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Enterprise Act 2016

Type Public General Act

Publication 2016-05-04

Last updated 2025-06-01

State In force

Department Statute Law Database

Source legislation.gov.uk

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PART 1 — The Small Business Commissioner

The Commissioner

The Institute for Apprenticeships

1

(1) A Small Business Commissioner is established.

(2) The Commissioner's principal functions are—

(a) to provide general advice and information to small businesses (see section 3), and

(b) to consider complaints from small businesses relating to payment matters in connection with the supply of goods and services to larger businesses, and make recommendations (see sections 4 to 8).

(3) Schedule 1 makes provision about the Commissioner.

“Small businesses”

Small businesses in relation to which the Commissioner has functions

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(1) In this Part “small business” means a relevant undertaking which—

(a) has a headcount of staff of less than 50,

(b) if the business threshold condition applies to the relevant undertaking, meets that condition, and

(2) The Secretary of State may by regulations (“SBC scope regulations”) make further provision about the meaning of “small business” in this Part.

(3) For the purposes of subsection (1)(b), the business threshold condition applies to a relevant undertaking if—

(a) SBC scope regulations provide for that condition to apply in relation to all relevant undertakings, or

(b) the relevant undertaking falls within a description of undertakings to which SBC scope regulations apply that condition.

(4) A relevant undertaking meets the business threshold condition if it has a turnover, or balance sheet total, of an amount less than or equal to the small business threshold.

(5) SBC scope regulations may (amongst other things) make provision about—

(a) the date (“the assessment date”) on which, or the period (“the assessment period”) for which, a relevant undertaking must meet a requirement of subsection (1)(a) or (b) in order to be a small business;

(b) the calculation of the headcount of staff, turnover or balance sheet total of a relevant undertaking at the assessment date or for the assessment period;

(c) the circumstances in which a relevant undertaking which has been established for less than a complete assessment period is to be regarded as meeting a requirement for that period.

(6) SBC scope regulations may provide that a relevant undertaking of a specified description is not a small business even if it falls within the definition.

(7) SBC scope regulations may—

(a) make transitional or transitory provision or savings;

(b) make different provision for different purposes.

(8) SBC scope regulations are to be made by statutory instrument.

(9) A statutory instrument containing SBC scope regulations may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

(10) In this section—

“balance sheet total”, “headcount of staff”, “turnover” and “small business threshold” have such meanings as may be specified;

“relevant undertaking” means a person who is carrying on one or more businesses and whose registered office or principal place of business is in the United Kingdom;

“specified” means specified in SBC scope regulations.

General advice and information

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(1) The Commissioner may publish, or give to small businesses, general advice or information that the Commissioner considers may be useful to small businesses in connection with their supply relationships with larger businesses.

(2) In considering under subsection (1) what advice and information may be useful, the Commissioner must, in particular, consider how useful any advice or information would be for the purposes of encouraging small businesses to resolve disputes with larger businesses or preventing such disputes arising.

(3) General advice or information published or given under subsection (1) may include general advice or information about—

(a) principles of the law of contract;

(b) other sources of rights or obligations in relation to the supply of goods or services;

(4) General advice or information published or given under subsection (1) may also include general advice or information about—

(a) complaint-handling bodies, ombudsmen, regulators or other persons (other than courts or tribunals) who, in connection with small businesses' supply relationships with larger businesses, may be able—

(i) to resolve or facilitate the resolution of disputes, or

(ii) to give other advice or assistance to small businesses;

(b) statutory rights to refer disputes in connection with such relationships for adjudication by a person other than a court or tribunal.

(5) The Commissioner may publish, or give to small businesses, general advice or information about—

(a) complaint-handling bodies, ombudsmen, regulators or public authorities (other than courts or tribunals) who, in connection with the supply relationships of small businesses with public authorities, may be able—

(i) to resolve or facilitate the resolution of disputes, or

(ii) to give other advice or assistance to small businesses;

(b) statutory rights to refer disputes in connection with such relationships for adjudication by a person other than a court or tribunal.

(6) Advice published or given under this section must be impartial, and information published or given under this section must be presented in an impartial manner.

(7) The powers conferred on the Commissioner by this section to publish or give general advice or information may be exercised by making arrangements with any other person in accordance with which that person publishes or provides that advice or information.

(8) The Commissioner may make recommendations to the Secretary of State about the publication, or provision to small businesses, by the Secretary of State of advice or information of a kind which the Commissioner is authorised to publish or give under this section.

(9) Where a recommendation is made under subsection (8), the Secretary of State must inform the Commissioner whether anything is to be done in response to the recommendation and, if it is, give details of the action to be taken.

(10) For the purposes of this section a small business has a “supply relationship” with a larger business or public authority if—

(a) the small business has an agreement to supply, has supplied or may supply, goods or services to the larger business or public authority, or

(b) the larger business or public authority has an agreement to supply, has supplied or may supply, goods or services to the small business.

(11) In this section—

“dispute” includes any difference;

“larger business” means a person carrying on one or more businesses who—is not a small business,has a place of business in the United Kingdom, andis not a public authority.

Complaints scheme

The SBC complaints scheme

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(1) The Commissioner must establish, maintain and administer a scheme (in this Part referred to as “the SBC complaints scheme”) under which the Commissioner—

(a) enquires into, considers and determines relevant complaints, and

(b) may make recommendations as to how the issues raised by those complaints may be remedied, resolved or mitigated or how similar issues may be prevented from arising in future.

(2) The Commissioner must establish, maintain and administer the SBC complaints scheme in accordance with regulations made by the Secretary of State under section 7 (scheme regulations).

(3) “Relevant complaint” means a complaint which—

(a) is made by a small business (“the complainant”) which has an agreement to supply, or has supplied or may supply, goods or services to a larger business (“the respondent”),

(b) relates to a payment matter (see subsection (4)), and

(4) A complaint relates to a payment matter if it relates to—

(a) a request or other act, or a failure to pay or other omission, in relation to a payment—

(i) for or in connection with the supply of goods or services, or

(ii) in connection with the relationship or possible relationship between the small business and the larger business so far as relevant to the supply, or

(b) any provision made or proposed to be made in connection with the supply or that relationship which restricts, or purports to restrict, any right of the small business to make a complaint under the SBC complaints scheme or to have a complaint enquired into, considered or determined under the scheme.

(5) A complaint is excluded from the scheme if—

(a) it relates to the appropriateness of the price payable or proposed to be payable under a contract for the goods or services supplied or to be supplied by the small business under the contract by comparison with those goods or services,

(b) it concerns matters which are currently the subject of legal proceedings or adjudication proceedings,

(c) it falls within the jurisdiction of an ombudsman, regulator or public authority (other than the Commissioner, a court or a tribunal),

(d) the complainant has a statutory right to refer the complaint for adjudication by a person other than a court or tribunal,

(e) the complaint relates to—

(i) an act or omission which occurred before the appointed start date, or

(ii) an act or omission in accordance with a term of a contract entered into before that date, where that term has not been varied on or after that date, or

(f) it is of a description specified by regulations made by the Secretary of State.

(6) For the purposes of paragraph (e) of subsection (5), “the appointed start date” means the date appointed by the Secretary of State by regulations.

(7) Regulations under this section may—

(a) make transitory or transitional provision or savings;

(b) make different provision for different purposes.

(8) Regulations under subsection (6) may appoint different dates for different areas.

(9) Regulations under this section are to be made by statutory instrument.

(10) A statutory instrument containing regulations under this section (other than regulations under subsection (6)) must not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

(11) In this section “larger business” has the meaning given by section 3(11).

Enquiry into, consideration and determination of complaints

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(1) This section applies where a complaint is to be determined under the SBC complaints scheme.

