Financial Services Act 1986 (repealed)

• (a) the unlisted person mentioned in paragraph (b) or, as the case may be, each of the unlisted persons mentioned in paragraph (c) has in the previous eighteen months entered into another transaction in respect of an investment specified in paragraph 2(2) above ;

• (b) those conditions were satisfied in the case of that other transaction ; and

• (c) that other transaction was entered into by that person (whether acting as principal or agent) with the listed institution making the arrangements (whether acting as principal or agent) or through the agency of that institution or was entered into by that person (whether acting as principal or agent) as a result of arrangements made by that institution.

11

In the case of a transaction falling within paragraph 3 above paragraph 9(b) and (c) above do not apply unless the condition in paragraph 7 above is satisfied.

SCHEDULE 6

Term of office of members

1

• (1) A person appointed to the panel mentioned in section 96(25) of this Act shall hold and vacate his office in accordance with the terms of his appointment and on ceasing to hold office shall be eligible for re-appointment.

• (2) A member of the panel appointed by the Lord Chancellor may resign his office by notice in writing to the Lord Chancellor; and a member of the panel appointed by the Secretary of State may resign his office by notice in writing to the Secretary of State.

Expenses

2

The Secretary of State shall pay to the persons serving as members of the Tribunal such remuneration and allowances as he may determine and shall defray such other expenses of the Tribunal as he may approve.

Staff

3

The Secretary of State may provide the Tribunal with such officers and servants as he thinks necessary for the proper discharge of its functions.

Procedure

4

• (1) The Secretary of State may make rules for regulating the procedure of the Tribunal, including provision for the holding of any proceedings in private, for the awarding of costs (or, in Scotland, expenses) and for the payment of expenses to persons required to attend before the Tribunal.

• (2) The Tribunal may appoint counsel or a solicitor to assist it in proceedings before the Tribunal.

Evidence

5

• (1) The Tribunal may by summons require any person to attend, at such time and place as is specified in the summons, to give evidence or to produce any document in his custody or under his control which the Tribunal considers it necessary to examine.

• (2) The Tribunal may take evidence on oath and for that purpose administer oaths or may, instead of administering an oath, require the person examined to make and subscribe a declaration of the truth of the matters in respect of which he is examined.

• (3) Any person who without reasonable excuse—

• (a) refuses or fails to attend in obedience to a summons issued by the Tribunal or to give evidence ; or

• (b) alters, suppresses, conceals or destroys or refuses to produce a document which he may be required to produce for the purposes of proceedings before the Tribunal,

shall be guilty of an offence.

• (4) A person guilty of an offence under paragraph (a) of subparagraph (3) above shall be liable on summary conviction to . fine not exceeding the fifth level on the standard scale; and a person guilty of an offence under paragraph (b) of that sub-paragraph shall be liable—

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

• (b) on summary conviction, to a fine not exceeding the statutory maximum.

• (5) A person shall not under this paragraph be required to disclose any information or produce any document which he would be entitled to refuse to disclose or produce on grounds of legal professional privilege in proceedings in the High Court or on grounds of confidentiality as between client and professional legal adviser in proceedings in the Court of Session except that a lawyer may be required to furnish the name and address of his client.

• (6) Any reference in this paragraph to the production of a document includes a reference to the production of a legible copy of information recorded otherwise than in legible form; and the reference to suppressing a document includes a reference to destroying the means of reproducing information recorded otherwise than in legible form.

Appeals and supervision by Council on Tribunals

6

The Tribunals and Inquiries Act 1971 shall be amended as follows—

• (a) in section 8(2) after " 6A " there shall be inserted " 6B" ;

• (b) in section 13(1) after " 6 " there shall be inserted " 6B " ;

• (c) in Schedule 1, after paragraph 6A there shall be inserted—

Financial services.	6B. The Financial Services Tribunal established by section 96 of the Financial Services Act 1986.

Parliamentary disqualification

7

• (1) In Part III of Schedule 1 to the House of Commons Disqualification Act 1975 (disqualifying offices) there shall be inserted at the appropriate place " Any member of the Financial Services Tribunal in receipt of remuneration ".

• (2) A corresponding amendment shall be made in Part III of Schedule 1 to the Northern Ireland Assembly Disqualification Act 1975.

SCHEDULE 7

Constitution

1

• (1) The constitution of the agency must provide for it to have—

• (a) a chairman; and

• (b) a governing body consisting of the chairman and other members ;

and the provisions of the constitution relating to the chairman and the other members of the governing body must comply with the following provisions of this paragraph.

• (2) The chairman and other members of the governing body must be persons appointed and liable to removal from office by the Secretary of State and the Governor of the Bank of England acting jointly.

• (3) The members of the governing body must include—

• (a) persons with experience of investment business of a kind relevant to the functions or proposed functions of the agency; and

• (b) other persons, including regular users on their own account or on behalf of others of services provided by persons carrying on investment business of any such kind ;

and the composition of that body must be such as to secure a proper balance between the interests of persons carrying on investment business and the interests of the public.

Arrangements for discharge of functions

2

• (1) The agency's arrangements for the discharge of its functions must comply with the following provisions of this paragraph.

• (2) Any rules or regulations must be made by the governing body of the agency.

• (3) Any decision taken in the exercise of other functions must be taken at a level appropriate to the importance of the decision.

• (4) In the case of functions to be discharged by the governing body, the members falling respectively within paragraphs (a) and (b) of paragraph 1(3) above must, so far as practicable, have an opportunity to express their opinions.

• (5) Subject to sub-paragraphs (2) to (4) above, the arrangements may enable any functions to be discharged by a committee, subcommittee, officer or servant of the agency.

Monitoring and enforcement

3

• (1) The agency must have a satisfactory system—

• (a) for enabling it to determine whether persons regulated by it are complying with the obligations which it is the responsibility of the agency to enforce; and

• (b) for the discharge of the agency's responsibility for the enforcement of those obligations.

• (2) The system may provide for the functions mentioned in subparagraph (l)(a) to be performed on its behalf (and without affecting its responsibility) by any other body or person who is able and willing to perform them.

Investigation of complaints

4

• (1) The agency must have effective arrangements for the investigation of complaints arising out of the conduct of investment business by authorised persons or against any recognised self-regulating organisation, professional body, investment exchange or clearing house.

• (2) The arrangements must make provision for the investigation of complaints in respect of authorised persons to be carried out in appropriate cases independently of the agency and those persons.

Promotion and maintenance of standards

5

The agency must be able and willing to promote and maintain high standards of integrity and fair dealing in the carrying on of investment business and to co-operate, by the sharing of information and otherwise, with the Secretary of State and any other authority, body or person having responsibility for the supervision or regulation of investment business or other financial services.

