Financial Services and Markets Act 2000 (c. 8)

(The document as of February, 2008)

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(2) The required statements are--

(a) that the instrument was made by the Authority;

(b) that the copy is a true copy of the instrument; and

(3) A certificate purporting to be signed as mentioned in subsection (1) is to be taken to have been properly signed unless the contrary is shown.

(4) A person who wishes in any legal proceedings to rely on a rule-making instrument may require the Authority to endorse a copy of the instrument with a certificate of the kind mentioned in subsection (1).

155 Consultation

(1) If the Authority proposes to make any rules, it must publish a draft of the proposed rules in the way appearing to it to be best calculated to bring them to the attention of the public.

(2) The draft must be accompanied by--

(a) a cost benefit analysis;

(b) an explanation of the purpose of the proposed rules;

(c) an explanation of the Authority's reasons for believing that making the proposed rules is compatible with its general duties under section 2; and

(d) notice that representations about the proposals may be made to the Authority within a specified time.

(3) In the case of a proposal to make rules under a provision mentioned in subsection (9), the draft must also be accompanied by details of the expected expenditure by reference to which the proposal is made.

(4) Before making the proposed rules, the Authority must have regard to any representations made to it in accordance with subsection (2)(d).

(5) If the Authority makes the proposed rules, it must publish an account, in general terms, of--

(a) the representations made to it in accordance with subsection (2)(d); and

(b) its response to them.

(6) If the rules differ from the draft published under subsection (1) in a way which is, in the opinion of the Authority, significant--

(a) the Authority must (in addition to complying with subsection (5)) publish details of the difference; and

(b) those details must be accompanied by a cost benefit analysis.

(7) Subsections (1) to (6) do not apply if the Authority considers that the delay involved in complying with them would be prejudicial to the interests of consumers.

(8) Neither subsection (2)(a) nor subsection (6)(b) applies if the Authority considers--

(a) that, making the appropriate comparison, there will be no increase in costs; or

(b) that, making that comparison, there will be an increase in costs but the increase will be of minimal significance.

(9) Neither subsection (2)(a) nor subsection (6)(b) requires a cost benefit analysis to be carried out in relation to rules made under--

(a) section 136(2);

(b) subsection (1) of section 213 as a result of subsection (4) of that section;

(d) paragraph 17 of Schedule 1.

(10) "Cost benefit analysis" means an estimate of the costs together with an analysis of the benefits that will arise--

(a) if the proposed rules are made; or

(b) if subsection (6) applies, from the rules that have been made.

(11) "The appropriate comparison" means--

(a) in relation to subsection (2)(a), a comparison between the overall position if the rules are made and the overall position if they are not made;

(b) in relation to subsection (6)(b), a comparison between the overall position after the making of the rules and the overall position before they were made.

(12) The Authority may charge a reasonable fee for providing a person with a copy of a draft published under subsection (1).

156 General supplementary powers

(1) Rules made by the Authority may make different provision for different cases and may, in particular, make different provision in respect of different descriptions of authorised person, activity or investment.

(2) Rules made by the Authority may contain such incidental, supplemental, consequential and transitional provision as the Authority considers appropriate.

Chapter II Guidance

157 Guidance

(1) The Authority may give guidance consisting of such information and advice as it considers appropriate--

(a) with respect to the operation of this Act and of any rules made under it;

(b) with respect to any matters relating to functions of the Authority;

(d) with respect to any other matters about which it appears to the Authority to be desirable to give information or advice.

(2) The Authority may give financial or other assistance to persons giving information or advice of a kind which the Authority could give under this section.

(3) If the Authority proposes to give guidance to regulated persons generally, or to a class of regulated person, in relation to rules to which those persons are subject, subsections (1), (2) and (4) to (10) of section 155 apply to the proposed guidance as they apply to proposed rules.

(4) The Authority may--

(a) publish its guidance;

(b) offer copies of its published guidance for sale at a reasonable price; and

(5) In this Chapter, references to guidance given by the Authority include references to any recommendation made by the Authority to persons generally, to regulated persons generally or to any class of regulated person.

(6) "Regulated person" means any--

(a) authorised person;

(b) person who is otherwise subject to rules made by the Authority.

158 Notification of guidance to the Treasury

(1) On giving any general guidance, the Authority must give the Treasury a copy of the guidance without delay.

(2) If the Authority alters any of its general guidance, it must give written notice to the Treasury without delay.

(3) The notice must include details of the alteration.

(4) If the Authority revokes any of its general guidance, it must give written notice to the Treasury without delay.