(2) The Commissioner may ask the complainant or the respondent to provide the Commissioner voluntarily with any information or documents relevant to the complaint.

(3) The Commissioner must give the respondent, and may give the complainant, an opportunity to make representations to the Commissioner.

(4) In enquiring into, considering and determining a complaint, the Commissioner must act impartially as between the complainant and the respondent.

(5) A complaint is to be determined under the SBC complaints scheme by reference to what is, in the Commissioner's opinion, fair and reasonable in all the circumstances of the case.

(6) The determination may contain one or more recommendations as to the steps that ought to be taken by the complainant or the respondent to remedy, resolve or mitigate any issue which is the subject of the complaint or to prevent a similar issue from arising in future.

(7) Where a complaint has been determined, the Commissioner must prepare a written statement of the determination.

(8) The statement must give the Commissioner's reasons for the determination (including any recommendations).

(9) If the determination does not contain any recommendations, the statement must contain the Commissioner's reasons for this.

(10) The Commissioner must give a copy of the statement to the complainant and the respondent.

(11) A determination made under the SBC complaints scheme is not legally binding.

Reports on complaints

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(1) The Commissioner may publish a report of the enquiry into, consideration and determination of a complaint under the SBC complaints scheme.

(2) A report under subsection (1) must not identify the complainant, unless the complainant consents.

See also section 7(7) which requires provision to be made about factors to be taken into account when deciding whether to identify the respondent in a report.

(3) A report identifies a person if it—

(a) mentions the person's name, or

(b) includes any particulars which, in the Commissioner's opinion, are likely to identify the person.

(4) Before publishing a report under subsection (1), the Commissioner must give the respondent and the complainant an opportunity to make representations to the Commissioner about the proposed publication of the report (including, in the case of the respondent, about any proposal to identify the respondent in the report).

Scheme regulations

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(1) The Secretary of State must make regulations (“scheme regulations”) about—

(a) the making of complaints for consideration under the SBC complaints scheme,

(b) the consideration and determination of complaints by the Commissioner, and the making of any recommendations, and

(2) Scheme regulations must—

(a) provide that a complaint (or part of a complaint) is, except in specified circumstances, to be dismissed if the Commissioner considers that the complainant has not previously communicated the substance of the complaint (or part) to the respondent and given the respondent a reasonable opportunity to deal with it;

(b) provide that a complaint is not to be entertained under the SBC complaints scheme unless the complainant has referred it under the scheme before the expiry of the applicable time limit (determined in accordance with the scheme regulations);

(3) Scheme regulations may, among other things—

(a) make provision about the content and form of a complaint and the manner in which it is to be made;

(b) allow the Commissioner to fix time limits for any aspect of the proceedings and to extend a time limit;

(c) provide that a complaint may, or may in specified circumstances, be dismissed, if or to the extent that the Commissioner considers—

(i) that the complaint is frivolous or vexatious,

(ii) that the complaint concerns matters which are more appropriately dealt with in another way,

(iii) that the complainant has not suffered, and is not likely to suffer, any financial loss, material distress, material inconvenience or other material adverse effect, as a result of the matter to which the complaint relates,

(iv) that the matter to which the complaint relates has been remedied,

(v) that the complainant is seeking an outcome other than a recommendation of the kind that can be made under the scheme,

(vi) that the complaint concerns matters that have been the subject of legal proceedings or adjudication proceedings,

(vii) that the matter to which the complaint relates has previously been considered under the SBC complaints scheme or by another complaints-handling body, ombudsman or regulator,

(viii) that any other condition specified by the scheme regulations is met, or

(ix) that there are other compelling reasons why it is inappropriate for the complaint to be dealt with under the SBC complaints scheme;

(d) provide that a complaint is to be dismissed if or to the extent that it becomes the subject of legal proceedings or adjudication proceedings;

(e) require the Commissioner to notify the person who makes a complaint under the scheme if the Commissioner considers that it is not a relevant complaint or it is dismissed in accordance with the scheme regulations;

(f) authorise or require the Commissioner to notify the person against whom a complaint is made if it is not a relevant complaint or it is dismissed in accordance with the scheme regulations.

(4) For the purposes of regulations under subsections (2)(a) and (3)(c) and (d) it does not matter whether there has been a consideration of the merits of the complaint by the time it is dismissed.

(5) Scheme regulations must also specify matters which are to be taken into account, or are to be taken into account in specified circumstances, by the Commissioner in determining under the scheme whether an act or omission was fair and reasonable.

Those matters must include any relevant law.

(6) But nothing in this section requires or authorises scheme regulations to specify that particular practices are to be regarded by the Commissioner, in making that determination, as “fair” or “unfair”.

(7) Scheme regulations must make provision about factors which are to be taken into account, or are to be taken into account in specified circumstances, by the Commissioner when deciding whether to identify the respondent in a report under section 6(1).

(8) Scheme regulations may—

(a) confer a discretion on the Commissioner;

(b) make transitional or transitory provision or savings;

(9) Before making scheme regulations the Secretary of State must consult such persons as the Secretary of State considers appropriate.

(10) Regulations under this section are to be made by statutory instrument.

(11) A statutory instrument containing regulations under this section must not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

(12) In this section—

“relevant complaint” has the meaning given by section 4(3);

“specified” means specified in scheme regulations.

Confidentiality

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(1) The Commissioner may not make a disclosure of information that the Commissioner considers is likely to cause someone to think that a particular person has made a complaint under the SBC complaints scheme, except where subsection (2) applies.

(2) This subsection applies if—

(a) the Commissioner has obtained the consent of the person concerned,

(b) the disclosure is made by the Commissioner to the respondent in relation to the complaint or in a report published under section 6,

(d) the disclosure is required, under rules of court or rules of a tribunal, or an order of a court or tribunal, for the purposes of legal proceedings of any description, or

(e) the information has already been made available to the public from other sources.

Reports and reviews

Annual report

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(1) After the end of each reporting period, the Commissioner must prepare and publish a report which—

(a) describes what the Commissioner has done during the period,

(b) contains a summary of the matters which the Commissioner considers to be the most significant matters raised by small businesses with the Commissioner during the period, and

(2) As well as publishing the report, the Commissioner must send a copy to the Secretary of State.

(3) The Secretary of State must lay a copy of the report before Parliament.

(4) In this section “reporting period” means—

(a) the period beginning with the day on which section 1 comes into force and ending with the following 31 March, and

(b) each successive period of 12 months.

Review of Commissioner’s performance

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(1) The Secretary of State must review the Commissioner's performance for each review period.

(2) For the purposes of subsection (1), the Secretary of State may direct the Commissioner to provide the Secretary of State with information specified in the direction.

(3) The first review period is the period beginning with the day on which section 1 comes into force and ending 2 years after the following 31 March.

(4) Subsequent review periods are each successive period of 3 years after the first review period.

(5) A review must, in particular, assess how effective the Commissioner has been in carrying out his or her functions, and in doing so may, in particular, assess the impact of the Commissioner's actions on—

(a) improving payment practices in commercial transactions;

(b) the awareness of small businesses of, or the use by small businesses of, alternative dispute resolution procedures.

(6) As soon as practicable after a review period, the Secretary of State must—

(a) publish a report of the findings of the review for that period, and

(b) lay a copy of the report before Parliament.

Power to abolish

Power to abolish the Commissioner

11

(1) The Secretary of State may, by regulations, abolish the office of Small Business Commissioner if, as a result of a review under section 10, the Secretary of State is satisfied that—

(a) it is no longer necessary for there to be a Small Business Commissioner carrying out the functions under this Part, or

(b) the Commissioner's role has not been sufficiently effective to justify the office's continued existence.

