Financial Services and Markets Act 2000

[F1 CHAPTER 3B U.K. Disciplinary measures

Textual Amendments

F1 Pt. 18 Ch. 3B inserted (24.1.2013 for specified purposes, 1.4.2013 in so far as not already in force) by Financial Services Act 2012 (c. 21), ss. 33, 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(b)(c), Sch. Pts. 2, 3; S.I. 2013/423, art. 3, Sch.

312E Public censure U.K.

(1) If the appropriate regulator considers that a recognised body has contravened a relevant requirement imposed on the body, it may publish a statement to that effect.

F2 (1A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) Where the FCA is the appropriate regulator, a requirement is a “relevant requirement” for the purposes of this Chapter if it is—

(a) a requirement that is imposed by or under any provision of this Part that relates to a recognised investment exchange,

(b) a requirement that is imposed under any other provision of this Act by the FCA that relates to a recognised investment exchange,

(c) a requirement that is imposed by a [F3 qualifying provision] specified, or of a description specified, for the purposes of this subsection by the Treasury by order, or

(d) a requirement that is imposed by this Act and whose contravention constitutes an offence that the FCA has power to prosecute under this Act (see section 401).

(3) Where the Bank of England is the appropriate regulator, a requirement is a “relevant requirement” for the purposes of this Chapter if it is—

(a) a requirement that is imposed by or under any provision of this Part that relates to a recognised clearing house [F4 , third country central counterparty or a recognised CSD],

(b) a requirement that is imposed under any other provision of this Act by the Bank,

(c) a requirement that is imposed by [F5 or under] a [F6 qualifying provision] specified, or of a description specified, for the purposes of this subsection by the Treasury by order, or

(d) a requirement that is imposed by this Act and whose contravention constitutes an offence that the Bank has power to prosecute under this Act (see section 401, as applied by paragraph 31 of Schedule 17A).

Textual Amendments

F2 S. 312E(1A) omitted (31.12.2020) by virtue of The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(2)(a) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F3 Words in s. 312E(2)(c) substituted (31.12.2020) by The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(2)(b) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F4 Words in s. 312E(3)(a) substituted (31.12.2020) by The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(2)(c)(i) (as substituted by S.I. 2020/646, regs. 1(2)(c), 11(2) (with savings in S.I. 2019/680, reg. 11 as amended by S.I. 2020/646, reg. 12))

F5 Words in s. 312E(3)(c) inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(27)(b)(ii) (with regs. 7(4), 9(1))

F6 Words in s. 312E(3)(c) substituted (31.12.2020) by The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(2)(c)(ii) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

Modifications etc. (not altering text)

C1 Ss. 312E-312I restricted (1.4.2013) by The Financial Services Act 2012 (Transitional Provisions) (Enforcement) Order 2013 (S.I. 2013/441), arts. 1(1), 13

C2 S. 312E applied (with modifications) (13.7.2016) by The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016 (S.I. 2016/715), regs. 1(2), 13

C3 S. 312E applied (with modifications) (7.12.2018) by The Central Securities Depositories (Amendment) (EU Exit) Regulations 2018 (S.I. 2018/1320), regs. 1(2), 26(3) (as amended (31.1.2020 immediately before exit day) by The Financial Services (Consequential Amendments) Regulations 2020 (S.I. 2020/56), regs. 1, 10(b))

312F Financial penalties U.K.

[F7 (1)] If the appropriate regulator considers that a recognised body has contravened a relevant requirement imposed on the body, it may impose on the body a penalty, in respect of the contravention, of such amount as it considers appropriate.

F8 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F7 S. 312F renumbered as s. 312F(1) (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(28)(a) (with regs. 7(4), 9(1))

F8 S. 312F(2) omitted (31.12.2020) by virtue of The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(3) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

Modifications etc. (not altering text)

C1 Ss. 312E-312I restricted (1.4.2013) by The Financial Services Act 2012 (Transitional Provisions) (Enforcement) Order 2013 (S.I. 2013/441), arts. 1(1), 13

C4 S. 312F applied (with modifications) (13.7.2016) by The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016 (S.I. 2016/715), regs. 1(2), 13

[F9 312FA. Central securities depositories: further disciplinary measures U.K.

