Legalize / United Kingdom / Public General Act

Building Societies Act 1986

Type Public General Act

Publication 1986-07-25

Last updated 2025-01-06

State In force

Department Statute Law Database

Source legislation.gov.uk

articles 16

Reform history JSON API

In the application of sections 141(1) and 142(1) (liquidation committees), of the Act to building societies, the references to functions conferred on a liquidation committee by or under that Act shall have effect as references to its functions by or under that Act as so applied.

24

The conditions which the court may impose under section 147 (power to stay or sist winding up) of the Act shall include those specified in paragraph 18(2) above.

25

Section 154 (adjustment of rights of contributories) of the Act shall have the effect with the modification that any surplus is to be distributed in accordance with the rules of the society.

26

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Winding up: general

27

Section 187 (power to make over assets to employees) of the Act does not apply.

28

(1) In section 201 (dissolution: voluntary winding up) of the Act, subsection (2) applies without the words from “and on the expiration” to the end of the subsection and, in subsection (3), the word “However” shall be omitted.

(2) Sections 202 to 204 (early dissolution) of the Act do not apply.

29

In section 205 (dissolution: winding up by the court) of the Act, subsection (2) applies with the omission of the words from “and, subject” to the end of the subsection; and in subsections (3) and (4) references to the Secretary of State shall have effect as references to the appropriate authority .

Penal provisions

30

Sections 216 and 217 of the Act (restriction on re-use of name) do not apply.

31

(1) Sections 218 and 219 (prosecution of delinquent officers) of the Act do not apply in relation to offences committed by members of a building society acting in that capacity.

(2) Sections 218(5) of the Act and subsections (1) and (2) of section 219 of the Act do not apply.

(3) The references in subsections (3) and (4) of section 219 of the Act to the Secretary of State shall have effect as references to the FCA ; and the reference in subsection (3) to subsection 218 of the Act shall have effect as a reference to that section as supplemented by paragraph 32 below.

32

(1) Where a report is made to the prosecuting authority (within the meaning of section 218) under section 218(4) of the Act, in relation to an officer of a building society, he may, if he thinks fit, refer the matter to the FCA for further enquiry.

(2) On such a reference to it the FCA shall exercise its power under section 55(1) of this Act to appoint one or more investigators to investigate and report on the matter.

(3) An answer given by a person to a question put to him in exercise of the powers conferred by section 55 on a person so appointed may be used in evidence against the person giving it.

Preferential debts

33

Section 387 (meaning in Schedule 6 of “the relevant date”) of the Act applies with the omission of subsections (2) and (4) to (6).

Part III — Modified application of Insolvency (Northern Ireland) Order 1989

Preliminary

34

In this Part of this Schedule, Part V of the Insolvency (Northern Ireland) Order 1989 is referred to as “Part V”, that Order is referred to as “the Order” and references to “Articles” are references to Articles of that Order.

Members of building society as contributories in winding up

35

(1) Article 61 (liability of members) is modified as follows.

(2) In paragraph (1), the reference to any past member shall be omitted.

(3) Sub-paragraphs (a) to (d) of paragraph (2) shall be omitted; and so shall paragraph (3).

(3A) In sub-paragraph (f) of paragraph (2) the reference to a sum due to a member of the company by way of dividends, profits or otherwise does not include a sum due to a shareholding member of a building society in respect of a deposit.

(4) The extent of the liability of a member of a building society in a winding up shall not exceed the extent of his liability under paragraph 6 of Schedule 2 to this Act.

36

Articles 62 to 65 and 69 in Chapter I of Part V (miscellaneous provisions not relevant to building societies) do not apply.

37

In the enactments as applied to a building society, “contributory”—

(a) means every person liable to contribute to the assets of the society in the event of its being wound up, and

(b) for the purposes of all proceedings for determining, and all proceedings prior to the determination of, the persons who are to be deemed contributories, includes any person alleged to be a contributory, and

(i) any debt or liability of the building society being wound up, or

(ii) any sum for the adjustment of rights of members among themselves, or

(iii) the expenses of the winding up;

but does not include persons liable to contribute by virtue of a declaration by the Court under Article 177 (imputed responsibility for fraudulent trading) or Article 178 (wrongful trading).

Voluntary winding up

38

(1) Article 70 does not apply.

(2) In the enactments as applied to a building society, the expression “resolution for voluntary winding up” means a resolution passed under section 88(1) of this Act.

39

In paragraph (1) of Article 87 (appointment of liquidation committee), the reference to functions conferred on a liquidation committee by or under the Order shall have effect as a reference to its functions by or under the Order as applied to building societies.

40

(1) Article 93 (distribution of property) does not apply; and the following applies in its place.

(2) Subject to the provisions of Part V relating to preferential payments, a building society’s property in a voluntary winding up shall be applied in satisfaction of the society’s liabilities to creditors (including any liability resulting from the variation to the liquidator’s duty effected by section 28 or 31 of this Act) pari passu and, subject to that application, in accordance with the rules of the society.

(3) In sub-paragraph (2) the reference to the society’s liabilities to creditors includes a reference to the society’s liabilities to shareholding members of the society in respect of deposits which are not relevant deposits.

41

Articles 96 and 97 (liquidator accepting shares, etc, as consideration for sale of company property) do not apply.

42

Article 101 (saving for certain rights) shall also apply in relation to the dissolution by consent of a building society as it applies in relation to its voluntary winding up.

Winding up by the court

43

Article 102 (circumstances in which company may be wound up by the High Court) does not apply.

44

Article 104 (application for winding up) does not apply.

45

(1) In Article 105 (powers of High Court on hearing of petition), paragraph (1) applies with the omission of the words from “but the Court” to the end of the paragraph.

(2) The conditions which the High Court may impose under Article 105 include conditions for securing—

(a) that the building society be dissolved by consent of its members under section 87, or

(b) that the society amalgamates with, or transfers its engagements to, another building society under section 93 or 94, or

and may also include conditions for securing that any default which occasioned the petition be made good and that the costs of the proceedings on that petition be defrayed by the person or persons responsible for the default.

46

Article 106 (power of High Court, between petition and winding-up order, to stay or restrain proceedings against company) has effect with the omission of paragraph (2).

47

If, before the presentation of a petition for the winding up by the High Court of a building society, an instrument of dissolution under section 87 is placed in the society’s public file, Article 109(1) (commencement of winding up by the High Court) shall also apply in relation to the date on which the instrument is so placed and to any proceedings in the course of the dissolution as it applies to the commencement date for, and proceedings in, a voluntary winding up.

