The Building Societies (Commercial Assets and Services) Order 1988

Title and commencement

1.  This Order may be cited as the Building Societies (Commercial Assets and Services) Order 1988 and shall come into force at the expiration of the period of two months beginning with the day on which this Order is made.

Interpretation

2.  In this Order, except where the context requires otherwise—

“the Act” means the Building Societies Act 1986;

“the 1987 Order” means the Building Societies (Limited Credit Facilities) Order 1987(1); and

“society” means a building society.

Class 3 assets

3.—(1) A society may, subject to the provisions of this Order, acquire, hold and dispose of the forms of property described in Section A of each Part of Schedule 1 below, as class 3 assets for the purposes of Part III of the Act, and for the purposes of the Act the power to acquire, hold and dispose of a description of property specified in any Part of that Schedule shall be treated as a separate power from the power to acquire, hold and dispose of a description of property specified in any other Part of that Schedule.

(2) Section B of each Part of Schedule 1 below has effect for the purpose of specifying the conditions and restrictions subject to which a society may acquire, hold and dispose of property of the description specified in Section A of that Part of that Schedule.

(3) Section C of each Part of Schedule 1 below has effect for the purpose of specifying, in relation to property of the description specified in Section A of that Part of that Schedule, how the aggregate value of that property is to be determined for the purposes of section 20 of the Act (commercial asset structure requirements for building societies) and, in the case of Part III of that Schedule, also contains provision whereby sums in addition to that value are to be taken into account for the purposes of that section.

Amendment of legislation relating to commercial assets

4.—(1) Schedule 2 to this Order shall have effect for the purpose of amending section 15 (loans for mobile homes) of the Act.

(2) Schedule 3 to this Order shall have effect for the purpose of amending section 16 (loans to individuals) of the Act.

(3) Schedule 4 to this Order shall have effect for the purpose of amending the 1987 Order.

Variation of Schedule 8 to the Act

5.  The Parts of Schedule 8 (powers to provide services) to the Act are hereby varied so as to have effect as set out in Schedule 5 below.

Transitional provision

6.—(1) Nothing in this Order shall—

(a) require a society to dispose of any property or rights held by it immediately before this Order came into force,

(b) take away the power of a society to complete, or do such things as are reasonably necessary to enable it to complete, the performance of existing obligations, or

(c) take away—

(i) the power of a society which, at the time when this Order comes into force, has a qualifying asset holding to continue to invest in or continue to support any body corporate, or

(ii) the power of a society which, at the time when this Order comes into force, does not have a qualifying asset holding to continue to invest in or continue to support any body corporate other than a subsidiary formed for the purpose of exercising the power in paragraph 9 (establishment and management of unit trust schemes for the provision of pensions) of Part I of Schedule 8 to the Act as it was before this Order came into force.

(2) Nothing in this Order shall take away the power of a society, the memorandum of which empowered it before this Order came into force to provide estate agency services as specified in paragraph 13 (estate agency services) of that Part of that Schedule, to provide those services as so specified, pending the taking effect of the first alteration of the powers of the society under paragraph 4 (requirements for alteration of purpose, powers and rules) of Schedule 2 to the Act.

Consequential revocation and amendment

7.—(1) The Building Societies (Provision of Services) Order 1987(2), the Building Societies (Provision of Services) (No. 2) Order 1987(3), the Building Societies (Provision of Services) (No. 3) Order 1987(4)and the Building Societies (Provision of Services) (No. 4) Order 1987(5) are hereby revoked.

(2) The Building Societies (Banking Institutions) Order 1987(6)is hereby amended by the deletion, in article 2 thereof (which amends provisions of the Act), of paragraph (b) and of the word“; and” at the end of paragraph (a).

David Lightbown

Mark Lennox-Boyd

Two of the Lords Commissioners of Her Majesty’s Treasury

30th June 1988