1

Banking services.

2

Investment services.

3

Insurance services.

4

Trusteeship.

5

Executorship.

6

Land services.

Part II General Restrictions On Services

1

Subject to paragraphs 2, 3, 4 and 5 below, no power conferred on a building society to provide a service of a description specified in Part I of this Schedule of itself confers power—

a

to perform the activities of—

i

taking deposits in circumstances which require authorisation under the Banking Act 1987 (or would require authorisation were the taker not a building society),

ii

making advances or loans of any description,

iii

acquiring the right to be paid any sum owing to another person arising out of any arrangement under which money is borrowed or goods or services are provided on credit,

iv

acquiring land,

v

acquiring or holding any asset the power to acquire or hold which is derived from section 19 of this Act by virtue of an order made under, or partly under, that section,

vi

acquiring or holding relevant investments, or

vii

underwriting risks of any description, or

F93b

i

to maintain a place of business in any country or territory for the purpose of providing that service unless the society also conducts the principal busi ness of a building society in that country or territory, save where that service is provided in any of the countries listed in paragraph (ii) below;

ii

Part III Restrictions In Relation To Certain Services

Banking services

1

In relation to the power to provide banking services—

F96a

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F97b

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F97c

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F96d

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F96e

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

f

provision of foreign exchange services, except where it arises for the purpose of or in the course of the provision of money transmission services, is restricted, save in excepted transactions, to their provision to individuals,

g

arranging the provision of foreign exchange services is, subject to the exception in subparagraph (f) above, restricted, save in excepted transactions, to their provision to individuals, and

h

administration of the issue of shares or corresponding membership rights by bodies corporate or of transferable instruments and registration of the transfer or cancellation of such shares, rights or instruments is restricted to administration and registration by a building society which has a qualifying asset holding.

Investment services

2

In relation to the power to provide investment services—

a

managing investments (except in relation to management of pension schemes) is restricted to managing by a building society which has a qualifying asset holding,

b

acquiring and holding relevant investments as a nominee is restricted to acquisition and holding by a building society which has a qualifying asset holding,

c

establishment and management of pension schemes is restricted to schemes which do not include provisions requiring the investment of any of the funds within the scheme in shares in or deposits with a building society of which the trustee or manager of the scheme is a subsidiary,

d

establishment of personal equity plans is restricted to establishment by a building society which has a qualifying asset holding, and

e

establishment of collective investment schemes is restricted to establishment by a building society which has a qualifying asset holding.

Trusteeship

F983

In relation to the power to provide the service of trusteeship—

a

a building society may not accept trusteeship of a prohibited trust, and

b

a building society which becomes aware that a trust of which it is trustee has become a prohibited trust shall retire as trustee of that trust as soon as it is practicable to do so.

Land services

4

In relation to the power to provide land services—

a

the carrying on of estate agency work is restricted to carrying on by a subsidiary or other associated body of a building society,

b

removal and storage of furniture is restricted to removal and storage by a subsidiary or other associated body of a building society which society has a qualifying asset holding,

c

management of land is restricted to management by a building society which has a qualifying asset holding,

d

management of land is restricted to land which is or is to be used primarily for residential purposes or for purposes incidental to the use of adjoining land under the same management which is or is to be used primarily for residential purposes,

e

arranging the management of land is restricted to land which is or is to be used primarily for residential purposes or for purposes incidental to the use of adjoining land under the same management which is or is to be used primarily for residential purposes,

f

development of land is restricted to development by a building society which has a qualifying asset holding,

g

development of land is restricted to land which is to be used primarily for residential purposes or for purposes incidental to the use of adjoining land developed by the developer which is or is to be used primarily for residential purposes,

h

development of land is restricted to land of a local authority in Great Britain or of a development corporation or land which is charged in favour of the developer of the land to secure repayment of the costs of development, and

i

arranging the development of land is restricted to land which is to be used primarily for residential purposes or for purposes incidental to the use of adjoining land developed by the developer which is or is to be used primarily for residential purposes.

5

No employee of a building society, a subsidiary or other associated body of which carries on estate agency work, whose duties include—

a

making a report on the value of land which is to secure an advance,

b

making an assessment of the adequacy of the security of an advance to be secured on land, or

c

authorising the making of an advance to be secured on land,

shall perform any service on behalf of that subsidiary or other associated body.

Part IV Supplementary

Powers—general

1

Any power derived from this Schedule to perform any activity includes the power to arrange its performance but a restriction in Part III of this Schedule on the power to perform any activity does not imply an equivalent restriction on the power to arrange its performance.

Powers—specific services

2

Without prejudice to the general scope of any service specified in Part I of this Schedule—

a

the power to provide banking services includes power,

i

to administer the issue of, and payments in respect of, shares or corresponding membership rights in bodies corporate or transferable instruments and to register the transfer or cancellation of such shares, rights or instruments, and

ii

to provide advice on taxation and financial planning,

b

the power to provide investment services includes power to provide advice on taxation and financial planning,

c

the power to provide the service of executorship includes power—

i

to act as administrator of the estates of deceased persons, and

ii

to assist in the making of wills, and

d

the power to provide land services includes power to carry out the removal and storage of furniture.

Banking—particular provisions

3

1

A building society shall, so far as regards the carrying on of an activity which comprises provision of a banking service for the purposes of this Schedule, be treated for all purposes as a bank and a banker and as carrying on the business of banking or a banking undertaking whether or not it would be so treated apart from this paragraph.

2

This paragraph does not affect the determination of any question as to the status of a building society as a bank or banker for other purposes.

4

Where an account of a person with a building society has, by virtue of the provision of banking services under this Schedule, become overdrawn, it shall be the duty of the building society to take all reasonable steps to recover as soon as practicable from that person the amount due to it on the overdrawn account.

5

1

For the purposes of paragraph 1(f) and (g) of Part III of this Schedule, a transaction consisting in the provision of foreign exchange services is an excepted transaction where the value of the transaction is less than £10,000.

2

For the purposes of subparagraph (1) above the value of a transaction consisting in the provision of foreign exchange services is, where the building society is selling foreign currency, the sum paid to it and, where the building society is purchasing foreign currency, the sum paid by it.

Land services—sanction

6

If a person performs any service in contravention of paragraph 5 of Part III of this Schedule he shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale.

Interpretation

C157

This Schedule is to be construed as relating only to the capacity of building societies to provide the services for the time being specified in it and not as making lawful any activity, whether of a building society or a subsidiary or other associated body of a building society, which would not be lawful apart from this Schedule.

8

In this Schedule—

“arranging”, in relation to the performance of any activity, includes—
1. a
  arranging its performance on behalf of the person in respect of whom the activity is performed as well as the person who performs the activity, and
2. b
  acting as agent on behalf of either such person;
F99“bailment”, in relation to Scotland, means “hire”;
“chattels” means—
1. i
  in relation to England and Wales and Northern Ireland, all personal chattels other than things in action and money, and
2. ii
  in relation to Scotland, all corporeal moveables except money;
“collective investment scheme” has the meaning which it bears in section 75 of the Financial Services Act 1986;
“corresponding membership right” has the meaning which it bears in section 18(17) of this Act;
“development corporation” means any of the following bodies:
1. a
  in England, a development corporation within the meaning of the New Towns Act 1981;
2. b
  in Wales, the Development Board for Rural Wales established by section 1 of the Development of Rural Wales Act 1976 and the Welsh Development Agency established by section 1 of the Welsh Development Agency Act 1975;
3. c
  in Scotland, a development corporation within the meaning of the New Towns (Scotland) Act 1968;
4. d
  in Northern Ireland, the Department of the Environment for Northern Ireland and the Northern Ireland Housing Executive referred to in article 3 of the Housing (Northern Ireland) Order 1981;
“estate agency work” has the same meaning as in the Estate Agents Act 1979;
“land services” means services relating to the acquisition, management, development or disposal of land;
F100“leasable chattels” means chattels which are, or are to be, subject to bailment to a person in return for periodical payments by that person under an agreement which may but need not contain provision (or be part of a series of agreements containing provision) for the property in those chattels to become vested in that person;
“local authority in Great Britain” means any of the following authorities:
1. a
  in England F101. . ., a county council, a district council, a London borough council, a parish F101. . . council, the Common Council of the City of London, and the Council of the Isles of Scilly;
2. aa
  F102in Wales, a county council, a county borough council and a community council;
3. b
  in Scotland, a local authority within the meaning of section 235 of the Local Government (Scotland) Act 1973;
“managing investments” means activity of the kind specified in paragraph 14 of Part II (activities constituting investment business) of Schedule 1 to the Financial Services Act 1986;
“pension scheme” means—
1. a
  a retirement benefits scheme within the meaning of, and which is approved or a candidate for approval by the Commissioners of Inland Revenue for the purposes of, Chapter I of Part XIV of the Income and Corporation Taxes Act 1988 (retirement benefit schemes), or
2. b
  a personal pension scheme within the meaning of, and which is approved or a candidate for approval by the Commissioners of Inland Revenue under, Chapter IV (personal pension schemes) of that Part of that Act,
and for the purposes of this definition a scheme is a candidate for approval for the purposes of the first or, as the case may be, under the second of those Chapters if it has been prepared with a view to being so approved and steps are being taken towards obtaining that approval;
“personal equity plan” means a plan for the purposes of section 333 (personal equity plans) of the Income and Corporation Taxes Act 1988;
“the principal business of a building society” means the business of raising funds (whether by the issue of shares or receiving deposits) for the purposes of the society or of making advances secured on land;
F103“prohibited trust” means a trust which is either—
1. a
  a trust under which the majority in number of the beneficiaries who are for the time being ascertained are non-charitable corporate bodies, or
2. b
  a trust of funds in a pension scheme which includes provisions requiring the investment of any of those funds in shares in or deposits with a building society of which the trustee is a subsidiary.
“relevant investment” means—
1. a
  any share or corresponding membership right in a body corporate, and
2. b
  any other asset, right or interest falling within any paragraph of Part I (investments) of Schedule 1 to the Financial Services Act 1986; and
“transferable instrument” means—
1. a
  where the issuer of the instrument is a building society, an instrument which is a transferable bearer instrument or a transferable non-bearer instrument for the purposes of section 7 of this Act, and
2. b
  in any other case, an instrument which would, were the issuer a building society, be such a transferable bearer instrument or transferable non-bearer instrument.

F106SCHEDULE 8A Transfer directions: modifications of Part X

Annotations:

Amendments (Textual)

F106

Sch. 8A inserted (9.6.1997) by 1997 c. 32, s. 17(2), Sch. 4; S.I. 1997/1427, art. 2(c)

Part I Directions under section 42B(3)

Preliminary

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

the failure shall not invalidate the proceedings of the meeting.

3

The statement shall be sent—

a

where the F381appropriate authority has given the society a direction under section 42B(1)(a), within the period (not being less than 28 days) specified in F104a final notice given by the F381appropriate authority under section 390 of the Financial Services and Markets Act 2000;

b

where the F381appropriate authority has not given the society such a direction, within 14 days of the board of directors passing a resolution in pursuance of the direction.

F3103A

For the purposes of sub-paragraph (3) above, in a case in which sub-paragraph (2A)(b) is relied on for compliance with a requirement under sub-paragraph (2), a statement published on a web site in accordance with sub-paragraph (2B) is to be treated as sent to a person on the day that the notification is given in accordance with sub-paragraph (2B)(c).

4

No statement shall be sent unless its contents, so far as they concern the prescribed matters or any matter of which particulars are required to be given under sub-paragraph (2)(b) above, have been approved by the F381appropriate authority .

5

A failure to comply with a requirement of this paragraph shall not invalidate the transfer of engagements; but, if the society fails without reasonable excuse to comply with such a requirement the society shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale and so shall any officer who is also guilty of the offence.

Application for confirmation

4

No application for confirmation by the F381appropriate authority of the transfer of engagements may be made under Part III of Schedule 16 until after the society has complied with the requirements of paragraph 3 above.

Grounds for not confirming transfer

5

Section 95 shall apply as if—

a

for paragraphs (a) and (b) of subsection (4) there were substituted the following paragraph—

a
the members or a proportion of them would be unreasonably prejudiced by the transfer;

b

in subsection (6), for the words “paragraphs (a), (b) and (c)” there were substituted the words “ paragraphs (a) and (c) ” and, in paragraph (a), the words “, including the calling of a further meeting,” were omitted.

Part II Directions under section 42B(4)

Preliminary

6

This Part of this Schedule applies where a direction is given under section 42B(4) (“the direction”).

Compensation for loss of office

7

1

The consent of the F381appropriate authority shall be sufficient authority for the provision for any such compensation as is mentioned in section 99(2)(a).

2

A resolution of the board of directors passed in pursuance of the direction shall be sufficient authority for any such payments as are mentioned in section 99(2)(b).

Increased remuneration

8

If the F381appropriate authority consents to the inclusion of any such provision as is mentioned in section 99A(1), it shall not be necessary for an ordinary resolution approving the provision to be put before a meeting of the society.

Statements to members

C169

1

The following provisions of this paragraph shall apply in place of Part I of Schedule 17.

2

The society shall send to every member entitled to notice of a meeting of the society, a statement containing—

a

the particulars required, in relation to prescribed matters, by regulations under section 42B(8); and

b

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

the failure shall not invalidate the proceedings of the meeting.

3

The statement shall be sent—

a

where the F381appropriate authority has given the society a direction under F404section 42B(1)(aa) or (b) , within the period (not being less than 28 days) specified in F105a final notice given by the F381appropriate authority under section 390 of the Financial Services and Markets Act 2000;

b

where the F381appropriate authority has not given the society such a direction, within 14 days of the board of directors passing a resolution in pursuance of the direction.

F3123A

For the purposes of sub-paragraph (3) above, in a case in which sub-paragraph (2A)(b) is relied on for compliance with a requirement under sub-paragraph (2), a statement published on a web site in accordance with sub-paragraph (2B) is to be treated as sent to a person on the day that the notification is given in accordance with sub-paragraph (2B)(c).

4

No statement shall be sent unless its contents, so far as they concern the prescribed matters or any matter of which particulars are required to be given under sub-paragraph (2)(b) above, have been approved by the F381appropriate authority .

5

A failure to comply with a requirement of this paragraph shall not invalidate the transfer of business; but, if the society fails without reasonable excuse to comply with such a requirement the society shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale and so shall any officer who is also guilty of the offence.

Application for confirmation

10

No application for confirmation by the F381appropriate authority of the transfer of business may be made under Part II of Schedule 17 until after the society has complied with the requirements of paragraph 9 above.

Grounds for not confirming transfer

11

Section 98 shall apply as if—

a

for paragraphs (a) and (b) of subsection (3) there were substituted the following paragraph—

a
the members or a proportion of them would be unreasonably prejudiced by the transfer;

b

in subsection (5), for the words “paragraphs (a), (b), (c) and (d)” there were substituted the words “ paragraphs (a), (c) and (d) ”; and

c

in subsection (6), the words “the calling of a further meeting,” were omitted.

SCHEDULE 9 Directors: Requisite Particulars of Restricted Transactions

Section 68(4).

Preliminary

1

In this Schedule—

“the financial year” means the financial year to which the statement under section 68(3) relates;
“restricted transaction or arrangement” means any transaction or arrangement falling within section 65(1) particulars of which are required to be included in that statement;

the maximum amount for which the society may become liable; and

iii

any amount paid and any liability incurred by the society for the purposes of fulfilling the guarantee or security (including any loss incurred by reason of its enforcement).

SCHEDULE 10 Requisite Particulars of Income or Related Businesses

Section 69(7).

Part I Requisite Particulars Where no Adoption of Part II

Conveyancers

1

Where the business associate of the building society provides conveyancing services the requisite particulars of its business in any financial year are the following—

a

the number of cases in which it has provided conveyancing services in respect of F108a loan secured on land and the purchase of the land both to the society and to the borrower;

b

the number of cases in which it has provided the society (but not the borrower) with conveyancing services in respect of F108a loan secured on land;

c

the aggregate amount of the fees paid to it by the society or by or on behalf of the borrower for the provision of conveyancing services falling within sub-paragraphs (a) and (b) above;

d

the aggregate of the amounts paid to it by the society by way of commission for its having introduced investment business to the society;

e

the aggregate amount of any fees paid to it by the society in consideration of the provision of conveyancing services in respect of any land held by the society F109under section 6, 10, 17 or 19;

f

the aggregate amount of any fees paid to it by the society in consideration of the provision of F110administrative services to the society.

Valuers and surveyors

2

Where the business associate of the building society provides the services of surveying and valuing property the requisite particulars of its business in any financial year are the following—

a

the number of cases in which it has, in respect of any land which is to secure F111a loan, surveyed the land or provided a valuation of it on behalf of the society or the borrower or both;

b

the number of cases in which it has, on behalf of the society (but not the borrower), surveyed any land which is to secure F111a loan or provided the society with a valuation of it;

c

the aggregate amount of the fees paid to it by the society or by or on behalf of the borrower for the provision of the services falling within sub-paragraphs (a) and (b) above;

d

the aggregate of the amounts paid to it by the society by way of commission for its having introduced investment business to the society;

e

the aggregate amount of any fees paid to it by the society in consideration of the provision of surveying or valuing services in respect of any property held by the society F112under section 6, 10, 17 or 19;

f

the aggregate amount of any fees paid to it by the society in consideration of the provision of F113administrative services to the society.

Accountants

3

Where the business associate of the building society provides accountancy services the requisite particulars of its business in any financial year are the following—

a

the aggregate amount of the fees paid to it by the society for the provision of accountancy services; and

b

the aggregate amount of any fees paid to it by the society in consideration of the provision of F114administrative services to the society.

Insurance agents, etc.

4

Where the business associate of the building society arranges for the provision of relevant insurance the requisite particulars of its business in any financial year are the following—

a

the aggregate of the amounts paid to it by the society or by way of commission by insurers in respect of relevant insurance effected by the society or by borrowers in compliance with the terms on which F115loans secured on land are made by the society; and

b

the aggregate amount of any fees paid to it by the society in consideration of the provision of F116administrative services to the society.

Part II Requisite Particulars on Adoption of This Part

Conveyancers

5

Where the business associate of the building society provides conveyancing services the requisite particulars of its business in any financial year are the following—

a

the prescribed band within which falls the estimated number of cases in which it has provided conveyancing services in respect of F117a loan secured on land and the purchase of the land both to the society and to the borrower;

b

the prescribed band within which falls the estimated number of cases in which it has provided the society (but not the borrower) with conveyancing services in respect of F117a loan secured on land;

c

the prescribed band within which falls the estimated aggregate amount of the fees paid to it by the society or by or on behalf of the borrower for the provision of conveyancing services falling within sub-paragraphs (a) and (b) above;

d

the prescribed band within which falls the estimated aggregate of the amounts paid to it by the society by way of commission for its having introduced investment business to the society;

e

the prescribed band within which falls the estimated aggregate amount of any fees paid to it by the society in consideration of the provision of conveyancing services in respect of any land held by the society F118under section 6, 10, 17 or 19;

f

the prescribed band within which falls the estimated aggregate of any fees paid to it by the society in consideration of the provision of F119administrative services to the society.

