§
Lords amendment: No. 10, in page 8, line 19, leave out subsection (2) and insert—
("(2) The contravention does not—
- (a) make a person guilty of an offence;
- (b) make any transaction void or unenforceable; or
- (c)(subject to subsection (3)) give rise to any right of action for breach of statutory duty.
§ (3) In prescribed cases the contravention is actionable at the suit of a person who suffers loss as a result of the contravention, subject to the defences and other incidents applying to actions for breach of statutory duty.")
47§ Mr. Deputy SpeakerWith this we may discuss Lords amendments Nos. 25 to 29, 33, 35 to 44, 78, 89, 178, 179, 250 and 251.
§ 5 pm
§ Miss Melanie JohnsonI beg to move, That this House agrees with the Lords in the said amendment.
In the light of points made in this House, particularly by the right hon. and learned Member for North-East Bedfordshire (Sir N. Lyell), and in the other place, the Government have reconsidered the different provisions in the Bill dealing with rights of action and enforcement of agreements.
The amendments on rights of action fulfil the Government's commitment given in Committee and on Report in this House to review and align the provisions on rights of action. The aim of the Government's amendments is to enable the current pattern of rights of action for rule breaches, as provided for under clauses 62 and 62A of the Financial Services Act 1986, to be reproduced as far as it is possible to do so given the different structure of the Bill in relation to contraventions of requirements imposed under parts IV, X and XIII.
The amendments will enable the Treasury, subject to Parliament, to give rights of action to private persons if an authorised person has handled client money without the appropriate part IV permission, but not for a breach of a capital requirement or premium income limit imposed under that part. The Treasury will also be able to extend rights of action to non-private persons acting in a fiduciary capacity for a private person.
Amendments Nos. 89 and 179 are technical improvements that relate to the transfer of the competent authority for listing function from the London stock exchange to the FSA. They ensure that the wording of the Bill properly reflects the fact that the transfer has taken place, but do not alter the basic position that clauses 141 and 142, which deal with rights of action for FSA rules made under part X, do not apply to listing rules.
The amendments on enforcement of agreements meet Opposition concerns raised in Committee and on Report in this House about the grounds on which agreements entered into in the course of, or as a result of, an unauthorised regulated activity or illegal financial promotion will be enforced.
As we said we would, we have reflected on those concerns and have tabled amendments that meet directly the points made by the right hon. and learned Member for North-East Bedfordshire and his colleagues. In particular, amendments Nos. 25 to 29, 33 and 38 to 44 introduce a single test for the court to determine whether an agreement is enforceable by considering whether it is just and equitable for it to be enforced.
The other amendments make technical and drafting improvements. I commend the amendments to the House.
§ Lords amendment agreed to.