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In force since 2026-07-16, as the publisher states.
Copy read on 2026-11-08. The page it was read from
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.
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(1) The Secretary of State may by notice in writing require a registered third country auditor to give him such information as he may reasonably require for the exercise of his functions under this Part. (2) The Secretary of State may require that any information which he requires under this section is to be given within such reasonable time and verified in such manner as he may specify.
Propose a change(1) If at any time it appears to the Secretary of State that a registered third country auditor has failed to comply with an obligation imposed on him by or by virtue of this Part, the Secretary of State may make an application to the court under this section. (2) If on an application under this section the court decides that the auditor has failed to comply with the obligation in question, it may order the auditor to take such steps as the court directs for securing that the obligation is complied with. (3) In this section “the court” means the High Court or, in Scotland, the Court of Session.
Propose a change(1) The Secretary of State may, by regulations, confer on the person keeping the register in accordance with regulations under section 1239(1) power to remove a third country auditor from the register. (2) Regulations under this section must require the person keeping the register, in determining whether to remove a third country auditor from the register, to have regard to the auditor's compliance with obligations imposed on him by or by virtue of this Part. (3) Where provision is made under section 1239(4) (different parts of the register to be kept by different persons), references in this section to the person keeping the register are to the person keeping that part of the register which relates to third country auditors. (4) Regulations under this section are subject to negative resolution procedure.
Propose a changeIn section 16 of the Companies (Audit, Investigations and Community Enterprise) Act 2004 (c. 27) (grants to bodies concerned with accounting standards etc), after subsection (2)(ka) (inserted by section 1238) insert— (kb) establishing, maintaining or carrying out arrangements within paragraph 1 or 2 of Schedule 12 to the Companies Act 2006; .
Propose a change(1) This section applies where a person appointed as statutory auditor of a company was not an appropriate person for any part of the period during which the audit was conducted. (2) The Secretary of State may direct the company concerned to retain an appropriate person— (a) to conduct a second audit of the relevant accounts, or (b) to review the first audit and to report (giving his reasons) whether a second audit is needed. (3) For the purposes of subsections (1) and (2) a person is “appropriate” if he— (a) is eligible for appointment as a statutory auditor or, if the person is an Auditor General, for appointment as statutory auditor of the company, and (b) is not prohibited by section 1214(1) (independence requirement) from acting as statutory auditor of the company. (4) The Secretary of State must send a copy of a direction under subsection (2) to the registrar of companies. (5) The company is guilty of an offence if— (a) it fails to comply with a direction under subsection (2) within the period of 21 days beginning with the date on which it is given, or (b) it has been convicted of a previous offence under this subsection and the failure to comply with the direction which led to the conviction continues after the conviction. (6) The company must— (a) send a copy of a report under subsection (2)(b) to the registrar of companies, and (b) if the report states that a second audit is needed, take such steps as are necessary for the carrying out of that audit. (7) The company is guilty of an offence if— (a) it fails to send a copy of a report under subsection (2)(b) to the registrar within the period of 21 days beginning with the date on which it receives it, (b) in a case within subsection (6)(b), it fails to take the steps mentioned immediately it receives the report, or (c) it has been convicted of a previous offence under this subsection and the failure to send a copy of the report, or take the steps, which led to the conviction continues after the conviction. (8) A company guilty of an offence under this section is liable on summary conviction— (a) in a case within subsection (5)(a) or (7)(a) or (b), to a fine not exceeding level 5 on the standard scale, and (b) in a case within subsection (5)(b) or (7)(c), to a fine not exceeding one-tenth of level 5 on the standard scaleone-tenth of the greater of £5,000 or level 4 on the standard scale for each day on which the failure continues. (9) In this section “registrar of companies” has the meaning given by section 1060.
Propose a change(1) If a person accepts an appointment, or continues to act, as statutory auditor of a company at a time when he knows he is not an appropriate person, the company may recover from him any costs incurred by it in complying with the requirements of section 1248. For this purpose “appropriate” is to be construed in accordance with subsection (3) of that section. (2) Where a second audit is carried out under section 1248, any statutory or other provision applying in relation to the first audit applies also, in so far as practicable, in relation to the second audit. (3) A direction under section 1248(2) is, on the application of the Secretary of State, enforceable by injunction or, in Scotland, by an order under section 45 of the Court of Session Act 1988 (c. 36).
Propose a change(1) A person is guilty of an offence if— (a) for the purposes of or in connection with any application under this Part, or (b) in purported compliance with any requirement imposed on him by or by virtue of this Part, he knowingly or recklessly furnishes information which is misleading, false or deceptive in a material particular. (2) It is an offence for a person whose name does not appear on the register of auditors kept under regulations under section 1239 in an entry made under subsection (1)(a) of that section to describe himself as a registered auditor or so to hold himself out as to indicate, or be reasonably understood to indicate, that he is a registered auditor. (3) It is an offence for a person whose name does not appear on the register of auditors kept under regulations under that section in an entry made under subsection (1)(b) of that section to describe himself as a registered third country auditor or so to hold himself out as to indicate, or be reasonably understood to indicate, that he is a registered third country auditor. (4) It is an offence for a body which is not a recognised supervisory body or a recognised qualifying body to describe itself as so recognised or so to describe itself or hold itself out as to indicate, or be reasonably understood to indicate, that it is so recognised. (5) A person guilty of an offence under subsection (1) is liable— (a) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine (or both); (b) on summary conviction— (i) in England and Wales, to imprisonment for a term not exceeding the general limit in a magistrates’ court or to a fine not exceeding the statutory maximum (or both), (ii) in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months or to a fine not exceeding the statutory maximum (or both). In relation to an offence committed before 2 May 2022, for “twelve months” in paragraph (b)(i) substitute “six months”. (6) Subject to subsection (7), a person guilty of an offence under subsection (2), (3) or (4) is liable on summary conviction— (a) in England and Wales, to imprisonment for a term not exceeding 51 weeks or to a fine not exceeding level 5 on the standard scale (or both), (b) in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months or to a fine not exceeding level 5 on the standard scale (or both). In relation to an offence committed before the commencement of section 281(5) of the Criminal Justice Act 2003, for “51 weeks” in paragraph (a) substitute “six months”. (7) Where a contravention of subsection (2), (3) or (4) involves a public display of the offending description, the maximum fine that may be imposed is an amount equal to level 5 on the standard scale multiplied by the number of days for which the display has continued. (8) It is a defence for a person charged with an offence under subsection (2), (3) or (4) to show that he took all reasonable precautions and exercised all due diligence to avoid the commission of the offence.
