Part XIV Disciplinary Measures
F1204AMeaning of “relevant requirement” and “appropriate regulator”
(1)
The following definitions apply for the purposes of this Part.
(2)
“Relevant requirement” means a requirement imposed—
(a)
by or under this Act, F2...
(b)
(c)
by the Alternative Investment Fund Managers Regulations 2013 F5, or
(d)
by the Undertakings for Collective Investment in Transferable Securities Regulations 2011.
(3)
The PRA is “the appropriate regulator” in the case of a contravention of—
(a)
a requirement that is imposed under any provision of this Act by the PRA;
(b)
a requirement under section 56(6) where the authorised person concerned is a PRA-authorised person and the prohibition order concerned is made by the PRA;
F6(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F7(d)
a requirement under section 62A(2) where F8the revised statement of responsibilities is to be provided to the PRA only;
(e)
a requirement under section 64B(2) or (5) where the conduct rules concerned are made by the PRA;
(f)
a requirement under section 64C(1) to notify the PRA that disciplinary action has been taken.
F9(3A)
Either the PRA or the FCA is “the appropriate regulator” in the case of a contravention of—
(a)
a requirement under section 59(1) or (2) where the authorised person concerned is a PRA-authorised person and the approval concerned falls to be given by the PRA;
(b)
a requirement under section 60A(1) or (2) where the authorised person concerned is a PRA-authorised person and the approval concerned falls to be given by the PRA;
F10(ba)
a requirement under section 62A(2) where the revised statement of responsibilities is to be provided to the FCA and the PRA;
(c)
a requirement under section 63(2A) where the approval concerned is within section 63(1A)(a);
(d)
a requirement under section 63E(1) where the authorised person concerned is a PRA-authorised person and the function concerned is of a description specified in rules made by the PRA;
(e)
a requirement under section 63F(1), (2), (4), (6) or (7) where the authorised person concerned is a PRA-authorised person and the certificate concerned relates to a function of a description specified in rules made by the PRA.
(4)
In the case of a contravention of a requirement that is imposed by a qualifying EU provision, “the appropriate regulator” for the purpose of any provision of this Part is whichever of the PRA or the FCA (or both) is specified by the Treasury by order in relation to the qualifying EU provision for the purposes of that provision of this Part.
(5)
In the case of a contravention of a requirement where the contravention constitutes an offence, the “appropriate regulator” is whichever of the PRA or the FCA has power to prosecute the offence (see section 401).
F11(6)
The FCA is “the appropriate regulator” in the case of a contravention of any other requirement imposed—
(a)
by or under this Act;
(b)
by the Alternative Investment Fund Managers Regulations 2013; or
(c)
by the Undertakings for Collective Investment in Transferable Securities Regulations 2011.
(7)
The Treasury may by order amend the provisions defining “the appropriate regulator”.
205 Public censure.
206 Financial penalties.
(1)
(2)
F16. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3)
A penalty under this section is payable to the F17regulator that imposed the penalty.
F18206A Suspending permission to carry on regulated activities etc
(1)
If the F19appropriate regulator considers that an authorised person has contravened a relevant requirement imposed on the person, it may—
(a)
suspend, for such period as it considers appropriate, any permission which the person has to carry on a regulated activity; or
(b)
impose, for such period as it considers appropriate, such limitations or other restrictions in relation to the carrying on of a regulated activity by the person as it considers appropriate.
F20(1A)
The power conferred by subsection (1) is also exercisable by the FCA if it considers that an authorised person has contravened a requirement imposed on the person by—
(a)
the Payment Services Regulations F212017, or
(b)
the Electronic Money Regulations 2011.
F22(1B)
The power conferred by subsection (1) may not be exercised in relation to a contravention of a requirement imposed under section 122A, 122B, 122C, 122G, 122H, 122I, F23122IA, 123A or 123B.
(2)
In subsection (1)—
“ permission ” means any permission that the authorised person has, whether given (or treated as given) by F24the FCA or the PRA or conferred by any provision of this Act;
F25...
(3)
The period for which a suspension or restriction is to have effect may not exceed 12 months.
(4)
A suspension may relate only to the carrying on of an activity in specified circumstances.
(5)
A restriction may, in particular, be imposed so as to require the person concerned to take, or refrain from taking, specified action.