Valuers and surveyors

6

Where the business associate of the building society provides the services of surveying and valuing property the requisite particulars of its business in any financial year are the following—

a

the prescribed band within which falls the estimated number of cases in which it has, in respect of any land which is to secure F120a loan, surveyed the land or provided a valuation of it on behalf of the society or the borrower or both;

b

the prescribed band within which falls the estimated number of cases in which it has, on behalf of the society (but not the borrower), surveyed any land which is to secure an advance or provided the society with a valuation of it;

c

the prescribed band within which falls the estimated aggregate amount of the fees paid to it by the society or by or on behalf of the borrower for the provision of the services falling within sub-paragraphs (a) and (b) above;

d

the prescribed band within which falls the estimated aggregate of the amounts paid to it by the society by way of commission for its having introduced investment business to the society;

e

the prescribed band within which falls the estimated aggregate of any fees paid to it by the society in consideration of the provision of surveying or valuing services in respect of any property held by the society F121under section 6, 10, 17 or 19;

f

the prescribed band within which falls the estimated aggregate amounts of any fees paid to it by the society in consideration of the provision of F122administrative services to the society.

Accountants

7

Where the business associate of the building society provides accountancy services the requisite particulars of its business in any financial year are the following—

a

the prescribed band within which falls the estimated aggregate amount of the fees paid to it by the society for the provision of accountancy services; and

b

the prescribed band within which falls the estimated aggregate amount of any fees paid to it by the society in consideration of the provision of F123administrative services to the society.

Insurance agents, etc.

8

Where the business associate of the building society arranges for the provision of relevant insurance the requisite particulars of its business in any financial year are the following—

a

the prescribed band within which falls the estimated aggregate of the amounts paid to it by the society or by way of commission by insurers in respect of relevant insurance effected by the society or by borrowers in compliance with the terms on which F124loans secured on land are made by the society; and

b

the prescribed band within which falls the estimated aggregate amount of any fees paid to it by the society in consideration of the provision of F125administrative services to the society.

Part III Supplementary

Power to prescribe bands for Part II particulars

9 C171

The F126Treasury may by order prescribe, for the purposes of the provisions of Part II of this Schedule,—

a

series of numbers by reference to limits specified in the order, or

b

series of monetary amounts by reference to limits so specified;

and, in any provision of Part II, “prescribed band” means, in relation to cases, any series of numbers so prescribed for the purposes of that provision and, in relation to monetary amounts, any series of monetary amounts so prescribed for the purposes of that provision.

C172

The power conferred by this paragraph includes power to prescribe different series of numbers or of monetary amounts for the purposes of different provisions.

3

The power to make an order under this paragraph is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Interpretation

10

1

In this Schedule—

“administrative services” means services falling within section 69(4);
“business associate” and “associated”, in relation to a building society, have the same meaning as in section 69;
“financial year” means a financial year of the society with which the business associate is associated;
“prescribed band” has the meaning given by paragraph 9(1) above; and
“relevant insurance” means insurance falling within section 69(3)(d).

2

In section 69, “the volume of the business”, in relation to any business constituted by the provision of any services referred to in any provision of Part I or Part II of this Schedule means—

a

in the case of a paragraph of Part I, the aggregate of all the fees and commissions which are the subject of the requisite particulars under that paragraph; and

b

in the case of a paragraph of Part II, the aggregate of the amounts which are specified in orders under paragraph 9 above as the upper limits of the prescribed bands within which fall the estimated aggregates of the fees or commissions or other amounts received which are the subject of the requisite particulars under the provisions of that paragraph

F339SCHEDULE 10ADisclosures about directors, other officers and employees in notes to accounts

Section 72J

Annotations:

Amendments (Textual)

F339

Schs. 10A, 10B inserted (22.12.2004) (with effect in accordance with art. 1(2) of the amending S.I.) by The Building Societies Act 1986 (International Accounting Standards and Other Accounting Amendments) Order 2004 (S.I. 2004/3380), art. 1, Sch. para. 9

Part 1Emoluments of and dealings with directors and other officers

Aggregate amount of director’s remuneration etc

1

The following must be shown—

a

the aggregate amount of salary and fees and sums paid by way of expenses allowance (so far as they are chargeable to United Kingdom tax) paid to or receivable by directors in respect of qualifying services;

b

the aggregate amount of bonuses paid to or receivable by directors in respect of qualifying services;

c

the aggregate amount of the estimated money value of any other benefits paid to or receivable by directors in respect of qualifying services otherwise than in cash;

d

the aggregate of the amount of gains made by directors on the exercise of share options;

e

the aggregate of the following–

i

the amount of money paid to or receivable by directors under long-term incentive schemes in respect of qualifying services; and

ii

the net value of assets (other than money and share options) received or receivable by directors under such schemes in respect of such services;

f

the aggregate value of any society contributions paid, or treated as paid, to a pension scheme in respect of directors' qualifying services, being contributions by reference to which the rate or amount of any money purchase benefits that may become payable will be calculated;

g

the aggregate amount of the increase during the financial year in the value of any accrued pension or accrued lump sum comprising defined benefits payable in respect of any qualifying services performed by directors during the financial year; and

h

the total aggregate amounts in paragraphs (a) to (g).

2

In this paragraph–

“accrued pension” and “accrued lump sum”, in relation to any pension scheme and any director, mean respectively the amount of the annual pension, and the amount of the lump sum, which would be payable under the scheme on his attaining normal pension age if–
1. a
  he had left the society’s service at the end of the financial year;
2. b
  there were no increase in the general level of prices in the United Kingdom during the period beginning with the end of that year and ending with his attaining that age;
3. c
  no question arose of any commutation of the pension or inverse commutation of the lump sum; and
4. d
  any amounts attributable to voluntary contributions paid by the director to the scheme, and any money purchase benefits which would be payable under the scheme, were disregarded;
“amount”, in relation to a gain made on the exercise of a share option means the difference between–
1. a
  the market price of the shares on the day on which the option was exercised, and
2. b
  the price actually paid for the shares;
F567“collective money purchase benefit” has the meaning given in section 1 F566or 52 of the Pension Schemes Act 2021;
“defined benefits” means retirement benefits payable under a pension scheme which are not money purchase benefits;
“defined benefit scheme”, in relation to a director, means a pension scheme which is not a money purchase scheme;
“long-term incentive scheme” means any agreement or arrangement under which money or other assets may become receivable by a director and which includes one or more qualifying conditions with respect to service or performance which cannot be fulfilled within a single financial year; and for this purpose the following are disregarded–
1. a
  bonuses the amount of which falls to be determined by reference to service or performance within a single financial year;
2. b
  compensation for loss of office, payments for breach of contract and other termination payments; and
3. c
  retirement benefits;
“money purchase benefits”, in relation to a director, F568means—
1. (a)
  retirement benefits payable under a pension scheme the rate or amount of which is calculated by reference to payments made, or treated as made, by the director or by any other person in respect of the director and F472which fall within paragraph 1A; F569and
2. (b)
  collective money purchase benefits;
“money purchase scheme”, in relation to a director, means a pension scheme under which all of the benefits that may become payable to or in respect of the director are money purchase benefits;
“normal pension age”, in relation to any pension scheme and any director, means the age at which the director will first become entitled to receive a full pension on retirement of any amount determined without reduction to take account of its payment before a later age (but disregarding any entitlement to pension upon retirement in the event of illness, incapacity or redundancy);
“net value”, in relation to any assets received or receivable by a director, means value after deducting any money paid or other value given by the director in respect of those assets;
“qualifying services”, in relation to any person, means his services as a director of the society, and his services while director of the society–
1. a
  as director of any of its connected undertakings; or
2. b
  otherwise in connection with the management of the affairs of the society or any of its connected undertakings;
“shares” means shares (whether allotted or not) in any connected undertaking of the society, and includes a share warrant as defined by F348section 779(1) of the Companies Act 2006;
“share option” means a right to acquire shares;
“society contributions”, in relation to a pension scheme and a director, means any payments (including insurance premiums) made, or treated as made, to the scheme in respect of the director by a person other than the director;
“value”, in relation to shares received or receivable by a director on any day, means the market price of the shares on that day.

3

For the purposes of this paragraph amounts paid or receivable or share options granted in respect of a person’s accepting office as a director are treated as amounts paid or receivable or share options granted in respect of his services as a director.

4

Where a pension scheme provides for any benefits that may become payable to or in respect of any director to be whichever are the greater of –

a

money purchase benefits as determined by or under the scheme; and

b

defined benefits as so determined,

the society may assume for the purposes of this paragraph that those benefits will be money purchase benefits, or defined benefits, according to whichever appears more likely at the end of the financial year.

5

For the purpose of determining whether a pension scheme is a money purchase or defined benefit scheme, any death in service benefits provided for by the scheme are disregarded.

F4711A

as (in each case) is in excess of the retirement benefits to which they were respectively entitled on the relevant date.

2

For the purposes of sub-paragraph (1) the relevant date is whichever is the later of

a

the date on which the benefits first became payable;

b

27 March 1998; or

c

the date on which the provisions of the Building Societies Act 1997 specified in Part 2 of the Schedule to the Building Societies Act 1997 (Commencement) (No.3) Order 1997, have come into force in accordance with Article 2 of that Order in relation to the society.

3

Amounts paid or receivable under a pension scheme need not be included in the aggregate amount if –

a

the funding of the scheme was such that the amounts were or, as the case may be, could have been paid without recourse to additional contributions; and

b

amounts were paid to or receivable by all pensioner members of the scheme on the same basis,

and in this sub-paragraph “pensioner member”, in relation to a pension scheme, means any person who is entitled to the present payment of retirement benefits under the scheme.

4

In this paragraph–

a

references to retirement benefits include benefits otherwise than in cash; and

b

in relation to so much of retirement benefits as consists of a benefit otherwise than in cash, references to their amount are to the estimated money value of the benefit,

and the nature of any such benefit must also be disclosed.

Compensation to directors for loss of office

4

2

The amount in each case includes all relevant sums paid by or receivable from–

a

the society;

b

the society’s connected undertakings; and

c

any other person,

except sums to be accounted for to the society or any of its connected undertakings.

3

References to amounts paid to or receivable by a person include amounts paid to or receivable by a person connected with him or a body corporate associated with him (but not so as to require an amount to be counted twice).

7

1

The amounts to be shown for any financial year under paragraphs 1 to 5 are the sums receivable in respect of that year (whenever paid) or, in the case of sums not receivable in respect of a period, the sums paid during that year.

2

But where–

a

any sums are not shown in a note to the accounts for the relevant financial year on the ground that the person receiving them is liable to account for them as mentioned in paragraph 6(2), but the liability is thereafter wholly or partly released or is not enforced within a period of 2 years; or

b

any sums paid by way of expenses allowance are charged to United Kingdom income tax after the end of the relevant financial year,

those sums must, to the extent to which the liability is released or not enforced or they are charged as mentioned (as the case may be), be shown in a note to the first accounts in which it is practicable to show them and must be distinguished from the amounts to be shown apart from this provision.

8

1

Where the chief executive of the society is not also a director of the society, he is deemed, for the purposes of paragraphs 1 to 7, to be a director of the society.

2

In such circumstances there must be a note in the accounts specifying that the chief executive has been so deemed to be a director.

Interpretation of provisions regarding directors remuneration

9

4

This paragraph applies in relation to loans to, and other transactions and arrangements with, a person connected with a director of the society where the society (or in the case of a subsidiary undertaking incorporated in the United Kingdom, the subsidiary undertaking) has notice of the connection between that director and that person.

Disclosure of auditors' remuneration

F36011

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Persons who are to be regarded as associates of a society’s auditors

F36112

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

PART 2Information about employees

13

1

The following information with respect to the employees of a building society must be given in notes to the society’s individual accounts–

a

the average number of persons employed by the society in the financial year, and

4

Where—

a

disclosure is made under paragraph 3(1) with respect to a subsidiary undertaking; and

b

that undertaking’s financial year does not end with that of the society,

there must be stated in relation to that undertaking the date on which its last financial year before the end of the society’s financial year ended.

Significant holdings in undertakings other than subsidiary undertakings

5

1

The information required by paragraphs 6 and 7 must be given where at the end of the financial year the society has a significant holding in an undertaking which is not a subsidiary undertaking of the society.

2

A holding is significant for this purpose if–

a

it amounts to 20 per cent or more of the nominal value of the shares in the undertaking; or

b

the amount of the holding (as stated or included in the society’s accounts) exceeds one-fifth of the amount (as so stated) of the society’s assets.

in the case of Building Societies Act accounts, for the purpose of giving a true and fair view for the society of the matters set out in section 72B(2) or ,where appropriate, section 72F(2), or

b

in the case of IAS accounts, to the requirement under F558UK-adopted international accounting standards that such accounts achieve a fair presentation.

7

9

1

The following information must be given with respect to the undertakings that are subsidiary undertakings of the society at the end of the financial year.

2

The name of each undertaking must be stated.

3

There must be stated–

a

if it is incorporated outside the United Kingdom, the country in which it is incorporated;

b

if it is unincorporated, the address of its principal place of business.

4

It must be stated whether the subsidiary undertaking is included in the consolidation and, if it is not, the reason for excluding it from the consolidation must be given.

5

It must be stated with respect to each subsidiary undertaking of the society by virtue of which of the conditions specified in F354section 1162 of the Companies Act 2006 it is a subsidiary undertaking of the society.

6

That information need not be given in relation to a subsidiary undertaking if—

a

the relevant condition is that specified in subsection (2)(a) of that section, and

b

the society that is its immediate parent undertaking (within the meaning of F355section 1162 of the Companies Act 2006) holds the same proportion of the shares in the undertaking as it holds voting rights.

Holdings in subsidiary undertakings

10

1

The following information must be given with respect to the shares of a subsidiary undertaking held—

a

by the society, and

b

by the group,

by the society; and

b

by the group,

and the information required under paragraphs (a) and (b) must (if different) be given separately.

5

There must be stated–

a

the identity of each class of shares in the associated undertaking held; and

b

the proportion of the nominal value of the shares of that class represented by those shares.

Other significant holdings of society or group

13

1

The information required by paragraphs 14 and 15 must be given where at the end of the financial year the society has a significant holding in an undertaking which is not one of its subsidiary undertakings and does not fall within paragraph 12 (associated undertakings).

2

A holding is significant for this purpose if–

a

it amounts to 20 per cent or more of the nominal value of the shares in the undertaking; or

b

the amount of the holding (as stated or included in the society’s individual accounts) exceeds one-fifth of the amount of the society’s assets (as so stated).

14

b

in the case of IAS accounts, to the requirement under F561UK-adopted international accounting standards that such accounts achieve a fair presentation.

if not, its financial year ending last before the end of the society’s financial year.

16

1

The information required by paragraphs 17 and 18 must be given where at the end of the financial year the group has a significant holding in an undertaking which is not a subsidiary undertaking of the society and does not fall within paragraph 12 (associated undertakings).

2

A holding is significant for this purpose if–

a

it amounts to 20 per cent or more of the nominal value of the shares in the undertaking; or

b

the amount of the holding (as stated or included in the group accounts) exceeds one-fifth of the amount of the group’s assets (as so stated).

for the purpose of giving a true and fair view for the society and its subsidiary undertakings as a whole, of the matters set out in section 72F(2);

b

in the case of IAS accounts, to the requirement under F563UK-adopted international accounting standards that such accounts achieve a fair presentation.

18

Interpretation: general

20

In this Schedule, “group” means a building society and its subsidiary undertakings.

F357SCHEDULE 10CDisclosure of auditor remuneration etc required in notes to accounts

Section 72M

Annotations:

Amendments (Textual)

F357

Sch. 10C inserted (29.6.2008) by The Building Societies Act 1986 (Accounts, Audit and EEA State Amendments) Order 2008 (S.I. 2008/1519), art. 1(2), Sch. 1 para. 1

Disclosure required

1

The following must be shown—

a

the amount of any remuneration receivable by the society’s auditor F537, or an associate of the society’s auditor, for the auditing of the annual accounts, and

b

the amount of any remuneration receivable in respect of the financial year by—

i

the society’s auditor, or

ii

any person who was, at any time during that financial year, an associate of the society’s auditor,

for the supply of other services to the society or any associate of the society.

2

Where the remuneration includes benefits in kind, the nature and estimated money-value of those benefits must also be shown.

3

Separate disclosure is required in respect of the auditing of the accounts in question and of each type of service specified in paragraph 2, but not in respect of each service falling within a type of service.

4

Separate disclosure is required in respect of services supplied to the society and its subsidiaries on the one hand and to associated pension schemes on the other.

5

Where more than one person has been appointed as a society’s auditor in respect of the financial year, separate disclosure is required in respect of the remuneration of each such person and his associates.

6

Where a building society is required to prepare consolidated group accounts—

a

those accounts must comply with sub-paragraph (1)(b) as if the undertakings included in the consolidation were a single building society, and

F538b

the notes to the individual accounts of—

i

the society, and

ii

a subsidiary of the society, where the subsidiary is included in the group accounts and the statutory auditor is the same for both the society and the subsidiary,

do not have to disclose the information required by that provision if the notes state that the group accounts are so required.

Types of service

Duty of auditor to supply information

g

a body corporate is in the same group as another body corporate if one is a subsidiary of the other.

Interpretation

6

In this Schedule—

“associate of the society” means—
1. a
  any subsidiary of the society, other than a subsidiary in respect of which severe long-term restrictions substantially hinder the exercise of rights of the society over the assets or management of that subsidiary, or
2. b
  any associated pension scheme;
“associated pension scheme”, in relation to a building society, means a scheme for the provision of benefits for or in respect of directors or employees (or former directors or employees) of the society or any subsidiary of the society where—
1. a
  the benefits consist of or include any pension, lump sum, gratuity or other like benefit given or to be given on retirement or on death or in anticipation of retirement or, in connection with past service, after retirement or death, and
2. b
  either—
  1. i
    a majority of the trustees are appointed by, or by a person acting on behalf of the society or a subsidiary of the society, or
  2. ii
    the society, or a subsidiary of the society, exercises a dominant influence over the appointment of the auditor (if any) of the scheme;
“remuneration” includes payments in respect of expenses and benefits in kind;
“subsidiary” means a subsidiary undertaking that is a body corporate.

C18 SCHEDULE 11F347 Auditors: Appointment, Tenure...

Section 77.

Annotations:

Amendments (Textual)

F347

Words in Sch. 11 heading omitted (6.4.2008) by virtue of The Companies Act 2006 (Consequential Amendments etc) Order 2008 (S.I. 2008/948), art. 2(2), Sch. 1 para. 14(a), Sch. 2 (with arts. 6, 11, 12)

Modifications etc. (not altering text)

C18

ii

the reasons for not following the audit committee’s recommendation.

6

Where the audit committee recommends re-appointment of the society’s existing auditor or auditors, and the directors are in agreement, sub-paragraphs (3) and (4)(a) and (b) do not apply.

3C

1

This paragraph applies to the appointment of an auditor or auditors under section 77, where the building society does not have an audit committee.

2

Before an appointment to which this paragraph applies is made the directors must propose an auditor or auditors for appointment.

3

Before the directors make a proposal under sub-paragraph (2), they must carry out a selection procedure in accordance with Article 16(3) of the Audit Regulation F532, from which their proposed auditor or auditors must be drawn .

F5314

Sub-paragraph (3) does not apply in relation to a proposal to re-appoint the society’s existing auditor or auditors.

F5243D

1

A person who has been, or will have been, auditor of a building society in respect of every financial year comprised in the maximum engagement period may not be appointed as auditor of the society in respect of any financial year which begins within the period of 4 years beginning with the day after the last day of the last financial year of the maximum engagement period.

2

A person who is a member of the same network as the auditor mentioned in sub-paragraph (1) may not be appointed as auditor of the society in respect of any financial year which begins within the period of 4 years mentioned in that sub-paragraph.