(2) For the purposes of subsection (1)(b), the Secretary of State must, in particular, take account of the Commissioner's role in—

(a) carrying out any of the functions under this Part,

(b) improving payment practices in commercial transactions, and

(3) For the purposes of giving effect to the abolition of the office of Small Business Commissioner, the regulations may amend or repeal this Part or any provision made by or under any other enactment (whether passed or made before or after this Act).

(4) Regulations under this section may make incidental, supplemental, consequential, transitional or transitory provision or savings.

(5) Before making regulations under this section, the Secretary of State must consult—

(a) the Small Business Commissioner (unless that office is vacant),

(b) such other persons as appear to the Secretary of State to be persons affected by the regulations, and

(6) If, as a result of consultation under subsection (5), the Secretary of State considers it appropriate to change the whole or part of the proposed regulations, the Secretary of State must carry out such further consultation with respect to the changes as seems appropriate.

Regulations under section 11: procedure

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(1) In this section “regulations” means regulations under section 11.

(2) If after consultation under section 11, the Secretary of State considers it appropriate to proceed with the making of regulations, the Secretary of State may lay before Parliament—

(a) draft regulations, and

(b) an explanatory document.

(3) The explanatory document must—

(a) explain why the Secretary of State considers that one of the conditions in section 11(1) is met, and

(b) contain a summary of representations received in the consultation.

(4) The Secretary of State may not act under subsection (2) before the end of the period of 12 weeks beginning with the day on which the consultation began under section 11(5).

(5) Subject to subsections (6) to (13), if after the expiry of the 40-day period the draft regulations laid under subsection (2) are approved by a resolution of each House of Parliament, the Secretary of State may make regulations in the terms of the draft regulations.

(6) The procedure in subsections (7) to (10) applies to the draft regulations instead of the procedure in subsection (5) if—

(a) either House of Parliament so resolves within the 30-day period, or

(b) a committee of either House charged with reporting on the draft regulations so recommends within the 30-day period and the House to which the recommendation is made does not by resolution reject the recommendation within that period.

(7) The Secretary of State must have regard to—

(a) any representations,

(b) any resolution of either House of Parliament, and

made during the 60-day period with regard to the draft regulations.

(8) If after the expiry of the 60-day period the draft regulations are approved by a resolution of each House of Parliament, the Secretary of State may make regulations in the terms of the draft regulations.

(9) If after the expiry of the 60-day period the Secretary of State wishes to proceed with the draft regulations but with material changes, the Secretary of State may lay before Parliament—

(a) revised draft regulations, and

(b) a statement giving a summary of the changes proposed.

(10) If the revised draft regulations are approved by a resolution of each House of Parliament, the Secretary of State may make regulations in the terms of the revised draft regulations.

(11) For the purposes of this section regulations are made in the terms of draft regulations or revised draft regulations if they contain no material changes to their provisions.

(12) In this section, references to the “30-day”, “40-day” and “60-day” periods in relation to any draft regulations are to the periods of 30, 40 and 60 days beginning with the day on which the draft regulations were laid before Parliament.

(13) For the purposes of subsection (12) no account is to be taken of any time during which Parliament is dissolved or prorogued or during which either House is adjourned for more than four days.

(14) Regulations are to be made by statutory instrument.

Definitions

Definitions used in Part 1

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In this Part—

“adjudication” includes arbitration;

“the Commissioner” means the Small Business Commissioner;

“the complainant” has the same meaning as in section 4;

“legal proceedings” means civil or criminal proceedings in or before a court or tribunal;

“public authority” means—a public authority within the meaning of section 3(1) of the Freedom of Information Act 2000, ...a Scottish public authority within the meaning of section 3(1) of the Freedom of Information (Scotland) Act 2002 , or the Advanced Research and Invention Agency.

“SBC complaints scheme” has the meaning given by section 4(1);

“small business” has the meaning given by section 2;

“the respondent” has the same meaning as in section 4.

PART 2 — Regulators

...

Extension of target to provisions made by regulators

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

Reporting requirements

Duty to report on effect of regulators’ code

15

After section 23 of the Legislative and Regulatory Reform Act 2006 insert—

(23A) (1) A relevant regulator must prepare and publish a performance report in respect of each reporting period. (2) A performance report is a report about the effect of performance of the duties in section 22 (duties to have regard to code of practice) on the way the relevant regulator exercised its relevant functions. (3) A relevant regulator is a person with regulatory functions to which section 22 applies, other than a local authority. (4) A performance report must include— (a) the relevant regulator's assessment— (i) of the views of persons carrying on businesses about the effect mentioned in subsection (2), and (ii) of the impact on such persons of that effect; (b) a description of the effect the relevant regulator expects performance of the duties in section 22 to have on the way it exercises its relevant functions in future. (5) In preparing and publishing a performance report a relevant regulator must follow any guidance given from time to time by a Minister of the Crown, unless the regulator considers that there is a good reason not to do so. (6) Guidance under subsection (5) may, in particular, include guidance as to— (a) information or other matters to be included in a performance report; (b) information to be obtained for the purposes of a performance report; (c) the means by which information should be obtained for the purposes of a performance report. (7) A performance report must be published no later than three months after the end of the reporting period concerned. (8) A reporting period is a period of 12 months, except as provided by subsection (13)(b). (9) A new reporting period begins immediately after the end of each reporting period. (10) A relevant regulator other than the Commission for Equality and Human Rights must give to a Minister of the Crown any information that the Minister may from time to time request which relates to— (a) the effect of performance of the duties in section 22 on the way the relevant regulator performs, has performed, or is expected to perform, its relevant functions, (b) the views of persons carrying on businesses about the effect mentioned in paragraph (a) or the impact on such persons of that effect, or (c) any aspect of a performance report in relation to which it appears to the Minister that guidance under subsection (5) has not been followed. (11) This section is subject to any express restriction on disclosure imposed by another enactment (ignoring any restriction which allows disclosure if authorised by an enactment). (12) In this section— - “local authority” means— 1. a county or district council in England; 2. a London borough council; 3. the Common Council of the City of London; 4. the Sub-Treasurer of the Inner Temple and the Under-Treasurer of the Middle Temple; 5. the Council of the Isles of Scilly; 6. a port health authority in England; 7. an authority established under section 10 of the Local Government Act 1985 (waste disposal authorities for Greater London and metropolitan counties); 8. a county or county borough council in Wales; 9. a fire and rescue authority in Wales; 10. a port health authority in Wales; 11. a council constituted under section 2 of the Local Government etc (Scotland) Act 1994; 12. a district council constituted under section 1 of the Local Government Act (Northern Ireland) 1972; - “relevant functions” means functions in the exercise of which a relevant regulator is required by section 22 to have regard to the code of practice under subsection (1) of that section. (13) A relevant regulator's first reporting period— (a) begins— (i) on the day on which section 15 of the Enterprise Act 2016 comes into force, or (ii) in the case of a person that becomes a relevant regulator after that day, on the day on which the person becomes a relevant regulator; (b) is of a length determined by the relevant regulator, but is not to exceed 12 months.