Propose a change(1) An applicant for a recognition order under this Part must pay such fee in respect of his application as the Secretary of State may by regulations prescribe; and no application is to be regarded as duly made unless this subsection is complied with. (2) The Secretary of State may by regulations prescribe periodical fees to be paid by— (a) every recognised supervisory body, (b) every recognised qualifying body, (c) every Auditor General, and (d) every registered third country auditor. (3) Fees received by the Secretary of State by virtue of this Part are to be paid into the Consolidated Fund. (4) Regulations under this section are subject to negative resolution procedure.
Propose a changeThe Secretary of State must, at least once in every calendar year, publish a report containing a summary of the results of inspections that are delivered to him— (a) by the Independent Supervisor under section 1229(5A); (b) by a recognised supervisory body under paragraph 13(12) of Schedule 10.
Propose a change(1) The Secretary of State may make an order under this section (a “delegation order”) for the purpose of enabling functions of the Secretary of State under this Part to be exercised by a body designated by the order. (2) The body designated by a delegation order may be either— (a) a body corporate which is established by the order, or (b) subject to section 1253, a body (including the competent authority, and whether a body corporate or an unincorporated association) which is already in existence (“an existing body”). (3) A delegation order has the effect of making the body designated by the order designated under section 5 of the Freedom of Information Act 2000 (c. 36) (further powers to designate public authorities). (4) A delegation order has the effect of transferring to the body designated by it all functions of the Secretary of State under this Part— (a) subject to such exceptions and reservations as may be specified in the order, and (b) except— (i) his functions in relation to the body itself, and (ii) his functions under section 1228 (appointment of Independent Supervisor). (5) A delegation order may confer on the body designated by it such other functions supplementary or incidental to those transferred as appear to the Secretary of State to be appropriate. (6) Any transfer of functions under the following provisions must be subject to the reservation that the functions remain exercisable concurrently by the Secretary of State— (a) section 1224 (power to call for information from recognised bodies etc); (b) section 1244 (power to call for information from registered third country auditors); (c) section 1254 (directions to comply with international obligations). (7) Any transfer of— (a) the function of refusing to make a declaration under section 1221(1) (approval of third country qualifications) on the grounds referred to in section 1221(4) (lack of comparable treatment), or (b) the function of withdrawing such a declaration under section 1221(7) on those grounds, must be subject to the reservation that the function is exercisable only with the consent of the Secretary of State. (8) A delegation order may be amended or, if it appears to the Secretary of State that it is no longer in the public interest that the order should remain in force, revoked by a further order under this section. (9) Where functions are transferred or resumed, the Secretary of State may by order confer or, as the case may be, take away such other functions supplementary or incidental to those transferred or resumed as appear to him to be appropriate. (10) Where a delegation order is made, Schedule 13 has effect with respect to— (a) the status of the body designated by the order in exercising functions of the Secretary of State under this Part, (b) the constitution and proceedings of the body where it is established by the order, (c) the exercise by the body of certain functions transferred to it, and (d) other supplementary matters. (11) An order under this section which has the effect of transferring or resuming any functions is subject to affirmative resolution procedure. (12) Any other order under this section is subject to negative resolution procedure.
Propose a change(1) The Secretary of State's power to make a delegation order under section 1252 which designates an existing body is exercisable in accordance with this section. (2) The Secretary of State may make such a delegation order if it appears to him that— (a) the body is able and willing to exercise the functions that would be transferred by the order, and (b) the body has arrangements in place relating to the exercise of those functions which are such as to be likely to ensure that the conditions in subsection (3) are met. (3) The conditions are— (a) that the functions in question will be exercised effectively, and (b) where the delegation order is to contain any requirements or other provisions specified under subsection (4), that those functions will be exercised in accordance with any such requirements or provisions. (4) The delegation order may contain such requirements or other provision relating to the exercise of the functions by the designated body as appear to the Secretary of State to be appropriate. (5) An existing body— (a) may be designated by a delegation order under section 1252, and (b) may accordingly exercise functions of the Secretary of State in pursuance of the order, despite any involvement of the body in the exercise of any functions under arrangements within ... paragraph 1 or 2 of Schedule 12.
Propose a changeThe Secretary of State may request from ... a third country competent authority such assistance, information or investigation as he may reasonably require in connection with the exercise of his functions under this Part.
Propose a change(1) The Secretary of State must take all necessary steps to— (a) ensure that an investigation is carried out, or (b) provide any other assistance or information, if requested to do so by an approved third country competent authority .... (1A) Where the request includes a request for the transfer of audit working papers and investigation reports, the Secretary of State must act in accordance with section 1253D. (2) Within 28 days following the date on which he receives the request, the Secretary of State must— (a) provide the assistance or information required by the requesting authority under subsection (1)(b), or (b) notify the requesting authority of the reasons why he has not done so. (3) But the Secretary of State need not take steps to comply with a request under subsection (1) if— (a) he considers that complying with the request may prejudice the sovereignty, security or public order of the United Kingdom; (b) legal proceedings have been brought in the United Kingdom (whether continuing or not) in relation to the persons and matters to which the request relates; or (c) disciplinary action has been taken by a recognised supervisory body in relation to the persons and matters to which the request relates. (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Propose a change(1) If the Secretary of State receives notice from a recognised supervisory body under section 1223A(1) (notification of matters relevant to approved third country competent authorities) that— (a) a person has become eligible for appointment as a statutory auditor, or (b) a person’s eligibility for appointment as a statutory auditor has been withdrawn, the Secretary of State must notify the relevant approved third country competent authority. (2) In subsection (1) “the relevant approved third country competent authority” means the approved third country competent authority which has approved the person concerned ... to carry out audits of annual accounts or consolidated accounts .... (3) The notification under subsection (1) must include the name of the person concerned and , in a case where a person’s eligibility for appointment as a statutory auditor has been withdrawn, the reasons for the withdrawal. (4) The Secretary of State must notify the relevant approved third country competent authority if he has reasonable grounds for suspecting that— (a) a person has contravened the law of the United Kingdom, or any equivalent third country or transitional third country, relating to audit, and (b) the act or omission constituting that contravention took place on the territory of an equivalent third country or transitional third country. (5) In subsection (4) “the relevant approved third country competent authority” means the approved third country competent authority for the country or territory in which the suspected contravention took place. (6) The notification under subsection (4) must include the name of the person concerned and the grounds for the Secretary of State's suspicion.
Propose a change(1) Audit working papers and investigation reports must not be transferred to a third country competent authority unless the third country competent authority is an approved third country competent authority and the transfers are made in accordance with— (a) section 1253DA (transfer by Secretary of State), (b) section 1253DB (transfer by statutory auditor with approval of Secretary of State), or (c) section 1253DC (transfer by statutory auditor for purposes of investigation of auditor). (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) Nothing in the sections referred to in subsection (1) authorises the making of a disclosure in contravention of the data protection legislation.