3

In this paragraph “network” means an association of persons, other than a firm, co-operating in audit work by way of—

a

profit-sharing;

b

cost-sharing;

c

common ownership, control or management;

d

common quality control policies and procedures;

e

common business strategy; or

f

use of a common name.

F5363DA

1

If—

a

a building society appoints, or purports to appoint, an auditor or auditors, and

b

the appointment or purported appointment is made in breach of paragraph 3B, 3C or 3D (requirements applying to appointment of auditors),

the appropriate authority may appoint another auditor or auditors in place of the auditor or auditors referred to in paragraph (a).

2

The breach of paragraph 3B, 3C or 3D does not invalidate any report made under this Part by the auditor or auditors on the building society’s annual reports or accounts before the auditor or auditors are replaced under sub-paragraph (1) of this paragraph.

3

But where the breach in question is a breach of paragraph 3D, sections 1248 and 1249 of the Companies Act 2006 (Secretary of State’s power to require second audit for companies) apply as if—

a

the building society were a company;

b

references to the Secretary of State were to the appropriate audit authority;

c

references to the registrar of companies were to the FCA and, if the society is a PRA-authorised person, to the PRA;

d

the auditor was not an appropriate person, or the auditors were not appropriate persons, for the period during which the audit was conducted;

e

section 1248(9) was omitted.

4

Within one week of becoming aware of the breach of paragraph 3B, 3C or 3D, the building society must give notice to the appropriate authority that the power under sub-paragraph (1) of this paragraph has become exercisable.

5

If the building society fails to give the notice required by sub-paragraph (4), the society shall be liable on summary conviction—

a

to a fine not exceeding level 3 on the standard scale; and

b

in the case of a continuing offence, to an additional fine not exceeding £40 for every day during which the offence continues;

and so shall any officer who is also guilty of the offence.

3E

1

Where a person is auditor of a building society in respect of consecutive financial years, the maximum engagement period of the person as auditor of the society—

a

begins with the first of those years (see the appropriate entry in the first column of the following Table), and

b

ends with the financial year specified in the corresponding entry in the second column of the Table:

First financial year of the maximum engagement period	Last financial year of the maximum engagement period
A financial year of the society beginning before 17 June 1994	The last financial year of the society to begin before 17 June 2020.
A financial year of the society beginning— (a) on or after 17 June 1994, and (b) before 17 June 2003	The last financial year of the society to begin before 17 June 2023.
A financial year of the society beginning— (a) on or after 17 June 2003, and (b) before 17 June 2016	No qualifying selection procedure Where neither the first financial year of the maximum engagement period nor any subsequent financial year is one in respect of which the auditor has been appointed following the carrying out of a qualifying selection procedure, the later of- (a) the last financial year of the society to begin before 17 June 2016, and (b) the last financial year of the society to begin within the period of 10 years beginning with the first day of the first financial year of the maximum engagement period. No qualifying selection procedure within 10 years Where the last day of the last financial year of the society to begin within the period of 10 years beginning with the first day of the last financial year of the society in respect of which the auditor was appointed following a qualifying selection procedure is before 17 June 2016— (a) the last financial year of the society to begin before 17 June 2016, unless (b) the auditor is appointed following a qualifying selection procedure for the first financial year of the society to begin on or after 17 June 2016, in which case it is the last financial year of the society to begin within the period of 20 years beginning with the first day of the first financial year of the maximum engagement period. Qualifying selection procedure within 10 years In any other case, the earlier of- (a) the last financial year of the society to begin within the period of 10 years beginning with the first day of the last financial year of the society in respect of which the auditor was appointed following a qualifying selection procedure, and (b) the last financial year of the society to begin within the period of 20 years beginning with the first day of the first financial year of the maximum engagement period.
A financial year of the society beginning on or after 17 June 2016	The earlier of— (a) the last financial year of the society to begin within the period of 10 years beginning with the first day of the last financial year of the society in respect of which the auditor was appointed following a qualifying selection procedure, and (b) the last financial year of the society to begin within the period of 20 years beginning with the first day of the first financial year of the maximum engagement period.

2

Where the first financial year of the maximum engagement period begins on or after 17 June 2003, the maximum engagement period may be extended by a period of no more than 2 years with the approval of the competent authority.

3

Such approval may be given by the competent authority only if it is satisfied that exceptional circumstances exist.

4

Where the competent authority gives its approval as mentioned in sub-paragraph (2)—

a

the second column of the Table in sub-paragraph (1) has effect with the necessary modifications, and

b

the first appointment to be made after the end of the period as so extended must be made following a qualifying selection procedure.

5

In this paragraph “qualifying selection procedure” means—

a

in the case of an appointment in respect of a financial year beginning on or after 17 June 2016 made after the Statutory Auditors and Third Country Auditors Regulations 2017 come into force—

i

if the society has an audit committee, a selection procedure that complies with the requirements of paragraph 3B(3) and (4)(a) and (b), and

ii

if the society does not have an audit committee, a selection procedure that complies with the requirements of Article 16(3) of the Audit Regulation;

b

in any other case, a selection procedure that substantially meets the requirements of Article 16(2) to (5) of the Audit Regulation F565as it had effect immediately before IP completion day, having regard to the circumstances at the time (including whether the society had an audit committee).

4

1

A resolution at a general meeting of a building society—

a

appointing as auditor a person other than a retiring auditor; or

b

filling a casual vacancy in the office of auditor; or

c

reappointing as auditor a retiring auditor who was appointed by the directors to fill a casual vacancy; or

d

b

i

the publication of the copy of the representations or the statement on a web site,

ii

the address of that web site,

iii

the place on that web site where the representations or statement may be accessed, and how it may be accessed,

and where the notification concerns the publication of a statement required to be sent by sub-paragraph (9)(a), the member is notified within the period specified in that paragraph; and

d

the copy of the representations or the statement is published continuously on that web site throughout the period beginning with the date on which notification is given in accordance with paragraph (c) and ending with the conclusion of the meeting.

10

If default is made in complying with sub-paragraph (4) or (9) above the building society shall be liable—

a

on conviction on indictment to a fine; or

b

on summary confiction to a fine not exceeding the statutory maximum and, in the case of a continuing offence, to a fine not exceeding ~~F486one tenth of the statutory maximum~~F486one-tenth of the greater of £5,000 or the amount corresponding to level 4 on the standard scale for summary offences for every day during which the offence continues;

and so shall any officer who is also guilty of the offence.

F31410A

Where, in a case in which sub-paragraph (9A)(b) is relied on for compliance with a requirement of sub-paragraph (4) or (9)—

a

a copy of representations or a statement is published on a web site for a part, but not all, of the period mentioned in sub-paragraph (9C)(d), but

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

no offence is committed under sub-paragraph (10) by reason of that failure.

Qualification and disqualification of auditors

F3565

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F493Tenure

Annotations:

Amendments (Textual)

F493

Sch. 11 paras. 5A, 5B and heading inserted (17.6.2016) by The Statutory Auditors and Third Country Auditors Regulations 2016 (S.I. 2016/649), reg. 1(1)(a), Sch. 4 para. 8(b) (with reg. 1(6))

F5335A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5335BMaximum engagement period: transitional arrangements

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Removal of auditors

6

1

A building society may by resolution in general meeting remove an auditor before the expiration of his term of office, notwithstanding anything in any agreement between it and him.

2

Where a resolution removing an auditor is passed at a general meeting of a building society, the society shall within 14 days give notice of that fact to the F410FCA and, if the society is a PRA-authorised person, the PRA .

3

If a building society fails to give the notice required by s ub-paragraph (2) above the society shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale and, in the case of a continuing offence, to an additional fine not exceeding £40 for every day during which the offence continues and so shall every officer who is also guilty of the offence.

4

Nothing in this paragraph is to be taken as depriving a person removed under it of compensation or damages that may be payable to him in respect of the termination of his appointment as auditor.

F4965

An auditor may not be removed from office before the expiration of that auditor's term of office except—

a

by resolution under this paragraph, or

b

in accordance with paragraph 6ZA.

6ZAF495Application to court to remove auditor from office

1

The competent authority may apply to the High Court for an order removing an auditor of a building society from office if the authority considers that there are proper grounds for removing the auditor from office.

2

The members of a building society may apply to the High Court for an order removing an auditor of the building society from office if the applicant or applicants consider that there are proper grounds for removing the auditor from office.

3

If the court is satisfied, on hearing an application under sub-paragraph (1), that there are proper grounds for removing the auditor from office, it may make an order removing the auditor from office.

4

If the court is satisfied, on hearing an application under sub-paragraph (2), that—

a

the applicants represent in total—

i

not less than 5% of the voting rights of all the members having a right to vote at a general meeting of the building society, or

ii

not less than 5% in nominal value of the amount standing to the credit of shares in a building society as shown by the latest balance sheet, and

b

there are proper grounds for removing the auditor from office,

the court may make an order removing the auditor from office.

5

For the purposes of this paragraph, divergence of opinions on accounting treatments or audit procedures are not to be taken to be proper grounds for removing an auditor from office.

F358Removal of auditor on improper grounds

Annotations:

Amendments (Textual)

F358

Sch. 11 para. 6A and cross-heading inserted (29.6.2008) by The Building Societies Act 1986 (Accounts, Audit and EEA State Amendments) Order 2008 (S.I. 2008/1519), arts. 1(2), 6(1)

6A

1

Where an auditor of a building society is removed from office F497, other than by order of the High Court made under paragraph 6ZA, an application may be made to the High Court under this paragraph.

2

The persons who may make such an application are—

a

any member of the society who was also a member at the time of the removal;

F411b

the FCA; and

c

if the society is a PRA-authorised person, the PRA.

3

If the court is satisfied that the removal was—

a

on grounds of divergence of opinion on accounting treatments or audit procedures, or

b

on any other improper grounds,

8

If default is made in complying with sub-paragraph (3) or sub-paragraph (7) the building society shall be liable—

a

on conviction on indictment to a fine; or

b

on summary conviction to a fine not exceeding the statutory maximum and, in the case of a continuing offence, to a fine not exceeding ~~F487one tenth of the statutory maximum~~ F487one-tenth of the greater of £5,000 or the amount corresponding to level 4 on the standard scale for summary offences for every day during which the offence continues;

and so shall any officer who is also guilty of the offence.

F3168A

Where, in a case in which sub-paragraph (7C) is relied on for compliance with a requirement under sub-paragraph (3) or (7)—

a

a notice or a statement is published for a part, but not all, of the period mentioned in sub-paragraph (7C)(d), but

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

no offence is committed under sub-paragraph (8) by reason of that failure.

8

1

Where an auditor’s notice of resignation contains a statement under paragraph 7(2)(b) above he may also deposit at the principal office of the society a requisition signed by him calling on the directors of the society forthwith duly to convene a special general meeting of the society for the purpose of receiving and considering such explanation of the circumstances connected with this resignation as he may wish to place before the meeting.

2

Where an auditor’s notice of resignation contains such a statement the auditor may request the society to send to its members—

a

before the general meeting at which his term of office would otherwise expire or expires, as the case may be; or

b

3C

Where, in a case in which sub-paragraph (3A)(b) is relied on for compliance with a requirement under sub-paragraph (3)(b)—

a

a statement is published for a part, but not all, of the period mentioned in subparagraph (3B)(d), but

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

that failure shall not invalidate the proceedings of the meeting.

4

If the directors of the society do not within 21 days from the date of the deposit of a requisition under this paragraph proceed duly to convene a meeting for a day not more than 28 days after the date on which the notice convening the meeting is given, every director who failed to take all reasonable steps to secure that a meeting was so convened shall be liable—

a

on conviction on indictment to a fine; or

b

on summary conviction to a fine not exceeding the statutory maximum.

5

If a copy of the statement mentioned in sub-paragraph (2) is not sent out as required by sub-paragraph (3) because it was received too late or because of the society’s default, the auditor may (without prejudice to his right to be heard orally) require that the statement be read out at the meeting.

6

Copies of a statement need not be sent out and the statement need not be read out at the meeting if—

a

on an application made to the High Court by the society or a person aggrieved, the court is satisfied that the rights conferred by this paragraph are being abused to secure needless publicity for defamatory matter; or

b

on an application to the F416PRA by the society or a person aggrieved, the F416PRA is satisfied that the circulating or reading out of the statement would be likely to diminish substantially the confidence in the society of investing members of the public.

7

If the High Court makes an order under sub-paragraph (6)(a) above it may also order the society’s costs of the application to be paid by the auditor notwithstanding that he is not a party to the application.

8

An auditor who has resigned his office is entitled to attend any such meeting as is mentioned in sub-paragraph (2)(a) or (b) and to receive all notices of, and other communications relating to, any such meeting which any member of the society is entitled to receive, and to be heard at any such meeting which he attends on any part of the business of the meeting which concerns him as former auditor of the society.

F359Duty of auditor to notify appropriate audit authority

Annotations:

Amendments (Textual)

F359

Sch. 11 paras. 8A-8C and cross-headings inserted (29.6.2008) by The Building Societies Act 1986 (Accounts, Audit and EEA State Amendments) Order 2008 (S.I. 2008/1519), arts. 1(2), 6(2)

Sch. 11 para. 8C heading substituted (17.6.2016) by The Statutory Auditors and Third Country Auditors Regulations 2016 (S.I. 2016/649), reg. 1(1)(a), Sch. 4 para. 8(f) (with reg. 1(6))

F4988C

F5351

In this Schedule—

“appropriate audit authority” means—
1. a
  the Secretary of State, or
2. b
  if the Secretary of State has delegated functions under section 1252 of the Companies Act 2006 F499 to a body whose functions include receiving the equivalent notice under section 522 F500 or 523 F501 of that Act, that body;
F555“audit committee” means a body which performs—
1. (a)
  the functions referred to in—
  1. (i)
    rule 7.1.3 of the Disclosure Guidance and Transparency Rules sourcebook made by the Financial Conduct Authority under the Financial Services and Markets Act 2000; or
  2. (ii)
    rule 2.4 of the Audit Committee Part of the Rulebook made by the Prudential Regulation Authority under that Act; or
2. (b)
  equivalent functions;
“Audit Regulation” means Regulation 537/2014 of the European Parliament and of the Council on specific requirements regarding statutory audit of public interest entities and repealing Commission Decision 2005/989/EC; and
“competent authority” means the Financial Reporting Council Limited F502.

F5541A

For the purposes of the definition of “audit committee”, references to rules made by the Prudential Regulation Authority or the Financial Conduct Authority are to those rules as they have effect on IP completion day.

F5342

For the purposes of this Schedule, a person is auditor of a building society in respect of a financial year if the auditor is required to report on the accounts of the society for that financial year.

9

In the application of this Schedule to Scotland, references to the High Court shall be read as references to the Court of Session.

F127SCHEDULE 12

Annotations:

Amendments (Textual)

F127

Sch. 12 repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538 art. 2

Part I Matters to be Provided for in Schemes

Annotations:

Amendments (Textual)

F231

Words in Sch. 12 Pt. I substituted (1.12.1997) by 1997 c. 32, s. 43, Sch. 7 para. 62(1); S.I. 1997/2668, art. 2, Sch. Pt. I(l)(xvi)

The matters for which provision is, subject to F231Part III of this Schedule, to be made are the following:

Administration

1

The establishment and functioning of an independent body (whether corporate or unincorporate) which is to administer the scheme.

2

The identity of the members.

3

The manner in which the expenses of the scheme are to be met by the members.

The adjudicator

4

The appointment of an independent adjudicator to conduct investigations under the scheme and his tenure of office and remuneration.

Scope of scheme

5

The matters action in relation to which is to be subject to investigation under the scheme and the grounds for making it subject to investigation.

Functions of adjudicator

6

The duty of the adjudicator to investigate, and make determinations on, actions duly referred for investigation.

7

The powers of, and procedure to be followed in the conduct of investigations by, the adjudicator.

8

The powers of the adjudicator on the making of determinations.

Determinations and their effects

9

The extent to which determinations are binding.

10

The manner in which determinations are to be communicated and published.

Reports by investigators to administering body

11

The making to the body administering the scheme of regular reports by the adjudicator as to the discharge of his functions, and their publication.

Amendment or revocation of scheme

12

The manner of amending or revoking the scheme.

Accession to membership

13

Accession to membership of other societies.

Withdrawal from membership

14

Withdrawal from membership.

F232Part II Requirements for Recognised Schemes:Matters of Complaint

Annotations:

Amendments (Textual)

F232

Sch. 12 Pt. II repealed (1.12.1997) by 1997 c. 32, ss. 43, 46(2), Sch. 7 para. 62(2), Sch. 9; S.I. 1997/2668, art. 2, Sch. Pt. I(j)(l)(xvi)(o)(viii)

Deposit accounts

2

The operation or termination of a deposit account and the grant or refusal to grant a depositor other facilities normally available to depositors of his description.

Note: The operation or termination of a deposit account includes any aspect of the relationship or the termination of the relationship between the society and a depositor as such, including in particular the operation or termination of any services incidental to such accounts.

Note: The grant of facilities includes the terms on which they are granted.

Borrowing members: class 1 or class 2 advances

3

The operation or termination of the account of a member borrowing on a class 1 or class 2 advance and the grant or refusal to grant a borrowing member of that description other or further class 1, or as the case may be, class 2 advances secured on the same or different land or other facilities normally available to borrowing members of his description.

Note: The operation or termination of the account of a borrowing member includes any aspect of the relationship or the termination of the relationship between the society and a borrowing member as such, including in particular the exercise of the right of foreclosure or any other power over the land by virtue of the mortgage.

Note: The grant of advances includes the terms on which they are granted.

Borrowers: mobile home loans

4

The operation or termination of the account of a borrower under section 15 and the grant or refusal to grant a borrower under that section other facilities normally available to borrowers of his description.

Note: The operation or termination of the account of a borrower under section 15 includes any aspect of the relationship or the termination of the relationship between the lender and such a borrower, including in particular the exercise of any power over the security.

Note: The grant of facilities includes the terms on which they are granted.

Borrowers: other loans

5

The operation or termination of the account of a borrower under section 16 and the grant or refusal to grant a borrower under that section other facilities normally available to borrowers of his description.

Note: The operation or termination of the account of a borrower under section 16 includes any aspect of the relationship or the termination of the relationship between the lender and such a borrower including in particular, in the case of a secured loan, the exercise of any power over the security.

Note: The grant of facilities includes the terms on which they are granted.

Money transmission services

6

The terms on which are provided, the operation of, or the withdrawal of money transmission services.

Note: “Money transmission services” means the services of that description provided in accordance with Schedule 8 to this Act.

Foreign exchange facilities

7

The terms on which are provided, the operation of, or the withdrawal of foreign exchange services.

Note: “Foreign exchange services” means services of that description provided in accordance with Schedule 8 to this Act.

Agency payments and receipts

8

The terms on which payments are made or received as agents or the operation or withdrawal of the service.

Note: The payments made or received as agents are those made or received in accordance with Schedule 8 to this Act.

Provision of credit

9

The operation or termination of the account of a borrower with the person providing the credit.

Note: The credit provided is credit provided under arrangements for the provision of credit in accordance with Schedule 8 to this Act.

Part III Minimum Requirements for Recognised Schemes: Other Provisions

Grounds of complaint

F2331

1

The grounds for making action by a building society or connected undertaking subject to investigation under the scheme must be that the action constitutes—

a

in the case of a building society, a breach of the society’s obligations under this Act, its rules or any contract, or

b

in the case of a connected undertaking, a breach of the undertaking’s obligations under its rules (if any) or any contract, or

c

unfair treatment, or

d

maladministration, or

e

a decision to which sub-paragraph (2) below applies, or action consequential on such a decision,

in relation to the complainant and has caused him pecuniary loss or expense or inconvenience.