Duty to report on effect of economic growth duty

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(1) After section 110 of the Deregulation Act 2015 insert—

(110A) (1) A person with regulatory functions to which section 108 applies (a “regulator”) must prepare and publish a performance report in respect of each reporting period. (2) A performance report is a report about the effect of performance of the duty under section 108(1) on the way the regulator exercised its functions to which that section applies (its “relevant functions”). (3) A performance report must include— (a) the regulator's assessment— (i) of the views of persons carrying on businesses about the effect mentioned in subsection (2), and (ii) of the impact on such persons of that effect; (b) a description of the effect the regulator expects performance of the duty under section 108(1) to have on the way it exercises its relevant functions in future. (4) In preparing and publishing a performance report a regulator must follow any guidance given from time to time by a Minister of the Crown, unless the regulator considers that there is a good reason not to do so. (5) Guidance under subsection (4) may, in particular, include guidance as to— (a) information or other matters to be included in a performance report; (b) information to be obtained for the purposes of a performance report; (c) the means by which information should be obtained for the purposes of a performance report. (6) A performance report must be published no later than three months after the end of the reporting period concerned. (7) A reporting period is a period of 12 months, except as provided by subsection (12)(b). (8) A new reporting period begins immediately after the end of each reporting period. (9) A regulator must give to a Minister of the Crown any information that the Minister may from time to time request which relates to— (a) the effect of performance of the duty under section 108(1) on the way the regulator performs, has performed, or is expected to perform, its relevant functions, (b) the views of persons carrying on businesses about the effect mentioned in paragraph (a) or the impact on such persons of that effect, or (c) any aspect of a performance report in relation to which it appears to the Minister that guidance under subsection (4) has not been followed. (10) A regulator is not required by this section to include in a performance report, or to give to a Minister of the Crown, information about the exercise of functions in relation to a particular person. (11) This section is subject to any express restriction on disclosure imposed by another enactment (ignoring any restriction which allows disclosure if authorised by an enactment). (12) A regulator's first reporting period— (a) begins— (i) on the day on which section 16 of the Enterprise Act 2016 comes into force, or (ii) in the case of a person that becomes a regulator (see subsection (1)) after that day, on the day on which the person becomes a regulator; (b) is of a length determined by the regulator, but is not to exceed 12 months.

(2) In section 111 of that Act (interpretation of sections 108 to 110)—

(a) in the heading and subsection (1) for “110” substitute “ 110A ”, and

(b) in subsection (4) for “and 110” substitute “ to 110A ”.

Application of regulators' principles and code of practice

Power of Welsh Ministers to apply regulators’ principles and code of practice

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In section 24 of the Legislative and Regulatory Reform Act 2006 (application of regulators' principles and code of practice to functions specified by order)—

(a) for paragraph (c) of subsection (3) (Wales: limit on power of Minister of the Crown to specify functions) substitute—

(c) a Welsh regulatory function.

;

(b) in subsection (4) (power of Welsh Ministers to specify functions) for “regulatory functions exercisable only in or as regards Wales” substitute “ Welsh regulatory functions ”;

“Welsh regulatory function” means a regulatory function, so far as exercisable in relation to Wales, if or to the extent that the function relates to matters— (a) within the legislative competence of the National Assembly for Wales (see section 108 of the Government of Wales Act 2006), or (b) in respect of which functions are exercisable by the Welsh Ministers.

Removal of restrictions

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Omit subsection (5) of section 24 of the Legislative and Regulatory Reform Act 2006 (which prevents the regulators' principles and code from being applied to regulatory functions of the Gas and Electricity Markets Authority, the Office of Communications, the Office of Rail and Road or the Water Services Regulation Authority).

Secondary legislation: duty to review

19

In section 30 of the Small Business, Enterprise and Employment Act 2015 (meaning of “provision for review” in section 28(2)(a) of that Act), in subsection (3)—

(a) after “must” insert “ so far as is reasonable ”, and

(b) omit third “the”.

PART 3 — Regulatory Enforcement and Sanctions Act 2008

Extending the primary authority scheme

20

(1) For Part 2 of the Regulatory Enforcement and Sanctions Act 2008 (co-ordination of regulatory enforcement) substitute—