Propose a change(1) The Secretary of State may transfer audit working papers and investigation reports to an approved third country competent authority if the following conditions are met (but see also section 1253DD). (2) The first condition is that the authority has made a request to the Secretary of State for the transfer of the audit working papers and investigation reports. (3) The second condition is that the audit working papers and investigation reports relate to audits of companies that— (a) have issued securities in the third country in which the authority is established, or (b) form part of a group issuing statutory consolidated accounts in that third country. (4) The third condition is that the authority has entered into arrangements with the Secretary of State in accordance with section 1253E.
Propose a change(1) A statutory auditor may transfer audit working papers and investigation reports to an approved third country competent authority if the transfer is made— (a) with the prior approval of the Secretary of State, and (b) in accordance with rules of a recognised supervisory body meeting the requirements of paragraph 16AA of Schedule 10. (2) The Secretary of State must not approve a transfer of audit working papers and investigation reports to an approved third country competent authority for the purposes of this section unless the following conditions are met (see also section 1253DD). (3) The first condition is that the authority has made a request to the Secretary of State for the transfer of the audit working papers and investigation reports. (4) The second condition is that the audit working papers and investigation reports relate to audits of companies that— (a) have issued securities in the third country in which the authority is established, or (b) form part of a group issuing statutory consolidated accounts in that third country. (5) The third condition is that the authority has entered into arrangements with the Secretary of State in accordance with section 1253E.
Propose a changeA statutory auditor may transfer audit working papers and investigation reports to a third country competent authority if the transfer is made— (a) for the purposes of an investigation of an auditor or audit firm, and (b) in accordance with rules of a recognised supervisory body meeting the requirements of paragraph 16AB of Schedule 10.
Propose a change(1) This section applies where— (a) an approved third country competent authority makes a request to the Secretary of State for the transfer of audit working papers and investigation reports which relate to the audit of the consolidated accounts of a group, and (b) the audit working papers and investigation reports that are the subject of the request— (i) have been created by the auditor of a subsidiary that is located in an equivalent third country or transitional third country in relation to the audit of that subsidiary, and (ii) are in the possession of a statutory auditor. (2) In the case of a transfer by the Secretary of State under section 1253DA, the transfer must not take place unless the third country competent authority responsible for the auditor of the subsidiary has given its express agreement to the transfer. (3) In the case of a transfer by a statutory auditor under section 1253DB, the Secretary of State must not approve the transfer unless the third country competent authority responsible for the auditor of the subsidiary has given its express agreement to the transfer.
Propose a change(1) This section applies in the case of a transfer of audit working papers and investigation reports if— (a) it is a transfer to an approved third country competent authority ..., (b) it is a transfer under section 1253DA or 1253DB, and (c) it is to take place by means of an inspection in the United Kingdom by the authority. (2) The Secretary of State must participate in the inspection. (3) The inspection must be under the leadership of the Secretary of State unless the Secretary of State otherwise permits.
Propose a change(1) The Secretary of State may enter into arrangements with a third country competent authority relating to the transfer of audit working papers and investigation reports— (a) from the third country competent authority or a third country auditor regulated by that authority to the Secretary of State, and (b) from the Secretary of State or a statutory auditor to the third country competent authority. (2) The arrangements must provide that a request by the Secretary of State or the third country competent authority for a transfer mentioned in subsection (1) must be accompanied by a statement explaining the reasons for the request. (3) The arrangements must— (a) provide that the Secretary of State may not use audit working papers and investigation reports obtained from the third country competent authority or a third country auditor regulated by that authority except in connection with one or more of the functions mentioned in subsection (4), and (b) include comparable provision in relation to audit working papers and investigation reports obtained by the third country competent authority from the Secretary of State or a statutory auditor. (4) Those functions are— (a) quality assurance functions which meet requirements equivalent to those of regulation 9 of the Statutory Auditors and Third Country Auditors Regulations 2016; (b) investigation or disciplinary functions which meet requirements equivalent to those of regulations 5 to 8 and 10 of the Statutory Auditors and Third Country Auditors Regulations 2016; (c) public oversight functions which meet requirements equivalent to those of regulation 3 of the Statutory Auditors and Third Country Auditors Regulations 2016. (5) The arrangements must— (a) provide that the Secretary of State, a person exercising the functions of the Secretary of State and persons employed or formerly employed in discharging those functions must be subject to obligations of confidentiality as to personal data, professional secrets and sensitive commercial information contained in audit working papers and investigation reports transferred to the Secretary of State, ... (b) provide that the third country competent authority and persons involved in exercising its functions are subject to comparable obligations in relation to audit working papers and investigation reports transferred to the authority and (c) ensure that the protection of the commercial interests of any audited person, including its industrial and intellectual property, is not undermined. (6) The arrangements must— (a) provide that the Secretary of State may refuse, or direct a statutory auditor to refuse, a request from the third country competent authority for a transfer of audit working papers and investigation reports in a case mentioned in subsection (7)(a) or (b), and (b) provide that the third country competent authority has comparable rights in relation to a request from the Secretary of State. (7) Those cases are— (a) where the transfer of the papers would adversely affect the sovereignty, security or public order ...of the United Kingdom; (b) where legal proceedings have been brought in the United Kingdom (whether continuing or not) in relation to the persons and matters to which the request relates. (7A) The arrangements must— (a) provide that the Secretary of State may only disclose confidential information received from the third country competent authority— (i) with the agreement of that authority or for purposes for which that authority has given its agreement, (ii) where disclosure is required by law, or (iii) where disclosure is necessary in connection with legal proceedings, and (b) provide that the third country competent authority may only disclose confidential information received from the Secretary of State— (i) with the Secretary of State’s agreement or for purposes for which the Secretary of State has given agreement, (ii) where disclosure is required by law, or (iii) where disclosure is necessary in connection with legal proceedings. (8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Propose a changeIf the Secretary of State enters into working arrangements in accordance with section 1253E, he must publish on a website without undue delay— (a) the name of the third country competent authority with which he has entered into such arrangements, and (b) the country or territory in which it is established.
Propose a change(1) If it appears to the Secretary of State— (a) that any action proposed to be taken by— (i) a recognised supervisory body, (ii) a recognised qualifying body, (iii) a person keeping a register of auditors, or part of such a register, in accordance with regulations under section 1239(1), (iv) a body exercising functions under arrangements within Schedule 12, (v) the Independent Supervisor, (vi) the competent authority, or (vii) a body designated by order under section 1252, would be incompatible with assimilated obligations or any other international obligations of the United Kingdom, or (b) that any action which that body has power to take is required for the purpose of implementing any such obligations, he may direct the body not to take or, as the case may be, to take the action in question. (2) A direction may include such supplementary or incidental requirements as the Secretary of State thinks necessary or expedient. (3) A direction under this section given to the Independent Supervisor , the competent authority or a body designated by order under section 1252 is enforceable on the application of the Secretary of State by injunction or, in Scotland, by an order under section 45 of the Court of Session Act 1988 (c. 36).