2

This sub-paragraph applies to any decision in connection with the provision of a relevant service which is made otherwise than in the legitimate exercise of commercial judgment.

Permissible exclusions from investigation

2

A scheme must not exclude action from investigation on any other than the following grounds, that is to say—

a

that the complaint is frivolous or vexatious;

b

that the action is the subject of proceedings in a court of law or was the subject of such proceedings in which a judgment on the merits was given;

F234bb

that the action is the subject of an investigation by another adjudicator (by whatever name called) operating under a comparable scheme (whether or not a recognised scheme), or was the subject of such an investigation in which a decision on the merits was made;

c

that, where the society or F235connected undertaking has a procedure for the resolution of complaints by it (an “internal procedure"), the procedure has not been invoked or has not been exhausted;

d

that there has been undue delay in having the matter investigated under the scheme F236, or in furnishing evidence in support of the complaint; or

e

that the action in question occurred outside the United Kingdom.

Note: An international procedure for resolution of complaints is not to be treated as having been invoked unless the complainant has made his complaint to the principal office of the society or, as the case may be, F237of the connected undertaking and is not to be treated as having been exhausted unless more than three months has elapsed since the complainant invoked it without any decision on his complaint having been communicated to him.

Note: Delay in having a matter investigated under the scheme is not “undue delay" unless at least six months (disregarding the period for exhausting the society’s or F238connected undertaking’s internal procedure) has expired since the matter came to the knowledge of the complainant; and a person is not, for this purpose, to be presumed to have knowledge of the contents of a document which contains or relates to the terms or proposed terms of any transaction between him and the society.

F239Note: Delay in furnishing evidence in support of the complaint is not “undue delay" unless at least six months have elapsed since the adjudicator acknowledged receipt of the complaint.

Functions of adjudicator

3

A scheme must, as regards the duties and powers attached to the investigation of complaints under the scheme—

a

impose on the adjudicator a duty, subject to the provision made in pursuance of sub-paragraph (c) below, to investigate and determine any complaint duly made;

b

impose on the adjudicator a duty to afford the complainant and the society or F240connected undertaking an opportunity to make representations (whether orally or in writing) in relation to the action complained of;

c

confer power on the adjudicator to advise, mediate or act as conciliator before proceeding further with an investigation;

d

confer power on the adjudicator to extend the scope of his investigation to other matters related to the action complained of; and

e

confer on an adjudicator such powers to require information and documents relevant to the matter to be furnished to him as are necessary for the purposes of the investigation.

4

1

Subject to any provision made in pursuance of sub-paragraph (3) below, a scheme must authorise the adjudicator, in reaching his decision, to have regard to, but not to be bound by, any matter (whether or not of obligation) relevant to the action complained of and to question any decision.

2

A scheme must impose on the adjudicator a duty, in reaching his decision, to have regard to—

a

the rules (if any) of the society or F241connected undertaking;

b

the provisions of any deed or contract binding the society and the complainant or, as the case may be, the F241connected undertaking and the complainant;

c

the provisions of any code of conduct applicable to the conduct by the society or F241connected undertaking of its affairs or business;

d

any advertisement issued by the society or F241connected undertaking in connection with any aspect of its activities and any communication with the complainant.

3

Subject to sub-paragraph (4) below, a scheme may preclude the adjudicator, in his determination, from questioning the merits of any decision taken by the society or F241connected undertaking with reference to—

a

the taking or conduct of legal proceedings to enforce any right of the society or F241connected undertaking; or

b

the creditworthiness, for the purposes of any advance or other service or facility, of the complainant;

but not otherwise.

4

Where investigation of a complaint on the ground of maladministration involves consideration by the adjudicator of any decision taken with reference to the creditworthiness of the complainant the scheme must confer power on the adjudicator to direct the society or associated body to take its decision again and reach it by proper procedures.

5

1

Subject to sub-paragraph (2) below, a scheme must confer power on the adjudicator, by his determination, to do either or both of the following, that is to say—

a

direct the society or F242connected undertaking whose action is complained of to take or desist from taking such steps as are specified in the determination;

b

order the society or F242connected undertaking whose action is complained of to pay the complainant a sum by way of compensation for the loss, expense or inconvenience caused by the action.

2

A scheme may impose a limit on the amount of compensation that a society or F242connected undertaking may be ordered to pay a complainant, but the limit must not be less than £100,000.

Effect of determinations and their communication

6

1

Subject to any provision made in pursuance of sub-paragraph (2) or (3) below, a scheme must provide that, if the complainant, by notice to the adjudicator within the period specified in the scheme, accepts his determination the society or F243connected undertaking is under an obligation to take the steps it is directed to take or pay the compensation awarded or both.

2

A scheme may relieve a society of the obligation imposed by a determination if, but only if, the society undertakes an obligation to give notice to its members of the reasons for its non-fulfilment of the obligations imposed by the determination in the next directors’ report under section 75 and to give notice of those reasons to the public in such manner as the adjudicator requires.

3

A scheme may relieve F244 a connected undertaking of the obligations imposed by a determination if, but only if, each of the building societies F245of which it is a connected undertaking undertakes an obligation to give notice to its members of the reasons for the non-fulfilment of the obligations imposed by the determination in the next directors’ report under section 75 and to give notice of those reasons to the public in such manner as the adjudicator requires.

7

A scheme must impose on the adjudicator an obligation not to disclose, whether in his determination or otherwise, any information or opinion furnished in confidence to the society or, as the case may be, to the F246connected undertaking for the purpose of any action on its part.

Reports by adjudicator to administering body

8

A scheme must require reports by the adjudicator as to the discharge of his functions to be made to the body administering the scheme not less frequently than once in every year.

Publication

9

1

A scheme must permit the body administering the scheme to publish the whole or any parts of the reports made to them by the adjudicator.

2

A scheme, if it makes the provision authorised by paragraph 6(2) or (3) above, must require the body administering the scheme to send to the Commission, not less frequently than once in every year, particulars of the cases in which building societies have undertaken the alternative obligation authorised by either or both of those sub-paragraphs.

F128SCHEDULE 13

Annotations:

Amendments (Textual)

F128

Sch. 13 repealed (1.12.2001) by S.I. 2001/2617 arts. 2(b), 13(2), Sch. 4 (with art. 13(3), Sch. 5); S.I. 2001/3538 art. 2

Preliminary

1

For the purposes of this Schedule, a scheme—

“qualifies for recognition” if it makes provision for the matters specified in Part I of Schedule 12 and F247the services action in relation to which is subject to investigation under the scheme consist of or include one or more F247relevant services; and
“conforms to the relevant requirements” if, in relation to a F248relevant service, it makes action in relation to F248that service subject to investigation in accordance with Part III of that Schedule;

and any reference to a scheme qualifying for recognition, or being recognised, to any “extent" indicates recognition of it for the purpose of investigations of action in relation to one or more F249relevant services.

2

1

The function of the Commission of granting recognition of schemes is exercisable, in accordance with paragraph 4 or 5 below, on the Commission’s own motion or on a submission for its approval made by or on behalf of any building societies.

2

In this Schedule, in relation to a scheme recognised by the Commission to any extent, a “direction for its recognition” means a direction that the scheme is, to the extent specified in the direction, a scheme recognised by the Commission.

The register of recognised schemes

3

b

accompanied by such information as the Commission may reasonably require, either generally or in any particular case, in order to make its decision on the application;

and in this paragraph “the applicants” means those societies or the person acting on their behalf for the purposes of the application.

2

Where an application is made to the Commission for recognition of a scheme then—

a

if it appears to the Commission that the scheme qualifies for recognition and conforms to the relevant requirements in respect of one or more F251relevant services, the Commission shall approve the scheme as a recognised scheme to such extent as it considers appropriate;

b

if it appears to the Commission that the scheme, with modifications, will, in addition to qualifying for recognition, conform to the relevant requirements in respect of one or more F251relevant services, and the applicants agree on appropriate modifications within the period of 21 days from the date on which the Commission notifies the applicants of the modifications it proposes for their agreement, the Commission shall approve the scheme as modified as a recognised scheme to such extent as it considers appropriate;

but otherwise it shall withold its approval.

3

The Commission shall, on approving a scheme, give a direction for its recognition and send copies of the direction to the applicants.

4

On giving a direction for the recognition of a scheme, the Commission shall also send a copy of the scheme and of the direction to the central office; and the central office shall keep the copy of the scheme and of the direction in the register.

Procedure on accession to schemes

6

1

A building society F252or connected undertaking of a building societywhich accedes to a recognised scheme or has acceded to a scheme which becomes a recognised scheme shall, within the period of 21 days beginning with the date of its accession or on which it receives a copy of the direction for its recognition, as the case may be, send a notice of that fact to the central office and to the Commission.

2

9

Withdrawal of recognition by the Commission shall take effect as from such date as is specified in the notice of its decision, being a date not less than one year nor more than two years after the date of the notice.

Withdrawal from membership

10

1

A building society F260or connected undertaking of a building societywishing to withdraw from membership of a recognised scheme shall send notice of its proposed withdrawal to the central office and to the Commission.

2

A notice by a society F261or undertakingunder sub-paragraph (1) above shall specify F262the relevant servicesaction in relation to which by the society F261or undertakingis subject to investigation under the scheme and the recognised scheme or recognised schemes of which it is or, on its withdrawal, will become a member under which, as regards each of F262the relevant services specified in the notice, action by the society F261or undertakingis or will be subject to investigation.

3

The central office, on receiving such a notice from a society, if satisfied that its withdrawal from the scheme will not result in a failure by it to comply with the duty imposed on it by section 83(3), shall confirm the withdrawal of the society from the scheme; but, if the central office is not so satisfied, the central office shall withold its confirmation.

F2633A

The central office, on receiving such a notice from a connected undertaking of a society, if satisfied that its withdrawal from the scheme will not result in a failure by the society to comply with the duty imposed on it by section 83(4), shall confirm the withdrawal of the undertaking from the scheme; but, if the central office is not so satisfied, the central office shall withhold its confirmation.

4

If the central office withholds its confirmation of a society’s F264or undertaking’swithdrawal from a scheme, the society F265or undertakingshall continue to a member of the scheme and bound and entitled under the scheme accordingly.

5

On confirming the withdrawal of a society F266or connected undertaking of a societyfrom a scheme the central office shall send to the society F267or undertakingand to the Commission notice of its decision and the central office shall record the decision in the public file of the society.

C19SCHEDULE 14 Settlement of Disputes

Section 85.

Annotations:

Modifications etc. (not altering text)

C19

Sch. 14 excluded (temp.) by S.I. 1986/2168, art. 3(1)(4)

Part I Proceedings in Court

Jurisdiction of the court

1

No court other than the High Court or, in the case of a building society whose principal office is in Scotland the Court of Session, shall have jurisdiction to hear and determine disputes to which this paragraph applies; and, in this Part of this Schedule, “the court” means the High Court or, as the case may be, the Court of Session.

2

This paragraph applies to any dispute—

a

between a building society and a member of the society in his capacity as a member, or

b

between a building society and a representative of such a member in that capacity,

in respect of any rights or obligations arising from the rules of the society or any provision of this Act or any statutory instrument under it.

3

Except in the cases referred to in sub-paragraph (5) below, no disputes to which this paragraph applies may be referred to arbitration.

4

The court shall not hear and determine any dispute arising out of section 61(8)(a) or F129paragraph 20A(10)(a) or 31(4)(a) of Schedule 2 to this Act.

5

The court shall not hear and determine any dispute which is required to be referred to arbitration under paragraph 4 below or which is referred to the F417FCA under paragraph 6 or to an adjudicator under paragraph 7 below except as provided in paragraph 2 below.

2

The court may hear and determine a dispute falling within paragraph 1(5) above in any case where, on the application of any person concerned, it appears to the court—

a

that application has been made by either party to the dispute to the other party for the purpose of having the dispute settled by arbitration, and

b

that either arbitrators have not been appointed within 40 days of that application or the arbitrators have refused, or have neglected for a period of 21 days, to proceed with the reference or make an award.

Right of F382FCA and PRA to be heard

Annotations:

Amendments (Textual)

F382

Words in Sch. 14 para. 3 heading substituted (1.4.2013) by The Financial Services Act 2012 (Mutual Societies) Order 2013 (S.I. 2013/496), art. 1(1), Sch. 8 para. 56(3) (with Sch. 12)

3

1

Any person who institutes proceedings in the court in relation to a dispute to which paragraph 1 above applies shall give notice of the fact and of the matter in dispute to the F383FCA and, if the society is a PRA-authorised person, the PRA .

2

The court shall not proceed to hear a dispute to which paragraph 1 applies until the court is satisfied that the notice required by sub-paragraph (1) above has been given.

3

The F383FCA and, if the society is a PRA-authorised person, the PRA shall be entitled, with the leave of the court, to attend and to be heard at any hearing of a dispute to which paragraph 1 applies.

Part II Arbitration

Circulation of election addresses, resolutions and statements

4

1

If the rules of the society so provide, any dispute in respect of a refusal by a building society to send to its members—

a

copies of an election address F130or a revised election address, in accordance with section 61(7), or

b

any document required to be sent under F131paragraph 20A(1)(b) or 31(1) of Schedule 2 to this Act,

shall, unless the refusal is on one of the grounds specified in sub-paragraph (2) below, be referred to arbitration.

2

Those grounds are—

a

that publicity for the document in question would be likely to diminish substantially the confidence in the society of investing members of the public, or

b

that the rights conferred by section 61(7) or F132paragraph 20A(1)(b) or 31(1) are being abused to seek needless publicity for defamatory matter.

F134Calling of special meeting

Annotations:

Amendments (Textual)

F134

Sch. 14 para. 4A and cross-heading preceding it inserted (1.12.1997 in specified cases and for specified purposes and otherwise in accordance with art. 2(2)(3)(5) of S.I. 1997/2668) by 1997 c. 32, ss. 43, 47(3), Sch. 7 para. 64(4); S.I. 1997/2668, art. 2, Sch. Pt. II(w)(z)(xxxvii)

F1334A

If the rules of the society so provide, any dispute in respect of a refusal by a building society to call a special meeting required to be called under paragraph 20A(1)(a) of Schedule 2 to this Act shall be referred to arbitration.

Procedure on a reference to arbitration

5

1

This paragraph has effect in relation to an arbitration under paragraph 4(1) above.

2

One or more arbitrators shall be appointed in the manner provided for by the rules of the building society; and so shall another arbitrator if an appointed arbitrator dies or refuses to act.

3

No arbitrator acting on a reference shall be beneficially interested (whether directly or indirectly) in the funds of the society.

4

The rules of the society may provide for the procedure to be followed on a reference to arbitration.

5

An award made by arbitrators, or the majority of them, shall be final and binding.

6

For the purposes of F135Part I of the Arbitration Act 1996 the rules of the society shall be treated as an arbitration agreement.

7

In relation to Scotland, sub-paragraph (6) above shall be omitted.

Access to register of members

6

1

Any dispute as to the rights of a member of a building society under paragraph 15 of Schedule 2 to this Act shall be referred to the F418FCA .

2

The reference of a dispute to the F418FCA under this paragraph shall be treated as a reference to arbitration; and its award shall have the same effect as that of an arbitrator acting in a reference under paragraph 4(1) above.

F4193

The FCA must consult the PRA before making any such award.

Disputes cognizable under a scheme

F1367

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

General

8

In this Part of this Schedule, in relation to an arbitration in Scotland, references to an arbitrator shall be read as references to an arbiter.

C35SCHEDULE 15 Application of Companies Winding Up Legislation to Building Societies

Section 90.

Annotations:

Modifications etc. (not altering text)

C35

Sch. 15 applied (with modifications) (7.4.2010) by The Building Societies (Financial Assistance) Order 2010 (S.I. 2010/1188), arts. 1(2), 9

Part I General Mode of Application

1

The enactments which comprise the companies winding up legislation (referred to in this Schedule as “the enactments”) are the provisions of—

a

Parts IV, VI, VIIF137, XII and XIII of the M9Insolvency Act 1986, or

F138b

Articles 5 to 8 of Part I and Parts V, VII and XI of the Insolvency (Northern Ireland) Order 1989; or

and, in so far as they relate to offences under any such enactment, sections 430 and 432 of, and Schedule 10 to, the Insolvency Act 1986 or F139Articles 2(6) and 373 of, and Schedule 7 to, the Insolvency (Northern Ireland) Order 1989.

F4741A

In this Schedule—

“deposit” means rights of the kind described in—
1. a
  paragraph 22 of Schedule 2 to the Financial Services and Markets Act 2000 (deposits); or
2. b
  section 1(2)(b) of the Dormant Bank and Building Society Accounts Act 2008 (balances transferred under that Act to authorised reclaim fund); and
“relevant deposit” means—
1. a
  an “eligible deposit” within the meaning given by paragraph 15C(1) of Schedule 6 to the Insolvency Act 1986 (categories of preferential debts) or a deposit of the kind mentioned in paragraph 15BB of that Schedule; or
2. b
  an “eligible deposit” within the meaning given by paragraph 21(1) of Schedule 4 to the Insolvency (Northern Ireland) Order 1989 (categories of preferential debts) or a deposit of the kind mentioned in paragraph 20 of that Schedule.

2

Subject to the following provisions of this Schedule, the enactments apply to the winding up of building societies as they apply to the winding up of companies limited by shares and F365registered under the Companies Act 2006 in England and Wales or Scotland or (as the case may be) in Northern Ireland.

3

1

The enactments shall, in their application to building societies, have effect with the substitution—

a

for “company” of “ building society ”F517(except as otherwise specified in paragraphs 33B and 55G below) ;

b

for “the registrar of companies” or “the registrar” of “ F420Financial Conduct Authority ”;

c

for “the articles” of “ the rules ”; and

d

for “registered office” of “ principal office ”.

2

In the application of the enactments to building societies—

F140aa

every reference to a company registered in Scotland shall have effect as a reference to a building society whose principal office is situated in Scotland;

F141aa

every reference to a company registered in Scotland shall have effect as a reference to a building society whose registered office is situated in Scotland;

F482ab

a reference to the debts of a company includes a reference to sums due to shareholding members of a building society in respect of deposits;

a

every reference to the officers, or to a particular officer, of a company shall have effect as a reference to the officers, or to the corresponding officer, of the building society and as including a person holding himself out as such an officer; and

F142b

every reference to an administrative receiver shall be omitted.

4

1

Where any of the enactments as applied to building societies requires a notice or other document to be sent to the F421FCA , it shall have effect as if it required the F421FCA to keep the notice or document in the public file of the society concerned and to record in that file the date on which the notice or document is placed in it.

2

Where any of the enactments, as so applied, refers to the registration, or to the date of registration, of such a notice or document, that enactment shall have effect as if it referred to the placing of the notice or document in the public file or (as the case may be) to the date on which it was placed there.

5

Any enactment which specifies a money sum altered by order under section 416 of the M10Insolvency Act 1986, or, as the case may be, F143Article 362 of the Insolvency (Northern Ireland) Order 1989, (powers to alter monetary limits) applies with the effect of the alteration.