(5) "General guidance" means guidance given by the Authority under section 157 which is--

(a) given to persons generally, to regulated persons generally or to a class of regulated person;

(b) intended to have continuing effect; and

(6) "Regulated person" has the same meaning as in section 157.

Chapter III Competition Scrutiny

159 Interpretation

(1) In this Chapter--

"Director" means the Director General of Fair Trading;
"practices", in relation to the Authority, means practices adopted by the Authority in the exercise of functions under this Act;
"regulating provisions" means any--
(a)
rules;
(b)
general guidance (as defined by section 158(5));
(c)
statement issued by the Authority under section 64;
(d)
code issued by the Authority under section 64 or 119.

(2) For the purposes of this Chapter, regulating provisions or practices have a significantly adverse effect on competition if--

(a) they have, or are intended or likely to have, that effect; or

(b) the effect that they have, or are intended or likely to have, is to require or encourage behaviour which has, or is intended or likely to have, a significantly adverse effect on competition.

(3) If regulating provisions or practices have, or are intended or likely to have, the effect of requiring or encouraging exploitation of the strength of a market position they are to be taken, for the purposes of this Chapter, to have an adverse effect on competition.

(4) In determining under this Chapter whether any of the regulating provisions have, or are likely to have, a particular effect, it may be assumed that the persons to whom the provisions concerned are addressed will act in accordance with them.

160 Reports by Director General of Fair Trading

(1) The Director must keep the regulating provisions and the Authority's practices under review.

(2) If at any time the Director considers that--

(a) a regulating provision or practice has a significantly adverse effect on competition, or

(b) two or more regulating provisions or practices taken together, or a particular combination of regulating provisions and practices, have such an effect,

he must make a report to that effect.

(3) If at any time the Director considers that--

(a) a regulating provision or practice does not have a significantly adverse effect on competition, or

(b) two or more regulating provisions or practices taken together, or a particular combination of regulating provisions and practices, do not have any such effect,

he may make a report to that effect.

(4) A report under subsection (2) must include details of the adverse effect on competition.

(5) If the Director makes a report under subsection (2) he must--

(a) send a copy of it to the Treasury, the Competition Commission and the Authority; and

(b) publish it in the way appearing to him to be best calculated to bring it to the attention of the public.

(6) If the Director makes a report under subsection (3)--

(a) he must send a copy of it to the Treasury, the Competition Commission and the Authority; and

(b) he may publish it.

(7) Before publishing a report under this section the Director must, so far as practicable, exclude any matter which relates to the private affairs of a particular individual the publication of which, in the opinion of the Director, would or might seriously and prejudicially affect his interests.

(8) Before publishing such a report the Director must, so far as practicable, exclude any matter which relates to the affairs of a particular body the publication of which, in the opinion of the Director, would or might seriously and prejudicially affect its interests.

(9) Subsections (7) and (8) do not apply in relation to copies of a report which the Director is required to send under subsection (5)(a) or (6)(a).

(10) For the purposes of the law of defamation, absolute privilege attaches to any report of the Director under this section.

161 Power of Director to request information

(1) For the purpose of investigating any matter with a view to its consideration under section 160, the Director may exercise the powers conferred on him by this section.

(2) The Director may by notice in writing require any person to produce to him or to a person appointed by him for the purpose, at a time and place specified in the notice, any document which--

(a) is specified or described in the notice; and

(b) is a document in that person's custody or under his control.

(3) The Director may by notice in writing--

(a) require any person carrying on any business to provide him with such information as may be specified or described in the notice; and

(b) specify the time within which, and the manner and form in which, any such information is to be provided.

(4) A requirement may be imposed under subsection (2) or (3)(a) only in respect of documents or information which relate to any matter relevant to the investigation.

(5) If a person ("the defaulter") refuses, or otherwise fails, to comply with a notice under this section, the Director may certify that fact in writing to the court and the court may enquire into the case.

(6) If, after hearing any witness who may be produced against or on behalf of the defaulter and any statement which may be offered in defence, the court is satisfied that the defaulter did not have a reasonable excuse for refusing or otherwise failing to comply with the notice, the court may deal with the defaulter as if he were in contempt.

(7) "Court" means--

(a) the High Court; or

(b) in relation to Scotland, the Court of Session.

162 Consideration by Competition Commission

(1) If the Director--

(a) makes a report under section 160(2), or

(b) asks the Commission to consider a report that he has made under section 160(3),

the Commission must investigate the matter.

(2) The Commission must then make its own report on the matter unless it considers that, as a result of a change of circumstances, no useful purpose would be served by a report.