Records

6

The agency must have satisfactory arrangements for recording decisions made in the exercise of its functions and for the safekeeping of those records which ought to be preserved.

SCHEDULE 8

Standards

1

The rules made under section 48 of this Act (in this Schedule referred to as " conduct of business rules ") and the other rules and regulations made under Part I of this Act must promote high standards of integrity and fair dealing in the conduct of investment business.

2

The conduct of business rules must make proper provision for requiring an authorised person to act with due skill, care and diligence in providing any service which he provides or holds himself out as willing to provide.

3

The conduct of business rules must make proper provision for requiring an authorised person to subordinate his own interests to those of his clients and to act fairly between his clients.

4

The conduct of business rules must make proper provision for requiring an authorised person to ensure that, in anything done by him for the persons with whom he deals, due regard is had to their circumstances.

Disclosure

5

The conduct of business rules must make proper provision for the disclosure by an authorised person of interests in, and facts material to, transactions which are entered into by him in the course of carrying on investment business or in respect of which he gives advice in the course of carrying on such business, including information as to any commissions or other inducements received or receivable from a third party in connection with any such transaction.

6

The conduct of business rules must make proper provision for the disclosure by an authorised person of the capacity in which and the terms on which he enters into any such transaction.

7

The conduct of business rules, or those rules and rules under section 51 of this Act, must make proper provision for requiring an authorised person who in the course of carrying on investment business enters or offers to enter into a transaction in respect of an investment with any person, or gives any person advice about such a transaction, to give that person such information as to the nature of the investment and the financial implications of the transaction as will enable him to make an informed decision.

8

Rules made under section 48 of this Act regulating action for the purpose of stabilising the price of investments must make proper provision for ensuring that where action is or is to be taken in conformity with the rules adequate arrangements exist for making known that the price of the investments in respect of which the action is or is to be taken (and, where relevant, of any other investments) may be affected by that action and the period during which it may be affected; and where a transaction is or is to be entered into during a period when it is known that the price of the investment to which it relates may be affected by any such action the information referred to in paragraph 7 above includes information to that effect.

Protection

9

The conduct of business rules and any regulations made under section 55 of this Act must make proper provision for the protection of property for which an authorised person is liable to account to another person.

10

Rules made under sections S3 and 54 of this Act must make the best provision that can reasonably be made under those sections.

Records

11

The conduct of business rules must require the keeping of proper records and make provision for their inspection in appropriate oases.

Classes of investors

12

The conduct of business rules and the other rules and regulations made under Chapter V of Part I of this Act must take proper account of the fact that provisions that are appropriate for regulating the conduct of business in relation to some classes of investors may not (by reason of their knowledge, experience or otherwise) be appropriate in relation to others.

SCHEDULE 9

Status

1

• (1) A designated agency shall not be regarded as acting on behalf of the Crown and its members, officers and servants shall not be regarded as Crown servants.

• (2) In Part III of Schedule 1 to the House of Commons Disqualification Act 1975 (disqualifying offices) there shall be inserted at the appropriate place—

• Chairman of a designated agency within the meaning of the Financial Services Act 1986 if he is in receipt of remuneration

.

• (3) An amendment corresponding to that in sub-paragraph (2) above shall be made in Part III of Schedule 1 to the Northern Ireland Assembly Disqualification Act 1975.

Exemption from requirement of " limited" in name of designated agency

2

• (1) A company is exempt from the requirements of the Companies Act 1985 relating to the use of " limited " as part of the company name if—

• (a) it is a designated agency ; and

• (b) its memorandum or articles comply with the requirements specified in paragraph (b) of subsection (3) of section 30 of that Act.

• (2) In subsection (4) of that section (statutory declaration of compliance with requirements entitling company to exemption) the reference to the requirements of subsection (3) of that section shall include a reference to the requirements of sub-paragraph (1) above.

• (3) In section 31 of that Act (provisions applicable to exempted companies) the reference to a company which is exempt under section 30 of that Act shall include a reference to a company that is exempt under this paragraph and, in relation to such a company, the power conferred by subsection (2) of that section (direction to include " limited " in company name) shall be exercisable on the ground that the company has ceased to be a designated agency instead of the ground mentioned in paragraph (a) of that subsection.

• (4) In this paragraph references to the said Act of 198S and sections 30 and 31 of that Act include references to the corresponding provisions in force in Northern Ireland.

The Tribunal

3

• (1) Where a case is referred to the Tribunal by a designated agency die Tribunal shall send the Secretary of State a copy of any report made by it to the agency in respect of that case.

• (2) Where the powers which the Tribunal could, apart from any delegation order, require the Secretary of State to exercise are, by virtue of such an order or of an order resuming any function transferred by it, exercisable partly by the Secretary of State and partly by a designated agency or designated agencies the Tribunal may require any of them to exercise such of those powers as are exercisable by them respectively.

Legislative functions

4

• (1) A designated agency shall send the Secretary of State a copy of any rules or regulations made by it by virtue of functions transferred to it by a delegation order and give him written notice of any amendment or revocation of or addition to any such rules or regulations.

• (2) A designated agency shall—

• (a) send the Secretary of State a copy of any guidance issued by the agency which is intended to have continuing effect and is issued in writing or other legible form ; and

• (b) give him written notice of any amendment, revocation of or addition to guidance issued by it ;

but notice need not be given of the revocation of guidance other than such as is mentioned in paragraph (a) above or of any amendment or addition which does not result in or consist of such guidance as is there mentioned.

5

Paragraphs 6 to 9 below shall have effect instead of section 205 (2) and (4) of this Act in relation to rules and regulations made by a designated agency in the exercise of functions transferred to it by a delegation order.

6

The rules and regulations shall be made by an instrument in writing.

7

The instrument shall specify the provision of this Act under which it is made.

8

• (1) Immediately after an instrument is made it shall be printed and made available to the public with or without payment

• (2) A person shall not be taken to have contravened any rule or regulation if he shows that at the time of the alleged contravention the instrument containing the rule or regulation had not been made available as required by this paragraph.

9

• (1) The production of a printed copy of an instrument purporting to be made by the agency on which is endorsed a certificate signed by an officer of the agency authorised by it for that purpose and stating—

• (a) that the instrument was made by the agency ;

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

• (c) that on a specified date the instrument was made available to the public as required by paragraph 8 above,

shall be prima facie evidence or, in Scotland, sufficient evidence of the facts stated in the certificate.

• (2) Any certificate purporting to be signed as mentioned in subparagraph (1) above shall be deemed to have been duly signed unless the contrary is shown.

• (3) Any person wishing in any legal proceedings to cite an instrument made by the agency may require the agency to cause a copy of it to be endorsed with such a certificate as is mentioned in this paragraph.