Propose a change(1) Where an offence under this Part committed by a body corporate is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, an officer of the body, or a person purporting to act in any such capacity, he as well as the body corporate is guilty of the offence and liable to be proceeded against and punished accordingly. (2) Where an offence under this Part committed by a partnership is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, a partner, he as well as the partnership is guilty of the offence and liable to be proceeded against and punished accordingly. (3) Where an offence under this Part committed by an unincorporated association (other than a partnership) is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any officer of the association or any member of its governing body, he as well as the association is guilty of the offence and liable to be proceeded against and punished accordingly.
Propose a change(1) An information relating to an offence under this Part which is triable by a magistrates' court in England and Wales may be so tried if it is laid at any time within the period of twelve months beginning with the date on which evidence sufficient in the opinion of the Director of Public Prosecutions or the Secretary of State to justify the proceedings comes to his knowledge. (2) Proceedings in Scotland for an offence under this Part may be commenced at any time within the period of twelve months beginning with the date on which evidence sufficient in the Lord Advocate's opinion to justify proceedings came to his knowledge or, where such evidence was reported to him by the Secretary of State, within the period of twelve months beginning with the date on which it came to the knowledge of the Secretary of State. (3) For the purposes of subsection (2) proceedings are to be deemed to be commenced on the date on which a warrant to apprehend or cite the accused is granted, if the warrant is executed without undue delay. (4) A complaint charging an offence under this Part which is triable by a magistrates' court in Northern Ireland may be so tried if it is made at any time within the period of twelve months beginning with the date on which evidence sufficient in the opinion of the Director of Public Prosecutions for Northern Ireland or the Secretary of State to justify the proceedings comes to his knowledge. (5) This section does not authorise— (a) in the case of proceedings in England and Wales, the trial of an information laid, (b) in the case of proceedings in Scotland, the commencement of proceedings, or (c) in the case of proceedings in Northern Ireland, the trial of a complaint made, more than three years after the commission of the offence. (6) For the purposes of this section a certificate of the Director of Public Prosecutions, the Lord Advocate, the Director of Public Prosecutions for Northern Ireland or the Secretary of State as to the date on which such evidence as is referred to above came to his knowledge is conclusive evidence. (7) Nothing in this section affects proceedings within the time limits prescribed by section 127(1) of the Magistrates' Courts Act 1980 (c. 43), section 331 of the Criminal Procedure (Scotland) Act 1975 or Article 19 of the Magistrates' Courts (Northern Ireland) Order 1981 (S.I. 1981/1675 (N.I. 26)) (the usual time limits for criminal proceedings).
Propose a change(1) Summary proceedings for an offence under this Part may, without prejudice to any jurisdiction exercisable apart from this section, be taken— (a) against a body corporate or unincorporated association at any place at which it has a place of business, and (b) against an individual at any place where he is for the time being. (2) Proceedings for an offence alleged to have been committed under this Part by an unincorporated association must be brought in the name of the association (and not in that of any of its members), and for the purposes of any such proceedings any rules of court relating to the service of documents apply as in relation to a body corporate. (3) Section 33 of the Criminal Justice Act 1925 (c. 86) and Schedule 3 to the Magistrates' Courts Act 1980 (c. 43) (procedure on charge of offence against a corporation) apply in a case in which an unincorporated association is charged in England and Wales with an offence under this Part as they apply in the case of a corporation. (4) Section 18 of the Criminal Justice Act (Northern Ireland) 1945 (c. 15 (N.I.)) and Article 166 and Schedule 4 to the Magistrates' Courts (Northern Ireland) Order 1981 (S.I. 1981/1675 (N.I. 26)) (procedure on charge of offence against a corporation) apply in a case in which an unincorporated association is charged in Northern Ireland with an offence under this Part as they apply in the case of a corporation. (5) In relation to proceedings on indictment in Scotland for an offence alleged to have been committed under this Part by an unincorporated association, section 70 of the Criminal Procedure (Scotland) Act 1995 (proceedings on indictment against bodies corporate) applies as if the association were a body corporate. (6) A fine imposed on an unincorporated association on its conviction of such an offence must be paid out of the funds of the association.
Propose a change(1) This section has effect in relation to any notice, direction or other document required or authorised by or by virtue of this Part to be given to or served on any person other than the Secretary of State. (2) Any such document may be given to or served on the person in question— (a) by delivering it to him, (b) by leaving it at his proper address, or (c) by sending it by post to him at that address. (3) Any such document may— (a) in the case of a body corporate, be given to or served on an officer of that body; (b) in the case of a partnership, be given to or served on any partner; (c) in the case of an unincorporated association other than a partnership, be given to or served on any member of the governing body of that association. (4) For the purposes of this section and section 7 of the Interpretation Act 1978 (c. 30) (service of documents by post) in its application to this section, the proper address of any person is his last known address (whether of his residence or of a place where he carries on business or is employed) and also— (a) in the case of a person who is eligible under the rules of a recognised supervisory body for appointment as a statutory auditor and who does not have a place of business in the United Kingdom, the address of that body; (b) in the case of a body corporate or an officer of that body, the address of the registered or principal office of that body in the United Kingdom; (c) in the case of an unincorporated association other than a partnership or a member of its governing body, its principal office in the United Kingdom.
Propose a change(1) This section applies where— (a) section 1258 authorises the giving or sending of a notice, direction or other document by its delivery to a particular person (“the recipient”), and (b) the notice, direction or other document is transmitted to the recipient— (i) by means of an electronic communications network, or (ii) by other means but in a form that requires the use of apparatus by the recipient to render it intelligible. (2) The transmission has effect for the purposes of this Part as a delivery of the notice, direction or other document to the recipient, but only if the recipient has indicated to the person making the transmission his willingness to receive the notice, direction or other document in the form and manner used. (3) An indication to a person for the purposes of subsection (2)— (a) must be given to the person in such manner as he may require, (b) may be a general indication or an indication that is limited to notices, directions or other documents of a particular description, (c) must state the address to be used, (d) must be accompanied by such other information as the person requires for the making of the transmission, and (e) may be modified or withdrawn at any time by a notice given to the person in such manner as he may require. (4) In this section “electronic communications network” has the same meaning as in the Communications Act 2003 (c. 21).