(22A) (1) A person is a “regulated person” for the purposes of this Part if the Secretary of State is satisfied that— (a) the person carries on, or proposes to carry on, an activity, and (b) a qualifying regulator has a relevant function which is, or would be, exercisable in relation to the person in respect of the activity. (2) A group of persons is a “regulated group” for the purposes of this Part if the Secretary of State is satisfied that— (a) a member of the group carries on, or proposes to carry on, an activity, and (b) a qualifying regulator has a relevant function which is, or would be, exercisable in relation to the member in respect of the activity. (22B) (1) In this Part, “qualifying regulator” means— (a) a local authority, or (b) a specified regulator. (2) In this Part, “local authority” means a local authority in England, Wales, Scotland or Northern Ireland. (3) In this Part— (a) references to a local authority in England or Wales have the same meaning as in Part 1; (b) references to a local authority in Scotland are to a council constituted under section 2 of the Local Government etc (Scotland) Act 1994; (c) references to a local authority in Northern Ireland are to a district council constituted under section 1 of the Local Government Act (Northern Ireland) 1972. (4) In this Part, “specified regulator” means a person (other than a local authority) who— (a) has regulatory functions, and (b) is specified for the purposes of this Part by regulations made by the Secretary of State. (5) Regulations under subsection (4)(b) require the consent of the Welsh Ministers to specify a regulator whose functions relate only to devolved Welsh matters. (22C) (1) In this Part, “relevant function”— (a) in relation to a local authority in England or Wales, has the same meaning as in Part 1; (b) in relation to a local authority in Scotland, means a regulatory function exercised by that authority and specified for the purposes of this Part by regulations made by the Secretary of State; (c) in relation to a local authority in Northern Ireland, means a regulatory function exercised by that authority and specified for the purposes of this Part by regulations made by the Secretary of State; (d) in relation to a specified regulator, means a regulatory function exercised by that regulator and specified for the purposes of this Part by regulations made by the Secretary of State. (2) Regulations under subsection (1)(b) or (c) may only specify a regulatory function— (a) which is a relevant function for the purposes of Part 1 in relation to local authorities in England or Wales or both, or (b) which, for the purposes of local authorities in Scotland or Northern Ireland, is equivalent to such a function. (3) Regulations under subsection (1)(d) may only specify a regulatory function— (a) which is a relevant function for the purposes of Part 1 in relation to local authorities in England or Wales or both, or (b) which, for the purposes of the specified regulator, is equivalent to such a function. (4) Regulations under subsection (1)(b) or (d) may not specify a regulatory function so far as exercisable in Scotland, if or to the extent that the function relates to matters which are not reserved matters. (5) Regulations under subsection (1)(c) or (d) may not specify a regulatory function so far as exercisable in Northern Ireland, if or to the extent that the function relates to matters which are transferred matters. (6) Regulations under subsection (1)(d) require the consent of the Welsh Ministers to specify a regulatory function, so far as exercisable in relation to Wales, which relates to a devolved Welsh matter. (7) Regulations under subsection (1)(d) may make different provision for— (a) different purposes; (b) different areas. (23A) (1) For the purposes of this Part, the Secretary of State— (a) may nominate, in relation to a regulated person, a qualifying regulator to be the “primary authority” for the exercise of the partnership functions in relation to that person (a “direct primary authority”); (b) may nominate, in relation to a regulated group, a qualifying regulator to be the “primary authority” for the exercise of the partnership functions in relation to the members of the group (a “co-ordinated primary authority”). (2) The “partnership functions” are the functions specified by the nomination under subsection (1) as covered by it. (3) A function may be so specified only if condition A or B is met. (4) Condition A is that the function— (a) is a relevant function of the primary authority, and (b) is, or (in the case of an activity proposed to be carried on) would be, exercisable by the primary authority in relation to the regulated person or a member of the regulated group. (5) Condition B is that the function— (a) is a relevant function of a qualifying regulator other than the primary authority, (b) is, or (in the case of an activity proposed to be carried on) would be, exercisable by that other regulator in relation to the regulated person or a member of the regulated group, and (c) is equivalent to a relevant function of the primary authority. (6) The Secretary of State may from time to time revise the specification of partnership functions included in a nomination under subsection (1) if— (a) the requirements of subsections (3) to (5) are met in relation to the revised specification, (b) in the case of a nomination under subsection (1)(a), the primary authority and the regulated person have agreed in writing to the revision, and (c) in the case of a nomination under subsection (1)(b), the primary authority and the co-ordinator of the regulated group have agreed in writing to the revision. (7) This Part applies to a revised specification of partnership functions as it applies to a specification of partnership functions under subsection (1); and references in this Part to the partnership functions include partnership functions in the revised specification. (23B) (1) The Secretary of State may only nominate a qualifying regulator as a direct primary authority if the regulator and the regulated person have agreed in writing to the nomination. (2) The Secretary of State may only nominate a qualifying regulator as a co-ordinated primary authority if— (a) there is a co-ordinator of the regulated group, and (b) the regulator and the co-ordinator have agreed in writing to the nomination. (3) The Secretary of State may at any time revoke a nomination under section 23A(1). (4) The Secretary of State must— (a) maintain, or cause to be maintained, a register of nominations under section 23A(1), and (b) make the register available for inspection free of charge. (23C) (1) For the purposes of this Part, there is a “co-ordinator” of a regulated group if there is a person nominated by the Secretary of State to be the co-ordinator of the group. (2) The Secretary of State may only nominate a person under subsection (1) if the person has agreed in writing to the nomination. (3) The Secretary of State may at any time revoke a nomination under subsection (1). (4) If at any time the co-ordinator of a regulated group is unable to act, the Secretary of State may nominate another person to exercise the functions of the co-ordinator of the group under this Part. (5) Subsections (2) and (3) apply to a nomination under subsection (4) as they apply to a nomination under subsection (1). (6) The Secretary of State must secure that the register of nominations maintained and made available under section 23B(4) includes, in relation to each co-ordinated primary authority, the name of— (a) the co-ordinator of the regulated group concerned, and (b) any person nominated under subsection (4) to exercise the co-ordinator's functions. (23D) (1) This section applies where a qualifying regulator is nominated as a co-ordinated primary authority. (2) The co-ordinator of the regulated group concerned must— (a) maintain, or cause to be maintained, a list of members of the group, and (b) secure, as far as is reasonably practicable, that the list is accurate and kept up-to-date. (3) The list must include in relation to each member— (a) the member's name and address, (b) when the person became a member, and (c) if applicable, when the person ceased to be a member. (4) The co-ordinator of the regulated group must make a copy of the list available free of charge, on request, to— (a) the Secretary of State, (b) the primary authority, and (c) a qualifying regulator who has a function which is both a relevant function of the regulator and a partnership function. (5) The copy must be made available as soon as is reasonably practicable and in any event not later than the end of the third working day after the day on which the request is received by the co-ordinator. (6) For the purposes of this Part, the list is conclusive as to whether a person is a member of the group at a particular time. (23E) (1) The following provisions apply in each case where a qualifying regulator has been nominated under section 23A(1) as a primary authority— (a) section 24A (primary authority advice and guidance); (b) sections 25A to 25D and Schedule 4A (enforcement action); (c) sections 26A to 26C (inspection plans); (d) section 27A (power for primary authority to recover costs); (e) section 28A (support of primary authority by other regulators); (f) section 28B (other regulators to act consistently with primary authority advice etc). (2) References in those provisions to “the primary authority”, “a partnership function” and other terms defined in or for the purposes of this Part are to be read accordingly. (3) But see sections 29A to 29D in relation to cases where more than one qualifying regulator has been nominated as the primary authority for the exercise of the same function in relation to the same person. (24A) (1) The primary authority, if it is a direct primary authority, has the function of— (a) giving advice and guidance to the regulated person in relation to each partnership function; (b) giving advice and guidance, in relation to each partnership function, to other qualifying regulators as to how they should exercise it in relation to the regulated person. (2) The primary authority, if it is a co-ordinated primary authority, has the function of— (a) giving advice and guidance to the co-ordinator of the regulated group in relation to each partnership function; (b) giving advice and guidance, in relation to each partnership function, to other qualifying regulators as to how they should exercise it in relation to a member of the group. (3) The primary authority may make arrangements with the regulated person or the co-ordinator of the regulated group as to how the authority will discharge its functions under subsection (1) or (2). (4) In the case of a co-ordinated primary authority, the co-ordinator of the regulated group must notify any advice or guidance given to the co-ordinator under subsection (2)(a) to those members of the group to whom the co-ordinator considers it may be relevant. (5) Advice or guidance may be given under subsection (1)(b) or (2)(b) only with the consent of the Secretary of State. (6) Subsections (1)(b) and (2)(b) do not require advice and guidance to be given to a qualifying regulator in relation to a partnership function if it is not a relevant function of that regulator. (25A) (1) In this Part, “enforcement action” means— (a) action which relates to securing compliance with a restriction, requirement or condition in the event of breach (or putative breach) of a restriction, requirement or condition; (b) action taken with a view to, or in connection with, the imposition of a sanction (criminal or otherwise) in respect of an act or omission; (c) action taken in connection with the pursuit of a remedy conferred by an enactment in respect of an act or omission. (2) But the Secretary of State may by regulations, with the consent of the Welsh Ministers, specify— (a) action which is to be regarded as enforcement action for the purposes of this Part or any provision of this Part specified in the regulations; (b) action which is not to be regarded as enforcement action for the purposes of this Part or any provision of this Part specified in the regulations. (3) Regulations under subsection (2) may make different provision for different purposes. (25B) (1) This section applies if— (a) the primary authority proposes to take enforcement action against the regulated person or a member of the regulated group pursuant to a relevant function of the primary authority which is a partnership function, and (b) in the case of proposed enforcement action against a member of the regulated group, the primary authority is aware that the member belongs to the group. But see section 25D (which imposes a duty to prescribe circumstances in which this section does not apply). (2) The primary authority— (a) must notify the regulated person or the member in writing before taking the proposed enforcement action, and (b) may not take the action during the referral period mentioned in paragraph 5(2) of Schedule 4A (period in which the regulated person or the member may refer the action to the Secretary of State) unless notified in writing by the regulated person or the member that no such reference is to be made. (3) Parts 1 and 3 of Schedule 4A contain provision for questions arising under this section to be referred to the Secretary of State. (4) Where another enactment limits the period within which the primary authority may take the proposed enforcement action, any time during which it is prohibited under this section or paragraph 5(7) of Schedule 4A from taking the action is to be disregarded in calculating that period. (25C) (1) This section applies if— (a) a qualifying regulator other than the primary authority proposes to take enforcement action against the regulated person or a member of the regulated group pursuant to a relevant function of the regulator which is a partnership function, and (b) in the case of proposed enforcement action against a member of the regulated group, the regulator is aware that the member belongs to the group. But see section 25D (which imposes a duty to prescribe circumstances in which this section does not apply). (2) The qualifying regulator (the “enforcing authority”)— (a) must notify the primary authority in writing