Fees

10

• (1) A designated agency may retain any fees payable to it by virtue of the delegation order.

• (2) Any such fees shall be applicable for meeting the expenses of the agency in discharging its functions under the order and for any purposes incidental thereto.

• (3) Any fees payable to a designated agency by virtue of a delegation order made before the coming into force of section 3 of this Act may also be applied for repaying the principal of, and paying interest on, any money borrowed by the agency (or by any other person whose liabilities in respect of the money are assumed by the agency) which has been used for the purpose of defraying expenses incurred before the making of the order (whether before or after the passing of this Act) in making preparations for the agency becoming a designated agency.

11

If the function of prescribing the amount of any fee, or of making a scheme under section 112 above, is exercisable by a designated agency it may prescribe or make provision for such fees as will enable it to defray any such expenses as are mentioned in paragraph 10 above.

Consultation

12

• (1) Before making any rules or regulations by virtue of functions transferred to it by a delegation order a designated agency shall, subject to sub-paragraphs (2) and (3) below, publish the proposed rules and regulations in such manner as appears to the agency to be best calculated to bring them to the attention of the public, together with a statement that representations in respect of the proposals can be made to the agency within a specified period; and before making the rules or regulations the agency shall have regard to any representations duly made in accordance with that statement

• (2) Sub-paragraph (1) above does not apply in any case in which the agency considers that the delay involved in complying with that sub-paragraph would be prejudicial to the interests of investors.

• (3) Sub-paragraph (1) above does not apply to the making of any rule or regulation if it is in the same terms (or substantially the same terms) as a proposed rule or regulation which was furnished by the agency to the Secretary of State for the purposes of section 114(9) of this Act.

Exchange of information

13

• (1) The Secretary of State may communicate to a designated agency any information in his possession of which he could have availed himself for the purpose of exercising any function which by virtue of a delegation order is for the time being exercisable by the agency.

• (2) A designated agency may in the exercise of any function which by virtue of a delegation order is for the time being exercisable by it communicate to any other person any information which has been communicated to the agency by the Secretary of State and which the Secretary of State could have communicated to that person in the exercise of that function.

• (3) No communication of information under sub-paragraph (1) above shall constitute publication for the purposes of the law of defamation.

SCHEDULE 10

Preliminary

1

In this Part of this Schedule " a regulated insurance company " means any such company as is mentioned in section 129 of this Act.

Authorisations for investment business and insurance business

2

• (1) An insurance company to which section 22 of this Act applies shall not be an authorised person except by virtue of that section.

• (2) If an insurance company to which Part II of the Insurance Companies Act 1982 applies but to which section 22 of this Act does not apply becomes an authorised person by virtue of any other provision of this Act it shall be an authorised person only as respects the management of the investments of any pension fund which is established solely for the benefit of the officers or employees and their dependants of that company or of any other body corporate in the same group as that company.

• (3) An insurance company to which section 31 of this Act applies shall not, so long as it is an authorised person by virtue of that section, be an authorised person by virtue of any other provision of this Act.

• (4) None of the provisions of Part I of this Act shall be construed as authorising any person to carry on insurance business in any case in which he could not lawfully do so apart from those provisions.

Recognition of self-regulating organisation with insurance company members

3

• (1) In the case of a self-regulating organisation whose members include or may include regulated insurance companies the requirements of Schedule 2 to this Act shall include a requirement that the rules of the organisation must take proper account of Part II of the Insurance Companies Act 1982 or, as the case may be, of the provisions for corresponding purposes in the law of any member State in which such companies are established.

• (2) Where the function of making or revoking a recognition order in respect of such a self-regulating organisation is exercisable by a designated agency it shall not regard that requirement as satisfied unless the Secretary of State has certified that he also regards it as satisfied.

• (3) A delegation order—

• (a) may reserve to the Secretary of State the function of revoking a recognition order in respect of such a self-regulating organisation as is mentioned in sub-paragraph (1) above on the ground that the requirement there mentioned is not satisfied ; and

• (b) shall not transfer to a designated agency the function of revoking any such recognition order on the ground that the organisation has contravened sub-paragraphs (3) or (4) of paragraph 6 below as applied by sub-paragraph (5) of that paragraph.

• (4) In the case of such a self-regulating organisation as is mentioned in sub-paragraph (1) above the requirements of Schedule 2 to this Act referred to in section 187(2)(a) of this Act shall include the requirement mentioned in that sub-paragraph.

Modification of provisions as to conduct of investment business

4

• (1) The rules under section 48 of this Act shall not apply to a regulated insurance company except so far as they make provision as respects the matters mentioned in sub-paragraph (2) below.

• (2) The matters referred to in sub-paragraph (1) above are—

• (a) procuring proposals for policies the rights under which constitute an investment for the purposes of this Act and advising persons on such policies and the exercise of the rights conferred by them ;

• (b) managing the investments of pension funds, procuring persons to enter into contracts for the management of such investments and advising persons on such contracts and the exercise of the rights conferred by them ;

• (c) matters incidental to those mentioned in paragraph (a) and (b) above.

• (3) The rules under section 49 of this Act shall not apply to an insurance company which is an authorised person by virtue of section 31 of this Act.

• (4) The rules under sections 53 and 54 of this Act shall not apply to loss arising as a result of a regulated insurance company being unable to meet its liabilities under a contract of insurance.

• (5) A direction under section 59 of this Act shall not prohibit the employment of a person by a regulated insurance company except in connection with—

• (a) the matters mentioned in sub-paragraph (2) above ; or

• (b) investment business carried on in connection with or for the purposes of those matters.

• (6) The Secretary of State shall not make a delegation order transferring any functions of making rules or regulations under Chapter V of Part I of this Act in relation to a regulated insurance company unless he is satisfied that those rules and regulations will take proper account of Part II of the Insurance Companies Act 1982 or, as the case may be, of the provisions for corresponding purposes in the law of the member State in which the company is established; and in section 115(5) of this Act the reference to the requirements of section 114(9)(b) shall include a reference to the requirements of this subparagraph.

Restriction of provisions as to conduct of insurance business

5

• (1) Regulations under section 72 of the Insurance Companies Act 1982 (insurance advertisements) shall not apply to so much of any advertisement issued by an authorised person as relates to a contract of insurance the rights under which constitute an investment for the purposes of this Act.

• (2) No requirement imposed under section 74 of that Act (intermediaries in insurance transactions) shall apply in respect of an invitation issued by, or by an appointed representative of, an authorised person in relation to a contract of insurance the rights under which constitute an investment for the purposes of this Act.

• (3) Subject to sub-paragraph (4) below, sections 75 to 77 of that Act (right to withdraw from long-term policies) shall not apply to a regulated insurance company in respect of a contract of insurance the rights under which constitute an investment for the purposes of this Act.