Propose a change(1) In this Part “associate”, in relation to a person, is to be construed as follows. (2) In relation to an individual, “associate” means— (a) that individual's spouse, civil partner or minor child or step-child, (b) any body corporate of which that individual is a director, and (c) any employee or partner of that individual. (3) In relation to a body corporate, “associate” means— (a) any body corporate of which that body is a director, (b) any body corporate in the same group as that body, and (c) any employee or partner of that body or of any body corporate in the same group. (4) In relation to a partnership constituted under the law of Scotland, or any other country or territory in which a partnership is a legal person, “associate” means— (a) any body corporate of which that partnership is a director, (b) any employee of or partner in that partnership, and (c) any person who is an associate of a partner in that partnership. (5) In relation to a partnership constituted under the law of England and Wales or Northern Ireland, or the law of any other country or territory in which a partnership is not a legal person, “associate” means any person who is an associate of any of the partners. (6) In subsections (2)(b), (3)(a) and (4)(a), in the case of a body corporate which is a limited liability partnership, “director” is to be read as “member”.
Propose a change(1) In this Part, unless a contrary intention appears— “address” means— in relation to an individual, his usual residential or business address; in relation to a firm, its registered or principal office in the United Kingdom; ... “the Audit Regulation ” means Regulation 537/2014 of the European Parliament and of the Council on specific requirements regarding statutory audit of public interest entities; ... “audit working papers and investigation reports” means— any documents which are or have been held by a statutory auditor ... or a third country auditor and which are related to the conduct of an audit conducted by that auditor; any report of an inspection of the conduct of an audit by a statutory auditor ... or a third country auditor, or any report of an investigation into the conduct of a statutory auditor ... or a third country auditor, “company” means any company or other body the accounts of which must be audited in accordance with Part 16; “the competent authority” means the Financial Reporting Council Limited “the data protection legislation” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act); “director”, in relation to a body corporate, includes any person occupying in relation to it the position of a director (by whatever name called) and any person in accordance with whose directions or instructions (not being advice given in a professional capacity) the directors of the body are accustomed to act; ... ... “firm” means any entity, whether or not a legal person, which is not an individual and includes a body corporate, a corporation sole and a partnership or other unincorporated association; “group”, in relation to a body corporate, means the body corporate, any other body corporate which is its holding company or subsidiary and any other body corporate which is a subsidiary of that holding company; “holding company” and “subsidiary” are to be read in accordance with section 1159 and Schedule 6; “officer”, in relation to a body corporate, includes a director, a manager, a secretary or, where the affairs of the body are managed by its members, a member; “parent undertaking” and “subsidiary undertaking” are to be read in accordance with section 1162 and Schedule 7. “regulated market” has the meaning given in Article 2(1)(13) of Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 and amending Regulation (EU) No. 648/2012; “third country” means a country or territory other than the United Kingdom; “ third country auditor ” means a person, other than ... a person eligible for appointment as a statutory auditor, who is eligible to conduct audits of the accounts of bodies corporate incorporated or formed under the law of a third country in accordance with the law of that country; “third country competent authority” means a body established in a third country exercising functions related to the regulation or oversight of auditors; “transfer”, in relation to audit working papers and investigation reports, includes physical and electronic transfer and allowing access to such papers; “transferable securities” has the meaning given in Article 2(1)(24) of Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 and amending Regulation (EU) No. 648/2012; “UK regulated market” has the meaning given in Article 2(1)(13A) of Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 and amending Regulation (EU) No. 648/2012; (2) For the purposes of this Part a body is to be regarded as “established in the United Kingdom” if and only if— (a) it is incorporated or formed under the law of the United Kingdom or a part of the United Kingdom, or (b) its central management and control are exercised in the United Kingdom; and any reference to a qualification “obtained in the United Kingdom” is to a qualification obtained from such a body. (2A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) The Secretary of State may by regulations make such modifications of this Part as appear to him to be necessary or appropriate for the purposes of its application in relation to any firm, or description of firm, which is not a body corporate or a partnership. (4) Regulations under subsection (3) are subject to negative resolution procedure.
Propose a changeThe following Table shows provisions defining or otherwise explaining expressions used in this Part (other than provisions defining or explaining an expression used only in the same section)— Expression | Provision address | section 1261(1) appropriate qualification | section 1219 approved third country competent authority | section 1240B(1); approved third country qualification | section 1221(1) associate | section 1260 Audit Directive | paragraph 20A of Schedule 10 Audit Regulation | section 1261(1) audit regulatory regime | section 1240A(3) . . . | . . . audit working papers and investigation reports | section 1261(1) audited person | section 1210(2) Auditor General | section 1226(1) company | section 1261(1) competent authority | section 1261(1) the data protection legislation | section 1261(1) delegation order | section 1252(1) director (of a body corporate) | section 1261(1) EEA auditor | paragraph 20A of Schedule 10 EEA competent authority | paragraph 20A of Schedule 10 enactment | section 1293 equivalent third country | section 1240A(1) established in the United Kingdom | section 1261(2) firm | section 1261(1) group (in relation to a body corporate) | section 1261(1) holding company | section 1261(1) main purposes of this Part | section 1209 member (of a supervisory body) | section 1217(2) obtained in the United Kingdom | section 1261(2) officer | section 1261(1) parent undertaking | section 1261(1) qualifying body | section 1220(1) recognised, in relation to a professional qualification | section 1220(3) and Schedule 11 recognised, in relation to a qualifying body | paragraph 1(2) of Schedule 11 recognised, in relation to a supervisory body | section 1217(4) and Schedule 10 registered third country auditor | section 1241(1) regulated market | section 1261(1) rules of a qualifying body | section 1220(2) rules of a supervisory body | section 1217(3) statutory auditor, statutory audit and statutory audit work | section 1210(1) subsidiary | section 1261(1) supervisory body | section 1217(1) subsidiary undertaking | section 1261(1) third country | section 1261(1) third country auditor, . . . | Section 1261(1). third country competent authority | section 1261(1) transfer (in relation to audit working papers) | section 1261(1) transferable securities | section 1261(1) transitional third country | section 1240A(1) UK regulated market | section 1261(1) UK-traded third country company | section 1261(2)
Propose a change(1) The Secretary of State may by regulations make such amendments of enactments as appear to him to be necessary or expedient in consequence of any change of name, merger or transfer of engagements affecting— (a) a recognised supervisory body or recognised qualifying body, or (b) a body of accountants referred to in, or approved, authorised or otherwise recognised for the purposes of, any other enactment. (2) Regulations under this section are subject to negative resolution procedure.
Propose a changeSchedule 14 contains consequential amendments relating to this Part.
Propose a changeIn Part 6 of the Financial Services and Markets Act 2000 (c. 8) (which makes provision about official listing, prospectus requirements for transferable securities, etc), in section 103(1) (interpretation), at the appropriate place insert— “the transparency obligations directive” means Directive 2004/109/EC of the European Parliament and of the Council relating to the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market; .