Part II Modified Application of Insolvency Act 1986

Parts IV F510, F5416, 7, 12 and 13F541and Schedule 10

Annotations:

Amendments (Textual)

F510

Words in Sch. 15 Pt. II heading substituted (7.4.2017) by The Deregulation Act 2015, the Small Business, Enterprise and Employment Act 2015 and the Insolvency (Amendment) Act (Northern Ireland) 2016 (Consequential Amendments and Transitional Provisions) Regulations 2017 (S.I. 2017/400), regs. 1(2), 2(3)(b)

F541

Words in Sch. 15 Pt. II heading inserted (13.3.2018) by The Small Business, Enterprise and Employment Act 2015 (Consequential Amendments, Savings and Transitional Provisions) Regulations 2018 (S.I. 2018/208), regs. 1(3), 2(2)(a)

Preliminary

6

In this Part of this Schedule, Part IV of the Insolvency Act 1986 is referred to as “Part IV”; and that"Act is referred to as “the Act”.

F5426ZA

Parts 4, 6, 7 and 12 of, and Schedule 10 to, the Act, in their application to building societies, have effect without the amendments of those Parts and that Schedule made by—

a

section 122 of the Small Business, Enterprise and Employment Act 2015 (abolition of requirements to hold meetings: company insolvency);

b

section 124 of that Act (ability for creditors to opt not to receive certain notices: company insolvency); and

c

Part 1 of Schedule 9 to that Act (sections 122 to 125: further amendments).

F4756A

In the following provisions of the Act a reference to the creditors, general creditors or unsecured creditors of a company includes a reference to every shareholding member of the building society to whom a sum due from the society in relation to the member’s shareholding is due in respect of a deposit—

a

subsection (1) of section 143 (general functions of liquidator in winding up by the court);

b

subsection (3) of section 149 (debts due from contributory to company);

c

subsection (4) of section 168 (supplementary powers (England and Wales));

d

subsection (2)(b) of section 175 (preferential debts (general provision));

e

subsection (1) of section 176ZA (payment of expenses of winding up (England and Wales)); F518...

f

subsections (3)(b) and (5)(a) of section 176A (share of assets for unsecured creditors);

F519g

subsection (1)(e) of section 391O (direct sanctions orders);

h

subsection (5) of section 391Q (direct sanctions order: conditions); and

i

subsection (3)(e) of section 391R (direct sanctions direction instead of order).

Members of a building society as contributories in winding up

7

1

Section 74 (liability of members) of the Act is modified as follows.

2

In subsection (1), the reference to any past member shall be omitted.

3

Paragraphs (a) to (d) of subsection (2) shall be omitted; and so shall subsection (3).

F4833A

In paragraph (f) of subsection (2) the reference to a sum due to a member of the company by way of dividends, profits or otherwise does not include a sum due to a shareholding member of a building society in respect of a deposit.

4

The extent of the liability of a member of a building society in a winding up shall not exceed the extent of his liability under paragraph 6 of Schedule 2 to this Act.

8

Sections 75 to 78 and 83 in Chapter I of Part IV (miscellaneous provisions not relevant to building societies) do not apply.

9

1

Section 79 (meaning of “contributory”) of the Act does not apply.

2

In the enactments as applied to a building society, “contributory”—

a

means every person liable to contribute to the assets of the society in the event of its being wound up, and

b

for the purposes of all proceedings for determining, and all proceedings prior to the determination of, the persons who are to be deemed contributories, includes any person alleged to be a contributory, and

c

includes persons who are liable to pay or contribute to the payment of—

i

any debt or liability of the building society being wound up, or

ii

any sum for the adjustment of rights of members among themselves, or

iii

the expenses of the winding up;

but does not include persons liable to contribute by virtue of a declaration by the court under section 213 (imputed responsibility for fraudulent trading) or section 214 (wrongful trading) of the Act.

Voluntary winding up

10

1

Section 84 of the Act does not apply.

2

In the enactments as applied to a building society, the expression “resolution for voluntary winding up” means a resolution passed under section 88(1) of this Act.

11

In subsection (1) of section 101 (appointment of liquidation committee) of the Act, the reference to functions conferred on a liquidation committee by or under that Act shall have effect as a reference to its functions by or under that Act as applied to building societies.

12

1

Section 107 (distribution of property) of the Act does not apply; and the following applies in its place.

2

Subject to the provisions of Part IV relating to preferential payments, a building society’s property in a voluntary winding up shall be applied in satisfaction of the society’s liabilities to creditors F144. . . pari passu and, subject to that application, in accordance with the rules of the society.

F4793

In sub-paragraph (2) the reference to the society’s liabilities to creditors includes a reference to the society’s liabilities to shareholding members of the society in respect of deposits which are not relevant deposits.

13

Sections 110 and 111 (liquidator accepting shares, etc. as consideration for sale of company property) of the Act do not apply.

14

Section 116 (saving for certain rights) of the Act shall also apply in relation to the dissolution by consent of a building society as it applies in relation to its voluntary winding up.

Winding up by the court

15

In sections 117 (High Court and county court jurisdiction) and 120 (Court of Session and sheriff court jurisdiction) of the Act, each reference to a company’s share capital paid up or credited as paid up shall have effect as a reference to the amount standing to the credit of shares in a building society as shown by the latest balance sheet.

F50616

1

Section 122 (circumstances in which company may be wound up by the court) of the Act does not apply in relation to a building society whose principal office is situated in England and Wales.

2

Section 122 has effect in relation to a building society whose principal office is situated in Scotland as if subsection (1) were omitted.

17

Section 124 (application for winding up) of the Act does not apply.

18

1

In section 125 (powers of court on hearing of petition) of the Act, subsection (1) applies with the omission of the words from “but the court” to the end of the subsection.

2

The conditions which the court may impose under section 125 of the Act include conditions for securing—

a

that the building society be dissolved by consent of its members under section 87, or

b

that the society amalgamates with, or transfers its engagements to, another building society under section 93 or 94, or

c

that the society transfers its business to a company under section 97,

and may also include conditions for securing that any default which occasioned the petition be made good and that the costs, or in Scotland the expenses, of the proceedings on that petition be defrayed by the person or persons responsible for the default.

19

Section 126 (power of court, between petition and winding up order, to stay or restrain proceedings against company) of the Act has effect with the omission of subsection (2).

20

If, before the presentation of a petition for the winding up by the court of a building society, an instrument of dissolution under section 87 is placed in the society’s public file, section 129(1) (commencement of winding up by the court) of the Act shall also apply in relation to the date on which the instrument is so placed and to any proceedings in the course of the dissolution as it applies to the commencement date for, and proceedings in, a voluntary winding up.

21

1

Section 130 of the Act (consequences of winding-up order) shall have effect with the following modifications.

2

Subsections (1) and (3) shall be omitted.

3

A building society shall, within 15 days of a winding-up order being made in respect of it, give notice of the order F422to the FCA and, if the society is a PRA-authorised person, the PRA ; and the F423FCA must keep the notice in the public file of the society.

4

If a building society fails to comply with sub-paragraph (3) above, it shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale; and so shall any officer who is also guilty of the offence.

22

Section 140 (appointment of liquidator by court in certain circumstances) of the Act does not apply.

23

In the application of sections 141(1) and 142(1) (liquidation committees), of the Act to building societies, the references to functions conferred on a liquidation committee by or under that Act shall have effect as references to its functions by or under that Act as so applied.

F47623A

Section 143 (general functions of liquidator in winding up by the court) of the Act has effect as if after subsection (1) there were inserted—

1A
Subject to the provisions of Part 4 relating to preferential payments, a building society’s property in the winding up shall be applied in satisfaction of the society’s liabilities to creditors pari passu and, subject to that application, in accordance with the rules of the society.
1B
In subsection (1A) the reference to the society’s liabilities to creditors includes a reference to the society’s liabilities to shareholding members of the society in respect of deposits which are not relevant deposits.

On such a reference to it the F426FCA shall exercise its power under section 55(1) of this Act to appoint one or more investigators to investigate and report on the matter.

3

An answer given by a person to a question put to him in exercise of the powers conferred by section 55 on a person so appointed may be used in evidence against the person giving it.

F545Protection of supplies

Annotations:

Amendments (Textual)

F545

Sch. 15 para. 32A and cross-heading inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 12 para. 2 (with ss. 2(2), 5(2), 14(4))

32A

Section 233B of the Act (protection of supplies of goods and services) does not apply.

Preferential debts

33

Section 387 (meaning in Schedule 6 of “the relevant date”) of the Act applies with the omission of subsections (2) and (4) to (6).

F511Insolvency practitioners: their qualification and regulation

Annotations:

Amendments (Textual)

F511

Sch. 15 paras. 33A, 33B and cross-heading inserted (7.4.2017) by The Deregulation Act 2015, the Small Business, Enterprise and Employment Act 2015 and the Insolvency (Amendment) Act (Northern Ireland) 2016 (Consequential Amendments and Transitional Provisions) Regulations 2017 (S.I. 2017/400), regs. 1(2), 2(3)(d)

33A

Section 390 of the Act (persons not qualified to act as insolvency practitioners) has effect as if for subsection (2) there were substituted—

2
A person is not qualified to act as an insolvency practitioner in relation to a building society at any time unless at that time the person is fully authorised to act as an insolvency practitioner or partially authorised to act as an insolvency practitioner only in relation to companies.

33B

1

In the following provisions of the Act, in a reference to authorisation or permission to act as an insolvency practitioner in relation to (or only in relation to) companies, the reference to companies has effect without the modification in paragraph 3(1)(a) above—

a

sections 390A and 390B(1) and (3) (authorisation of insolvency practitioners); and

b

sections 391O(1)(b) and 391R(3)(b) (court sanction of insolvency practitioners in public interest cases).

2

In sections 391Q(2)(b) (direct sanctions order: conditions) and 391S(3)(e) (power for Secretary of State to obtain information) of the Act the reference to a company has effect without the modification in paragraph 3(1)(a) above.

F145Part III Modified application of Insolvency (Northern Ireland) Order 1989

Annotations:

Amendments (Textual)

F145

Sch. 15 paras. 34-55E substituted (N.I.) (1.10.1991) for Sch. 15 paras. 34-55 by S.I. 1989/2405 (N.I. 19), arts. 2(1), 381, Sch. 9 Pt. II para. 45(c); S.R. 1991/411, art. 2

Parts V F512, 11 and 12

Annotations:

Amendments (Textual)

F512

Words in Sch. 15 Pt. III heading substituted (7.4.2017) by The Deregulation Act 2015, the Small Business, Enterprise and Employment Act 2015 and the Insolvency (Amendment) Act (Northern Ireland) 2016 (Consequential Amendments and Transitional Provisions) Regulations 2017 (S.I. 2017/400), regs. 1(2), 2(3)(e)

Preliminary

34

In this Part of this Schedule, Part V of the Insolvency (Northern Ireland) Order 1989 is referred to as “Part V”, that Order is referred to as “the Order” and references to “Articles” are references to Articles of that Order.

F47734A

In the following provisions a reference to the creditors, general creditors or unsecured creditors of a company includes a reference to every shareholding member of the building society to whom a sum due from the society in relation to the member’s shareholding is due in respect of a deposit—

a

paragraph (1) of Article 121 (general functions of liquidator in winding up by the High Court);

b

paragraph (3) of Article 127 (debts due from contributory to company);

c

paragraph (4) of Article 143 (supplementary powers);

d

paragraph (2)(b) of Article 149 (preferential debts (general provision));

e

paragraph (1) of Article 150ZA (payment of expenses of winding up); F520...

f

paragraphs (3)(b) and (5)(a) of Article 150A (share of assets for unsecured creditors);

F521g

paragraph (1)(e) of Article 350O (direct sanctions orders);

h

paragraph (5) of Article 350Q (direct sanctions order: conditions); and

i

paragraph (3)(e) of Article 350R (direct sanctions direction instead of order).

Members of a building society as contributories in winding up

35

1

Article 61 (liability of members) is modified as follows.

2

In paragraph (1), the reference to any past member shall be omitted.

3

Sub-paragraphs (a) to (d) of paragraph (2) shall be omitted; and so shall paragraph (3).

F4843A

In sub-paragraph (f) of paragraph (2) the reference to a sum due to a member of the company by way of dividends, profits or otherwise does not include a sum due to a shareholding member of a building society in respect of a deposit.

4

The extent of the liability of a member of a building society in a winding up shall not exceed the extent of his liability under paragraph 6 of Schedule 2 to this Act.

36

Articles 62 to 65 and 69 in Chapter I of Part V (miscellaneous provisions not relevant to building societies) do not apply.

37

In the enactments as applied to a building society, “contributory”—

a

means every person liable to contribute to the assets of the society in the event of its being wound up, and

b

for the purposes of all proceedings for determining, and all proceedings prior to the determination of, the persons who are to be deemed contributories, includes any person alleged to be a contributory, and

c

includes persons who are liable to pay or contribute to the payment of—

i

any debt or liability of the building society being wound up, or

ii

any sum for the adjustment of rights of members among themselves, or

iii

the expenses of the winding up;

but does not include persons liable to contribute by virtue of a declaration by the Court under Article 177 (imputed responsibility for fraudulent trading) or Article 178 (wrongful trading).

Voluntary winding up

38

1

Article 70 does not apply.

2

In the enactments as applied to a building society, the expression “resolution for voluntary winding up” means a resolution passed under section 88(1) of this Act.

39

In paragraph (1) of Article 87 (appointment of liquidation committee), the reference to functions conferred on a liquidation committee by or under the Order shall have effect as a reference to its functions by or under the Order as applied to building societies.

40

1

Article 93 (distribution of property) does not apply; and the following applies in its place.

2

Subject to the provisions of Part V relating to preferential payments, a building society’s property in a voluntary winding up shall be applied in satisfaction of the society’s liabilities to creditors (including any liability resulting from the variation to the liquidator’s duty effected by section 28 or 31 of this Act) pari passu and, subject to that application, in accordance with the rules of the society.

F4853

In sub-paragraph (2) the reference to the society’s liabilities to creditors includes a reference to the society’s liabilities to shareholding members of the society in respect of deposits which are not relevant deposits.

41

Articles 96 and 97 (liquidator accepting shares, etc, as consideration for sale of company property) do not apply.

42

Article 101 (saving for certain rights) shall also apply in relation to the dissolution by consent of a building society as it applies in relation to its voluntary winding up.

Winding up by the High Court

43

Article 102 (circumstances in which company may be wound up by the High Court) does not apply.

44

Article 104 (application for winding up) does not apply.

45

1

In Article 105 (powers of High Court on hearing of petition), paragraph (1) applies with the omission of the words from “but the Court” to the end of the paragraph.

2

The conditions which the High Court may impose under Article 105 include conditions for securing—

a

that the building society be dissolved by consent of its members under section 87, or

b

that the society amalgamates with, or transfers its engagements to, another building society under section 93 or 94, or

c

that the society transfers its business to a company under section 97,

and may also include conditions for securing that any default which occasioned the petition be made good and that the costs of the proceedings on that petition be defrayed by the person or persons responsible for the default.

46

Article 106 (power of High Court, between petition and winding-up order, to stay or restrain proceedings against company) has effect with the omission of paragraph (2).

47

If, before the presentation of a petition for the winding up by the High Court of a building society, an instrument of dissolution under section 87 is placed in the society’s public file, Article 109(1) (commencement of winding up by the High Court) shall also apply in relation to the date on which the instrument is so placed and to any proceedings in the course of the dissolution as it applies to the commencement date for, and proceedings in, a voluntary winding up.

48

1

Article 110 (consequences of winding-up order) shall have effect with the following modifications.

2

Paragraphs (1) and (3) shall be omitted.

3

A building society shall, within 15 days of a winding-up order being made in respect of it, give notice of the order F441to the FCA and, if the society is a PRA-authorised person, the PRA ; and F442the FCA must keep the notice in the public file of the society.

4

If a building society fails to comply with sub-paragraph (3) above, it shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale; and so shall any officer who is also guilty of the offence.

49

Article 119 (appointment of liquidator by High Court in certain circumstances) does not apply.

50

In the application of Article 120(1) (liquidation committee) to building societies, the references to functions conferred on a liquidation committee by or under the Order shall have effect as references to its function by or under the Order as so applied.

F47850A

Article 121 (general functions of liquidator in winding up by the High Court) of the Order has effect as if after paragraph (1) there were inserted—

1A
Subject to the provisions of Part V relating to preferential payments, a building society’s property in the winding up shall be applied in satisfaction of the society’s liabilities to creditors pari passu and, subject to that application, in accordance with the rules of the society.
1B
In paragraph (1A) the reference to the society’s liabilities to creditors includes a reference to the society’s liabilities to shareholding members of the society in respect of deposits which are not relevant deposits.

On such a reference to it the F454FCA shall exercise its power under section 55(1) of this Act to appoint one or more investigators to investigate and report on the matter.

3

An answer given by a person to a question put to him in exercise of the powers conferred by section 55 on a person so appointed may be used in evidence against the person giving it.

F546Protection of supplies

Annotations:

Amendments (Textual)

F546

Sch. 15 para. 55DA and cross-heading inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 13 para. 2 (with ss. 2(2), 5(2), 18(4))

55DA

Article 197B (protection of supplies of goods and services) does not apply.

Preferential debts

55E

Article 347 (meaning in Schedule 4 of “the relevant date”) applies with the omission of paragraphs (2) and (4) to (6).

F513Insolvency practitioners: their qualification and regulation

Annotations:

Amendments (Textual)

F513

Sch. 15 paras. 55F, 55G and cross-heading inserted (7.4.2017) by The Deregulation Act 2015, the Small Business, Enterprise and Employment Act 2015 and the Insolvency (Amendment) Act (Northern Ireland) 2016 (Consequential Amendments and Transitional Provisions) Regulations 2017 (S.I. 2017/400), regs. 1(2), 2(3)(g)

55F

Article 349 (persons not qualified to act as insolvency practitioners) has effect as if for paragraph (2) there were substituted—

2
A person is not qualified to act as an insolvency practitioner in relation to a building society at any time unless at that time the person is fully authorised to act as an insolvency practitioner or partially authorised to act as an insolvency practitioner only in relation to companies.

55G

1

In the following provisions of the Order, in a reference to authorisation or permission to act as an insolvency practitioner in relation to (or only in relation to) companies, the reference to companies has effect without the modification in paragraph 3(1)(a) above—

a

Articles 349A and 349B(1) and (3) (authorisation of insolvency practitioners); and

b

Articles 350O(1)(b) and 350R(3)(b) (court sanction of insolvency practitioners in public interest cases).

2

In Articles 350Q(2)(b) (direct sanctions order: conditions) and 350S(3)(e) (power for Department to obtain information) the reference to a company has effect without the modification in paragraph 3(1)(a) above.

Part IV Dissolution of Building Society wound up (England and Wales, Scotland and Northern Ireland)

56

1

Where a building society has been wound up voluntarily, it is dissolved as from 3 months from the date of the placing in the public file of the society of the return of the final meetings of the society and its creditors made by the liquidator under—

a

section 94 or (as the case may be) 106 of the M11Insolvency Act 1986 (as applied to building societies), or on such other date as is determined in accordance with section 201 of that Act, or

b

Article F14680 or (as the case may be) 92 of the Insolvency (Northern Ireland) Order 1989(as so applied), or on such other date as is determined in accordance with that Article,

as the case may be.

2

Where a building society has been wound up by the court, it is dissolved as from 3 months from the date of the placing in the public file of the society of—

a

the liquidator’s notice under section 172(8) of the M12Insolvency Act 1986 (as applied to building societies) F147or, as the case may be, Article 146(7) of the Insolvency (Northern Ireland) Order 1989 (as applied to building societies), or

b

the notice of the completion of the winding up from the official receiver or the F148official receiver for Northern Ireland,

or on such other date as is determined in accordance with section 205 of that Act F149or Article 169 of that Order, as the case may be.