• (4) Sub-paragraph (3) above does not affect the operation of the said sections 75 to 77 in a case in which the statutory notice required by those sections has been or ought to have been served before the coming into force of that sub-paragraph.

Exercise of powers of intervention etc.

6

• (1) The powers conferred by Chapter VI of Part I of this Act shall not be exercisable in relation to a regulated insurance company on the ground specified in section 64(l)(a) of this Act for reasons relating to the ability of the company to meet its liabilities to policy holders or potential policy holders.

• (2) The powers conferred by sections 66 and 68 of this Act, and those conferred by section 67 of this Act so far as applicable to assets belonging to the authorised person, shall not be exercisable in relation to a regulated insurance company.

• (3) A designated agency shall not in the case of a regulated insurance company impose any prohibition or requirement under section 65 or 67 of mis Act, or vary any such prohibition or requirement, unless it has given reasonable notice of its intention to do so to the Secretary of State and informed him—

• (a) of the manner in which and the date on or after which it intends to exercise that power ; and

• (b) in the case of a proposal to impose a prohibition or requirement, on which of the grounds specified in section 64(1) of this Act it proposes to act and its reasons for considering that the ground in question exists and that it is necessary to impose the prohibition or requirement

• (4) A designated agency shall not exercise any power to which sub-paragraph (3) above applies if the Secretary of State has before the date specified in accordance with sub-paragraph (3), above served on it a notice in writing directing it not to do so ; and the Secretary of State may serve such a notice if he considers it desirable for protecting policy holders or potential policy holders of the company against the risk that it may be unable to meet its liabilities or to fulfil the reasonable expectations of its policy holders or potential policy holders.

• (5) Sub-paragraphs (3) and (4) above shall, with the necessary modifications, apply also where a recognised self-regulating organisation proposes to exercise, in the case of a member who is a regulated insurance company, any powers of the organisation for purposes corresponding to those of Chapter VI of Part I of this Act

• (6) The powers conferred by sections 72 and 73 of this Act shall not be exercisable in relation to a regulated insurance company.

Withdrawal of insurance business authorisation

7

• (1) At the end of section 11(2)(a) of the Insurance Companies Act 1982 (withdrawal of authorisation in respect of new business where insurance company has failed to satisfy an obligation to which it is subject by virtue of that Act) there shall be inserted the words " or the Financial Services Act 1986 or, if it is a member of a recognised self-regulating organisation within the meaning of that Act, an obligation to which it is subject by virtue of the rules of that organisation ".

• (2) After subsection (2) of section 13 of that Act (final withdrawal of authorisation) there shall be inserted—

(2A) The Secretary of State may direct that an insurance company shall cease to be authorised to carry on business which is insurance business by virtue of section 95(c)(ii) of this Act if it appears to him that the company has failed to satisfy an obligation to which it is subject by virtue of the Financial Services Act 1986 or, if it is a member of a recognised self-regulating organisation within the meaning of that Act, an obligation to which it is subject by virtue of the rules of that organisation. (2B) Subsections (3), (5) and (6) of section 11 and subsections (1) and (5) to (8) of section 12 above shall apply to a direction under subsection (2A) above as they apply to a direction under section 11.

Termination of investment business authorisation of insurer established in other member State

8

• (1) Sections 33(1)(b) and 34 of this Act shall not apply to a regulated insurance company.

• (2) A direction under section 33(1)(a) of this Act in respect of such an insurance company may provide that the company shall cease to be an authorised person except as respects investment business of a kind specified in the direction and shall not make it unlawful for the company to effect a contract of insurance in pursuance of a subsisting contract of insurance.

• (3) Where the Secretary of State proposes to give a direction under section 33(1)(a) of this Act in respect of such an insurance company he shall give it written notice of his intention to do so, giving particulars of the grounds on which he proposes to act and of the rights exercisable under sub-paragraph (4) below.

• (4) An insurance company on which a notice is served under sub-paragraph (3) above may within fourteen days after the date of service make written representations to the Secretary of State and, if desired, oral representations to a person appointed for that purpose by the Secretary of State; and the Secretary of State shall have regard to any representations made in accordance with this sub-paragraph in determining whether to give the direction.

• (5) After giving a direction under section 33(1)(a) of this Act in respect of a regulated insurance company the Secretary of State shall inform the company in writing of the reasons for giving the direction.

• (6) A delegation order shall not transfer to a designated agency the function of giving a direction under section 33(1)(a) of this Act in respect of a regulated insurance company.

Powers of Tribunal

9

In the case of a regulated insurance company the provisions mentioned in section 98(4) of this Act shall include sections 11 and 13(2A) of the Insurance Companies Act 1982 but where the Tribunal reports that the appropriate decision would be to take action under either of those sections or under section 33((1)(a)) of this Act the Secretary of State shall take the report into consideration but shall not be bound to act upon it

Consultation with designated agencies

10

• (1) Where any functions under this Act are for the tune being exercisable by a designated agency in relation to regulated insurance companies the Secretary of State shall, before issuing an authorisation under section 3 of the Insurance Companies Act 1982 to an applicant who proposes to carry on in the United Kingdom insurance business which is investment business—

• (a) seek the advice of the designated agency with respect to any matters which are relevant to those functions of the agency and relate to the applicant, his proposed business or persons who will be associated with him in, or in connection with, that business; and

• (b) take into account any advice on those matters given to him by the agency before the end of the period within which the application is required to be decided.

• (2) The Secretary of State may for the purpose of obtaining the advice of a designated agency under sub-paragraph (1) above furnish it with any information obtained by him in connection with the application.

• (3) If a designated agency by which any functions under this Act are for the time being exercisable in relation to regulated insurance companies has reasonable grounds for believing mat any such insurance company has failed to comply with an obligation to which it is subject by virtue of this Act it shall forthwith give notice of that fact to the Secretary of State so that he can take it into consideration in deciding whether to give a direction in respect of the company under section 11 or 13(2A) of the said Act of 1982 or section 33 of this Act.

• (4) A notice under sub-paragraph (3) above shall contain particulars of the obligation in question and of the agency's reasons for considering that the company has failed to satisfy that obligation.

• (5) A designated agency need not give a notice under subparagraph (3) above in respect of any matter unless it considers that that matter (either alone or in conjunction with other matters) would justify the withdrawal of authorisation under section 28 of this Act in the case of a person to whom that section applies.