Propose a change(1) After section 89 of the Financial Services and Markets Act 2000 insert— Transparency obligations Transparency rules 89A (1) The competent authority may make rules for the purposes of the transparency obligations directive. (2) The rules may include provision for dealing with any matters arising out of or related to any provision of the transparency obligations directive. (3) The competent authority may also make rules— (a) for the purpose of ensuring that voteholder information in respect of voting shares traded on a UK market other than a regulated market is made public or notified to the competent authority; (b) providing for persons who hold comparable instruments (see section 89F(1)(c)) in respect of voting shares to be treated, in the circumstances specified in the rules, as holding some or all of the voting rights in respect of those shares. (4) Rules under this section may, in particular, make provision— (a) specifying how the proportion of— (i) the total voting rights in respect of shares in an issuer, or (ii) the total voting rights in respect of a particular class of shares in an issuer, held by a person is to be determined; (b) specifying the circumstances in which, for the purposes of any determination of the voting rights held by a person (“P”) in respect of voting shares in an issuer, any voting rights held, or treated by virtue of subsection (3)(b) as held, by another person in respect of voting shares in the issuer are to be regarded as held by P; (c) specifying the nature of the information which must be included in any notification; (d) about the form of any notification; (e) requiring any notification to be given within a specified period; (f) specifying the manner in which any information is to be made public and the period within which it must be made public; (g) specifying circumstances in which any of the requirements imposed by rules under this section does not apply. (5) Rules under this section are referred to in this Part as “transparency rules”. (6) Nothing in sections 89B to 89G affects the generality of the power to make rules under this section. Provision of voteholder information 89B (1) Transparency rules may make provision for voteholder information in respect of voting shares to be notified, in circumstances specified in the rules— (a) to the issuer, or (b) to the public, or to both. (2) Transparency rules may make provision for voteholder information notified to the issuer to be notified at the same time to the competent authority. (3) In this Part “voteholder information” in respect of voting shares means information relating to the proportion of voting rights held by a person in respect of the shares. (4) Transparency rules may require notification of voteholder information relating to a person— (a) initially, not later than such date as may be specified in the rules for the purposes of the first indent of Article 30.2 of the transparency obligations directive, and (b) subsequently, in accordance with the following provisions. (5) Transparency rules under subsection (4)(b) may require notification of voteholder information relating to a person only where there is a notifiable change in the proportion of— (a) the total voting rights in respect of shares in the issuer, or (b) the total voting rights in respect of a particular class of share in the issuer, held by the person. (6) For this purpose there is a “notifiable change” in the proportion of voting rights held by a person when the proportion changes— (a) from being a proportion less than a designated proportion to a proportion equal to or greater than that designated proportion, (b) from being a proportion equal to a designated proportion to a proportion greater or less than that designated proportion, or (c) from being a proportion greater than a designated proportion to a proportion equal to or less than that designated proportion. (7) In subsection (6) “designated” means designated by the rules. Provision of information by issuers of transferable securities 89C (1) Transparency rules may make provision requiring the issuer of transferable securities, in circumstances specified in the rules— (a) to make public information to which this section applies, or (b) to notify to the competent authority information to which this section applies, or to do both. (2) In the case of every issuer, this section applies to— (a) information required by Article 4 of the transparency obligations directive; (b) information relating to the rights attached to the transferable securities, including information about the terms and conditions of those securities which could indirectly affect those rights; and (c) information about new loan issues and about any guarantee or security in connection with any such issue. (3) In the case of an issuer of debt securities, this section also applies to information required by Article 5 of the transparency obligations directive. (4) In the case of an issuer of shares, this section also applies to— (a) information required by Article 5 of the transparency obligations directive; (b) information required by Article 6 of that directive; (c) voteholder information— (i) notified to the issuer, or (ii) relating to the proportion of voting rights held by the issuer in respect of shares in the issuer; (d) information relating to the issuer's capital; and (e) information relating to the total number of voting rights in respect of shares or shares of a particular class. Notification of voting rights held by issuer 89D (1) Transparency rules may require notification of voteholder information relating to the proportion of voting rights held by an issuer in respect of voting shares in the issuer— (a) initially, not later than such date as may be specified in the rules for the purposes of the second indent of Article 30.2 of the transparency obligations directive, and (b) subsequently, in accordance with the following provisions. (2) Transparency rules under subsection (1)(b) may require notification of voteholder information relating to the proportion of voting rights held by an issuer in respect of voting shares in the issuer only where there is a notifiable change in the proportion of— (a) the total voting rights in respect of shares in the issuer, or (b) the total voting rights in respect of a particular class of share in the issuer, held by the issuer. (3) For this purpose there is a “notifiable change” in the proportion of voting rights held by a person when the proportion changes— (a) from being a proportion less than a designated proportion to a proportion equal to or greater than that designated proportion, (b) from being a proportion equal to a designated proportion to a proportion greater or less than that designated proportion, or (c) from being a proportion greater than a designated proportion to a proportion equal to or less than that designated proportion. (4) In subsection (3) “designated” means designated by the rules. Notification of proposed amendment of issuer's constitution 89E Transparency rules may make provision requiring an issuer of transferable securities that are admitted to trading on a regulated market to notify a proposed amendment to its constitution— (a) to the competent authority, and (b) to the market on which the issuer's securities are admitted, at times and in circumstances specified in the rules. Transparency rules: interpretation etc 89F (1) For the purposes of sections 89A to 89G— (a) the voting rights in respect of any voting shares are the voting rights attached to those shares, (b) a person is to be regarded as holding the voting rights in respect of the shares— (i) if, by virtue of those shares, he is a shareholder within the meaning of Article 2.1(e) of the transparency obligations directive; (ii) if, and to the extent that, he is entitled to acquire, dispose of or exercise those voting rights in one or more of the cases mentioned in Article 10(a) to (h) of the transparency obligations directive; (iii) if he holds, directly or indirectly, a financial instrument which results in an entitlement to acquire the shares and is an Article 13 instrument, and (c) a person holds a “comparable instrument” in respect of voting shares if he holds, directly or indirectly, a financial instrument in relation to the shares which has similar economic effects to an Article 13 instrument (whether or not the financial instrument results in an entitlement to acquire the shares). (2) Transparency rules under section 89A(3)(b) may make different provision for different descriptions of comparable instrument. (3) For the purposes of sections 89A to 89G two or more persons may, at the same time, each be regarded as holding the same voting rights. (4) In those sections— “Article 13 instrument” means a financial instrument of a type determined by the European Commission under Article 13.2 of the transparency obligations directive; “UK market” means a market that is situated or operating in the United Kingdom; “voting shares” means shares of an issuer to which voting rights are attached. Transparency rules: other supplementary provisions 89G (1) Transparency rules may impose the same obligations on a person who has applied for the admission of transferable securities to trading on a regulated market without the issuer's consent as they impose on an issuer of transferable securities. (2) Transparency rules that require a person to make information public may include provision authorising the competent authority to make the information public in the event that the person fails to do so. (3) The competent authority may make public any information notified to the authority in accordance with transparency rules. (4) Transparency rules may make provision by reference to any provision of any rules made by the Panel on Takeovers and Mergers under Part 28 of the Companies Act 2006. (5) Sections 89A to 89F and this section are without prejudice to any other power conferred by this Part to make Part 6 rules. . (2) The effectiveness for the purposes of section 155 of the Financial Services and Markets Act 2000 (c. 8) (consultation on proposed rules) of things done by the Financial Services Authority before this section comes into force with a view to making transparency rules (as defined in the provisions to be inserted in that Act by subsection (1) above) is not affected by the fact that those provisions were not then in force.