48

(1) Article 110 (consequences of winding-up order) shall have effect with the following modifications.

(2) Paragraphs (1) and (3) shall be omitted.

(3) A building society shall, within 15 days of a winding-up order being made in respect of it, give notice of the order to the FCA and, if the society is a PRA-authorised person, the PRA ; and the FCA must keep the notice in the public file of the society.

(4) If a building society fails to comply with sub-paragraph (3) above, it shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale; and so shall any officer who is also guilty of the offence.

49

Article 119 (appointment of liquidator by High Court in certain circumstances) does not apply.

50

In the application of Article 120(1) (liquidation committee) to building societies, the references to functions conferred on a liquidation committee by or under the Order shall have effect as references to its function by or under the Order as so applied.

51

The conditions which the High Court may impose under Article 125 (power to stay winding up) shall include those specified in paragraph 45(2) above.

52

Article 132 (adjustment of rights of contributories) shall have effect with the modification that any surplus is to be distributed in accordance with the rules of the society.

Winding up: general

53

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Penal provisions

54

Article 158 (power to make over assets to employees) does not apply.

55

(1) In Article 166 (dissolution: voluntary winding up), paragraph (2) applies without the words from “and on the expiration” to the end of the paragraph and, in paragraph (3), the word “However” shall be omitted.

(2) Articles 167 and 168 (early dissolution) do not apply.

Part IV — Dissolution of Building Society wound up (England and Wales, Scotland and Northern Ireland)

56

(1) Where a building society has been wound up voluntarily, it is dissolved as from 3 months from the date of the placing in the public file of the society of the return of the final meetings of the society and its creditors made by the liquidator under—

(a) section 94 or (as the case may be) 106 of the Insolvency Act 1986 (as applied to building societies), or on such other date as is determined in accordance with section 201 of that Act, or

(b) Article 80 or (as the case may be) 92 of the Insolvency (Northern Ireland) Order 1989(as so applied), or on such other date as is determined in accordance with that Article,

as the case may be.

(2) Where a building society has been wound up by the court, it is dissolved as from 3 months from the date of the placing in the public file of the society of—

(a) the liquidator’s notice under section 172(8) of the Insolvency Act 1986 (as applied to building societies) or, as the case may be, Article 146(7) of the Insolvency (Northern Ireland) Order 1989 (as applied to building societies), or

(b) the notice of the completion of the winding up from the official receiver or the official receiver for Northern Ireland,

or on such other date as is determined in accordance with section 205 of that Act or Article 169 of that Order, as the case may be.

57

(1) Sections 1012 to 1023 and 1034 of the Companies Act 2006 (property of dissolved company) apply in relation to the property of a dissolved building society (whether dissolved under section 87 or following its winding up) as they apply in relation to the property of a dissolved company.

(2) Paragraph 3(1) above shall apply to those sections for the purpose of their application to building societies.

(3) Any reference in those sections to restoration to the register shall be read as a reference to the effect of an order under section 91 of this Act.

Insolvency rules and fees: England and Wales and Scotland

58

(1) Rules may be made under section 411 of the Insolvency Act for the purpose of giving effect, in relation to building societies, to the provisions of the applicable winding up legislation.

(2) An order made by the competent authority under section 414 of the Insolvency Act 1986 may make provision for fees to be payable under that section in respect of proceedings under the applicable winding up legislation and the performance by the official receiver or the Secretary of State of functions under it.

Insolvency rules and fees: Northern Ireland

59

(1) Rules may be made under Article 359 of the Insolvency (Northern Ireland) Order 1989 for the purpose of giving effect in relation to building societies, to the provisions of the applicable winding up legislation.

(2) An order made by the Department of Economic Development under Article 361 of the Insolvency (Northern Ireland) Order 1989 may make provision for fees to be payable under that Article in respect of proceedings under the applicable winding-up legislation and the performance by the official receiver for Northern Ireland or that Department of functions under it.

SCHEDULE 16

Part I — Issue of Statements to Members

1

(1) A building society which desires—

(a) to amalgamate with one or more other building societies, or

(b) to transfer its engagements to another building society, or

shall, unless the appropriate authority , in the case of a society desirous of undertaking to fulfil another’s engagements, has consented under section 94(5) to its proceeding by resolution of the board of directors, send to every member entitled to notice of a meeting of the society a statement concerning the matters specified in sub-paragraph (4) below.

(2) A building society shall include the statement referred to in sub-paragraph (1) above in or with the notice to be sent to its members of the meeting of the society at which the resolutions require for the approval of the amalgamation or, as the case may be, the transfer are to be moved.

(2A) Where a statement is required to be sent to a member in or with the notice of the meeting under sub-paragraph (2)—

(a) in a case where notice of the meeting is given to that member electronically in accordance with paragraph 22A of Schedule 2, the statement may be sent to him electronically only if it is sent to the same electronic address, and at the same time, as the notice;

(b) in a case where notice of the meeting is given on a web site in accordance with paragraph 22B of Schedule 2, the requirement to send it shall also be treated as satisfied if the conditions set out in sub-paragraph (2B) are satisfied.

(2B) The conditions of this sub-paragraph are satisfied in the case of a statement if—

(a) the society and that member have agreed that information that is required to be sent to him may instead be accessed by him on a web site;

(b) the agreement applies to the statement in question;

(c) at the same time and in the same manner as the society notifies that person of the publication of the notice of the meeting, it notifies him of—

(i) the publication of the statement on a web site,

(ii) the address of that web site,

(iii) the place on that web site where the statement may be accessed, and how it may be accessed; and

(d) the statement is published continuously on that web site throughout the period beginning with the giving of that notification and ending with the decision of the appropriate authority whether to confirm the amalgamation or transfer of engagements pursuant to section 95.

(2C) Where, in a case in which sub-paragraph (2A)(b) above is relied on for compliance with a requirement under sub-paragraph (2)—

(a) a statement is published for a part, but not all, of the period mentioned in subparagraph (2B)(d), but

(b) the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

that failure shall not invalidate the proceedings of a meeting or prevent the requirements of sub-paragraph (2B) from being treated as fulfilled in relation to section 95(4)(c).

(3) No statement shall be sent unless its contents, so far as they concern the matters specified in sub-paragraph (4) below, have been approved by the appropriate authority .