SCHEDULE 11

PART I — Preliminary

1

In this Schedule—

• "a regulated friendly society" means a society which is an authorised person by virtue of section 23 of this Act as respects such investment business as is mentioned in that section;

• " regulated business ", in relation to a regulated friendly society, means investment business as respects which the society is authorised by virtue of that section;

• " a self-regulating organisation for friendly societies" means a self-regulating organisation which is permitted under its rules to admit regulated friendly societies as members and to regulate the carrying on by such societies of regulated business;

• " a recognised self-regulating organisation for friendly societies " means a body declared by an order of the Registrar for the time being in force to be a recognised self-regulating organisation for friendly societies for the purposes of this Schedule ;

• "a member society" means a regulated friendly society which is a member of an appropriate recognised self-regulating organisation for friendly societies and is subject to its rules in carrying on all its regulated business and, for the purposes of this definition, " an appropriate recognised self-regulating organisation for friendly societies " means— in the case of any such society as is mentioned in section 23(1) of this Act, an organisation declared by an order of the Chief Registrar of friendly societies for the time being in force to be a recognised self-regulating organisation for friendly societies for the purposes of this Schedule; and in the case of any such society as is mentioned in section 23(2) of this Act, an organisation declared by an order of the Registrar of Friendly Societies for Northern Ireland for the time being in force to be such an organisation ;

• " the Registrar " means— in relation to any such society as is mentioned in section 23(1) of this Act, or to any self-regulating organisation for friendly societies which has applied for or been granted a recognition order made by him, the Chief Registrar of friendly societies ; and in relation to any such society as is mentioned in section 23(2) of this Act, or to any self-regulating organisation for friendly societies which has applied for or been granted a recognition order made by him, the Registrar of Friendly Societies for Northern Ireland.

PART II — Self-Regulating Organisations for Friendly Societies

Recognition

2

• (1) A self-regulating organisation for friendly societies may apply to the Chief Registrar of friendly societies or the Registrar of Friendly Societies for Northern Ireland for an order declaring it to be a recognised self-regulating organisation for friendly societies for the purposes of this Schedule.

• (2) An application under sub-paragraph (1) above—

• (a) shall be made in such manner as the Registrar may direct; and

• (b) shall be accompanied by such information as the Registrar may reasonably require for the purpose of determining the application.

• (3) At any time after receiving an application and before determining it the Registrar may require the applicant to furnish additional information.

• (4) The directions and requirements given or imposed under subparagraphs (2) and (3) above may differ as between different applications.

• (5) Any information to be furnished to the Registrar under this paragraph shall, if he so requires, be in such form or verified in such manner as he may specify.

• (6) Every application shall be accompanied by a copy of the applicant's rules and of any guidance issued by the applicant which is intended to have continuing effect and is issued in writing or other legible form.

3

• (1) If, on an application duly made in accordance with paragraph 2 above and after being furnished with all such information as he may require under that paragraph, it appears to the Registrar from that information and having regard to any other information in his possession that the requirements mentioned in paragraph 4 below are satisfied as respects that organisation, he may, with the consent of the Secretary of State and subject to sub-paragraph (2) below, make an order ("a recognition order") declaring the applicant to be a recognised self-regulating organisation for friendly societies.

• (2) Where the Registrar proposes to grant an application for a recognition order he shall send to the Secretary of State a copy of the application together with a copy of the rules and any guidance accompanying the application and the Secretary of State shall not consent to the making of the recognition order unless he is satisfied that the rules and guidance of which copies have been sent to him under this sub-paragraph do not have, and are not intended or likely to have, to any significant extent the effect of restricting, distorting or preventing competition or, if they have or are intended or likely to have that effect to any significant extent, that the effect is not greater than is necessary for the protection of investors.

• (3) Section 122 of this Act shall apply in relation to the decision whether to consent to the making of a recognition order under this paragraph as it applies to the decisions mentioned in subsection (1) of that section.

• (4) Subsections (1) and (2) of section 128 of this Act shall apply for the purposes of this paragraph as if the powers there mentioned included the power of refusing consent to the making of a recognition order under this paragraph and subsection (5) of that section shall apply for that purpose as if the reference to Chapter XIV of Part I included a reference to this paragraph.

• (5) The Registrar may refuse to make a recognition order in respect of an organisation if he considers that its recognition is unnecessary having regard to the existence of one or more other organisations which are concerned with such investment business as is mentioned in section 23 of this Act and which have been or are likely to be recognised under this paragraph.

• (6) Where the Registrar refuses an application for a recognition order he shall give the applicant a written notice to that effect specifying a requirement which in the opinion of the Registrar is not satisfied, stating that the application is refused on the ground mentioned in sub-paragraph (5) above or stating that the Secretary of State has refused to consent to the making of the order.

• (7) A recognition order shall state the date on which it takes effect.

4

• (1) The requirements referred to in paragraph 3 above are that mentioned in sub-paragraph (2) below and those set out in paragraphs 2 to 7 of Schedule 2 to this Act as modified in sub-paragraphs (3) to (5) below.

• (2) The rules of the organisation must take proper account of the Friendly Societies Act 1974, or as the case may be, the Friendly Societies Act (Northern Ireland) 1970.

• (3) References in paragraphs 2, 3, 4 and 6 of Schedule 2 to members are to members who are regulated friendly societies.

• (4) In paragraph 3 of that Schedule—

• (a) in sub-paragraph (1) for the reference to Chapter V of Part I of this Act there shall be substituted a reference to paragraphs 14 to 22 below ; and

• (b) in sub-paragraph (2) the reference to section 49 of this Act shall be omitted and for the reference to sections S3 and 54 there shall be substituted a reference to paragraphs 17 and 18 below ; and

• (c) in sub-paragraph (3) for the reference to Chapter VI of that Part there shall be substituted a reference to the powers exercisable by the Registrar by virtue of paragraph 23 below. ,

• (5) In paragraph 4 of that Schedule for the reference to Chapter V of Part I of this Act there shall be substituted references to paragraphs 14 to 22 below.

Revocation of recognition

5

• (1) A recognition order may be revoked by a further order made by the Registrar if at any time it appears to him—

• (a) that any requirement mentioned in paragraph 4(1) above is not satisfied in the case of the organisation to which the recognition order relates (" the recognised organisation ");

• (b) that the recognised organisation has failed to comply with any obligation to which it is subject by virtue of this Act; or

• (c) that the continued recognition of the organisation is undesirable having regard to the existence of one or more other organisations which have been or are to be recognised under paragraph 3 above.

• (2) Subsections (2) to (9) of section 11 of this Act shall have effect in relation to the revocation of a recognition order under this paragraph as they have effect in relation to the revocation of a recognition order under subsection (1) of that section but with the substitution—

• (a) for references to the Secretary of State of references to the Registrar;

• (b) for the reference in subsection (3) to members of a reference to members of the organisation which are member societies in relation to it; and

• (c) for the reference in subsection (6) to investors of a reference to members of the societies which are member societies in relation to the organisation.