Propose a changeIn Part 6 of the Financial Services and Markets Act 2000 after the sections inserted by section 1266 above insert— Power of competent authority to call for information Competent authority's power to call for information 89H (1) The competent authority may by notice in writing given to a person to whom this section applies 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) This section applies to— (a) an issuer in respect of whom transparency rules have effect; (b) a voteholder; (c) an auditor of— (i) an issuer to whom this section applies, or (ii) a voteholder; (d) a person who controls a voteholder; (e) a person controlled by a voteholder; (f) a director or other similar officer of an issuer to whom this section applies; (g) a director or other similar officer of a voteholder or, where the affairs of a voteholder are managed by its members, a member of the voteholder. (3) This section applies only to information and documents reasonably required in connection with the exercise by the competent authority of functions conferred on it by or under sections 89A to 89G (transparency rules). (4) Information or documents required under this section 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. (5) If a person claims a lien on a document, its production under this section does not affect the lien. Requirements in connection with call for information 89I (1) The competent authority may require any information provided under section 89H to be provided in such form as it may reasonably require. (2) The competent authority may require— (a) any information provided, whether in a document or otherwise, to be verified in such manner as it may reasonably require; (b) any document produced to be authenticated in such manner as it may reasonably require. (3) If a document is produced in response to a requirement imposed under section 89H, the competent authority may— (a) take copies of or extracts from the document; or (b) require the person producing the document, or any relevant person, to provide an explanation of the document. (4) In subsection (3)(b) “relevant person”, in relation to a person who is required to produce a document, means a person who— (a) has been or is a director or controller of that person; (b) has been or is an auditor of that person; (c) has been or is an actuary, accountant or lawyer appointed or instructed by that person; or (d) has been or is an employee of that person. (5) If a person who is required under section 89H to produce a document fails to do so, the competent authority may require him to state, to the best of his knowledge and belief, where the document is. Power to call for information: supplementary provisions 89J (1) The competent authority may require an issuer to make public any information provided to the authority under section 89H. (2) If the issuer fails to comply with a requirement under subsection (1), the competent authority may, after seeking representations from the issuer, make the information public. (3) In sections 89H and 89I (power of competent authority to call for information)— “control” and “controlled” have the meaning given by subsection (4) below; “specified” means specified in the notice; “voteholder” means a person who— holds voting rights in respect of any voting shares for the purposes of sections 89A to 89G (transparency rules), or is treated as holding such rights by virtue of rules under section 89A(3)(b). (4) For the purposes of those sections a person (“A”) controls another person (“B”) if— (a) A holds a majority of the voting rights in B, (b) A is a member of B and has the right to appoint or remove a majority of the members of the board of directors (or, if there is no such board, the equivalent management body) of B, (c) A is a member of B and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in B, or (d) A has the right to exercise, or actually exercises, dominant influence or control over B. (5) For the purposes of subsection (4)(b)— (a) any rights of a person controlled by A, and (b) any rights of a person acting on behalf of A or a person controlled by A, are treated as held by A. .
Propose a changeIn Part 6 of the Financial Services and Markets Act 2000 (c. 8), after the sections inserted by section 1267 above insert— Powers exercisable in case of infringement of transparency obligation Public censure of issuer 89K (1) If the competent authority finds that an issuer of securities admitted to trading on a regulated market is failing or has failed to comply with an applicable transparency obligation, it may publish a statement to that effect. (2) If the competent authority proposes to publish a statement, it must give the issuer a warning notice setting out the terms of the proposed statement. (3) If, after considering any representations made in response to the warning notice, the competent authority decides to make the proposed statement, it must give the issuer a decision notice setting out the terms of the statement. (4) A notice under this section must inform the issuer of his right to refer the matter to the Tribunal (see section 89N) and give an indication of the procedure on such a reference. (5) In this section “transparency obligation” means an obligation under— (a) a provision of transparency rules, or (b) any other provision made in accordance with the transparency obligations directive. (6) In relation to an issuer whose home State is a member State other than the United Kingdom, any reference to an applicable transparency obligation must be read subject to section 100A(2). Power to suspend or prohibit trading of securities 89L (1) This section applies to securities admitted to trading on a regulated market. (2) If the competent authority has reasonable grounds for suspecting that an applicable transparency obligation has been infringed by an issuer, it may— (a) suspend trading in the securities for a period not exceeding 10 days, (b) prohibit trading in the securities, or (c) make a request to the operator of the market on which the issuer's securities are traded— (i) to suspend trading in the securities for a period not exceeding 10 days, or (ii) to prohibit trading in the securities. (3) If the competent authority has reasonable grounds for suspecting that a provision required by the transparency obligations directive has been infringed by a voteholder of an issuer, it may— (a) prohibit trading in the securities, or (b) make a request to the operator of the market on which the issuer's securities are traded to prohibit trading in the securities. (4) If the competent authority finds that an applicable transparency obligation has been infringed, it may require the market operator to prohibit trading in the securities. (5) In this section “transparency obligation” means an obligation under— (a) a provision contained in transparency rules, or (b) any other provision made in accordance with the transparency obligations directive. (6) In relation to an issuer whose home State is a member State other than the United Kingdom, any reference to an applicable transparency obligation must be read subject to section 100A(2). Procedure under section 89L 89M (1) A requirement under section 89L takes effect— (a) immediately, if the notice under subsection (2) states that that is the case; (b) in any other case, on such date as may be specified in the notice. (2) If the competent authority— (a) proposes to exercise the powers in section 89L in relation to a person, or (b) exercises any of those powers in relation to a person with immediate effect, it must give that person written notice. (3) The notice must— (a) give details of the competent authority's action or proposed action; (b) state the competent authority's reasons for taking the action in question and choosing the date on which it took effect or takes effect; (c) inform the recipient that he may make representations to the competent authority within such period as may be specified by the notice (whether or not he had referred the matter to the Tribunal); (d) inform him of the date on which the action took effect or takes effect; (e) inform him of his right to refer the matter to the Tribunal (see section 89N) and give an indication of the procedure on such a reference. (4) The competent authority may extend the period within which representations may be made to it. (5) If, having considered any representations made to it, the competent authority decides to maintain, vary or revoke its earlier decision, it must give written notice to that effect to the person mentioned in subsection (2). Right to refer matters to the Tribunal 89N A person— (a) to whom a decision notice is given under section 89K (public censure), or (b) to whom a notice is given under section 89M (procedure in connection with suspension or prohibition of trading), may refer the matter to the Tribunal. .