(3) If the Commission decides in accordance with subsection (2) not to make a report, it must make a statement setting out the change of circumstances which resulted in that decision.

(4) A report made under this section must state the Commission's conclusion as to whether--

(a) the regulating provision or practice which is the subject of the report has a significantly adverse effect on competition; or

(b) the regulating provisions or practices, or combination of regulating provisions and practices, which are the subject of the report have such an effect.

(5) A report under this section stating the Commission's conclusion that there is a significantly adverse effect on competition must also--

(a) state whether the Commission considers that that effect is justified; and

(b) if it states that the Commission considers that it is not justified, state its conclusion as to what action, if any, ought to be taken by the Authority.

(6) Subsection (7) applies whenever the Commission is considering, for the purposes of this section, whether a particular adverse effect on competition is justified.

(7) The Commission must ensure, so far as that is reasonably possible, that the conclusion it reaches is compatible with the functions conferred, and obligations imposed, on the Authority by or under this Act.

(8) A report under this section must contain such an account of the Commission's reasons for its conclusions as is expedient, in the opinion of the Commission, for facilitating proper understanding of them.

(9) Schedule 14 supplements this section.

(10) If the Commission makes a report under this section it must send a copy to the Treasury, the Authority and the Director.

163 Role of the Treasury

(1) This section applies if the Competition Commission makes a report under section 162(2) which states its conclusion that there is a significantly adverse effect on competition.

(2) If the Commission's conclusion, as stated in the report, is that the adverse effect on competition is not justified, the Treasury must give a direction to the Authority requiring it to take such action as may be specified in the direction.

(3) But subsection (2) does not apply if the Treasury consider--

(a) that, as a result of action taken by the Authority in response to the Commission's report, it is unnecessary for them to give a direction; or

(b) that the exceptional circumstances of the case make it inappropriate or unnecessary for them to do so.

(4) In considering the action to be specified in a direction under subsection (2), the Treasury must have regard to any conclusion of the Commission included in the report because of section 162(5)(b).

(5) Subsection (6) applies if--

(a) the Commission's conclusion, as stated in its report, is that the adverse effect on competition is justified; but

(b) the Treasury consider that the exceptional circumstances of the case require them to act.

(6) The Treasury may give a direction to the Authority requiring it to take such action--

(a) as they consider to be necessary in the light of the exceptional circumstances of the case; and

(b) as may be specified in the direction.

(7) The Authority may not be required as a result of this section to take any action--

(a) that it would not have power to take in the absence of a direction under this section; or

(b) that would otherwise be incompatible with any of the functions conferred, or obligations imposed, on it by or under this Act.

(8) Subsection (9) applies if the Treasury are considering--

(a) whether subsection (2) applies and, if so, what action is to be specified in a direction under that subsection; or

(b) whether to give a direction under subsection (6).

(9) The Treasury must--

(a) do what they consider appropriate to allow the Authority, and any other person appearing to the Treasury to be affected, an opportunity to make representations; and

(b) have regard to any such representations.

(10) If, in reliance on subsection (3)(a) or (b), the Treasury decline to act under subsection (2), they must make a statement to that effect, giving their reasons.

(11) If the Treasury give a direction under this section they must make a statement giving--

(a) details of the direction; and

(b) if the direction is given under subsection (6), their reasons for giving it.

(12) The Treasury must--

(a) publish any statement made under this section in the way appearing to them best calculated to bring it to the attention of the public; and

(b) lay a copy of it before Parliament.

164 The Competition Act 1998

(1) The Chapter I prohibition does not apply to an agreement the parties to which consist of or include--

(a) an authorised person, or

(b) a person who is otherwise subject to the Authority's regulating provisions,

to the extent to which the agreement consists of provisions the inclusion of which in the agreement is encouraged by any of the Authority's regulating provisions.

(2) The Chapter I prohibition does not apply to the practices of an authorised person or a person who is otherwise subject to the regulating provisions to the extent to which the practices are encouraged by any of the Authority's regulating provisions.

(3) The Chapter II prohibition does not apply to conduct of--

(a) an authorised person, or

(b) a person who is otherwise subject to the Authority's regulating provisions,

to the extent to which the conduct is encouraged by any of the Authority's regulating provisions.

(4) "The Chapter I prohibition" means the prohibition imposed by section 2(1) of the [1998 c. 41.] Competition Act 1998.

(5) "The Chapter II prohibition" means the prohibition imposed by section 18(1) of that Act.