(1) If the Bank of England considers that a contravention by a recognised CSD of a relevant requirement occurred with the consent or connivance of, or was attributable to any neglect on the part of, a member of the management body or other person who effectively controls the business of the recognised CSD, the Bank of England may do one or both of the following—

(a) publish a statement to that effect;

(b) impose on that person a penalty, in respect of the contravention, of such amount as it considers appropriate.

(2) If the Bank of England considers that a member of the management body or other person who effectively controls the business of a recognised CSD is responsible for a contravention by the central securities depository of a relevant requirement, it may do one or more of the following—

(a) publish a statement to that effect;

(b) impose on that person a penalty, in respect of the contravention, of such amount as it considers appropriate;

(c) prohibit that person from holding an office or position involving responsibility for taking decisions about the management of the recognised CSD.

(3) A prohibition under subsection (2)(c) may apply—

(a) for a specified period,

(b) until further notice, or

(c) for repeated serious contraventions, permanently.

(4) The Bank of England may, on the application of the person subject to a prohibition under subsection (2)(c), vary or revoke the prohibition.

F10 (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

Textual Amendments

F9 S. 312FA inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(29) (with regs. 7(4), 9(1))

F10 S. 312FA(5) omitted (31.12.2020) by virtue of The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(4) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

312G Proposal to take disciplinary measures U.K.

[F11 (1) If the appropriate regulator proposes to impose a sanction—

(a) on a recognised body under section 312E or 312F, or

(b) on a person under section 312FA,

it must give the body or person (as the case may be) 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.

[F12 (4) A warning notice about a proposal to impose a prohibition must specify the extent of the prohibition.

F13 (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

Textual Amendments

F11 S. 312G(1) substituted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(30)(a) (with regs. 7(4), 9(1))

F12 S. 312G(4)(5) inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(30)(b) (with regs. 7(4), 9(1))

F13 S. 312G(5) omitted (31.12.2020) by virtue of The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(5) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

Modifications etc. (not altering text)

C1 Ss. 312E-312I restricted (1.4.2013) by The Financial Services Act 2012 (Transitional Provisions) (Enforcement) Order 2013 (S.I. 2013/441), arts. 1(1), 13

C5 S. 312G applied (with modifications) (13.7.2016) by The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016 (S.I. 2016/715), regs. 1(2), 13

312H Decision notice U.K.

[F14 (1) If the appropriate regulator decides to impose a sanction—

(a) on a recognised body under section 312E or 312F, or

(b) on a person under section 312FA,

it must give the body or person (as the case may be) 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.

[F15 (3A) In the case of a prohibition, the decision notice must specify the extent of the prohibition.

(3B) The sanction which the appropriate regulator decides to impose may differ from that proposed in the warning notice.]

[F16 (4) If the appropriate regulator decides to impose a sanction—

(a) on a recognised body under section 312E or 312F, or

(b) on a person under section 312FA,

the body or person (as the case may be) may refer the matter to the Tribunal.

F17 (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

Textual Amendments

F14 S. 312H(1) substituted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(31)(a) (with regs. 7(4), 9(1))

F15 S. 312H(3A)(3B) inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(31)(b) (with regs. 7(4), 9(1))

F16 S. 312H(4) substituted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(31)(c) (with regs. 7(4), 9(1))

F17 S. 312H(5) omitted (31.12.2020) by virtue of The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(6) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

Modifications etc. (not altering text)

C1 Ss. 312E-312I restricted (1.4.2013) by The Financial Services Act 2012 (Transitional Provisions) (Enforcement) Order 2013 (S.I. 2013/441), arts. 1(1), 13

C6 S. 312H applied (with modifications) (13.7.2016) by The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016 (S.I. 2016/715), regs. 1(2), 13

312I Publication U.K.

After an appropriate regulator publishes a statement under section 312E [F18 or 312FA], it must send a copy of the statement to—

(a) the recognised body [F19 F20 ... or person] concerned, and

(b) any person to whom a copy of the decision notice was given under section 393(4).