before taking the proposed enforcement action, and (b) may not take the action during the relevant period. (3) If— (a) the enforcing authority fails to notify the primary authority under subsection (2)(a) of the proposed enforcement action, but (b) the primary authority is notified of it by the regulated person or the member or the co-ordinator of the regulated group, the primary authority must notify the enforcing authority in writing that the enforcing authority is prohibited by subsection (2)(b) from taking the action during the relevant period. (4) If the primary authority determines, within the relevant period, that the proposed enforcement action is inconsistent with advice or guidance previously given by it (generally or specifically), it may direct the enforcing authority in writing not to take the action. (5) Any such direction must be given as soon as is reasonably practicable, and in any event within the relevant period. (6) If the enforcing authority is not directed under subsection (4) not to take the proposed enforcement action, and continues to propose to take the action— (a) it must inform the regulated person or the member, and (b) it may not take the action during the referral period mentioned in paragraph 5(4) of Schedule 4A (period in which the regulated person or the member may refer the action to the Secretary of State) unless notified in writing by the regulated person or the member that no such reference is to be made. (7) Parts 2 and 3 of Schedule 4A contain provision for questions arising under this section to be referred to the Secretary of State. (8) Where another enactment limits the period within which the enforcing authority may take the proposed enforcement action, any time during which it is prohibited under this section or paragraph 5(7) of Schedule 4A from taking the action is to be disregarded in calculating the period. (9) For the purposes of this section, the “relevant period” means the period which— (a) begins when the primary authority is notified under subsection (2)(a) of the proposed enforcement action or the enforcing authority is notified under subsection (3) that it is prohibited from taking the action during the relevant period, and (b) ends— (i) at the end of the fifth working day after the day on which the period begins, or at such later time as the Secretary of State may direct, or (ii) if earlier, when the enforcing authority is notified in writing by the primary authority that no direction is to be given under subsection (4) (unless the notification states that the primary authority has referred the action to the Secretary of State under paragraph 4(1) of Schedule 4A or that it intends to do so). (25D) (1) The Secretary of State must by regulations, with the consent of the Welsh Ministers, prescribe— (a) circumstances in which section 25B, and Schedule 4A so far as relating to cases within section 25B, do not apply, and (b) circumstances in which section 25C, and Schedule 4A so far as relating to cases within section 25C, do not apply. (2) In particular, the Secretary of State must exercise the power under subsection (1) to secure that those provisions do not apply— (a) where the enforcement action is required urgently to avoid a significant risk of serious harm to— (i) human health, (ii) the environment (including the health of animals or plants), or (iii) the financial interests of consumers; (b) where the application of those provisions would be wholly disproportionate. (3) Where a qualifying regulator other than the primary authority takes enforcement action against the regulated person or a member of the regulated group in circumstances prescribed under subsection (1)(b), the qualifying regulator must inform the primary authority of the action as soon as it reasonably can. (26A) (1) Where a partnership function consists of or includes a function of inspection (an “inspection function”), the primary authority may make an inspection plan in accordance with this section. (2) An “inspection plan” is a plan containing recommendations as to how the inspection function should be exercised by an inspecting regulator in relation to the regulated person or a member of the regulated group. (3) A person is an “inspecting regulator” if— (a) the person is a qualifying regulator, and (b) the inspection function is a relevant function of the person. (4) An inspection plan may, in particular— (a) set out what an inspection should consist of; (b) set out the frequency with which inspections should be carried out; (c) set out the circumstances in which they should be carried out; (d) require the inspecting regulator to provide the primary authority with a report on the inspecting regulator's exercise of the inspection function. (5) Before making an inspection plan the primary authority must consult the regulated person or the co-ordinator of the regulated group. (6) When making an inspection plan the primary authority must take into account any relevant recommendations relating to inspections which are published pursuant to a regulatory function by a person other than an inspecting regulator. (7) When it has made an inspection plan, the primary authority may apply to the Secretary of State for consent to the plan. (8) If the Secretary of State consents to a plan under subsection (7), the primary authority must notify the plan to— (a) the regulated person or the co-ordinator of the regulated group, and (b) inspecting regulators. (9) If, in the case of a regulated group, an inspection plan is notified to the co-ordinator under subsection (8)(a), the co-ordinator must— (a) notify the plan to those members of the group to whom the co-ordinator considers it may be relevant, (b) prepare a list of the names and addresses of those members, (c) secure, as far as is reasonably practicable, that the list is accurate and kept up-to-date, (d) provide the primary authority with the list, including any updates to it, and (e) notify any member whose name is included in the list or removed from it of the inclusion or removal. (10) If a list or update is provided to the primary authority under subsection (9)(d), the primary authority must notify the list or update to inspecting regulators. (26B) (1) If the Secretary of State consents under section 26A(7) to an inspection plan in respect of an inspection function, the primary authority must have regard to the plan when it exercises the inspection function in relation to— (a) the regulated person, or (b) a member of the regulated group whose name is included in the list provided to the primary authority (and, where applicable, updated) under section 26A(9)(d). (2) If an inspection plan of the primary authority is notified to an inspecting regulator under section 26A(8)(b), the inspecting regulator may not exercise the inspection function in relation to the regulated person or a member of the regulated group otherwise than in accordance with the plan, unless— (a) the inspecting regulator has notified the primary authority in writing of the way in which it proposes to exercise the function, and the primary authority has notified the regulator in writing that the primary authority consents to that proposed exercise, or (b) in the case of a regulated group, the member's name is not included in the list notified to the inspecting regulator (and, where applicable, updated) under section 26A(10). (3) A notification by an inspecting regulator under subsection (2)(a) must include reasons for exercising the function otherwise than in accordance with the plan. (4) A primary authority is to be treated as having given the notification of consent described in subsection (2)(a) if— (a) it is notified by the inspecting regulator as described in that subsection, and (b) it fails to notify the inspecting regulator in writing, before the end of the fifth working day after the day on which it received the notification, whether it consents as described in that subsection. (26C) (1) A primary authority may, with the consent of the Secretary of State, revoke an inspection plan made by it under section 26A. (2) If a primary authority revokes an inspection plan, it must notify the following that the plan is no longer in effect— (a) the regulated person or the co-ordinator of the regulated group; (b) inspecting regulators. (3) Where the revocation of an inspection plan is notified to the co-ordinator of a regulated group under subsection (2)(a), the co-ordinator must notify the revocation to those members of the group to whom the co-ordinator considers it may be relevant. (4) A primary authority may from time to time revise an inspection plan made by it under section 26A. (5) Sections 26A and 26B and this section apply to a revised plan as they apply to a plan made under section 26A; and references in this Part to an inspection plan include the revised plan. (27A) (1) The primary authority— (a) may, in the case of a regulated person, charge the person such fees as the authority considers to represent the costs reasonably incurred by it in the exercise of its functions under this Part in relation to the person; (b) may, in the case of a regulated group, charge the co-ordinator such fees as the authority considers to represent the costs reasonably incurred by it in the exercise of its functions under this Part in relation to the regulated group. (2) The reference in subsection (1)(b) to functions in relation to the regulated group includes functions in relation to the co-ordinator or a member of the group. (28A) (1) This section applies to a person who has regulatory functions and who— (a) is specified as a “supporting regulator” by the Secretary of State by regulations, and (b) has a function which is not a relevant function of the person but which— (i) is a designated function of the person, and (ii) is, or is relevant to the exercise of, a partnership function. (2) The supporting regulator may do anything which it considers appropriate for the purpose of supporting the primary authority in the preparation of— (a) advice or guidance under section 24A in relation to the partnership function, or (b) an inspection plan in relation to the partnership function. (3) If the supporting regulator provides support under subsection (2), it must, in the exercise of the designated function in relation to the regulated person or a member of the regulated group, act consistently with any advice or guidance under section 24A, or any inspection plan— (a) which is subsequently given or made in relation to the partnership function, and (b) to which the supporting regulator has consented. (4) But, in the case of a regulated group, the duty under subsection (3) applies to the exercise of the designated function in relation to a member of the group only if the supporting regulator is aware that the member belongs to the group. (5) The duty under subsection (3) is a duty to act consistently so far as it is possible for the supporting regulator to do so in accordance with its other functions. (6) If— (a) the supporting regulator provides support under subsection (2), and (b) the regulated person or the co-ordinator of the regulated group has agreed in writing to the provision of that support, the supporting regulator may charge the regulated person or the co-ordinator such fees as it considers to represent the costs reasonably incurred by it in providing that support. (7) In the case of a regulated group, the co-ordinator of the group must make the following available free of charge, on request, to the supporting regulator— (a) a copy of the group membership list maintained under section 23D(2); (b) a copy of a list under section 26A(9) of group members to whom an inspection plan may be relevant. (8) The copy must be made available as soon as is reasonably practicable and in any event not later than the end of the third working day after the day on which the request is received by the co-ordinator. (9) Regulations under subsection (1)(a) require the consent of the Welsh Ministers to specify a person whose functions relate only to devolved Welsh matters. (10) In this section, “designated function”, in relation to a supporting regulator, means a regulatory function exercised by that regulator and specified by the Secretary of State by regulations. (11) Regulations under subsection (10)— (a) may not specify a regulatory function so far as exercisable in Scotland, if or to the extent that the function relates to matters which are not reserved matters; (b) may not specify a regulatory function so far as exercisable in Northern Ireland, if or to the extent that the function relates to matters which are transferred matters; (c) require the consent of the Welsh Ministers to specify a regulatory function, so far as exercisable in relation to Wales, which relates to a devolved Welsh matter. (12) Regulations under subsection (10) may make different provision for— (a) different purposes; (b) different areas. (13) A supporting regulator who, apart from subsection (2), has power to provide the support described in that subsection, is not prevented by that power from exercising the power conferred by subsection (2). (28B) (1) This section applies to a person who has regulatory functions and who— (a) is specified as a “complementary regulator” by the Secretary of State by regulations, and (b) has a function which is not a relevant function of the person, but which— (i) is a designated function of the person, (ii) is, or is equivalent to, a partnership function, and (iii) is exercisable by the person in relation to the regulated person or a member of the regulated group. (2) The complementary regulator must act consistently with primary authority advice and guidance in the exercise of the designated function in relation to the regulated person or a member of the regulated group. (3) But, in the case of a regulated group, the duty under subsection (2) applies to the exercise of the designated function in relation to a member of the group only if the complementary regulator is aware that the member belongs to the group. (4) The duty under subsection (2) is a duty to act consistently so far as it is possible for the complementary regulator to do so in accordance with its other functions. (5) In subsection (2), “primary authority advice and guidance” means— (a) advice and guidance