(4) Those maters are the following, namely—

(a) the financial position of the building society and that of the other building society or societies participating in the amalgamation or transfer;

(b) the interest of the directors of the building society in the amalgamation or transfer of engagements;

(c) the compensation or other consideration (if any) proposed to be paid to or in respect of the directors or other officers of the building society and of the other building society or societies participating in the amalgamation or transfer;

(d) the payments (if any) to be made to members of the building society and of the other building society or societies participating in the amalgamation or transfer by way of a distribution of funds in consideration of the amalgamation or transfer;

(e) the changes (if any) to be made, in connection with the amalgamation or transfer of engagements, in the terms governing outstanding loans made by the building society which are secured on land;

(f) any other matter which the appropriate authority requires in the case of the particular amalgamation or transfer of engagements.

(4A) The PRA must consult the FCA before approving a statement under sub-paragraph (3).

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) Any expression used in this paragraph and in section 96 has the same meaning in this paragraph as in that section.

Part II — Notification of Proposals for Merger

Preliminary

2

In this Part of this Schedule—

“merger” means an amalgamation of building societies under section 93 or a transfer of all the engagements of one building society to another under section 94; and “merger” has a corresponding meaning;

“merger proposal”, in relation to a building society, means a proposal in writing, by another building society desiring to merge with it, for the societies to merge, with or without terms for the merger; and “proposer” has a corresponding meaning;

“merger resolutions”, in relation to a building society, means the resolutions required for the approval of a merger of the society with another building society under section 93(2) or 94(2);

“merger statement” means a statement containing the requisite particulars of a merger proposal; and

“requisite particulars”, in relation to a merger proposal, means the particulars required by paragraph 3(2) below to be given in a merger statement.

Duty to notify members

3

(1) Subject to sub-paragraph (3) below, it shall be the duty of a building society receiving a merger proposal to send, in accordance with this Part of this Schedule, a merger statement in respect of the proposal to every member entitled to notice of a meeting of the society.

(2) A merger statement must contain the following particulars—

(a) the fact that a merger proposal has been made, and

(b) the identity of the proposer,

with or without other particulars regarding the proposal.

(3) Sub-paragraph (1) above does not require a merger statement to be sent to members if the proposer has requested in writing that the requisite particulars are to be treated as confidential; and, where such a request is made and is at a later date withdrawn in writing, the society receiving the proposal shall, for the purposes of this Part of this Schedule, treat the proposal as having been received on that date instead of any earlier date.

4

(1) A building society shall include in or with every notice of its annual general meeting a merger statement with respect to any merger proposal, other than a proposal of which notice has already been given under this paragraph,—

(a) received by it during the period of 12 months ending with the ninth month of the last financial year of the society before that meeting; or

(b) treated by paragraph 3(3) above as having been received by it during the last three months of that financial year;

and the society may also include, under this sub-paragraph, a merger statement with respect to any proposal received, or treated as received, by it after the end of either period.

(2) In any case where merger resolutions are to be moved at any meeting of a building society, every notice of the meeting shall have included in or with it—

(a) a merger statement with respect to any merger proposal, other than a proposal of which notice has already been given under this paragraph, received by it more than 42 days before the date of the meeting; and

(b) a transfer proposal notification with respect to any transfer proposal so received by it.

(2A) Where a merger statement or a transfer proposal notification is required to be sent to a person in or with the notice of a meeting of the society under sub-paragraph (1) or (2)—

(a) in a case where notice of a meeting is given electronically to a person in accordance with paragraph 22A of Schedule 2, the merger statement or transfer proposal notification may be sent to him electronically only if it is sent to the same electronic address and at the same time as the notice;

(b) in a case where notice of a meeting is given on a web site in accordance with paragraph 22B of Schedule 2, the requirement to send the statement or notification shall also be treated as satisfied if the conditions set out in sub-paragraph (2B) are satisfied.

(2B) The conditions of this sub-paragraph are satisfied in the case of a merger statement or transfer proposal notification if—

(a) the society and that person have agreed that information that is required to be sent to him may instead be accessed by him on a web site;

(b) the agreement applies to the merger statement or transfer proposal notification in question;

(c) at the same time and in the same manner as the society notifies that person of the publication of the notice of the meeting, it notifies him of—

(i) the publication of the merger statement or transfer proposal notification on a web site,

(ii) the address of that web site,

(iii) the place on that web site where that statement or notification may be accessed, and how it may be accessed; and

(d) the statement or notification is published continuously on that web site throughout the period beginning when the person is notified in accordance with paragraph (c) and ending with the conclusion of the meeting.

(2C) Where, in a case in which sub-paragraph (2A)(b) is relied on for compliance with a requirement under sub-paragraph (1) or (2)—

(a) a statement or notification is published for a part, but not all, of the period mentioned in sub-paragraph (2B)(d), but

(b) the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

that failure shall not invalidate the proceedings of a meeting or prevent the requirements of sub-paragraph (2B) from being treated as fulfilled in relation to section 95(4)(c).

(3) In this paragraph and paragraph 5 below—

“transfer proposal” has the same meaning as in Part IA of Schedule 17;

“transfer proposal notification” means a transfer proposal notification (within the meaning of that Part) required to be sent to members by paragraph 5B(1) of that Schedule.

Duty to notify appropriate authority

5

(1) Where a building society sends a merger statement or transfer proposal notification to its members under paragraph 4 above in connection with a meeting of the society, it shall send a copy of the statement or notification to the FCA and, if the society is a PRA-authorised person, the PRA at least 14 days before the date of the meeting.

(2) The FCA must keep the copy of a merger statement or transfer proposal notification received by it from a building society in the public file of that society.

Penalty

6

(1) If default is made by a building society in complying with paragraph 4(1), 4(2) or 5 above, the society shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale; and so shall any officer who is also guilty of the offence.

(2) Where, in a case in which paragraph 4(2A)(b) is relied on for compliance with a requirement under paragraph (a) or (b) of paragraph 4(2)—

(a) a merger statement or transfer proposal notification is published for a part, but not all, of the period mentioned in sub-paragraph (2B)(d), but

(b) the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

no offence is committed under this paragraph by reason of that failure.

Part III — Confirmation by appropriate authority : Procedure

7

An application for confirmation by the appropriate authority of an amalgamation or transfer of engagements shall be made in such manner as the appropriate authority may direct.

8

(1) Where a building society applies to the appropriate authority for confirmation of an amalgamation or transfer or engagements, the society shall publish notice of the application in any one or more of the London Gazette, the Edinburgh Gazette or the Belfast Gazette, as the appropriate authority directs and, if it so directs, in one or more newspapers.