Part XI Information Gathering and Investigations

Powers to gather information

165 Authority's power to require information

(1) The Authority may, by notice in writing given to an authorised person, require him--

(a) to provide specified information or information of a specified description; or

(b) to produce specified documents or documents of a specified description.

(2) The information or documents must be provided or produced--

(a) before the end of such reasonable period as may be specified; and

(b) at such place as may be specified.

(3) An officer who has written authorisation from the Authority to do so may require an authorised person without delay--

(a) to provide the officer with specified information or information of a specified description; or

(b) to produce to him specified documents or documents of a specified description.

(4) This section applies only to information and documents reasonably required in connection with the exercise by the Authority of functions conferred on it by or under this Act.

(5) The Authority may require any information provided under this section to be provided in such form as it may reasonably require.

(6) The Authority may require--

(a) any information provided, whether in a document or otherwise, to be verified in such manner, or

(b) any document produced to be authenticated in such manner,

as it may reasonably require.

(7) The powers conferred by subsections (1) and (3) may also be exercised to impose requirements on--

(a) a person who is connected with an authorised person;

(b) an operator, trustee or depositary of a scheme recognised under section 270 or 272 who is not an authorised person;

(8) "Authorised person" includes a person who was at any time an authorised person but who has ceased to be an authorised person.

(9) "Officer" means an officer of the Authority and includes a member of the Authority's staff or an agent of the Authority.

(10) "Specified" means--

(a) in subsections (1) and (2), specified in the notice; and

(b) in subsection (3), specified in the authorisation.

(11) For the purposes of this section, a person is connected with an authorised person ("A") if he is or has at any relevant time been--

(a) a member of A's group;

(b) a controller of A;

(d) in relation to A, a person mentioned in Part I of Schedule 15.

166 Reports by skilled persons

(1) The Authority may, by notice in writing given to a person to whom subsection (2) applies, require him to provide the Authority with a report on any matter about which the Authority has required or could require the provision of information or production of documents under section 165.

(2) This subsection applies to--

(a) an authorised person ("A"),

(b) any other member of A's group,

(d) a person who has at any relevant time been a person falling within paragraph (a), (b) or (c),

who is, or was at the relevant time, carrying on a business.

(3) The Authority may require the report to be in such form as may be specified in the notice.

(4) The person appointed to make a report required by subsection (1) must be a person--

(a) nominated or approved by the Authority; and

(b) appearing to the Authority to have the skills necessary to make a report on the matter concerned.

(5) It is the duty of any person who is providing (or who at any time has provided) services to a person to whom subsection (2) applies in relation to a matter on which a report is required under subsection (1) to give a person appointed to provide such a report all such assistance as the appointed person may reasonably require.

(6) The obligation imposed by subsection (5) is enforceable, on the application of the Authority, by an injunction or, in Scotland, by an order for specific performance under section 45 of the [1988 c. 36.] Court of Session Act 1988.

Appointment of investigators

167 Appointment of persons to carry out general investigations

(1) If it appears to the Authority or the Secretary of State ("the investigating authority") that there is good reason for doing so, the investigating authority may appoint one or more competent persons to conduct an investigation on its behalf into--

(a) the nature, conduct or state of the business of an authorised person or of an appointed representative;

(b) a particular aspect of that business; or

(2) If a person appointed under subsection (1) thinks it necessary for the purposes of his investigation, he may also investigate the business of a person who is or has at any relevant time been--

(a) a member of the group of which the person under investigation ("A") is part; or

(b) a partnership of which A is a member.

(3) If a person appointed under subsection (1) decides to investigate the business of any person under subsection (2) he must give that person written notice of his decision.

(4) The power conferred by this section may be exercised in relation to a former authorised person (or appointed representative) but only in relation to--

(a) business carried on at any time when he was an authorised person (or appointed representative); or

(b) the ownership or control of a former authorised person at any time when he was an authorised person.

(5) "Business" includes any part of a business even if it does not consist of carrying on regulated activities.

168 Appointment of persons to carry out investigations in particular cases

(1) Subsection (3) applies if it appears to an investigating authority that there are circumstances suggesting that--

(a) a person may have contravened any regulation made under section 142; or

(b) a person may be guilty of an offence under section 177, 191, 346 or 398(1) or under Schedule 4.

(2) Subsection (3) also applies if it appears to an investigating authority that there are circumstances suggesting that--

(a) an offence under section 24(1) or 397 or under Part V of the [1993 c. 36.] Criminal Justice Act 1993 may have been committed;

(b) there may have been a breach of the general prohibition;

(d) market abuse may have taken place.

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