given by the primary authority under section 24A to the regulated person or the co-ordinator of the regulated group in relation to the partnership function, (b) advice and guidance given by the primary authority under that section to qualifying regulators as to how they should exercise the partnership function in relation to the regulated person or a member of the regulated group, and (c) an inspection plan made by the primary authority in respect of the exercise of the partnership function in relation to the regulated person or a member of the regulated group. (6) In the case of a regulated group, the co-ordinator of the group must make the following available free of charge, on request, to the complementary regulator— (a) a copy of the group membership list maintained under section 23D(2); (b) a copy of a list under section 26A(9) of group members to whom an inspection plan may be relevant. (7) The copy must be made available as soon as is reasonably practicable and in any event not later than the end of the third working day after the day on which the request is received by the co-ordinator. (8) Regulations under subsection (1)(a) require the consent of the Welsh Ministers to specify a person whose functions relate only to devolved Welsh matters. (9) In this section, “designated function”, in relation to a complementary regulator, means a regulatory function exercised by that regulator and specified for the purposes of this section by the Secretary of State by regulations. (10) Regulations under subsection (9) specifying a function other than a partnership function must identify the partnership function to which the designated function is equivalent. (11) Regulations under subsection (9)— (a) may not specify a regulatory function so far as exercisable in Scotland, if or to the extent that the function relates to matters which are not reserved matters; (b) may not specify a regulatory function so far as exercisable in Northern Ireland, if or to the extent that the function relates to matters which are transferred matters; (c) require the consent of the Welsh Ministers to specify a regulatory function, so far as exercisable in relation to Wales, which relates to a devolved Welsh matter. (12) Regulations under subsection (9) may make different provision for— (a) different purposes; (b) different areas. (29A) (1) This section applies if— (a) a qualifying regulator nominated as a direct primary authority or a co-ordinated primary authority for the exercise of a function in relation to a person notifies the person, under section 25B(2)(a), of enforcement action that it proposes to take against the person pursuant to the function, and (b) within the referral period, the person notifies the primary authority that the person considers the action to be inconsistent with advice or guidance previously given (generally or specifically) by another qualifying regulator nominated as the primary authority for the exercise of the function in relation to the person. (2) Section 25C (but not section 29C) applies in relation to the proposed enforcement action as if the primary authority which gave the notification under section 25B(2)(a) were an enforcing authority under section 25C; and section 25B no longer applies in relation to the action. (3) “Referral period” in this section means the referral period mentioned in paragraph 5(2) of Schedule 4A (period in which the regulated person or the member may refer the proposed enforcement action to the Secretary of State). (29B) (1) This section applies if— (a) a qualifying regulator is nominated as a co-ordinated primary authority for the exercise of a function in relation to a person, (b) an enforcing authority proposes to take enforcement action against the person pursuant to the function, and (c) because of the nomination mentioned in paragraph (a), the enforcing authority is (ignoring this section) required under section 25C(2)(a) to notify the co-ordinated primary authority of the proposed enforcement action. (2) That requirement to notify the co-ordinated primary authority does not apply if condition A or B is met. (3) Condition A is that under section 25C(2)(a) the enforcing authority is required to notify another qualifying regulator of the proposed enforcement action because of that other qualifying regulator's nomination as a direct primary authority for the exercise of the function in relation to the person. (4) Condition B is that— (a) condition A is not met, (b) the enforcing authority is (ignoring this section) required under section 25C(2)(a) to notify at least one other qualifying regulator of the proposed enforcement action because of that other regulator's nomination as a co-ordinated primary authority for the exercise of the function in relation to the person, and (c) the enforcing authority has so notified that other regulator or (if there is more than one) it has so notified at least one of them. (29C) (1) This section applies if— (a) a qualifying regulator is nominated as a direct primary authority or a co-ordinated primary authority for the exercise of a function in relation to a person, (b) that primary authority (“PA1”) is notified under section 25C(2)(a) of enforcement action that an enforcing authority proposes to take against the person pursuant to the function, and (c) PA1 decides not to give a direction under section 25C(4) directing the enforcing authority not to take the enforcement action, and does not refer the action to the Secretary of State under paragraph 4(1) of Schedule 4A. (2) PA1 must, within the relevant period, take reasonable steps to find out if— (a) another qualifying regulator nominated as the primary authority (“PA2”) for the exercise of the function in relation to the person has previously given advice or guidance (generally or specifically), and (b) the person considers the proposed enforcement action to be inconsistent with that advice or guidance. (3) If PA1 is of the view that such advice or guidance has previously been given and that the person considers the proposed enforcement action to be inconsistent with it, PA1 must— (a) refer the action to PA2, and (b) notify the enforcing authority and the person that it has done so. (4) If subsection (3) applies— (a) the reference of the proposed enforcement action by PA1 to PA2 under subsection (3)(a) is to be treated as a notification given by the enforcing authority to PA2 under section 25C(2)(a), and (b) accordingly, section 25C (but not this section) applies in relation to PA2 as the primary authority and ceases to apply in relation to PA1 as the primary authority. (5) “Relevant period” in this section has the same meaning as in section 25C (see subsection (9) of that section). (29D) (1) This section applies if, in relation to an inspecting regulator, there is more than one relevant inspection plan in respect of the exercise of the same inspection function in relation to the same person. (2) An inspection plan is “relevant” in relation to an inspecting regulator if— (a) it is a plan made by it (as a primary authority) to which the Secretary of State has consented under section 26A(7), or (b) it is a plan notified to it (as an inspecting regulator) under section 26A(8)(b). (3) If— (a) the inspecting regulator is a direct primary authority for the exercise of the inspection function in relation to the person, and (b) there is a relevant inspection plan made by the regulator in relation to the exercise of the function in relation to the person, section 26B(2) (duty of inspecting regulator to act in accordance with plans notified by the primary authority) does not apply in relation to the inspecting regulator by reason of it being notified of any other relevant inspection plan under section 26A(8)(b) in relation to the exercise of the function in relation to the person. (4) Subsection (5) applies if— (a) the inspecting regulator is a co-ordinated primary authority for the exercise of the inspection function in relation to the person, and (b) there is a relevant inspection plan which is made by a direct primary authority for the exercise of the function in relation to the person and notified to the inspecting regulator under section 26A(8)(b). (5) Where this subsection applies— (a) section 26B(1) (duty of primary authority to have regard to its own inspection plan) does not apply to the inspecting regulator (as primary authority) in relation to any relevant inspection plan made by it in respect of the exercise of the function in relation to the person; (b) in the application of section 26B(2) to the exercise of the function in relation to the person by the inspecting regulator, the reference to the inspection plan in that provision is to the plan mentioned in subsection (4)(b) only. (6) If— (a) the inspecting regulator is a co-ordinated primary authority for the exercise of the inspection function in relation to the person, (b) there is a relevant inspection plan made by the regulator in respect of the exercise of the function in relation to the person, and (c) subsection (5) does not apply, section 26B(2) does not apply in relation to the exercise of the function by the inspecting regulator in relation to the person. (7) If none of subsections (3) to (6) apply, but more than one relevant inspection plan is notified to the inspecting regulator under section 26A(8)(b) in relation to the exercise of the inspection function in relation to the person, in section 26B(2) the reference to the plan is to be read— (a) if one of those plans is made by a direct primary authority for the exercise of the function in relation to the person, as a reference to that plan, and (b) otherwise, as a reference to any one of the plans notified to the regulator. (30A) (1) The Secretary of State may give guidance to any one or more qualifying regulators, supporting regulators, complementary regulators or co-ordinators about the operation of this Part. (2) The guidance may include, in particular, guidance to qualifying regulators about— (a) arrangements under section 24A(3) for the giving of advice or guidance by primary authorities; (b) enforcement action referred to the Secretary of State under paragraph 1(1), 2(1), 3(1) or 4(1) of Schedule 4A; (c) the notification of inspection plans under section 26A(8); (d) the charging of fees under section 27A. (3) The guidance may include, in particular, guidance to supporting regulators about— (a) the circumstances in which a function is relevant to the exercise of a partnership function for the purposes of section 28A; (b) the charging of fees under section 28A(6). (4) A qualifying regulator, supporting regulator, complementary regulator or co-ordinator must have regard to any guidance given to it under this section. (5) Before giving guidance under this section the Secretary of State must consult such persons as the Secretary of State considers appropriate. (6) The Secretary of State may not give guidance under subsection (2)(d) or (3) without consulting the Welsh Ministers. (7) The Secretary of State may at any time vary or revoke guidance given under this section. (8) The Secretary of State must publish guidance given under this section and any variation or revocation of the guidance. (9) A qualifying regulator must comply with a direction given to it under this Part. (30B) The Secretary of State may by regulations amend any provision of this Part which specifies a period within which, or a time before which, anything must, must not or may be done. (30C) (1) Regulations under this Part must be made by statutory instrument. (2) A statutory instrument containing regulations under section 22B, 28B(1)(a) or 30B (whether alone or with other provision) may not be made unless a draft of the instrument has been laid before, and approved by resolution of, each House of Parliament. (3) Any other statutory instrument containing regulations under this Part is subject to annulment in pursuance of a resolution of either House of Parliament. (30D) (1) In this Part— - “complementary regulator” means a complementary regulator under section 28B; - “co-ordinated primary authority” has the meaning given in section 23A(1)(b); - “co-ordinator” has the meaning given in section 23C(1); - “direct primary authority” has the meaning given in section 23A(1)(a); - “enforcement action” has the meaning given in section 25A; - “enforcing authority” has the meaning given in section 25C(2); - “inspecting regulator” has the meaning given in section 26A(3); - “inspection function” has the meaning given in section 26A(1); - “inspection plan” has the meaning given in sections 26A(2) and 26C(5); - “local authority” has the meaning given in section 22B(2) and (3); - “Northern Ireland” has the same meaning as in the Northern Ireland Act 1998; - “partnership function” has the meaning given in section 23A(2) and (7); - “primary authority” means a qualifying regulator nominated as a primary authority under section 23A(1); - “qualifying regulator” has the meaning given in section 22B(1); - “regulated group” has the meaning given in section 22A(2); - “regulated person” has the meaning given in section 22A(1); - “relevant function” has the meaning given in section 22C(1); - “reserved matter” has the same meaning as in the Scotland Act 1998; - “Scotland” has the same meaning as in the Scotland Act 1998; - “specified regulator” has the meaning given in section 22B(4); - “supporting regulator” means a supporting regulator under section 28A; - “transferred matter” has the same meaning as in the Northern Ireland Act 1998; - “Wales” has the same meaning as in the Government of Wales Act 2006; - “working day” has the meaning given in subsection (2). (2) In this Part, “working day” means a day other than— (a) a Saturday or Sunday, (b) Christmas Day or Good Friday, or (c) a day which is a bank holiday under the Banking and Financial Dealings Act 1971 in the relevant part of the United Kingdom. (3) For the purposes of subsection (2)(c), the “relevant part” of the United Kingdom is— (a) in relation to section 23D(5), 28A(8) or 28B(7) (period in which co-ordinator must make available a list of group members or of group members to whom an inspection plan may be relevant), the part where the co-ordinator of the group is; (b) in any other case, the part where the primary authority is.