(6)
The F26appropriate regulator may—
(a)
withdraw a suspension or restriction; or
(b)
vary a suspension or restriction so as to reduce the period for which it has effect or otherwise to limit its effect.
(7)
The power under this section may (but need not) be exercised so as to have effect in relation to all the regulated activities that the person concerned carries on.
(8)
Any one or more of the powers under—
(a)
subsection (1)(a) and (b) of this section, and
(b)
sections 205 and 206,
may be exercised in relation to the same contravention.
207 Proposal to take disciplinary measures.
(1)
If F27a regulator proposes—
(a)
to publish a statement in respect of an authorised person (under section 205), F28. . .
(b)
to impose a penalty on an authorised person (under section 206), F29 or
(c)
to suspend a permission of an authorised person or impose a restriction in relation to the carrying on of a regulated activity by an authorised person (under section 206A),
it must give the authorised person a warning notice.
(2)
A warning notice about a proposal to publish a statement must set out the terms of the statement.
(3)
A warning notice about a proposal to impose a penalty, must state the amount of the penalty.
F30(4)
A warning notice about a proposal to suspend a permission or impose a restriction must state the period for which the suspension or restriction is to have effect.
208 Decision notice.
(1)
If F31a regulator decides—
(a)
to publish a statement under section 205 (whether or not in the terms proposed), F32. . .
(b)
to impose a penalty under section 206 (whether or not of the amount proposed), F33 or
(c)
to suspend a permission or impose a restriction under section 206A (whether or not in the manner proposed),
it must without delay give the authorised person concerned a decision notice.
(2)
In the case of a statement, the decision notice must set out the terms of the statement.
(3)
In the case of a penalty, the decision notice must state the amount of the penalty.
F34(3A)
In the case of a suspension or restriction, the decision notice must state the period for which the suspension or restriction is to have effect.
(4)
If F35a regulator decides to—
(a)
publish a statement in respect of an authorised person under section 205, F36. . .
(b)
impose a penalty on an authorised person under section 206, F37 or
(c)
suspend a permission of an authorised person, or impose a restriction in relation to the carrying on of a regulated activity by an authorised person, under section 206A,
the authorised person may refer the matter to the Tribunal.
209 Publication.
After a statement under section 205 is published, F38the regulator concerned must send a copy of it to the authorised person and to any person on whom a copy of the decision notice was given under section 393(4).
210 Statements of policy.
(1)
F39Each regulator must prepare and issue a statement of its policy with respect to—
F40(a)
the imposition of penalties, suspensions or restrictions under this Part;
(b)
the amount of penalties under this Part; and
(c)
the period for which suspensions or restrictions under this Part are to have effect.
F41(1A)
Each regulator's policy with respect to the imposition of penalties, suspensions or restrictions under this Part must include policy with respect to their imposition in relation to conduct which constitutes or may constitute an offence by virtue of section 23(1A) (authorised persons carrying on credit-related regulated activities otherwise than in accordance with permission).
(2)
F42A regulator's policy in determining what the amount of a penalty should be F43, or what the period for which a suspension or restriction is to have effect should be, must include having regard to—
(a)
the seriousness of the contravention in question in relation to the nature of the requirement contravened;
(b)
the extent to which that contravention was deliberate or reckless; and
(c)
whether F44the person against whom action is to be taken is an individual.
(3)
(4)
If a statement issued under this section is altered or F47replaced by a regulator, the regulator must issue the altered or replacement statement.
(5)
F48A regulator must, without delay, give the Treasury a copy of any statement which it publishes under this section.
(6)
(7)
(8)
The F54regulator may charge a reasonable fee for providing a person with a copy of the statement.
211 Statements of policy: procedure.
(1)
(2)
The draft must be accompanied by notice that representations about the proposal may be made to the F57regulator within a specified time.
(3)
Before issuing the proposed statement, the F57regulator must have regard to any representations made to it in accordance with subsection (2).
(4)
If the F57regulator issues the proposed statement it must publish an account, in general terms, of—
(a)
the representations made to it in accordance with subsection (2); and
(b)
its response to them.
(5)
(6)
F59A regulator may charge a reasonable fee for providing a person with a copy of a draft published under subsection (1).
(7)
This section also applies to a proposal to alter or replace a statement.