57 F3671

Sections 1012 to 1023 and 1034 of the Companies Act 2006 (property of dissolved company) apply in relation to the property of a dissolved building society (whether dissolved under section 87 or following its winding up) as they apply in relation to the property of a dissolved company.

2

Paragraph 3(1) above shall apply to those sections for the purpose of their application to building societies.

F3663

Any reference in those sections to restoration to the register shall be read as a reference to the effect of an order under section 91 of this Act.

Insolvency rules and fees: England and Wales and Scotland

58

1

Rules may be made under section 411 of the Insolvency Act for the purpose of giving effect, in relation to building societies, to the provisions of the applicable winding up legislation.

2

An order made by the competent authority under section 414 of the Insolvency Act 1986 may make provision for fees to be payable under that section in respect of proceedings under the applicable winding up legislation and the performance by the official receiver or the Secretary of State of functions under it.

Insolvency rules and fees: Northern Ireland

59

1

Rules may be made under F150Article 359 of the Insolvency (Northern Ireland) Order 1989 for the purpose of giving effect in relation to building societies, to the provisions of the applicable winding up legislation.

F1512

An order made by the Department of Economic Development under Article 361 of the Insolvency (Northern Ireland) Order 1989 may make provision for fees to be payable under that Article in respect of proceedings under the applicable winding-up legislation and the performance by the official receiver for Northern Ireland or that Department of functions under it.

C39 C37 C36F171SCHEDULE 15A Application of other companies insolvency legislation to building societies

Annotations:

Amendments (Textual)

F171

Sch. 15A inserted (1.12.1997) by 1997 c. 32, s. 39(2), Sch. 6; S.I. 1997/2668, art. 2, Sch. Pt. I(i)

Modifications etc. (not altering text)

C39

Sch. 15A amendment to earlier affecting provision SI 2010/1188 art. 11 (with application in accordance with art. 1(4) of the amending S.I.) by The Building Societies (Floating Charges and Other Provisions) Order 2016 (S.I. 2016/679), art. 1(1)(2), 5(3)

C37

Sch. 15A: amendment to earlier affecting provision S.I. 2010/1188, arts. 1(2), 11 (1.4.2013) by The Financial Services Act 2012 (Mutual Societies) Order 2013 (S.I. 2013/496), arts. 1(1), 2(c), Sch. 11 para. 018(05)(d) (with Sch. 12)

C36

Sch. 15A applied (with modifications) (7.4.2010) by The Building Societies (Financial Assistance) Order 2010 (S.I. 2010/1188), arts. 1(2), 11 (as amended (1.4.2013) by The Financial Services Act 2012 (Mutual Societies) Order 2013 (S.I. 2013/496), arts. 1(1), 2(c), Sch. 11 para. 18(5)(d) (with Sch. 12) and (with application in accordance with art. 1(4) of the amending S.I.) by The Building Societies (Floating Charges and Other Provisions) Order 2016 (S.I. 2016/679), art. 1(1)(2), 5(3))

Part I General mode of application

1

Subject to the provisions of this Schedule, the enactments specified in sub-paragraph (2) below (referred to in this Schedule as “the enactments”) apply in relation to building societies as they apply in relation to companies limited by shares and F368registered under the Companies Act 2006 in England and Wales or Scotland or (as the case may be) in Northern Ireland.

2

The enactments referred to in sub-paragraph (1) above are—

a

Parts I F549...F507, II, F522and 3, section 176ZB (in Part 4), and VI, VII, XII and XIII, section 434 and Part XVIII of the M13Insolvency Act 1986, or

b

F334Part I, Part II F550..., Parts III,IV, VII, XI and XII and Article 378 of the M14Insolvency (Northern Ireland) Order 1989,

and, in so far as they relate to offences under any such enactment, sections 430 and 432 of, and Schedule 10 to, the M15Insolvency Act 1986 or Article 2(6) and 373 of, and Schedule 7 to, the M16Insolvency (Northern Ireland) Order 1989.

2

1

The enactments shall, in their application to building societies, have effect with the substitution—

F152aa

every reference to a company registered in Scotland shall have effect as a reference to a building society whose principal office is situated in Scotland;

F153aa

every reference to a company registered in Scotland shall have effect as a reference to a building society whose registered office is situated in Scotland;

a

for “company” of “ building society ”F523(except as otherwise specified in paragraphs 27H and 54 below) ;

b

for “the registrar of companies” or “the registrar” of “ F427Financial Conduct Authority ”;

c

for “the articles” of “ the rules ”; and

d

5

Any enactment which specifies a money sum altered by order under section 416 of the Insolvency Act 1986, or, as the case may be, Article 362 of the Insolvency (Northern Ireland) Order 1989, (powers to alter monetary limits) applies with the effect of the alteration.

C385A

In this Schedule—

“deposit” and “relevant deposit” have the meaning given by paragraph 1A of Schedule 15; and
“scheme manager” has the same meaning as in the Financial Services and Markets Act 2000.

Part II Modified Application of F503Parts I to IIIF543, 6, 7, 12 and 13 of Insolvency Act 1986

Annotations:

Amendments (Textual)

F503

Words in Sch. 15A Pt. II heading substituted (with application in accordance with art. 1(4) of the amending S.I.) by The Building Societies (Floating Charges and Other Provisions) Order 2016 (S.I. 2016/679), arts. 1(1), 4(3)(a)

F543

for the purposes of all proceedings for determining, and all proceedings prior to the determination of, the persons who are to be deemed contributories, includes any person alleged to be a contributory, and

c

includes persons who are liable to pay or contribute to the payment of—

i

any debt or liability of the building society being wound up, or

ii

any sum for the adjustment of rights of members among themselves, or

iii

the expenses of the winding up;

but does not include persons liable to contribute by virtue of a declaration by the court under section 213 (imputed responsibility for fraudulent trading) or section 214 (wrongful trading) of the Act.

F1569A

In section 7A of the Act (prosecution of delinquent officers) as applied to a building society—

a

in subsection (2), for paragraphs (i) and (ii) there is substituted “ the F429FCA ”,

b

subsections (3) to (7) are omitted,

c

in subsection (8), for “Secretary of State” there is substituted “ F429FCA ”.

Administration orders

10

1

Section 8 of the Act (power of court to make administration order) has effect as if it included provision that, where—

a

an application for an administration order to be made in relation to a building society is made by the F430FCA or the PRA (with or without other parties); and

b

the society has defaulted in an obligation to pay any sum due and payable in respect of any deposit or share,

the society shall be deemed for the purposes of subsection (1) to be unable to pay its debts.

2

In subsection (3) of that section, paragraph (c) and, in subsection (4) of that section, the words from “nor where” to the end are omitted.

Subsection (3) of section 13 of the Act (appointment of administrator) has effect as if it enabled an application for an order under subsection (2) of that section to be made by the F432FCA or the PRA .

16

1

Subject to sub-paragraph (2) below, section 14 of the Act (general powers of administrator) has effect as if it required the administrator of a building society, in exercising his powers under that section—

a

a

he is requested, in accordance with the rules, to do so by 500 of the society’s shareholding members, or by one-tenth, in number, of those members, or

b

he is directed to do so by the court.

F48920

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

21

1

Subsection (1) of section 23 of the Act (statement of proposals) as applied to a building society has effect as if—

a

the reference to the F433Financial Conduct Authority included a reference to the F159scheme manager;

b

the reference to all creditors included a reference to all holders of shares in the society; and

c

the reference to a meeting of the society’s creditors included a reference to a meeting of holders of shares in the society.

2

In subsection (2) of that section as so applied, references to members of the society do not include references to holders of shares in the society.

22

Section 24 of the Act (consideration of proposals by creditors’ meeting) as applied to a building society has effect as if any reference to a meeting of creditors included a reference to a meeting of holders of shares in the society.

23

1

Section 25 of the Act (approval of substantial revisions) as applied to a building society has effect as if—

a

subsection (2) required the administrator to send a statement in the prescribed form of his proposed revisions to the F160F434FCA, to the PRA and to the scheme manager; and

b

the reference in that subsection to a meeting of creditors included a reference to a meeting of holders of shares in the society.

2

In subsection (3) of that section as so applied, references to members of the society do not include references to holders of shares in the society.

24

Subsection (1) of section 27 of the Act (protection of interests of creditors and members) has effect—

a

as if it enabled the F161F435FCA, the PRA or the scheme manager to apply to the court by petition for an order under that section; and

b

in relation to an application by the F162F435FCA, the PRA or the scheme manager, as if the words “(including at least himself)” were omitted.

in subsections (1) and (2) the word “qualifying” and in subsection (3) the definition of “holder of a qualifying floating charge in respect of a company’s property” were omitted; and

ii

subsections (4)(a), (5) and (6) were omitted; and

b

sections 72B to 72H (exceptions to prohibition) were omitted.

F547Protection of supplies

Annotations:

Amendments (Textual)

F547

Sch. 15A para. 27FA and cross-heading inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 12 para. 3 (with ss. 2(2), 5(2), 14(4))

27FA

Section 233B of the Act (protection of supplies of goods and services) is omitted.

F514Insolvency practitioners: their qualification and regulation

Annotations:

Amendments (Textual)

F514

Sch. 15A paras. 27G-27I and cross-heading inserted (7.4.2017) by The Deregulation Act 2015, the Small Business, Enterprise and Employment Act 2015 and the Insolvency (Amendment) Act (Northern Ireland) 2016 (Consequential Amendments and Transitional Provisions) Regulations 2017 (S.I. 2017/400), regs. 1(2), 2(4)(d)

27G

Section 390 of the Act (persons not qualified to act as insolvency practitioners) has effect as if for subsection (2) there were substituted—

2
A person is not qualified to act as an insolvency practitioner in relation to a building society at any time unless at that time the person is fully authorised to act as an insolvency practitioner or partially authorised to act as an insolvency practitioner only in relation to companies.

27H

1

In the following provisions of the Act, in a reference to authorisation or permission to act as an insolvency practitioner in relation to (or only in relation to) companies the reference to companies has effect without the modification in paragraph 2(1)(a) above—

a

sections 390A and 390B(1) and (3) (authorisation of insolvency practitioners); and

b

sections 391O(1)(b) and 391R(3)(b) (court sanction of insolvency practitioners in public interest cases).

2

In sections 391Q(2)(b) (direct sanctions order: conditions) and 391S(3)(e) (power for Secretary of State to obtain information) of the Act the reference to a company has effect without the modification in paragraph 2(1)(a) above.

27I

In sections 391O, 391Q and 391R of the Act a reference to the creditors of a company includes a reference to every shareholding member of the building society to whom a sum due from the society in relation to the member’s shareholding is due in respect of a deposit.

Part III Modified Application of Parts II, IIIF515, 4 and 12 of Insolvency (Northern Ireland) Order 1989

Annotations:

Amendments (Textual)

F515

Words in Sch. 15A Pt. III heading substituted (7.4.2017) by The Deregulation Act 2015, the Small Business, Enterprise and Employment Act 2015 and the Insolvency (Amendment) Act (Northern Ireland) 2016 (Consequential Amendments and Transitional Provisions) Regulations 2017 (S.I. 2017/400), regs. 1(2), 2(4)(e)

Preliminary

28

In this Part of this Schedule, the M20Insolvency (Northern Ireland) Order 1989 is referred to as “the Order”.

Voluntary arrangements

29

Article 14 of the Order (proposals for voluntary arrangements) has effect as if—

a

it required any proposal under Part II of the Order to be so framed as to enable a building society to comply with the requirements of this Act; and

b

any reference to debts included a reference to liabilities owed to the holders of shares in a building society.

30

In Article 15 (procedure where nominee is not liquidator or administrator) and Article 16 (summoning of meetings) of the Order as applied to a building society, any reference to meetings of the society is a reference to—

a

a meeting of both shareholding and borrowing members of the society; and

b

a meeting of shareholding members alone.

F335and paragraph (1) of Article 15 shall have effect with the omission of the words from “and the directors” to the end.

F33230A

In paragraph (2) of Article 17A of the Order (approval of arrangement) as applied to a building society, sub-paragraph (b) and the word “or” immediately preceding that sub-paragraph are omitted.

31

In Article 19 of the Order (challenge of decisions) as applied to a building society, “contributory”—

a

means every person liable to contribute to the assets of the society in the event of its being wound up, and

b

for the purposes of all proceedings for determining, and all proceedings prior to the determination of, the persons who are to be deemed contributories, includes any person alleged to be a contributory, and

c

includes persons who are liable to pay or contribute to the payment of—

i

any debt or liability of the building society being wound up, or

ii

any sum for the adjustment of rights of members among themselves, or

iii

the expenses of the winding up;

but does not include persons liable to contribute by virtue of a declaration by the High Court under Article 177 (imputed responsibility for fraudulent trading) or Article 178 (wrongful trading) of the Order.

F33331A

In Article 20A of the Order (prosecution of delinquent officers) as applied to a building society—

a

in paragraph (2) for the words “the Department”, in each place where they occur, there are substituted the words “ F436each of the Financial Conduct Authority and the Prudential Regulation Authority ”,

b

paragraphs (3) to (7) are omitted,

c

in paragraph (8)—

i

after the words “Northern Ireland” there are inserted the words “or the F437Financial Conduct Authority or the Prudential Regulation Authority ”, and

ii

after the words “Northern Ireland” and the words “the Director”, in the second place where they occur, there are inserted the words “or the F437Financial Conduct Authority or the Prudential Regulation Authority ”,

d

in paragraph (9) after the words “for Northern Ireland” there are inserted the words “or the F437Financial Conduct Authority or the Prudential Regulation Authority ”.

Administration orders

32

1

Article 21 of the Order (power of High Court to make administration order) has effect as if it included provision that, where—

a

an application for an administration order to be made in relation to a building society is made by the F438FCA or the PRA (with or without other parties); and

b

the society has defaulted in an obligation to pay any sum due and payable in respect of any deposit or share,

the society shall be deemed for the purposes of paragraph (1) to be unable to pay its debts.

2

In paragraph (3) of that Article, sub-paragraph (c) and, in paragraph (4) of that Article, the words from “nor where” to the end are omitted.

Paragraph (3) of Article 26 of the Order (appointment of administrator) has effect as if it enabled an application for an order under paragraph (2) of that Article to be made by F443the FCA and the PRA .

38

1

Subject to sub-paragraph (2) below, Article 27 of the Order (general powers of administrator) has effect as if it required the administrator of a building society, in exercising his powers under that Article—

a

a

he is requested, in accordance with the rules, to do so by 500 of the society’s shareholding members, or by one-tenth, in number, of those members, or

b

he is directed to do so by the High Court.

F49142

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

43

1

Paragraph (1) of Article 35 of the Order (statement of proposals) as applied to a building society has effect as if—

a

the reference to the F444Financial Conduct Authority included a reference to the F166scheme manager;

b

the reference to all creditors included a reference to all holders of shares in the society; and

c

the reference to a meeting of the society’s creditors included a reference to a meeting of holders of shares in the society.

2

In paragraph (2) of that Article as so applied, references to members of the society do not include references to holders of shares in the society.

44

Article 36 of the Order (consideration of proposals by creditors’ meeting) as applied to a building society has effect as if any reference to a meeting of creditors included a reference to a meeting of holders of shares in the society.

45

1

Article 37 of the Order (approval of substantial revisions) as applied to a building society has effect as if—

a

paragraph (2) required the administrator to send a statement in the prescribed form of his proposed revisions to the F167F445FCA, to the PRA and to the scheme manager; and

b

the reference in that paragraph to a meeting of creditors included a reference to a meeting of holders of shares in the society.

2

In paragraph (3) of that Article as so applied, references to members of the society do not include references to holders of shares in the society.

46

Paragraph (1) of Article 39 of the Order (protection of interests of creditors and members) has effect—

a

as if it enabled the F168F446FCA, the PRA or the scheme manager to apply to the High Court by petition for an order under that section; and

b

in relation to an application by the F169F446FCA, the PRA or the scheme manager, as if the words “(including at least himself)” were omitted.

Receivers and managers

C2147

In Article 48 of the Order (receivership accounts), “prescribed” means prescribed by regulations made by statutory instrument by the F170Treasury.

48

In paragraph (1) of Article 49 of the Order (notification that receiver or manager appointed), the reference to every invoice, order for goods or business letter is a reference to every statement of account, order for goods or services, business letter or advertisement.

F50549

Paragraph (3) of Article 50 of the Order (payment of debts out of assets subject to floating charge), as applied to a building society, has effect as if the reference to general creditors included a reference to shareholding members of the society in respect of deposits which are not relevant deposits.

50

Articles 52 to 59 of the Order (administrative receivers) are omitted.

51

Article 59A of the Order (floating charge holder not to appoint administrative receiver), as applied to a building society, has effect as if—

a

in paragraph (1) the word “qualifying” were omitted; and

b

paragraphs (2), (3)(a), (4) and (5) were omitted.

52

Articles 59B to 59J of the Order (exceptions to prohibition) are omitted.

F548Protection of supplies

Annotations:

Amendments (Textual)

F548

Sch. 15A para. 52A and cross-heading inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 13 para. 3 (with ss. 2(2), 5(2), 18(4))

52A

Article 197B of the Order (protection of supplies of goods and services) is omitted.

F516Insolvency practitioners: their qualification and regulation

Annotations:

Amendments (Textual)

F516

Sch. 15A paras. 53-55 and cross-heading inserted (7.4.2017) by The Deregulation Act 2015, the Small Business, Enterprise and Employment Act 2015 and the Insolvency (Amendment) Act (Northern Ireland) 2016 (Consequential Amendments and Transitional Provisions) Regulations 2017 (S.I. 2017/400), regs. 1(2), 2(4)(f)

53

Article 349 of the Order (persons not qualified to act as insolvency practitioners) has effect as if for paragraph (2) there were substituted—

2
A person is not qualified to act as an insolvency practitioner in relation to a building society at any time unless at that time the person is fully authorised to act as an insolvency practitioner or partially authorised to act as an insolvency practitioner only in relation to companies.

54

1

In the following provisions of the Order, in a reference to authorisation or permission to act as an insolvency practitioner in relation to (or only in relation to) companies the reference to companies has effect without the modification in paragraph 2(1)(a) above—

a

Articles 349A and 349B(1) and (3) (authorisation of insolvency practitioners); and

b

Articles 350O(1)(b) and 350R(3)(b) (court sanction of insolvency practitioners in public interest cases).

2

In Articles 350Q(2)(b) (direct sanctions order: conditions) and 350S(3)(e) (power for Department to obtain information) of the Order the reference to a company has effect without the modification in paragraph 2(1)(a) above.

55

In Articles 350O, 350Q and 350R of the Order a reference to the creditors of a company includes a reference to every shareholding member of the building society to whom a sum due from the society in relation to the member’s shareholding is due in respect of a deposit.

C24SCHEDULE 16 Mergers: Supplementary Provisions

Sections 93, 94 and 95.

Annotations:

Modifications etc. (not altering text)

C24

Sch. 16 excluded by S.I. 1986/2168, art. 9(2)(b)(3)

Part I Issue of Statements to Members

1

A building society which desires—

a

to amalgamate with one or more other building societies, or

b

to transfer its engagements to another building society, or

c

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

that failure shall not invalidate the proceedings of a meeting or prevent the requirements of sub-paragraph (2B) from being treated as fulfilled in relation to section 95(4)(c).

3

No statement shall be sent unless its contents, so far as they concern the matters specified in sub-paragraph (4) below, have been approved by the F378appropriate authority .