Compliance orders

6

• (1) If at any time it appears to the Registrar—

• (a) that any requirement mentioned in paragraph 3 above is not satisfied in the case of a recognised self-regulating organisation for friendly societies; or

• (b) that such an organisation has failed to comply with any obligation to which it is subject by virtue of this Act,

he may, instead of revoking the recognition order under paragraph 5 above, make an application to the court under this paragraph.

• (2) If on any such application the court decides that the requirement in question is not satisfied or, as the case may be, that the organisation has failed to comply with the obligation in question it may order the organisation concerned to take such steps as the court directs for securing that that requirement is satisfied or that that obligation is complied with.

• (3) The jurisdiction conferred by this paragraph shall be exercisable by the High Court and the Court of Session.

7

• (1) If at any time it appears to the Registrar that the rules of a recognised self-regulating organisation for friendly societies do not satisfy the requirements of paragraph 3(1) of Schedule 2 to this Act as modified by paragraph 4(4) above he may, instead of revoking the recognition order or making an application under paragraph 6 above, direct the organisation to alter, or himself alter, its rules in such manner as he considers necessary for securing that the rules satisfy those requirements.

• (2) Before giving a direction or making any alteration under this paragraph the Registrar shall consult the organisation concerned.

• (3) Any direction given under sub-paragraph (1) above shall, on the application of the Registrar, be enforceable by mandamus or, in Scotland, by an order for specific performance under section 91 of the Court of Session Act 1868.

• (4) A recognised self-regulating organisation for friendly societies whose rules have been altered by or pursuant to a direction given by the Registrar under sub-paragraph (1) above may apply to the court and if the court is satisfied—

• (a) that the rules without the alteration satisfied the requirements mentioned in that sub-paragraph ; or

• (b) that other alterations proposed by the organisation would result in the rules satisfying those requirements,

the court may set aside the alteration made by or pursuant to the direction given by the Registrar and, in a case within paragraph (b) above, order the organisation to make the alterations proposed by it; but the setting aside of an alteration under this sub-paragraph shall not affect its previous operation.

• (5) The jurisdiction conferred by sub-paragraph (4) above shall be exercisable by the High Court and the Court of Session.

• (6) Subsections (2) to (7) and (9) of section 11 of this Act shall, with the modifications mentioned in paragraph 5(2) above and any other necessary modifications, have effect in relation to any direction given or alteration made by the Registrar under sub-paragraph (1) above as they have effect in relation to an order revoking a recognition order.

• (7) The fact that the rules of an organisation have been altered by or pursuant to a direction given by the Registrar, or pursuant to an order made by the court, under this paragraph shall not preclude their subsequent alteration or revocation by that organisation.

8

• (1) The Registrar or the Secretary of State may make regulations requiring a recognised self-regulating organisation for friendly societies to give the Registrar or, as the case may be, the Secretary of State forthwith notice of the occurrence of such events relating to the organisation or its members as are specified in the regulations and such information in respect of those events as is so specified.

• (2) The Registrar or the Secretary of State may make regulations requiring a recognised self-regulating organisation for friendly societies to furnish the Registrar or, as the case may be, the Secretary of State at such times or in respect of such periods as are specified in the regulations with such information relating to the organisation or its members as is so specified.

• (3) The notices and information required to be given or furnished under the foregoing provisions of this paragraph shall be such as the Registrar or, as the case may be, the Secretary of State may reasonably require for the exercise of his functions under this Act.

• (4) Regulations under the foregoing provisions of this paragraph may require information to be given in a specified form and to be verified in a specified manner.

• (5) A notice or information required to be given or furnished under the foregoing provisions of this paragraph shall be given in writing or such other manner as the Registrar or, as the case may be, the Secretary of State may approve.

• (6) Where a recognised self-regulating organisation for friendly societies amends, revokes or adds to its rules or guidance it shall within seven days give the Registrar written notice of the amendment, revocation or addition; but notice need not be given of the revocation of guidance other than such as is mentioned in paragraph 2(6) above or of any amendment of or addition to guidance which does not result in or consist of such guidance as is there mentioned.

• (7) The Registrar shall send the Secretary of State a copy of any notice given to him under sub-paragraph (6) above.

• (8) Contravention of or of regulations under this paragraph shall not be an offence.

9

• (1) A recognised self-regulating organisation for friendly societies shall not exercise any powers for purposes corresponding to those of the powers exercisable by the Registrar by virtue of paragraph 23 below in relation to a regulated friendly society unless it has given reasonable notice of its intention to do so to the Registrar and informed him—

• (a) of the manner in which and the date on or after which it intends to exercise the power; and

• (b) in the case of a proposal to impose a prohibition or requirement, of the reason why it proposes to act and its reasons for considering that that reason exists and that it is necessary to impose the prohibition or requirement.

• (2) A recognised self-regulating organisation for friendly societies shall not exercise any power to which sub-paragraph (1)(a) above applies if before the date given in the notice in pursuance of that sub-paragraph the Registrar has served on it a notice in writing directing it not to do so; and the Registrar may serve such a notice if he considers it is desirable for protecting members or potential members of the society against the risk that it may be unable to meet its liabilities or to fulfil the reasonable expectations of its members or potential members.

Prevention of restrictive practices

10

• (1) The powers conferred by sub-paragraph (2) below shall be exercisable by the Secretary of State if at any time it appears to him that—

• (a) any rules made or guidance issued by a recognised self-regulating organisation for friendly societies;

• (b) any practices of any such organisation; or

• (c) any practices of persons who are members of, or otherwise subject to the rules made by, any such organisation,

have, or are intended or likely to have, to a significant extent the effect of restricting, distorting or preventing competition and that that effect is greater than is necessary for the protection of investors.

• (2) The powers exercisable under this sub-paragraph are to direct the Registrar—

• (a) to revoke the recognition order of the organisation;

• (b) to direct the organisation to take specified steps for the purpose of securing that the rules, guidance or practices in question do not have the effect mentioned in sub-paragraph (1) above;

• (c) to make alterations in the rules for that purpose ;

and subsections (2) to (5), (7) and (9) of section 11 of this Act, as applied by sub-paragraph (2) of paragraph 5 above, shall have effect in relation to the revocation of a recognition order by virtue of a direction under this sub-paragraph as they have effect in relation to the revocation of such an order under sub-paragraph (1) of that paragraph.

• (3) The practices referred to in paragraph (b) of sub-paragraph (1) above are practices of the organisation in its capacity as such; and the practices referred to in paragraph (c) of that sub-paragraph are practices in relation to business in respect of which the persons in question are subject to the rules of the organisation and which are required or contemplated by its rules or guidance or otherwise attributable to its conduct in its capacity as such.

