Part XXV Injunctions and Restitution
Restitution required by F1FCA or PRA
384 Power of F2FCA or PRA to require restitution.
(1)
F3The appropriate regulator may exercise the power in subsection (5) if it is satisfied that an authorised person F4or recognised investment exchange (“the person concerned”) has contravened a relevant requirement, or been knowingly concerned in the contravention of such a requirement, and—
(a)
that profits have accrued to him as a result of the contravention; or
(b)
that one or more persons have suffered loss or been otherwise adversely affected as a result of the contravention.
F5(2)
The FCA may exercise the power in subsection (5) if it is satisfied that—
(a)
a person (“the person concerned”) has contravened Article 14 (prohibition of insider dealing and of unlawful disclosure of inside information) or Article 15 (prohibition of market manipulation) of the market abuse regulation; and
(b)
the condition mentioned in subsection (3) is fulfilled.
(3)
The condition is—
(a)
that profits have accrued to the person concerned as a result of the F6contravention of Article 14 or 15 of the market abuse regulation; or
(b)
that one or more persons have suffered loss or been otherwise adversely affected as a result of the F6contravention of Article 14 or 15 of the market abuse regulation.
F7(4)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5)
The power referred to in subsections (1) and (2) is a power to require the person concerned, in accordance with such arrangements as the F8regulator exercising the power (“the regulator concerned”) considers appropriate, to pay to the appropriate person or distribute among the appropriate persons such amount as appears to the F9regulator concerned to be just having regard—
(a)
in a case within paragraph (a) of subsection (1) or (3), to the profits appearing to the F9regulator concerned to have accrued;
(b)
in a case within paragraph (b) of subsection (1) or (3), to the extent of the loss or other adverse effect;
(c)
in a case within paragraphs (a) and (b) of subsection (1) or (3), to the profits appearing to the F9regulator concerned to have accrued and to the extent of the loss or other adverse effect.
(6)
“Appropriate person” means a person appearing to the F10regulator concerned to be someone—
(a)
to whom the profits mentioned in paragraph (a) of subsection (1) or (3) are attributable; or
(b)
who has suffered the loss or adverse effect mentioned in paragraph (b) of subsection (1) or (3).
(7)
“Relevant requirement” means—
(a)
(b)
(c)
a requirement imposed by the Alternative Investment Fund Managers Regulations 2013. F18and
(d)
a requirement which is imposed by Part 7 of the Financial Services Act 2012 (offences relating to financial services) and whose contravention constitutes an offence under that Part.
F19(8)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F20(9)
The PRA is the “appropriate regulator” in the case of a contravention of—
(a)
a requirement that is imposed by the PRA under any provision of this Act,
(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, or
(c)
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.
(10)
(11)
In the case of a contravention of a requirement where the contravention constitutes an offence under this Act, the “appropriate regulator” is the regulator which has power to prosecute the offence (see section 401).
(12)
The FCA is the “appropriate regulator” in the case of a contravention of any other requirement.
(13)
The Treasury may by order amend the definition of “appropriate regulator”.
385 Warning notices.
(1)
If F22a regulator proposes to exercise the power under section 384(5) in relation to a person, it must give him a warning notice.
(2)
A warning notice under this section must specify the amount which F23the regulator proposes to require the person concerned to pay or distribute as mentioned in section 384(5).
386 Decision notices.
(1)
If the F24regulator decides to exercise the power under section 384(5), it must give a decision notice to the person in relation to whom the power is exercised.
(2)
The decision notice must—
(a)
state the amount that he is to pay or distribute as mentioned in section 384(5);
(b)
identify the person or persons to whom that amount is to be paid or among whom that amount is to be distributed; and
(c)
state the arrangements in accordance with which the payment or distribution is to be made.
(3)
If the F25regulator decides to exercise the power under section 384(5), the person in relation to whom it is exercised may refer the matter to the Tribunal.