Textual Amendments

F18 Words in s. 312I inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(32)(a) (with regs. 7(4), 9(1))

F19 Words in s. 312I(a) inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(32)(b) (with regs. 7(4), 9(1))

F20 Words in s. 312I(a) omitted (31.12.2020) by virtue of The Investment Exchanges, Clearing Houses and Central Securities Depositories (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/662), regs. 1(3), 8(7) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

Modifications etc. (not altering text)

C1 Ss. 312E-312I restricted (1.4.2013) by The Financial Services Act 2012 (Transitional Provisions) (Enforcement) Order 2013 (S.I. 2013/441), arts. 1(1), 13

C7 S. 312I applied (with modifications) (13.7.2016) by The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016 (S.I. 2016/715), regs. 1(2), 13

312J Statement of policy U.K.

(1) Each appropriate regulator must prepare and issue a statement of its policy with respect to—

(a) the imposition of penalties under [F21 sections 312F and 312FA and prohibitions under section 312FA], F22 ...

(b) the amount of penalties under [F23 those sections] [F24 ; and

(c) the period for which prohibitions under section 312FA are to have effect].

(2) An appropriate regulator's policy in determining what the amount of a penalty should be [F25 , or what the period for which a prohibition 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 concerned, F26 ...

(b) the extent to which that contravention was deliberate or reckless [F27 ; and

(c) whether the person against whom action is to be taken is an individual].

(3) An appropriate regulator may at any time alter or replace a statement issued by it under this section.

(4) If a statement issued by an appropriate regulator under this section is altered or replaced, the regulator must issue the altered or replacement statement.

(5) In exercising, or deciding whether to exercise, its power under section 312F [F28 or 312FA] in the case of any particular contravention, an appropriate regulator must have regard to any statement of policy published by it under this section and in force at a time when the contravention in question occurred.

(6) A statement issued by an appropriate regulator under this section must be published by the regulator in the way appearing to the regulator to be best calculated to bring it to the attention of the public.

(7) An appropriate regulator may charge a reasonable fee for providing a person with a copy of the statement.

(8) An appropriate regulator must, without delay, give the Treasury a copy of any statement which it publishes under this section.

Textual Amendments

F21 Words in s. 312J(1)(a) substituted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(33)(a)(i) (with regs. 7(4), 9(1))

F22 Word in s. 312J(1) omitted (28.11.2017) by virtue of The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(33)(a)(ii) (with regs. 7(4), 9(1))

F23 Words in s. 312J(1)(b) substituted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(33)(a)(iii) (with regs. 7(4), 9(1))

F24 S. 312J(1)(c) and word inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(33)(a)(iv) (with regs. 7(4), 9(1))

F25 Words in s. 312J(2) inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(33)(b)(i) (with regs. 7(4), 9(1))

F26 Word in s. 312J(2) omitted (28.11.2017) by virtue of The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(33)(b)(ii) (with regs. 7(4), 9(1))

F27 S. 312J(2)(c) and word inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(33)(b)(iii) (with regs. 7(4), 9(1))

F28 Words in s. 312J(5) inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 2(33)(c) (with regs. 7(4), 9(1))

Modifications etc. (not altering text)

C8 S. 312J applied by S.I. 2014/2879, reg. 5C(8) (as inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 5(9) (with regs. 7(4), 9(1)))

312K Statement of policy: procedure U.K.

(1) Before issuing a statement under section 312J, an appropriate regulator must publish a draft of the proposed statement in the way appearing to the regulator to be best calculated to bring it to the attention of the public.

(2) The draft must be accompanied by notice that representations about the proposal may be made to the regulator within a specified time.

(3) Before issuing the proposed statement, the regulator must have regard to any representations made to it in accordance with subsection (2).

(4) If the regulator 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) If the statement differs from the draft published under subsection (1) in a way which is, in the opinion of the regulator, significant, the regulator must (in addition to complying with subsection (4)) publish details of the difference.

(6) An appropriate 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.]

Modifications etc. (not altering text)

C9 S. 312K applied by S.I. 2014/2879, reg. 5C(8) (as inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), regs. 1, 5(9) (with regs. 7(4), 9(1)))