(2) A notice published in pursuance of sub-paragraph (1) above shall—

(a) state that any interested party has the right to make representations to the appropriate authority with respect to the application; and

(b) specify a date determined by the appropriate authority before which any written representations or notice of a person’s intention to make oral representations must be received by the Commission; and

(c) specify a date determined by the appropriate authority as the day on which it intends to hear any oral representations.

9

(1) After the date specified in pursuance of paragraph 8(2)(b) above, the appropriate authority shall—

(a) determine the time and place at which oral representations may be made;

(b) give notice of that determination to the building societies participating in the amalgamation or transfer and any persons who have given notice of their intention to make oral representations; and

(c) send copies of the written representations received by the appropriate authority to the building societies participating in the amalgamation or transfer.

(2) The appropriate authority shall allow any building society participating in the amalgamation or transfer an opportunity to comment on the written representations, whether at a hearing or in writing before the expiration of such period as the appropriate authority specifies in a notice to the society.

SCHEDULE 17

PART I — Issue of statement or summary to members

Preliminary

1

In this Part of this Schedule—

“prescribed matters” in relation to any transfer of the business of a building society to its successor, means the matters relating to the transfer, the society, its officers, members or depositors, or the successor, which are prescribed in regulations made under paragraph 5(1) below;

“transfer statement”, in relation to a transfer of business by a building society, means the statement with respect to the transfer which may be sent or handed to members of the society under paragraph 2 below;

“transfer summary”, in relation to a transfer of business by a building society, means the summary of the transfer statement which may be sent to members of the society under that paragraph.

Duty to send transfer statements to members

2

A building society which desires to transfer its business shall, in accordance with this Part of this Schedule, send a transfer statement, or a transfer summary, to every member entitled to notice of a meeting of the society.

3

(1) A transfer statement, in relation to a transfer of business by a building society, shall contain—

(a) the particulars required, in relation to the prescribed matters, by the regulations made under paragraph 5(1) below, and

(b) particulars of any other matters required by the appropriate authority in the case of the particular transfer,

with or without other particulars regarding the transfer.

(2) A transfer summary, in relation to a transfer of business by a building society, shall contain—

(a) the information required by the regulations made under paragraph 5(2) below, and

(b) any other information required by the appropriate authority in the case of the particular transfer,

with or without other particulars regarding the transfer.

4

(1) Subject to sub-paragraph (3) below, a building society shall, in relation to a transfer of business, include a transfer statement, or a transfer summary, in or with the notice to be sent to its members of the meeting of the society at which the requisite transfer resolutions are to be moved.

(1A) Where a transfer statement or transfer summary is required under sub-paragraph (1) to be sent to a member in or with the notice of the meeting of the society at which the requisite transfer resolutions are to be moved—

(a) in a case where notice of that meeting is given to that member electronically in accordance with paragraph 22A of Schedule 2, the transfer statement or transfer summary may be sent to him electronically only if it is sent to the same electronic address, and at the same time as the notice;

(b) in a case where notice of that meeting is given on a web site in accordance with paragraph 22B of Schedule 2, the requirement to send the statement or summary to that member shall also be treated as satisfied if the conditions set out in sub-paragraph (1B) are satisfied.

(1B) The conditions of this sub-paragraph are satisfied in the case of a transfer statement or transfer summary if—

(a) the society and that member have agreed that information which is required to be sent to him may instead be accessed by him on a web site;

(b) the agreement applies to the statement or summary in question;

(c) at the same time and in the same manner as the society notifies that member of the publication of the notice of the meeting, it notifies him of—

(i) the publication of the statement or summary on a web site,

(ii) the address of that web site,

(iii) the place on that web site where that statement or summary may be accessed, and how it may be accessed; and

(d) the statement or summary is published continuously on that web site throughout the period beginning when the member is notified in accordance with paragraph (a) and ending with the decision of the appropriate authority whether to confirm the transfer pursuant to section 98.

(1C) Where, in a case in which sub-paragraph (1A)(b) is relied on for compliance with a requirement under sub-paragraph (1)—

(a) a statement is published for a part, but not all, of the period mentioned in subparagraph (1B)(d), but

(b) the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

the failure shall not invalidate the proceedings of a meeting or prevent the requirements of sub-paragraph (1B) from being treated as fulfilled in relation to section 98.

(2) Subject to sub-paragraph (3) below, where a building society sends a transfer summary, a transfer statement—

(a) shall be handed forthwith and free of charge to any member to whom the summary was sent who asks for such a statement at an office or branch of the society; and

(b) shall be sent forthwith and free of charge to any such member who asks for such a statement otherwise than at such an office or branch.

(2A) Where a transfer statement is required to be sent to a member under sub-paragraph (2)(b)—

(a) it may be sent to him electronically only if it is sent to an electronic address notified by him to the society for the purpose;

(b) the requirement to send it shall also be treated as satisfied if the conditions set out in sub-paragraph (2B) are satisfied.

(2B) The conditions of this sub-paragraph are satisfied in the case of a transfer statement if—

(a) the society and that member have agreed information which is required to be sent to him may instead be accessed by him on a web site;

(b) the agreement applies to the transfer statement in question;

(i) the publication of the statement on a web site,

(ii) the address of that web site,

(iii) the place on that web site where the statement may be accessed and how it may be accessed; and

(d) that statement is published continuously on that web site for the period beginning with the giving of that notification and ending with the decision of the appropriate authority whether to confirm the transfer pursuant to section 98.

(2C) Where, in a case in which sub-paragraph (2A)(b) is relied on for compliance with a requirement under sub-paragraph (2)(b)—

(a) a statement is published for a part, but not all, of the period mentioned in subparagraph (2B)(d), but

(b) the failure to publish it throughout that period is wholly attributable to circumstances which it would not be reasonable to have expected the society to prevent or avoid,

the failure shall not invalidate the proceedings of a meeting or prevent the requirements of sub-paragraph (2B) from being treated as fulfilled in relation to section 98.

(3) No transfer statement shall be sent or handed to a member unless its contents, so far as they concern the prescribed matters or any matter of which particulars are required to be given under paragraph 3(1)(b) above, have been approved by the appropriate authority .

(4) The PRA must consult the FCA before approving a statement under sub-paragraph (3).

5

(1) The Treasury, may make regulations for the purpose of specifying, as prescribed matters, the matters of which transfer statements are to give particulars; and the regulations may also require particulars to be given of any alternatives to the particular transfer which were available to the society making the transfer.