• (4) Subsections (3) to (8) of section 122 of this Act shall apply for the purposes of this paragraph as if—

• (a) the reference to a notice in subsection (3) included a notice received under paragraph 8(7) above or 33(4) below ;

• (b) the references to rules and guidance in subsection (4) included such rules and guidance as are mentioned in subparagraph (1) above;

• (c) the reference to practices in subsection (6) included such practices as are mentioned in subparagraph (1) above ; and

• (d) the reference to the Secretary of State's powers in subsection (7) included his powers under subparagraph (2) above.

• (6) Section 128 of this Act shall apply for the purposes of this paragraph as if—

• (a) the powers referred to in subsection (1) of that section included the powers conferred by subparagraph (2)(b) and (c) above;

• (b) the references to Chapter XIV of Part I included references to this paragraph ; and

• (c) the reference to a recognised self-regulating organisation included a reference to a recognised self-regulating organisation for friendly societies.

Fees

11

• (1) An applicant for a recognition order under paragraph 3 above shall pay such fees in respect of his application as may be required by a scheme made and published by the Registrar; and no application for such an order shall be regarded as duly made unless this sub-paragraph is complied with.

• (2) Subsections (2) to (4) of section 112 of this Act apply to a scheme under sub-paragraph (1) above as they apply to a scheme under subsection (1) of that section.

• (3) Every recognised self-regulating organisation for friendly societies shall pay such periodical fees to the Registrar as he may by regulations prescribe.

Application of provisions of this Act

12

• (1) Subject to the following provisions of this paragraph, sections 44(7), 102(l)(c), 124, 125, 126, 180(1)(n). 181. 187, 192 and 200(4) of this Act shall apply in relation to recognised self-regulating organisations for friendly societies as they apply in relation to recognised self-regulating organisations.

• (2) In its application by virtue of sub-paragraph (1) above section 126(1) of this Act shall have effect as if the reference to section 119(2) were a reference to paragraph 10(1) above.

• (3) In its application by virtue of sub-paragraph (1) above subsection (2) of section 187 of this Act shall have effect as if—

• (a) the reference in paragraph (a) to paragraphs 1 to 6 of Schedule 2 were to paragraphs 2 to 6 of that Schedule (as they apply by virtue of paragraph 4 above) and to sub-paragraph (2) of paragraph 4 above ; and

• (b) paragraph (d) referred to the powers of the organisation under paragraph 23(4) below.

• (4) A direction under subsection (1) of section 192 of this Act as it applies by virtue of sub-paragraph (1) above shall direct the Registrar to direct the organisation not to take or, as the case may be, to take the action in question; and where the function of making or revoking a recognition order in respect of a self-regulating organisation for friendly societies is exercisable by a transferee body any direction under that subsection as it applies as aforesaid shall be a direction requiring the Registrar to direct the transferee body to give the organisation such a direction as is specified in the direction given by the Secretary of State.

• (5) Subsection (5) of that section shall not apply to a direction given to the Registrar by virtue of this paragraph.

PART III — Registrar's Powers in Relation to Regulated Friendly Societies

Special provisions for regulated friendly societies

13

Paragraphs 14 to 25 below shall have effect in connection with the exercise of powers for the regulation of regulated friendly societies in relation to regulated business, but nothing in this Part of this Schedule shall affect the exercise of any power conferred by this Act in relation to a regulated friendly society which is an authorised person by virtue of section 25 of this Act to the extent that the power relates to other investment business.

Conduct of investment business

14

• (1) The rules under section 48 of this Act shall not apply to a regulated friendly society but the Registrar may, with the consent of the Secretary of State, make such rules as may be made under that section regulating the conduct of any such society other than a member society as respects the matters mentioned in sub-paragraph (2) below.

• (2) The matters referred to in sub-paragraph (1) above are-

• (a) procuring persons to transact regulated business with it and advising persons as to the exercise of rights conferred by investments acquired from the society in the course of such business;

• (b) managing the investments of pension funds, procuring persons to enter into contracts for the management of such investments and advising persons on such contracts and the exercise of the rights conferred by them ;

• (c) matters incidental to those mentioned in paragraphs (a) and (b) above.

• (3) Section SO of this Act shall apply in relation to rules under this paragraph as it applies in relation to rules under section 48 except that—

• (a) for the reference to the Secretary of State there shall be substituted a reference to the Registrar ; and

• (b) the Registrar shall not exercise the power under subsection (1) to alter the requirement of rules made under this paragraph without the consent of the Secretary of State.

15

• (1) The rules under section 51 of this Act shall not apply to any investment agreement which a person has entered or offered to enter into with a regulated friendly society if, as respects the society, entering into the agreement constitutes the carrying on of regulated business but the Registrar may, with the consent of the Secretary of State, make rules for enabling a person who has entered or offered to enter into such an agreement to rescind the agreement or withdraw the offer within such period and in such manner as may be specified in the rules.

• (2) Subsection (2) of section 51 of this Act shall apply in relation to rules under this paragraph as it applies in relation to rules under that section but with the substitution for the reference to the Secretary of State of a reference to the Registrar.

16

• (1) Regulations under section 52 of this Act shall not apply to any regulated friendly society but the Registrar may, with the consent of the Secretary of State, make such regulations as may be made under that section imposing requirements on regulated friendly societies other than member societies.

• (2) Any notice or information required to be given or furnished under this paragraph shall be given in writing or in such other manner as the Registrar may approve.

17

• (1) Rules under section S3 of this Act shall not apply to any regulated friendly society but the Registrar may. with the consent of the Secretary of State make rules concerning indemnity against any claim in respect of any description of civil liability incurred by a regulated friendly society in connection with any regulated business.

• (2) Such rules shall not apply to a member society of a recognised self-regulating organisation for friendly societies unless that organisation has requested that such rules should apply to it; and any such request shall not be capable of being withdrawn after rules giving effect to it have been made but without prejudice to the power of the Registrar to revoke the rules if he and the Secretary of State think fit.

• (3) Subsections (3) and (4) of section 53 of this Act shall apply in relation to such rules as they apply to rules under that section but with the substitution for references to the Secretary of State of references to the Registrar.

18

• (1) No scheme established by rules under section 54 shall apply in cases where persons who are or have been regulated friendly societies are unable, or likely to be unable, to satisfy claims in respect of any description of civil liability incurred by them in connection with any regulated business but the Registrar may. with the consent of the Secretary of State, by rules establish a scheme for compensating investors in such cases.

• (2) Subject to sub-paragraph (3) below, subsections (2) to (4) and (6) of that section shall apply in relation to such rules as they apply to rules under that section but with the substitution for the references to the Secretary of State, authorised persons, members and a recognised self-regulating organisation of references respectively to the Registrar, regulated friendly societies, member societies and a recognised self-regulating organisation for friendly societies.

