HC Deb 09 February 2000 vol 344 cc288-9
Mr. Timms

I beg to move amendment No. 69, in page 14, line 15, leave out from "person" to end of line 16.

Mr. Deputy Speaker

With this, it will be convenient to discuss Government amendments Nos. 81, 82, 89 and 98.

Mr. Timms

These amendments remove the existing provision in clause 30 for retaining the authorisation of persons who no longer have permission for any regulated activity. Amendments Nos. 69, 89 and 98 provide instead that, under clauses 39 and 40, the FSA will be able to keep an empty permission in force, but may need to cancel it once it is satisfied that this is no longer necessary.

We are not just talking about preventing wrongdoers from escaping the jurisdiction of the FSA. The power could be used, for example, to suspend an authorised person's activities while an aspect of his business is investigated urgently. Following the investigation, his substantive permissions could be restored without forcing him to make a fresh application under clause 36.

Amendments Nos. 81 and 82 are consequential, and limit clause 36 to fresh applications by persons who are not already authorised under the Bill. The amendments exclude applications from persons who already have a permission under part IV. They can apply instead for a variation of their existing permission under clause 39.

I hope that the amendments will meet with the approval of the House.

Mr. Heathcoat-Amory

I thought that I understood the Bill, but I am a little baffled by the amendment. I think that I see the intention behind it, but as the clause stood, the FSA was to be allowed to maintain someone's status as an authorised person even though the person concerned might not have permission to carry on a regulated activity. From what I understand of the amendment, the authority will be able to keep a permission alive even though the authorised person concerned may not any longer be performing any regulated activities. That is a consequence of the fact that his permission may have been varied.

The amendment would introduce a bizarre concept. Other parts of the Bill might have been drafted by Lewis Carroll, but this seems to break new ground. We were trying, I thought, to make the Bill easy to understand, so perhaps the amendment could have been drafted differently or we could stick with the previous wording, which was at least logically possible. If a permission is to be kept alive when the person to whom it was granted no longer has it because it has been withdrawn or varied, that requires some explanation.

Mr. Timms

The benefit of keeping an empty permission in force is that it will allow the FSA to retain its jurisdiction over the firm involved. For example, it may be investigating a possible disciplinary matter or it may be necessary for the firm to complete a past business review. That is the reason for the need to keep the permission alive.

The amended provision will make it clear that the FSA has to cancel a firm's permission once the FSA is satisfied that it is no longer necessary. The previous formulation in clause 30 only required the FSA to have good reason for not withdrawing a person's authorisation. The FSA's refusal of an application to cancel a firm's permission will be subject to the usual procedural safeguards. It is necessary to have the mechanism contained in the amendment to allow the FSA to retain its jurisdiction for a time while an investigation or other matter is in hand.

Amendment agreed to.

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