(2) The Treasury, may make regulations for the purpose of specifying the information which transfer summaries are to give.

(3) Any power to make regulations under this paragraph is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Part II — Confirmation by appropriate authority : Procedure

6

An application by a building society for confirmation by the appropriate authority of a transfer of its business tschedule 16o a company shall be made in such manner as the appropriate authority may direct.

7

(1) Where a building society applies for confirmation of a transfer of its business, the society shall publish a notice of the application in any one or more of the London Gazette, the Edinburgh Gazette or the Belfast Gazette, as the appropriate authority directs and, if it so directs, in one or more newspapers.

(2) A notice published in pursuance of sub-paragraph (1) above shall—

(a) state that any interested party has the right to make representations to the appropriate authority with respect to the application;

(b) specify a date determined by the appropriate authority before which any written representations or notice of a person’s intention to make oral representations must be received by the appropriate authority; and

(c) specify a date determined by the appropriate authority as the day on which it intends to hear any oral representations.

8

(1) After the date specified in the notice in pursuance of paragraph 7(2)(b) above, the Commission shall—

(a) determine the time and place at which oral representations may be made;

(b) give notice of that determination to the building society making the transfer and any persons who have given notice of their intention to make oral representations; and

(2) The Commission shall allow the building society making the transfer an opportunity to comment on the written representations, whether at a hearing or in writing, before the expiration of such period as the Commission specifies in a notice to the society.

SCHEDULE 18

Part I — United Kingdom

Bankers’ Books Evidence Act 1879 (c.11)

1

In section 9(1) of the Bankers’ Books Evidence Act 1879 (meaning of “bank” and “banker” for purposes of that Act), after paragraph (a) there shall be inserted the following—

(aa) a building society (within the meaning of the Building Societies Act 1986);

Land Registration Act 1925 (c.21)

2

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Payment of Wages Act 1960 (c.37)

3

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Trustee Investments Act 1961 (c.62)

4

(1) This paragraph amends the Trustee Investments Act 1961 as follows.

(2) In Part II of Schedule 1 (narrower range investments requiring advice), for paragraph 12 there shall be substituted—

(12) In deposits with a building society within the meaning of the Building Societies Act 1986.

(3) In Part III of Schedule 1 (wider range investments), for paragraph 2 there shall be substituted—

(2) In shares in a building society within the meaning of the Building Societies Act 1986.

Stock Transfer Act 1963 (c.18)

5

In section 1(4) of the Stock Transfer Act 1963 (simplified transfer of certain securities, not to apply to building society securities), for “1962” there shall be substituted “ 1986 ”.

Industrial and Provident Societies Act 1965 (c.12)

6

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Income and Corporation Taxes Act 1970 (c.10)

7

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Banking and Financial Dealings Act 1971 (c.80)

8

(1) This paragraph amends the Banking and Financial Dealings Act 1971 as follows.

(2) In section 2(1) (power to suspend financial dealings on bank holidays) after paragraph (g) there shall be inserted—

; and (h) a direction that, subject as aforesaid, no building society shall, on that day, except with permission so granted, effect in the course of its business any transaction or, according as may be specified in the order, a transaction of such kind as may be so specified.

(3) In section 2(6) after the definition of “authorised dealer in gold” there shall be inserted—

“building society” means a building society within the meaning of the Building Societies Act 1986.

Local Government Act 1972 (c.70)

9

In Schedule 12A (access to information: exempt information) to the Local Government Act 1972—

(a) in Part II, in paragraph 2(d) for “1962” there shall be substituted “ 1986 ”; and

(b) in Part III, in paragraph 1(1), after the definition of "protected informant’ there shall be inserted the following definition—

“registered”, in relation to information required to be registered under the Building Societies Act 1986, means recorded in the public file of any building society (within the meaning of that Act);

Consumer Credit Act 1974 (c.39)

10

(1) This paragraph amends the Consumer Credit Act 1974 as follows.

(2) In section 16(1) (consumer credit agreement with certain bodies exempt from regulation) the words “or building society” shall be omitted and, after paragraph (f), there shall be inserted the words

, or (g) a building society.

(3) In section 16(3) (Secretary of State’s duty to consult before making orders), after paragraph (d) there shall be inserted the words

or (e) under subsection (1)(g) without consulting the Building Societies Commission and the Treasury.

(4) In section 189(1) (definitions), for the definition of “building society” there shall be substituted the following definition—

“building society” means a building society within the meaning of the Building Societies Act 1986;

Solicitors Act 1974 (c.47)

11

(1) This paragraph amends the Solicitors Act 1974 as follows.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) In section 85 (bank accounts)—

(a) after “account with a bank” there shall be inserted “ or a building society ”, and

(b) in paragraphs (a) and (b) after “bank” there shall be inserted “ or society ”.

(5) In section 87(1) (interpretation), after the definition of “bank” there shall be inserted—

“building society” means a building society within the meaning of the Building Societies Act 1986; and a reference to an account with a building society is a reference to a deposit account.

Home Purchase Assistance and Housing Corporation Guarantee Act 1978 (c.27)

12

In section 3(1) (building society law) of the Home Purchase Assistance and Housing Corporation Guarantee Act 1978, after “determining” there shall be added the word “ (a) ” and at the end of that subsection there shall be added the words—

(b) the classification of the advance, or any such further advance, for the purposes of Part III of the Building Societies Act 1986.

Banking Act 1979 (c.37)

13

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Charging Orders Act 1979 (c.53)

14

In section 6(1) (interpretation) of the Charging Orders Act 1979, in the definition of “building society”, for “1962” there shall be substituted “ 1986 ”.

Finance Act 1982 (c.39)

15

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Companies Act 1985 (c.6)

16

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Insolvency Act 1985 (c.65)

17

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Housing Act 1985 (c.68)

18

(1) This paragraph amends the Housing Act 1985 as follows.

(2) In section 442(5) (consultations by Secretary of State regarding forms of local authority indemnity agreement) for “Chief Registrar of Friendly Societies" in paragraph (a), there shall be substituted “Building Societies Commission".

(3) In section 447 (recognised lending institutions) and in section 448 (recognised savings institutions) for “designated building societies" there shall be substituted “building societies".