• (3) Subsection (3) of that section shall have effect with the substitution for the words " the Secretary of State is satisfied " of the words " the Registrar and the Secretary of State are satisfied ".

• (4) The references in section 179(3)(b) and 180(1)(e) of this Act to the body administering a scheme established under section 54 of this Act shall include the body administering a scheme established under this paragraph.

19

• (1) Regulations under section 55 of this Act shall not apply to money held by regulated friendly societies but the Registrar may. with the consent of the Secretary of State, make regulations with respect to money held by a regulated friendly society in such circumstances as may be specified in the regulations.

• (2) Regulations under this paragraph shall not provide that money held by a regulated friendly society shall be held as mentioned in paragraph (a) of subsection (2) of that section but paragraphs (6) to (f) of that subsection and subsections (3) and (4) of that section shall apply in relation to regulations made under this paragraph as they apply in relation to regulations under that section (but with the substitution for the reference in paragraphs (b) and (e) of subsection (2) to a member of a recognised self-regulating organisation of a reference to a member society of a recognised self-regulating organisation for friendly societies and for the reference in paragraph (e) of that subsection to the Secretary of State of a reference to the Registrar).

20

Regulations under section 56(1) of this Act shall not permit anything to be done by a regulated friendly society but that section shall not apply to anything done by such a society in the course of or in consequence of an unsolicited call which, as respects the society constitutes die carrying on of regulated business, if it is permitted to be done by the society in those circumstances—

• (a) in the case of a member society, by the rules of the recognised self-regulating organisation for friendly societies of which it is a member; and

• (b) in any other case, by regulations made by the Registrar with the consent of the Secretary of State.

21

• (1) If it appears to the Registrar that a regulated friendly society other than a member society has contravened—

• (a) any provision of rules or regulations made under this Schedule or of section 56 or 59 of this Act;

• (b) any condition imposed under section 50 of this Act as it applies by virtue of paragraph 14(3) above;

• (c) any prohibition or requirement imposed under Chapter VI of Part I of this Act as it applies by virtue of paragraph 23 below; or

• (d) any requirement imposed under paragraph 24 below ;

he may publish a statement to that effect.

• (2) Subsections (2) to (5) of section 60 above shall apply in relation to the power under sub-paragraph (1) above as they apply in relation to the power in subsection (1) of that section but with the substitution for the references to the Secretary of State of references to the Registrar.

22

• (1) If on the application of the Registrar the court is satisfied—

• (a) that there is a reasonable likelihood that any regulated friendly society will contravene any provision of—

• (i) any prohibition or requirement imposed under Chapter VI of Part I of this Act as it applies by virtue of paragraph 23 below ;

• (ii) the rules or regulations made under this Schedule ;

• (iii) any requirement imposed under paragraph 24 below;

• (iv) section 47, 56 or 59 of this Act;

• (v) the rules of a recognised self-regulating organisation for friendly societies in relation to which it is a member society,

or any condition imposed under section SO of this Act as it applies by virtue of paragraph 14(3) above ;

• (b) that any regulated friendly society has contravened any such provision or condition and that there is a reasonable likelihood that the contravention will continue or be repeated; or

• (c) that any person has contravened any such provision or condition and that there are steps that could be taken for remedying the contravention,

the court may grant an injunction restraining the contravention or, in Scotland, an interdict prohibiting the contravention or, as the case may be, make an order requiring the society and any other person who appears to the court to have been knowingly concerned in the contravention to take steps to remedy it.

• (2) No application shall be made by the Registrar under subparagraph (1) above in respect of any such rules as are mentioned in paragraph (a)(v) of that sub-paragraph unless it appears to him that the organisation is unable or unwilling to take appropriate steps to restrain the contravention or to require the society concerned to take such steps as are mentioned in sub-paragraph (1) above.

• (3) Subsections (3) to (9) of section 61 of this Act apply to such a contravention as is mentioned in subparagraph (1)(a) above as they apply to such a contravention as is mentioned in subsection (3) of that section, but with the substitution for the references to the Secretary of State of references to the Registrar.

• (4) Without prejudice to the preceding provisions of this paragraph—

• (a) a contravention of any rules or regulations made under this Schedule;

• (b) a contravention of any prohibition or requirement imposed under Chapter VI of Part I of this Act as it applies by virtue of paragraph 23 below ;

• (c) a contravention of any requirement imposed under paragraph 24 below;

• (d) a contravention by a member society of any rules of the recognised self-regulating organisation for friendly societies of which it is a member relating to a matter in respect of which rules or regulations have been or could be made under this Schedule or of any requirement or prohibition imposed by the organisation in the exercise of powers for purposes corresponding to those of the said Chapter VI or paragraph 24;

shall be 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, but no person shall be guilty of an offence by reason of any such contravention and no such contravention shall invalidate any transaction.

• (5) This paragraph is without prejudice to any equitable remedy available in respect of property which by virtue of a requirement under section 67 of this Act as it applies by virtue of paragraph 23 below is subject to a trust.

Intervention, information and investigations

23

• (1) The powers conferred by Chapter VI of Part I of this Act shall not be exercisable in relation to a regulated friendly society or the appointed representative of such a society by the Secretary of State but instead shall be exercisable by the Registrar ; and accordingly references in that Chapter to the Secretary of State shall as respects the exercise of powers in relation to a regulated friendly society or such a representative be taken as references to the Registrar.

• (2) Section 64 of this Act shall not apply to the exercise of those powers by virtue of sub-paragraph (1) above but those powers shall only be exercisable by the Registrar if it appears to him—

• (a) that the exercise of the powers is desirable in the interests of members or potential members of the regulated friendly society; or

• (b) that the society is not a fit person to carry on regulated business of a particular kind or to the extent to which it is carrying it on or proposing to carry it on ; or

• (c) that the society has contravened any provision of this Act or of any rules or regulations made under it or in purported compliance with any such provision has furnished him with false, inaccurate or misleading information or has contravened any prohibition or requirement imposed under this Act.

• (3) For the purposes of sub-paragraph (2)(b) above the Registrar may take into account any matters that could be taken into account in deciding whether to withdraw or suspend an authorisation under Chapter III of Part I of this Act.

• (4) The powers conferred by this paragraph shall not be exercisable in relation—

• (a) to a member society which is subject to the rules of a recognised self-regulating organisation for friendly societies in carrying on all the investment business carried on by it; or

• (b) to an appointed representative of a member society if that member society, and each other member society which is his principal, is subject to the rules of such an organisation in carrying on the investment business in respect of which it has accepted responsibility for his activities;