4

Those maters are the following, namely—

a

the financial position of the building society and that of the other building society or societies participating in the amalgamation or transfer;

b

the interest of the directors of the building society in the amalgamation or transfer of engagements;

c

the compensation or other consideration (if any) proposed to be paid to or in respect of the directors or other officers of the building society and of the other building society or societies participating in the amalgamation or transfer;

d

the payments (if any) to be made to members of the building society and of the other building society or societies participating in the amalgamation or transfer by way of a distribution of funds in consideration of the amalgamation or transfer;

e

the changes (if any) to be made, in connection with the amalgamation or transfer of engagements, in the terms governing outstanding F172loans made by the building society which are secured on land;

f

any other matter which the F378appropriate authority requires in the case of the particular amalgamation or transfer of engagements.

F3794A

The PRA must consult the FCA before approving a statement under sub-paragraph (3).

F1735

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6

Any expression used in this paragraph and in section 96 has the same meaning in this paragraph as in that section.

C23Part II Notification of Proposals for Merger

Annotations:

Modifications etc. (not altering text)

C23

Sch. 16 Pt. II (paras. 2–6) excluded by S.I. 1986/2169, art. 10

Preliminary

2

In this Part of this Schedule—

“merger” means an amalgamation of building societies under section 93 or a transfer of all the engagements of one building society to another under section 94; and “merger” has a corresponding meaning;
C22“merger proposal”, in relation to a building society, means a proposal in writing, by another building society desiring to merge with it, for the societies to merge, with or without terms for the merger; and “proposer” has a corresponding meaning;
“merger resolutions”, in relation to a building society, means the resolutions required for the approval of a merger of the society with another building society under section 93(2) or 94(2);
“merger statement” means a statement containing the requisite particulars of a merger proposal; and
“requisite particulars”, in relation to a merger proposal, means the particulars required by paragraph 3(2) below to be given in a merger statement.

Duty to notify members

3

1

Subject to sub-paragraph (3) below, it shall be the duty of a building society receiving a merger proposal to send, in accordance with this Part of this Schedule, a merger statement in respect of the proposal to every member entitled to notice of a meeting of the society.

2

A merger statement must contain the following particulars—

a

the fact that a merger proposal has been made, and

b

the identity of the proposer,

with or without other particulars regarding the proposal.

3

Sub-paragraph (1) above does not require a merger statement to be sent to members if the proposer has requested in writing that the requisite particulars are to be treated as confidential; and, where such a request is made and is at a later date withdrawn in writing, the society receiving the proposal shall, for the purposes of this Part of this Schedule, treat the proposal as having been received on that date instead of any earlier date.

4

1

A building society shall include in or with every notice of its annual general meeting a merger statement with respect to any merger proposal, other than a proposal of which notice has already been given under this paragraph,—

a

received by it during the period of 12 months ending with the ninth month of the last financial year of the society before that meeting; or

b

2C

Where, in a case in which sub-paragraph (2A)(b) is relied on for compliance with a requirement under sub-paragraph (1) or (2)—

a

a statement or notification is published for a part, but not all, of the period mentioned in sub-paragraph (2B)(d), but

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

that failure shall not invalidate the proceedings of a meeting or prevent the requirements of sub-paragraph (2B) from being treated as fulfilled in relation to section 95(4)(c).

3

In this paragraph and paragraph 5 below—

“transfer proposal” has the same meaning as in Part IA of Schedule 17;
“transfer proposal notification” means a transfer proposal notification (within the meaning of that Part) required to be sent to members by paragraph 5B(1) of that Schedule.

Duty to notify F378appropriate authority

5

1

Where a building society sends a merger statement F175or transfer proposal notification to its members under paragraph 4 above in connection with a meeting of the society, it shall send a copy of the statement F176or notification to the F447FCA and, if the society is a PRA-authorised person, the PRA at least 14 days before the date of the meeting.

2

The F448FCA must keep the copy of a merger statement F177or transfer proposal notification received by it from a building society in the public file of that society.

Penalty

6 F3201

If default is made by a building society in complying with paragraph 4(1), 4(2) or 5 above, the society shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale; and so shall any officer who is also guilty of the offence.

F3212

Where, in a case in which paragraph 4(2A)(b) is relied on for compliance with a requirement under F373paragraph (a) or (b) of paragraph 4(2)—

a

a merger statement or transfer proposal notification is published for a part, but not all, of the period mentioned in sub-paragraph (2B)(d), but

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

no offence is committed under this paragraph by reason of that failure.

Part III Confirmation by F378appropriate authority : Procedure

7

An application for confirmation by the F378appropriate authority of an amalgamation or transfer of engagements shall be made in such manner as the F378appropriate authority may F178direct.

8

1

Where a building society applies to the F378appropriate authority for confirmation of an amalgamation or transfer or engagements, the society shall publish notice of the application in any one or more of the London Gazette, the Edinburgh Gazette or the Belfast Gazette, as the F378appropriate authority directs and, if it so directs, in one or more newspapers.

2

A notice published in pursuance of sub-paragraph (1) above shall—

a

state that any interested party has the right to make representations to the F378appropriate authority with respect to the application; and

b

specify a date determined by the F378appropriate authority before which any written representations or notice of a person’s intention to make oral representations must be received by the Commission; and

c

specify a date determined by the F378appropriate authority as the day on which it intends to hear any oral representations.

9

1

After the date specified in pursuance of paragraph 8(2)(b) above, the F378appropriate authority shall—

a

determine the time and place at which oral representations may be made;

b

give notice of that determination to the building societies participating in the amalgamation or transfer and any persons who have given notice of their intention to make oral representations; and

c

send copies of the written representations received by the F378appropriate authority to the building societies participating in the amalgamation or transfer.

2

The F378appropriate authority shall allow any building society participating in the amalgamation or transfer an opportunity to comment on the written representations, whether at a hearing or in writing before the expiration of such period as the F378appropriate authority specifies in a notice to the society.

C31 C33SCHEDULE 17 Transfers of Business: Supplementary Provisions

Section 97 and 98.

Annotations:

Modifications etc. (not altering text)

C31

Sch. 17: power to modify conferred (16.1.2009) by Building Societies (Funding) and Mutual Societies (Transfers) Act 2007 (c. 26), ss. 3, 6(2); S.I. 2009/36, art. 2

C33

Sch. 17 applied (with modifications) (5.3.2009) by The Mutual Societies (Transfers) Order 2009 (S.I. 2009/509), arts. 1(2), 3-18

F187PART I Issue of statement or summary to members

Annotations:

Amendments (Textual)

F187

Sch. 17 Pts. I, IA substituted for Sch. 17 Pt. I (1.12.1997) by 1997 c. 32, s. 30(3), Sch. 5 Pts. I, II; S.I. 1997/2668, art. 2, Sch. Pt. I(e)

F180Preliminary

Annotations:

Amendments (Textual)

F180

Sch. 17 Pts. I, IA substituted for Sch. 17 Pt. I (1.12.1997) by 1997 c. 32, s. 30(3), Sch. 5 Pts. I, II; S.I. 1997/2668, art. 2, Sch. Pt. I(e)

F1791

In this Part of this Schedule—

“prescribed matters” in relation to any transfer of the business of a building society to its successor, means the matters relating to the transfer, the society, its officers, members or depositors, or the successor, which are prescribed in regulations made under paragraph 5(1) below;
“transfer statement”, in relation to a transfer of business by a building society, means the statement with respect to the transfer which may be sent or handed to members of the society under paragraph 2 below;
“transfer summary”, in relation to a transfer of business by a building society, means the summary of the transfer statement which may be sent to members of the society under that paragraph.

F186Duty to send transfer statements or summaries to members

Annotations:

Amendments (Textual)

F186

Sch. 17 Pts. I, IA substituted for Sch. 17 Pt. I (1.12.1997) by 1997 c. 32, s. 30(3), Sch. 5 Pts. I, II; S.I. 1997/2668, art. 2, Sch. Pt. I(e)

F181 C252

A building society which desires to transfer its business shall, in accordance with this Part of this Schedule, send a transfer statement, or a transfer summary, to every member entitled to notice of a meeting of the society.

F1823

1

A transfer statement, in relation to a transfer of business by a building society, shall contain—

a

the particulars required, in relation to the prescribed matters, by the regulations made under paragraph 5(1) below, and

b

a statement is published for a part, but not all, of the period mentioned in subparagraph (2B)(d), but

b

the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

the failure shall not invalidate the proceedings of a meeting or prevent the requirements of sub-paragraph (2B) from being treated as fulfilled in relation to section 98.

3

No transfer statement shall be sent or handed to a member unless its contents, so far as they concern the prescribed matters or any matter of which particulars are required to be given under paragraph 3(1)(b) above, have been approved by the F380appropriate authority .

F4494

The PRA must consult the FCA before approving a statement under sub-paragraph (3).

C26 F1845

1

The F185Treasury, may make regulations for the purpose of specifying, as prescribed matters, the matters of which transfer statements are to give particulars; and the regulations may also require particulars to be given of any alternatives to the particular transfer which were available to the society making the transfer.

2

The F185Treasury, may make regulations for the purpose of specifying the information which transfer summaries are to give.

3

Any power to make regulations under this paragraph is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

F197PART IA Notification of proposals for transfers of business

Annotations:

Amendments (Textual)

F197

Sch. 17 Pts. I, IA substituted for Sch. 17 Pt. I (1.12.1997) by 1997 c. 32, s. 30(3), Sch. 5 Pts. I, II; S.I. 1997/2668, art. 2, Sch. Pt. I(e)

F189Preliminary

Annotations:

Amendments (Textual)

F189

Sch. 17 Pts. I, IA substituted for Sch. 17 Pt. I (1.12.1997) by 1997 c. 32, s. 30(3), Sch. 5 Pts. I, II; S.I. 1997/2668, art. 2, Sch. Pt. I(e)

F1885A

In this Part of this Schedule—

“requisite particulars”, in relation to a transfer proposal, means the particulars required by paragraph 5B(2) below to be given in a transfer proposal notification;
“transfer”, in relation to a building society, means a transfer of the whole of its business to a company under section 97;
C27“transfer proposal”, in relation to a building society, means a proposal in writing by a company for a transfer by the society to the company, with or without terms for the transfer; and “proposer” has a corresponding meaning;
“transfer proposal notification” means a notification containing the requisite particulars of a transfer proposal;
“transfer resolutions”, in relation to a building society, means the resolutions required for the approval of a transfer by the society under section 97.

F192Duty to notify members

Annotations:

Amendments (Textual)

F192

Sch. 17 Pts. I, IA substituted for Sch. 17 Pt. I (1.12.1997) by 1997 c. 32, s. 30(3), Sch. 5 Pts. I, II; S.I. 1997/2668, art. 2, Sch. Pt. I(e)

F1905B

1

Subject to sub-paragraph (3) below, it shall be the duty of a building society receiving a transfer proposal to send, in accordance with this Part of this Schedule, a transfer proposal notification in respect of the proposal to every member entitled to notice of a meeting of the society.

2

A transfer proposal notification must contain the following particulars—

a

the fact that a transfer proposal has been made, and

b

the identity of the proposer;

with or without other particulars regarding the proposal.

3

Sub-paragraph (1) above does not require a transfer proposal notification to be sent to members if the proposer has requested in writing that the requisite particulars are to be treated as confidential; and, where such a request is made and is at a later date withdrawn in writing, the society receiving the proposal shall, for the purposes of this Part of this Schedule, treat the proposal as having been received on that date instead of any earlier date.

F1915C

F3241

A building society shall include in or with every notice of its annual general meeting a transfer proposal notification with respect to any transfer proposal, other than a proposal of which notice has already been given under this paragraph—

a

received by it during the period of 12 months ending with the ninth month of the last financial year of the society before that meeting; or

b

the failure shall not invalidate the proceedings of a meeting.

F194Duty to notify F380appropriate authority

Annotations:

Amendments (Textual)

F194

Sch. 17 Pts. I, IA substituted for Sch. 17 Pt. I (1.12.1997) by 1997 c. 32, s. 30(3), Sch. 5 Pts. I, II; S.I. 1997/2668, art. 2, Sch. Pt. I(e)

F1935D

1

Where a building society sends a transfer proposal notification to its members under paragraph 5C above in connection with a meeting of the society, it shall send a copy of the notification to the F450FCA and, if the society is a PRA-authorised person, the PRA at least 14 days before the date of the meeting.

2

The F451FCA must keep the copy of a transfer proposal notification received by it from a building society in the public file of that society.

F196Penalty

Annotations:

Amendments (Textual)

F196

Sch. 17 Pts. I, IA substituted for Sch. 17 Pt. I (1.12.1997) by 1997 c. 32, s. 30(3), Sch. 5 Pts. I, II; S.I. 1997/2668, art. 2, Sch. Pt. I(e)

F1955E

F3261

If default is made by a building society in complying with paragraph 5C or 5D above, the society shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale; and so shall any officer who is also guilty of the offence.

F3272

But no offence is committed under this paragraph, in a case in which paragraph 5C(2)(b) is relied on for compliance with a requirement under paragraph 5C(1), where—

a

a transfer proposal notification is published for a part, but not all, of the period mentioned in paragraph 5C(3)(d); and

b

the failure to publish that notification throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid.

Part II Confirmation by F380appropriate authority : Procedure

6

An application by a building society for confirmation by the F380appropriate authority of a transfer of its business tschedule 16o a company shall be made in such manner as the F380appropriate authority may F198direct.

7

1

Where a building society applies for confirmation of a transfer of its business, the society shall publish a notice of the application in any one or more of the London Gazette, the Edinburgh Gazette or the Belfast Gazette, as the F380appropriate authority directs and, if it so directs, in one or more newspapers.

2

A notice published in pursuance of sub-paragraph (1) above shall—

a

state that any interested party has the right to make representations to the F380appropriate authority with respect to the application;

b

specify a date determined by the F380appropriate authority before which any written representations or notice of a person’s intention to make oral representations must be received by the F380appropriate authority; and

c

specify a date determined by the F380appropriate authority as the day on which it intends to hear any oral representations.

8

1

After the date specified in the notice in pursuance of paragraph 7(2)(b) above, the Commission shall—

a

determine the time and place at which oral representations may be made;

b

give notice of that determination to the building society making the transfer and any persons who have given notice of their intention to make oral representations; and

c

send copies of the written representations received by the Commission to the building society making the transfer.

2

The Commission shall allow the building society making the transfer an opportunity to comment on the written representations, whether at a hearing or in writing, before the expiration of such period as the Commission specifies in a notice to the society.

SCHEDULE 18 Amendments of Enactments

Section 120.

Part I United Kingdom

M21Bankers’ Books Evidence Act 1879 (c.11)

Annotations:

Marginal Citations

M21

1879 c. 11.

1

In section 9(1) of the Bankers’ Books Evidence Act 1879 (meaning of “bank” and “banker” for purposes of that Act), after paragraph (a) there shall be inserted the following—

aa
a building society (within the meaning of the Building Societies Act 1986);

Land Registration Act 1925 (c.21)

F3312

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Payment of Wages Act 1960 (c. 37)

F3373

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Trustee Investments Act 1961 (c. 62)

4

1

This paragraph amends the M22Trustee Investments Act 1961 as follows.

2

In Part II of Schedule 1 (narrower range investments requiring advice), for paragraph 12 there shall be substituted—

12
In deposits with a building society within the meaning of the Building Societies Act 1986.

3

In Part III of Schedule 1 (wider range investments), for paragraph 2 there shall be substituted—

2
In shares in a building society within the meaning of the Building Societies Act 1986.

Stock Transfer Act 1963 (c.18)

5

In section 1(4) of the M23Stock Transfer Act 1963 (simplified transfer of certain securities, not to apply to building society securities), for “1962” there shall be substituted “ 1986 ”.

Industrial and Provident Societies Act 1965 (c.12)

F4736

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Income and Corporation Taxes Act 1970 (c.10)

F1997

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Banking and Financial Dealings Act 1971 (c.80)

8

1

This paragraph amends the M24Banking and Financial Dealings Act 1971 as follows.

2

In section 2(1) (power to suspend financial dealings on bank holidays) after paragraph (g) there shall be inserted—

; and
h
a direction that, subject as aforesaid, no building society shall, on that day, except with permission so granted, effect in the course of its business any transaction or, according as may be specified in the order, a transaction of such kind as may be so specified.

3

In section 2(6) after the definition of “authorised dealer in gold” there shall be inserted—

“building society” means a building society within the meaning of the Building Societies Act 1986.

Local Government Act 1972 (c.70)

9

In Schedule 12A (access to information: exempt information) to the M25Local Government Act 1972—

a

in Part II, in paragraph 2(d) for “1962” there shall be substituted “ 1986 ”; and

b

in Part III, in paragraph 1(1), after the definition of "protected informant’ there shall be inserted the following definition—

“registered”, in relation to information required to be registered under the Building Societies Act 1986, means recorded in the public file of any building society (within the meaning of that Act);

Consumer Credit Act 1974 (c. 39)

10

1

This paragraph amends the M26Consumer Credit Act 1974 as follows.

2

In section 16(1) (consumer credit agreement with certain bodies exempt from regulation) the words “or building society” shall be omitted and, after paragraph (f), there shall be inserted the words

, or
g
a building society.

3

In section 16(3) (Secretary of State’s duty to consult before making orders), after paragraph (d) there shall be inserted the words

or
e
under subsection (1)(g) without consulting the Building Societies Commission and the Treasury.

4

In section 189(1) (definitions), for the definition of “building society” there shall be substituted the following definition—

“building society” means a building society within the meaning of the Building Societies Act 1986;

Solicitors Act 1974 (c.47)

11

1

This paragraph amends the M27Solicitors Act 1974 as follows.

F3722

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F3723

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4

In section 85 (bank accounts)—

a

after “account with a bank” there shall be inserted “ or a building society ”, and

b

in paragraphs (a) and (b) after “bank” there shall be inserted “ or society ”.

5

In section 87(1) (interpretation), after the definition of “bank” there shall be inserted—

“building society” means a building society within the meaning of the Building Societies Act 1986; and a reference to an account with a building society is a reference to a deposit account.

Home Purchase Assistance and Housing Corporation Guarantee Act 1978 (c.27)

F20012

In section 3(1) (building society law) of the M28Home Purchase Assistance and Housing Corporation Guarantee Act 1978, after “determining” there shall be added the word “ (a) ” and at the end of that subsection there shall be added the words—

b
the classification of the advance, or any such further advance, for the purposes of Part III of the Building Societies Act 1986.

Banking Act 1979 (c.37)

F20113

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Charging Orders Act 1979 (c.53)

14

In section 6(1) (interpretation) of the M29Charging Orders Act 1979, in the definition of “building society”, for “1962” there shall be substituted “ 1986 ”.

Finance Act 1982 (c.39)

F20215

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Companies Act 1985 (c.6)

F20316

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Insolvency Act 1985 (c.65)

F20417

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Housing Act 1985 (c. 68)

18

1

This paragraph amends the M30Housing Act 1985 as follows.

2

In section 442(5) (consultations by Secretary of State regarding forms of local authority indemnity agreement) for “Chief Registrar of Friendly Societies" in paragraph (a), there shall be substituted “Building Societies Commission".

3

In section 447 (recognised lending institutions) and in section 448 (recognised savings institutions) for “designated building societies" there shall be substituted “building societies".

F2054

For section 450 (modifications of building society law) there shall be substituted the following section—

450 Modifications of building society law.
So much of an advance by a building society which is partly financed under section 445 (assistance for first-time buyers) or the corresponding Scottish or Northern Ireland provisions as is so financed shall be treated as not forming part of the advance for the purpose of determining—
a
whether the advance, or any further advance made within two years of the date of purchase, is beyond the powers of the society, and
b
the classification of the advance, or any such further advance, for the purposes of Part III of the Building Societies Act 1986.