(4) For section 450 (modifications of building society law) there shall be substituted the following section—

(450) So much of an advance by a building society which is partly financed under section 445 (assistance for first-time buyers) or the corresponding Scottish or Northern Ireland provisions as is so financed shall be treated as not forming part of the advance for the purpose of determining— (a) whether the advance, or any further advance made within two years of the date of purchase, is beyond the powers of the society, and (b) the classification of the advance, or any such further advance, for the purposes of Part III of the Building Societies Act 1986.

(5) In section 622 (minor definitions) for the definition of “building society" there shall be substituted—

“building society” means a building society within the meaning of the Building Societies Act 1986

Housing Associations Act 1985 (c. 69)

19

(1) This paragraph amends the Housing Associations Act 1985 as follows.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) In section 84(5) and 86(4) (consultation by Secretary of State regarding building society indemnities) for “Chief Registrar of Friendly Societies” there shall be substituted “ Building Societies Commission ”.

(4) In section 101 (minor definitions), for the definition of “building society” there shall be substituted—

“building society” means a building society within the meaning of the Building Societies Act 1986;

Part II — Northern Ireland

Industrial and Provident Societies Act (Northern Ireland) 1969 (c.24 N.I.)

20

In section 31(b) of the Industrial and Provident Societies Act (Northern Ireland) 1969 (authorised investments) for “society registered under the Building Societies Act” there shall be substituted “ building society within the meaning of the Building Societies Act 1986. ”.

Payment of Wages Act (Northern Ireland 1970

21

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Private Streets (Northern Ireland) Order 1980 (S.I. 1980/1086 (N.I.12))

22

In Article 33 (security not to be deemed prior mortgage under Building Societies Acts) of the Private Streets (Northern Ireland) Order 1980 for the words from “section 32” where they first occur onwards there shall be substituted “ section 11(2)(d) or (4)(d) of the Building Societies Act 1986 ”.

Housing (Northern Ireland) Order 1981 (S.I. 1981/156 (N.I.3))

23

(1) This paragraph amends the Housing (Northern Ireland) Order 1981 as follows.

(2) In Article 2(2) (interpretation) after the definition of “building regulations” there shall be inserted—

“building society” means a building society within the meaning of the Building Societies Act 1986

(3) For Article 155 (building society law) there shall be substituted the following section—

(155) So much of an advance by a building society which is partly financed under this Part or sections 445 to 449 of the Housing Act 1985 or the Home Purchase Assistance and Housing Corporation Guarantee Act 1978 as is so financed shall be treated as not forming part of the advance for the purpose of determining— (a) whether the advance, or any further advance made within two years of the date of purchase, is beyond the powers of the society, and (b) the classification of the advance, or any such further advance, for the purposes of Part III of the Building Societies Act 1986.

(4) In Article 155A (exclusion of Restrictive Trade Practices Act 1976), after “Scottish Provisions” there shall be inserted “ (namely, sections 445 to 447 of the Housing Act 1985 or the Home Purchase Assistance and Housing Corporation Guarantee Act 1978) ”.

(5) In Article 156(5)(b) (consultations by the Department regarding forms of indemnity agreements) for “Registrar of Friendly Societies for Northern Ireland” there shall be substituted “ Building Societies Commission ”.

(6) For paragraph 1 of Schedule 10 there shall be substituted—

(1) Building Societies.

Property (Discharge of Mortgage by Receipt) (Northern Ireland) Order 1983 (S.I.1983/766 (N.I.9))

24

In Article 3(10) of the Property (Discharge of Mortgage by Receipt) (Northern Ireland) Order 1983, after “applies” in the definition of “mortgage” there shall be inserted “ and, subject to paragraph 2(7) of Schedule 4 to the Building Societies Act 1986, does not include a mortgage to which that paragraph 2 applies. ”.

Housing (Northern Ireland) Order 1983 (S.I. 1983/1118 (N.I. 15))

25

In Article 3(4) of the Housing (Northern Ireland) Order 1983, in the definition of “building society” for the words from “1962” onwards there shall be substituted “ 1986 ”.

Companies (Northern Ireland) Order 1986

26

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE 19

Part I — Repeals: General

Part II — Revocation Extending to Great Britain

PART III — Repeals and Revocations Extending Only to Northern Ireland

SCHEDULE 20

Preliminary

1

In this Schedule—

“the commencement date for” any provision of this Act means the date on which that provision comes into operation;

“existing society” means a building society registered at the passing of this Act under the repealed enactments; and

“existing rules” means the rules of a society in force immediately before the commencement date for section 5.

Adoption of powers and alteration of rules

2

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Default powers

4

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Registration with existing authorities

5

A building society which, at the commencement date for section 5, was registered under the Building Societies Act (Northern Ireland) 1967 or registered or deemed to be registered in Northern Ireland under the enactments repealed by that Act shall be treated, for the purposes of this Act, as registered with the central office immediately before the commencement of that section.

Authorisation under existing enactments

6

(1) A building society which, at the commencement date for section 9 is authorised to raise money and accept deposits under—

(a) the Building Societies (Authorisation) Regulations 1981, or

(b) the Building Societies (Authorisation) Regulations (Northern Ireland) 1982,

shall be treated, whether or not the requirements of subsection (4) of section 9 would be fulfilled in its case, at the commencement of that section as authorised for the purposes of this Act (in particular Part VI).

(2) The central office shall record in the public file of each building society to which sub-paragraph (1) above applies the fact that, by virtue of that sub-paragraph, the society is to be treated as authorised for the purposes of this Act.

Anticipation of powers: declaratory provision

7

(1) It is hereby declared that every building society has had, as from 19th December 1985, power, for the purposes of any power conferred by this Act on building societies or building societies of its description, to do such things, subject to sub-paragraph (2) below, as are reasonably necessary to enable it—

(a) to decide whether or not, and to what extent, to exercise (and in the case of an adoptable power to adopt) the power, and

(b) if it decides to exercise the power, to exercise it as from the date when it becomes exercisable by the society.

(2) Sub-paragraph (1)(b) above does not authorise a society—

(a) to make contracts, other than conditional contracts, for the acquisition of land, the acquisition of a business or the acquisition of shares in any company if that company offers the public any service or facility within the power,

(b) to issue invitations to members of the society or the public to apply for any power to be exercised for their benefit, or

and, in this sub-paragraph, “conditional”, in relation to contracts with respect to the exercise of a power, means conditional on the power’s becoming exercisable by the society.

(3) The power conferred by this paragraph, and activities carried on under it, for the purposes of an adoptable power are not to be treated as included in, or in activities comprised in, that adoptable power for the purposes of paragaph 8 of this Schedule.