Propose a changeIn Part 6 of the Financial Services and Markets Act 2000 (c. 8), after the sections inserted by section 1268 above insert— Corporate governance Corporate governance rules 89O (1) The competent authority may make rules (“corporate governance rules”)— (a) for the purpose of implementing, enabling the implementation of or dealing with matters arising out of or related to, any EU obligation relating to the corporate governance of issuers who have requested or approved admission of their securities to trading on a regulated market; (b) about corporate governance in relation to such issuers for the purpose of implementing, or dealing with matters arising out of or related to, any EU obligation. (2) “Corporate governance”, in relation to an issuer, includes— (a) the nature, constitution or functions of the organs of the issuer; (b) the manner in which organs of the issuer conduct themselves; (c) the requirements imposed on organs of the issuer; (d) the relationship between the different organs of the issuer; (e) the relationship between the organs of the issuer and the members of the issuer or holders of the issuer's securities. (3) The burdens and restrictions imposed by rules under this section on foreign-traded issuers must not be greater than the burdens and restrictions imposed on UK-traded issuers by— (a) rules under this section, and (b) listing rules. (4) For this purpose— “foreign-traded issuer” means an issuer who has requested or approved admission of the issuer's securities to trading on a regulated market situated or operating outside the United Kingdom; “UK-traded issuer” means an issuer who has requested or approved admission of the issuer's securities to trading on a regulated market situated or operating in the United Kingdom. (5) This section is without prejudice to any other power conferred by this Part to make Part 6 rules. .
Propose a changeIn Part 6 of the Financial Services and Markets Act 2000 (c. 8), after section 90 insert— Compensation for statements in certain publications 90A (1) The publications to which this section applies are— (a) any reports and statements published in response to a requirement imposed by a provision implementing Article 4, 5 or 6 of the transparency obligations directive, and (b) any preliminary statement made in advance of a report or statement to be published in response to a requirement imposed by a provision implementing Article 4 of that directive, to the extent that it contains information that it is intended— (i) will appear in the report or statement, and (ii) will be presented in the report or statement in substantially the same form as that in which it is presented in the preliminary statement. (2) The securities to which this section applies are— (a) securities that are traded on a regulated market situated or operating in the United Kingdom, and (b) securities that— (i) are traded on a regulated market situated or operating outside the United Kingdom, and (ii) are issued by an issuer for which the United Kingdom is the home Member State within the meaning of Article 2.1(i) of the transparency obligations directive. (3) The issuer of securities to which this section applies is liable to pay compensation to a person who has— (a) acquired such securities issued by it, and (b) suffered loss in respect of them as a result of— (i) any untrue or misleading statement in a publication to which this section applies, or (ii) the omission from any such publication of any matter required to be included in it. (4) The issuer is so liable only if a person discharging managerial responsibilities within the issuer in relation to the publication— (a) knew the statement to be untrue or misleading or was reckless as to whether it was untrue or misleading, or (b) knew the omission to be dishonest concealment of a material fact. (5) A loss is not regarded as suffered as a result of the statement or omission in the publication unless the person suffering it acquired the relevant securities— (a) in reliance on the information in the publication, and (b) at a time when, and in circumstances in which, it was reasonable for him to rely on that information. (6) Except as mentioned in subsection (8)— (a) the issuer is not subject to any other liability than that provided for by this section in respect of loss suffered as a result of reliance by any person on— (i) an untrue or misleading statement in a publication to which this section applies, or (ii) the omission from any such publication of any matter required to be included in it, and (b) a person other than the issuer is not subject to any liability, other than to the issuer, in respect of any such loss. (7) Any reference in subsection (6) to a person being subject to a liability includes a reference to another person being entitled as against him to be granted any civil remedy or to rescind or repudiate an agreement. (8) This section does not affect— (a) the powers conferred by section 382 and 384 (powers of the court to make a restitution order and of the Authority to require restitution); (b) liability for a civil penalty; (c) liability for a criminal offence. (9) For the purposes of this section— (a) the following are persons “discharging managerial responsibilities” in relation to a publication— (i) any director of the issuer (or person occupying the position of director, by whatever name called), (ii) in the case of an issuer whose affairs are managed by its members, any member of the issuer, (iii) in the case of an issuer that has no persons within sub-paragraph (i) or (ii), any senior executive of the issuer having responsibilities in relation to the publication; (b) references to the acquisition by a person of securities include his contracting to acquire them or any interest in them. Power to make further provision about liability for published information 90B (1) The Treasury may by regulations make provision about the liability of issuers of securities traded on a regulated market, and other persons, in respect of information published to holders of securities, to the market or to the public generally. (2) Regulations under this section may amend any primary or subordinate legislation, including any provision of, or made under, this Act. .
Propose a changeIn Part 6 of the Financial Services and Markets Act 2000 (c. 8), after section 100 insert— Exercise of powers where UK is host member state 100A (1) This section applies to the exercise by the competent authority of any power under this Part exercisable in case of infringement of— (a) a provision of prospectus rules or any other provision made in accordance with the prospectus directive, or (b) a provision of transparency rules or any other provision made in accordance with the transparency obligations directive, in relation to an issuer whose home State is a member State other than the United Kingdom. (2) The competent authority may act in such a case only in respect of the infringement of a provision required by the relevant directive. Any reference to an applicable provision or applicable transparency obligation shall be read accordingly. (3) If the authority finds that there has been such an infringement, it must give a notice to that effect to the competent authority of the person's home State requesting it— (a) to take all appropriate measures for the purpose of ensuring that the person remedies the situation that has given rise to the notice, and (b) to inform the authority of the measures it proposes to take or has taken or the reasons for not taking such measures. (4) The authority may not act further unless satisfied— (a) that the competent authority of the person's home State has failed or refused to take measures for the purpose mentioned in subsection (3)(a), or (b) that the measures taken by that authority have proved inadequate for that purpose. This does not affect exercise of the powers under section 87K(2), 87L(2) or (3) or 89L(2) or (3) (powers to protect market). (5) If the authority is so satisfied, it must, after informing the competent authority of the person's home State, take all appropriate measures to protect investors. (6) In such a case the authority must inform the Commission of the measures at the earliest opportunity. .
Propose a change