5

In section 622 (minor definitions) for the definition of “building society" there shall be substituted—

“building society” means a building society within the meaning of the Building Societies Act 1986

Housing Associations Act 1985 (c.69)

19

1

This paragraph amends the M31Housing Associations Act 1985 as follows.

F3382

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3

In section 84(5) and 86(4) (consultation by Secretary of State regarding building society indemnities) for “Chief Registrar of Friendly Societies” there shall be substituted “ Building Societies Commission ”.

4

In section 101 (minor definitions), for the definition of “building society” there shall be substituted—

“building society” means a building society within the meaning of the Building Societies Act 1986;

Part II Northern Ireland

Industrial and Provident Societies Act (Northern Ireland)1969 (c.24 N.I.)

20

In section 31(b) of the M32Industrial and Provident Societies Act (Northern Ireland) 1969 (authorised investments) for “society registered under the Building Societies Act” there shall be substituted “ building society within the meaning of the Building Societies Act 1986. ”.

M33Payment of Wages Act (Northern Ireland 1970

Annotations:

Marginal Citations

M33

1970 c. 12 (N.I.).

F20621

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Private Streets (Northern Ireland) Order 1980 (S.I. 1980/1086 (N.I.12))

22

In Article 33 (security not to be deemed prior mortgage under Building Societies Acts) of the M34Private Streets (Northern Ireland) Order 1980 for the words from “section 32” where they first occur onwards there shall be substituted “ section 11(2)(d) or (4)(d) of the Building Societies Act 1986 ”.

Housing (Northern Ireland) Order 1981 (S.I. 1981/156 (N.I.3))

23

1

This paragraph amends the M35Housing (Northern Ireland) Order 1981 as follows.

2

In Article 2(2) (interpretation) after the definition of “building regulations” there shall be inserted—

“building society” means a building society within the meaning of the Building Societies Act 1986

F2073

For Article 155 (building society law) there shall be substituted the following section—

155 Modifications of building society law.
So much of an advance by a building society which is partly financed under this Part or sections 445 to 449 of the Housing Act 1985 or the Home Purchase Assistance and Housing Corporation Guarantee Act 1978 as is so financed shall be treated as not forming part of the advance for the purpose of determining—
a
whether the advance, or any further advance made within two years of the date of purchase, is beyond the powers of the society, and
b
the classification of the advance, or any such further advance, for the purposes of Part III of the Building Societies Act 1986.

4

In Article 155A (exclusion of Restrictive Trade Practices Act 1976), after “Scottish Provisions” there shall be inserted “ (namely, sections 445 to 447 of the Housing Act 1985 or the Home Purchase Assistance and Housing Corporation Guarantee Act 1978) ”.

5

In Article 156(5)(b) (consultations by the Department regarding forms of indemnity agreements) for “Registrar of Friendly Societies for Northern Ireland” there shall be substituted “ Building Societies Commission ”.

6

For paragraph 1 of Schedule 10 there shall be substituted—

1
Building Societies.

Property (Discharge of Mortgage by Receipt) (Northern Ireland) Order 1983 (S.I. 1983/766 (N.I.9))

24

In Article 3(10) of the M36Property (Discharge of Mortgage by Receipt) (Northern Ireland) Order 1983, after “applies” in the definition of “mortgage” there shall be inserted “ and, subject to paragraph 2(7) of Schedule 4 to the Building Societies Act 1986, does not include a mortgage to which that paragraph 2 applies. ”.

Housing (Northern Ireland) Order 1983 (S.I. 1983/1118 (N.I.15))

25

In Article 3(4) of the M37Housing (Northern Ireland) Order 1983, in the definition of “building society” for the words from “1962” onwards there shall be substituted “ 1986 ”.

Companies (Northern Ireland) Order 1986

F20826

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE 19 Repeals and Revocations

Section 120.

Part I Repeals: General

Chapter	Short title	Extent of repeal
37 & 38 Vict. c. 42.	The Building Societies Act 1874.	Section 1.
		Section 4.
		Section 32.
57 & 58 Vict. c. 47.	The Building Societies Act 1894.	Section 8(1).
		Section 29.
8 & 9 Eliz. 2 c. 64.	The Building Societies Act 1960.	Section 72.
		Section 73(1).
		Section 77.
		In Schedule 5, the entry relating to paragraph 4 of section 32 of the Building Societies Act 1874.
9 & 10 Eliz. 2 c. 62.	The Trustee Investments Act 1961.	In Part IV of Schedule 1, paragraphs 3A and 7.
10 & 11 Eliz. 2 c. 37.	The Building Societies Act 1962.
		The whole Act.
1965 c. 32.	The Administration of Estates (Small Payments) Act 1965.	In Schedules 1 and 3, the entries relating to the Building Societies Act 1962.
69 c. 46.	The Family Law Reform Act 1969.	In Schedule 1, the entry relating to the Building Societies Act 1962.
1970 c. 10.	The Income and Corporation Taxes Act 1970.	In section 343(5), the words “union or”.
1974 c. 39.	The Consumer Credit Act 1974.	In section 16, in subsection (1) the words “or building society,” and, in subsections (1)(e) and (3)(c), the word “or”.
1974 c. 46.	The Friendly Societies Act 1974.	In Schedule 10, paragraph 9.
1974 c. 47.	The Solicitors Act 1974.	In section 32, in subsections (1) and (2), the word “banks”.
1974 c. 49.	The Insurance Companies Act 1974.In Schedule 1, the entries relating to	the Building Societies Act 1962.
1978 c. 27.	The Home Purchase Assistance and Housing Corporation Guarantee Act 1978.	In section 3, subsections (2) to (4).
1979 c. 37.	The Banking Act 1979.	In paragraph 6 of Schedule 1, the words from “within” to the end.
		In Schedule 6, paragraphs 6, 7, 16, and 17.
1982 c. 50.	The Insurance Companies Act 1982.	In Schedule 5, paragraphs 3 and 5.
1984 c. 28.	The County Courts Act 1984.	In Schedule 2, paragraph 26.
1985 c. 9.	The Companies Consolidation (Consequential Provisions) Act 1985.	In Schedule 2, the entries relating to the Building Societies Act 1962.
1985 c. 58.	The Trustee Savings Banks Act 1985.	In Schedule 1, paragraph 11(2)(a) and so much of that sub-paragraph as relates to the section 59 specified therein.
1985 c. 61.	The Administration of Justice Act 1985.	Section 66.
1985 c. 68.	The Housing Act 1985.	In section 458, the definition of “designated building society”.
		In section 459, the entry relating to “designated buildings society”.
1985 c. 69.	The Housing Associations Act 1985.	Sections 63 to 66.
		In Section 72, the definitions of “building society”, “Chief Registrar” and “officer”.
		In section 73, the entries relating to “building society”, “Chief registrar” and “officer”.
1985 c. 71.	The Housing (Consequential Provisions) Act 1985.	In Schedule 2, paragraphs 5 and 6.

Part II Revocation Extending to Great Britain

Number	Title	Extent of revocation
S.I. 1981/1488.	The Building Societies (Authorisation) Regulations 1981.	The whole Regulations.

PART III Repeals and Revocations Extending Only to Northern Ireland

Chapter or number	Short title	Extent of repeal or revocation
1967 c. 5 (N.I.).	The Administration of Estates (Small Payments) Act (Northern Ireland) 1967.	In Schedule 1, the entry relating to the Building Societies Act 1874.
1967 c. 31 (N.I.).	The Building Societies Act (Northern Ireland) 1967.	The whole Act.
1969 c. 24 (N.I.).	The Industrial and Provident Societies Act (Northern Ireland) 1969.	In section 101(1), the definition of “Building Societies Acts”.
1969 c. 28 (N.I.).	The Age of Majority Act (Northern Ireland) 1969	In Schedule 1, the entry relating to the Building Societies Act (Northern Ireland) 1967.
1969 c. 31 (N.I.).	The Age of Majority Act (Northern Ireland) 1969.	In Part I of Schedule 1, the entry relating to the Building Societies Act (Northern Ireland) 1967.
1970 c. 18 (N.I.).	The Land Registration Act (Northern Ireland) 1970.	In Schedule 12 the entry relating to the Building Societies Act (Northern Ireland) 1967.
1978 c. 23.	The Judicature (Northern Ireland) Act 1978.	In Schedule 5, in Part II the entry relating to the Building Societies Act (Northern Ireland) 1967.
S.I. 1979/1573 (N.I.12).	The Statutory Rules (Northern Ireland) Order 1979.	In Schedule 4 the entry relating to the Building Societies Act (Northern Ireland) 1967.
1980 c. 25.	The Insurance Companies Act 1980.	In Schedule 3, paragraph 3.
S.I. 1981/156 (N.I.3).	The Housing (Northern Ireland) Order 1981.	Article 156(6).
		In Part II of Schedule 2, the entry relating to the Building Societies Act (Northern Ireland) 1967.
S.R. 1982/155 (N.I.).	The Building Societies (Authorisation) Regulations (Northern Ireland) 1982.	The whole Regulations.
S.I. 1983/776 (N.I.9).	The Property (Discharge of Mortgage by Receipt) (Northern Ireland) Order 1983.	In Article 3(10), in the definition of “mortgage” the words “section 37 of the Building Societies Act (Northern Ireland) 1967”.
S.I. 1983/1118 (N.I.15).	The Housing (Northern Ireland) Order 1983.	In Schedule 10, the entry relating to the Building Societies Act (Northern Ireland) 1967.
1985 c. 71.	The Housing (Consequential Provisions) Act 1985.	In Schedule 2, paragraphs 13, 51(2) and 51(5)(a).
S.I. 1986/1035 (N.I.9).	The Companies Consolidation (Consequential Provisions) (Northern Ireland) Order 1986.	In Part I of Schedule 1, the entry relating to the Building Societies Act (Northern Ireland) 1967.

SCHEDULE 20 Transitional and Saving Provisions

Section 120.

Preliminary

1

In this Schedule—

“the commencement date for” any provision of this Act means the date on which that provision comes into operation;
F209“existing society” means a building society registered at the passing of this Act under the repealed enactments; and
“existing rules” means the rules of a society in force immediately before the commencement date for section 5.

Adoption of powers and alteration of rules

F2102

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F2113

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Default powers

F2124

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Registration with existing authorities

5

A building society which, at the commencement date for section 5, was registered under the M38Building Societies Act (Northern Ireland) 1967 or registered or deemed to be registered in Northern Ireland under the enactments repealed by that Act shall be treated, for the purposes of this Act, as registered with the central office immediately before the commencement of that section.

Authorisation under existing enactments

6

1

A building society which, at the commencement date for section 9 is authorised to raise money and accept deposits under—

a

the M39Building Societies (Authorisation) Regulations 1981, or

b

the M40 Building Societies (Authorisation) Regulations (Northern Ireland) 1982,

shall be treated, whether or not the requirements of subsection (4) of section 9 would be fulfilled in its case, at the commencement of that section as authorised for the purposes of this Act (in particular Part VI).

2

The central office shall record in the public file of each building society to which sub-paragraph (1) above applies the fact that, by virtue of that sub-paragraph, the society is to be treated as authorised for the purposes of this Act.

Anticipation of powers: declaratory provision

F2137

1

It is hereby declared that every building society has had, as from 19th December 1985, power, for the purposes of any power conferred by this Act on building societies or building societies of its description, to do such things, subject to sub-paragraph (2) below, as are reasonably necessary to enable it—

a

to decide whether or not, and to what extent, to exercise (and in the case of an adoptable power to adopt) the power, and

b

if it decides to exercise the power, to exercise it as from the date when it becomes exercisable by the society.

2

Sub-paragraph (1)(b) above does not authorise a society—

a

to make contracts, other than conditional contracts, for the acquisition of land, the acquisition of a business or the acquisition of shares in any company if that company offers the public any service or facility within the power,

b

to issue invitations to members of the society or the public to apply for any power to be exercised for their benefit, or

c

to retain shares in a company which offers the public any service or facility within the power;

and, in this sub-paragraph, “conditional”, in relation to contracts with respect to the exercise of a power, means conditional on the power’s becoming exercisable by the society.

3

The power conferred by this paragraph, and activities carried on under it, for the purposes of an adoptable power are not to be treated as included in, or in activities comprised in, that adoptable power for the purposes of paragaph 8 of this Schedule.

Unlawful anticipation of powers

F2148

1

Where a building society adopts any adoptable power under paragraph 2 or 3 above—

a

it shall, by virtue of this paragraph, assume an obligation, enforceable as provided in pararaph 9 below, not to exercise that power until the date on which the memorandum of its powers takes effect as respects that power, and

b

it shall send to the central office, with the documents required by paragraph 2(1) or 3(1) above a declaration as respects that power made on behalf of the society which satisfies the requirements of this paragraph.

2

The obligation assumed by virtue of this paragraph on the adoption of a power does not extend to the exercise of any power included in the adoptable power which the society has under the law in force at any time before the registration takes effect.

3

A declaration, to satisfy the requirements of this paragraph, must be made by the chairman of the board of directors of the society, by one other director and by the chief executive of the society and it must either—

a

Powers of central office

F21711

1

The central office, on receiving from a building society the declaration required by and the other documents referred to in paragraph 8 above, shall refer to the Commission for its determination the questi on whether or not the memorandum of the society’s powers is to be registered.

2

On a reference to the Commission of the question whether or not the memorandum of a society’s power is to be registered—

a

if the declaration contains the statement specified in paragraph 8(3)(a) above and the Commission has no reasonable cause to believe that the society in question has carried on any activity comprised in the power to which the obligation imposed by paragraph 8 above extends at any time during the period which begin one year before the specified date (or with 1st April 1986, if later) and expired on the date on which it considers the reference, the Commission shall direct the central office to register the memorandum, and

b

in any other case, the Commission may, as it thinks fit, direct the central office to register, or not to register, the memorandum.

3

The Commission, in deciding, in a case falling within sub-paragraph (2)(b) above, whether or not to direct the registration of the memorandum of a society’s powers may have regard to all the circumstances of the case.

4

No registration of a memorandum shall be effected by the central office under paragraph 2(2) or 3(2) above before the expiry of the period of 21 days beginning with the date on which it receives the declaration required by and the other documents referred to in paragraph 8 above.

5

If the central office, in pursuance of a direction of the Commission under sub-paragraph (2) above, refuses registration of the memorandum of a society’s powers under sub-paragraph (1) above it shall serve on the society a notice—

a

recording its refusal,

b

specifying the activity which is believed to constitute a breach of the society’s obligation, and

c

directing the society to make an application to the Commission under section 38 for a determination under that section whether the activity was or was not within the powers of the society at the time specified under sub-paragraph (b) above,

and shall send a copy of the notice to the Commission.

6

The central office shall comply with any direction as regards the registration of the memorandum of the society’s powers given to it by the Commission consequent on the Commission’s determination of the society’s powers under section 38.

7

Nothing in the foregoing provisions of this Schedule implies that it is improper for any of the following, that is to say—

a

the Chief Registrar or any assistant registrar of the central office,

b

the assistant registrar of friendly societies for Scotland,

c

the registrar of building societies for Northern Ireland, or

d

the Commission,

to give to a building society or building societies generally an indication of the action the Commission might or might not take in exercising its functions under this paragraph; and no decision of the Commission under this paragraph shall be liable to be set aside by reason of the indication having been given.

8

In this paragraph “the specified date” has the same meaning as in paragraph 2 or, as the case may be, 3 above.

Permissible securities for advances

F21812

1

Until provision is made by an order under section 10(6) prescribing the descriptions of equitable interests in land which may be taken as security for advances secured on land, building societies may advance money on the security of an equitable interest in land in England and Wales or Northern Ireland in addition to a mortgage of the freehold or leasehold estate where the lease or a related instrument includes provision entitling the leaseholder to acquire a beneficial interest of any extent in the freehold or a greater leasehold interest and the right to acquire that interest is assigned as additional security.

2

Until such provision is made, section 17(10) shall have effect with the substitution of a reference to an equitable interest of the description specified in sub-paragraph (1) above for the reference to an equitable interest specified in an order under section 10(6).

3

On the making of the first order under section 10(6) this paragraph shall cease to have effect.

F21913

Until provision is made by an order under section 12(3) prescribing indemnities given by a local authority as a description of additional security for the purposes of section 11(4)(c), an indemnity given under section 442 of the M41Housing Act 1985, under section 31 of the M42Tenants’ Rights, Etc. (Scotland) Act 1980 or under Article 156 of the M43Housing (Northern Ireland) Order 1981 shall be such a security; and on the making of the first order under section 12(3) this paragraph shall cease to have effect.

Existing business names

F22014

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Directors in office

F22115

1

Except as provided in this paragraph, an existing director shall be treated for the purposes of sections 60 and 61 as having been duly elected a director on the date of his appointment as a director or, as the case may be, of his most recent re-appointment to that office before the commencement date.

2

An existing director who holds office as director by virtue of holding some other position in the society shall, except in a case within sub-paragraph (4) below, be treated for the purposes of sections 60 and 61 as having been duly elected a director at the commencement date.

3

If the term of office of an existing director would, in accordance with the terms on which he holds office, expire on an earlier date than is provided for by sub-paragraph (1) above, he shall vacate office on that earlier date.

4

An existing director who has attained the normal retirement age, or the compulsory retirement age (if any), as the case may be, before the commencement date shall retire from office at the first annual general meeting of the society after the commencement date.

5

If, at the commencement date, an existing director, other than a director falling within sub-paragraph (2) above, has held office since the date of his appointment or most recent re-appointment for a period longer than is provided for in section 60(11)(a), he shall retire from office at the first annual general meeting of the society after the commencement date.

6

In this paragraph—

“the commencement date” means the commencement date for sections 60 and 61;
“existing director” means any director of a building society in office immediately before the commencement date; and
“the compulsory retirement age” and “the normal retirement age” have the meanings given in section 60(8).

Existing financial years

F47016

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Qualifying assets

F22217

For the purposes of the application of section 118 by reference to the annual accounts of a building society prepared before the first financial year for which accounts under Part VIII of this Act are prepared, the reference to the total commercial assets of a society shall have effect as a reference to the amount in the last balance sheet prepared under the Building Societies Act 1962 which represents the total assets constituted by mortgage debts outstanding to the society.

Provision of conveyancing services for building societies

F22318

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE 21 Provision of Conveyancing Services by Recognised Institutions and Practitioners

Section 124.

F336...

Annotations:

Amendments (Textual)

F336

Sch. 21 repealed (22.7.2004) by Statute Law (Repeals) Act 2004 (c. 14), Sch. 1 Pt. 17 Group 2

SCHEDULES

F1SCHEDULE 1

Status

1

The First Commissioner, etc.

2

Tenure of office of member

3

1

2

3

4

5

a

b

c

d

4

Remuneration and pensions, etc. for part-time members

C285

C296

1

2

Parliamentary disqualification

7

1

2

Staff

8

Proceedings

9

10

Performance of functions

11

1

F224a

b

c

2

12

13F225. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Instruments

14

1

15

1

2

C13C34 SCHEDULE 2 Establishment, Incorporation and Constitution of Building Societies

Part I General

Requirements for establishment

1

1

a

b

c

2

a

b

c

3

a

b

c

F34

The memorandum

2

F41

2

a

b

c

4

a

b

F55

The rules

3

1

2

3

C13 C34 SCHEDULE 2 Establishment, Incorporation and Constitution of Building Societies