Unlawful anticipation of powers

8

(1) Where a building society adopts any adoptable power under paragraph 2 or 3 above—

(a) it shall, by virtue of this paragraph, assume an obligation, enforceable as provided in pararaph 9 below, not to exercise that power until the date on which the memorandum of its powers takes effect as respects that power, and

(b) it shall send to the central office, with the documents required by paragraph 2(1) or 3(1) above a declaration as respects that power made on behalf of the society which satisfies the requirements of this paragraph.

(2) The obligation assumed by virtue of this paragraph on the adoption of a power does not extend to the exercise of any power included in the adoptable power which the society has under the law in force at any time before the registration takes effect.

(3) A declaration, to satisfy the requirements of this paragraph, must be made by the chairman of the board of directors of the society, by one other director and by the chief executive of the society and it must either—

(a) state that, to the best of the knowledge and belief of the declarants, after due enquiry, the society has not, or has not with the permitted qualification, carried on any activity comprised in the power during the period which began one year before the specified date (or with 1 April 1986, if later) and expired with the date of the meeting at which the power was adopted, or

(b) state that, to the best of the knowledge and belief of the declarants, after due enquiry, the society, with specified exceptions, has not, or has not with the permitted qualification, carried on any activity comprised in the power during the period which began one year before the specified date (or with 1 April 1986, if later) and expired with the date of the meeting at which the power was adopted.

(4) The qualification of the statement so required which is permitted is that in so far as the society has, at any time during the said period, carried on any activity comprised in the power to which the statement relates, the society had the power to carry on that activity at that time under the law in force at that time.

(5) The exceptions to the statement so required must not include activities of the society which constitute significant excesses of its powers during the said period; and a declaration specifying activities as exceptions to the statement so required must also state the opinion of the declarants that the activities are believed not to constitute significant excesses of the society’s powers during the period to which the declaration relates.

Penalty for breach of undertaking

9

If, in breach of the obligation assumed by virtue of paragraph 8 above, a building society exercises any power to which the obligation extends, then—

(a) the society shall be liable on conviction on indictment or on summary conviction to a fine not exceeding, on summary conviction, the statutory maximum, and

(b) every officer of the society who is also guilty of the offence shall be liable, on summary conviction to a fine not exceeding the statutory maximum.

Penalty for false declaration

10

If the statement in a declaration made for the purposes of paragraph 8 above is false, then, any person who made the statement knowing it to be false or reckless as to whether it was true or false shall be liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine or both, and

(b) on summary conviction to imprisonment for a term not exceeding six months or to a fine not exceeding the statutory maximum or both.

Powers of central office

11

(1) The central office, on receiving from a building society the declaration required by and the other documents referred to in paragraph 8 above, shall refer to the Commission for its determination the questi on whether or not the memorandum of the society’s powers is to be registered.

(2) On a reference to the Commission of the question whether or not the memorandum of a society’s power is to be registered—

(a) if the declaration contains the statement specified in paragraph 8(3)(a) above and the Commission has no reasonable cause to believe that the society in question has carried on any activity comprised in the power to which the obligation imposed by paragraph 8 above extends at any time during the period which begin one year before the specified date (or with 1st April 1986, if later) and expired on the date on which it considers the reference, the Commission shall direct the central office to register the memorandum, and

(b) in any other case, the Commission may, as it thinks fit, direct the central office to register, or not to register, the memorandum.

(3) The Commission, in deciding, in a case falling within sub-paragraph (2)(b) above, whether or not to direct the registration of the memorandum of a society’s powers may have regard to all the circumstances of the case.

(4) No registration of a memorandum shall be effected by the central office under paragraph 2(2) or 3(2) above before the expiry of the period of 21 days beginning with the date on which it receives the declaration required by and the other documents referred to in paragraph 8 above.

(5) If the central office, in pursuance of a direction of the Commission under sub-paragraph (2) above, refuses registration of the memorandum of a society’s powers under sub-paragraph (1) above it shall serve on the society a notice—

(a) recording its refusal,

(b) specifying the activity which is believed to constitute a breach of the society’s obligation, and

(c) directing the society to make an application to the Commission under section 38 for a determination under that section whether the activity was or was not within the powers of the society at the time specified under sub-paragraph (b) above,

and shall send a copy of the notice to the Commission.

(6) The central office shall comply with any direction as regards the registration of the memorandum of the society’s powers given to it by the Commission consequent on the Commission’s determination of the society’s powers under section 38.

(7) Nothing in the foregoing provisions of this Schedule implies that it is improper for any of the following, that is to say—

(a) the Chief Registrar or any assistant registrar of the central office,

(b) the assistant registrar of friendly societies for Scotland,

(d) the Commission,

to give to a building society or building societies generally an indication of the action the Commission might or might not take in exercising its functions under this paragraph; and no decision of the Commission under this paragraph shall be liable to be set aside by reason of the indication having been given.

(8) In this paragraph “the specified date” has the same meaning as in paragraph 2 or, as the case may be, 3 above.

Permissible securities for advances

12

(1) Until provision is made by an order under section 10(6) prescribing the descriptions of equitable interests in land which may be taken as security for advances secured on land, building societies may advance money on the security of an equitable interest in land in England and Wales or Northern Ireland in addition to a mortgage of the freehold or leasehold estate where the lease or a related instrument includes provision entitling the leaseholder to acquire a beneficial interest of any extent in the freehold or a greater leasehold interest and the right to acquire that interest is assigned as additional security.

(2) Until such provision is made, section 17(10) shall have effect with the substitution of a reference to an equitable interest of the description specified in sub-paragraph (1) above for the reference to an equitable interest specified in an order under section 10(6).

(3) On the making of the first order under section 10(6) this paragraph shall cease to have effect.

13

Until provision is made by an order under section 12(3) prescribing indemnities given by a local authority as a description of additional security for the purposes of section 11(4)(c), an indemnity given under section 442 of the Housing Act 1985, under section 31 of the Tenants’ Rights, Etc. (Scotland) Act 1980 or under Article 156 of the Housing (Northern Ireland) Order 1981 shall be such a security; and on the making of the first order under section 12(3) this paragraph shall cease to have effect.

Existing business names

14

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Directors in office

15

(1) Except as provided in this paragraph, an existing director shall be treated for the purposes of sections 60 and 61 as having been duly elected a director on the date of his appointment as a director or, as the case may be, of his most recent re-appointment to that office before the commencement date.

(2) An existing director who holds office as director by virtue of holding some other position in the society shall, except in a case within sub-paragraph (4) below, be treated for the purposes of sections 60 and 61 as having been duly elected a director at the commencement date.

(3) If the term of office of an existing director would, in accordance with the terms on which he holds office, expire on an earlier date than is provided for by sub-paragraph (1) above, he shall vacate office on that earlier date.

(4) An existing director who has attained the normal retirement age, or the compulsory retirement age (if any), as the case may be, before the commencement date shall retire from office at the first annual general meeting of the society after the commencement date.

(5) If, at the commencement date, an existing director, other than a director falling within sub-paragraph (2) above, has held office since the date of his appointment or most recent re-appointment for a period longer than is provided for in section 60(11)(a), he shall retire from office at the first annual general meeting of the society after the commencement date.

(6) In this paragraph—

“the commencement date” means the commencement date for sections 60 and 61;

“existing director” means any director of a building society in office immediately before the commencement date; and

“the compulsory retirement age” and “the normal retirement age” have the meanings given in section 60(8).

Existing financial years

16

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Qualifying assets

17

For the purposes of the application of section 118 by reference to the annual accounts of a building society prepared before the first financial year for which accounts under Part VIII of this Act are prepared, the reference to the total commercial assets of a society shall have effect as a reference to the amount in the last balance sheet prepared under the Building Societies Act 1962 which represents the total assets constituted by mortgage debts outstanding to the society.

Provision of conveyancing services for building societies

18

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE 21

...

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Recognition of institutions

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Grant and revocation of recognition

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Recording of recognised status

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Delegation of functions

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Supplementary provisions as to recognition rules

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Restrictions on conveyancing by unqualified persons not to apply in case of recognized institutions

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Legal professional privilege

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Modification of enactments relating to conveyancing

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Penalty for pretending to be a recognised institution

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Offences committed by bodies corporate and unincorporated associations

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Power of Lord Chancellor to make recognition rules in the case of sole practitioners

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Restrictions on conveyancing by unqualified persons not to apply to recognised practitioners in relation to acts done by their employees

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Penalty for pretending to be a recognised practitioner

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The Building Societies Commission.

Making loans

Functions of the Financial Conduct Authority and the Prudential Regulation Authority in relation to building societies.

6A

(1) For the purposes of this Act a loan is secured on land if it is secured by—

(a) a mortgage of a legal estate in land in England and Wales or Northern Ireland;

(b) a heritable security over land in Scotland; or

(1A) For the purposes of this Act a loan is also secured on land if—

(a) it was secured before IP completion day by a qualifying security over land in an EEA country or territory other than the United Kingdom, and

(b) it continues to be secured by a qualifying security over that land.

(2) For the purposes of this Act a loan is also secured on land if—

(a) it is secured by a mortgage of an equitable interest in land in England and Wales or Northern Ireland;

(b) the equitable interest is an equitable interest in land of a description, and is created in circumstances, prescribed in an order made by the . . . Treasury; and

and an order under this subsection may apply in relation to securities held by or on behalf of building societies or connected undertakings of a description specified in the order, or securities held by or on behalf of all such societies or undertakings other than those of a description so specified.

(3) For the purposes of this Act—

(a) a loan shall be treated as secured by a mortgage of a legal estate in registered land in England and Wales or Northern Ireland notwithstanding that the loan is made before the mortgagor is registered as proprietor of the estate; and

(b) a loan shall be treated as secured by a heritable security over land in Scotland notwithstanding that the loan is made before title to that land has been transferred to the debtor in the heritable security.

(4) The Treasury may, by order provide for any provisions of this Act to have effect in relation to loans secured on land outside the United Kingdom with such modifications as appear to them to be appropriate.

(5) An order under subsection (2) or (4) above may make such incidental, supplementary and transitional provision as appears to the Treasury to be necessary or expedient.

(6) The power to make an order under subsection (2) or (4) above is exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(7) In this section and section 6B—

“EEA country or territory” means a country or territory in the European Economic Area;

“qualifying security”, in relation to a loan and land in the Isle of Man, the Channel Islands, Gibraltar or in an EEA country or territory, means a security over the land which—acknowledges, and requires repayment of, the loan; andsecures repayment of the loan on the land;...

(8) In this Act “land”, in the expression “loan secured on land”, means—

(a) land in—

(i) the United Kingdom;

(ii) the Isle of Man, the Channel Islands, Gibraltar; or

(iii) an EEA country or territory; and

(b) in so far as land in any other country or territory is, under any provision of this Act, land on which loans may be secured, land in that other country or territory.

6B

(1) For the purposes of this Act a loan which is owed to a building society or a subsidiary undertaking of a building society and is secured on residential property or other land is fully secured on the land if—

(a) the principal of, and interest accrued on, the loan does not exceed the value of the requisite security; and

(b) no, or no more than one, mortgage of the land which has priority over the society’s or undertaking’s mortgage is outstanding in favour of an outside person.

(2) Where a mortgage of the residential property or other land which has priority over the society’s or undertaking’s mortgage is outstanding, the principal of the loan secured or, in the case of a loan by instalments, intended to be secured by that mortgage shall be deducted from the value of the requisite security for the purposes of subsection (1)(a) above.

(3) Where the loan is secured on residential property or other land in the United Kingdom, any outstanding charge over the land which—

(a) in the case of land in England and Wales, is registered in the appropriate local land charges register;

(b) in the case of land in Scotland, is recorded in the Register of Sasines, or registered in the Land Register, under section 108 of the Civic Government (Scotland) Act 1982 or Schedule 9 to the Housing (Scotland) Act 1987;

(c) in the case of land in Northern Ireland, is registered in the statutory charges register under section 87 of, and Schedule 11 to, the Land Registration Act (Northern Ireland) 1970,

shall be disregarded for the purposes of subsections (1)(b) and (2) above.

(4) Where, on the occasion on which a building society or a subsidiary undertaking of a building society makes or acquires a loan which is secured on land, the society or undertaking is satisfied that the loan is—

(a) a loan which is fully secured on residential property;

(b) a loan which is not so secured but is fully secured on land; or

the loan shall be treated as such a loan for the purposes of this Act until such time (if any) as subsection (7) below applies.

(5) Subsection (4) above shall have effect in relation to a loan which the society or undertaking makes by two or more payments on different dates as if—

(a) the reference to the occasion on which the society or undertaking makes the loan were a reference to the occasion on which it makes the first of the payments;

(b) other references to the loan were references to it in its intended maximum amount; and

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