(2) For Schedule 4 to the Regulatory Enforcement and Sanctions Act 2008 (enforcement action: references to the Secretary of State) substitute Schedule 4A set out in Schedule 3 to this Act.

Devolved Welsh matters

21

(1) The Regulatory Enforcement and Sanctions Act 2008 is amended as follows.

(2) In each of the following provisions, for “Welsh ministerial” substitute “ devolved Welsh ”

(a) in section 4 (meaning of “relevant function”), subsections (6) and (8)(b);

(b) in section 6 (guidance to local authorities), subsections (1) and (1A);

(d) in section 12 (relationship between Secretary of State and other regulators), subsection (3);

(e) in section 16 (guidance or directions by Welsh Ministers), subsection (1);

(f) in section 36 (power to make orders providing for civil sanctions), subsection (2);

(g) in section 59 (consultation and consent for civil sanctions orders: Wales), subsection (2);

(h) in section 73 (functions to which duty not to impose or maintain unnecessary regulatory burdens applies), subsections (3)(c), (4)(c) and (5).

(3) In section 73 (functions to which section 72 applies), in subsections (3)(c) and (4)(c), for “in Wales” substitute “ in relation to Wales ”.

(4) In section 74 (general interpretation)—

(a) omit the definition of “Welsh ministerial matter”;

(b) before the definition of “Minister of the Crown” insert—

“devolved Welsh matter” means — (a) a matter within the legislative competence of the National Assembly for Wales (see section 108 of the Government of Wales Act 2006), or (b) a matter in relation to Wales in respect of which functions are exercisable by the Welsh Ministers, and in this definition “Wales” has the same meaning as in the Government of Wales Act 2006;

PART 4 — Apprenticeships

The Institute for Apprenticeships

22

Schedule 4 establishes the Institute for Apprenticeships and makes provision about its functions.

The Institute for Apprenticeships: transitional provision

23

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

Public sector apprenticeship targets

24

(1) In Chapter A1 of Part 1 of the Apprenticeships, Skills, Children and Learning Act 2009 (apprenticeships: England), after section A8 insert—

(A9) (1) The Secretary of State may by regulations set apprenticeship targets for prescribed public bodies. (2) An “apprenticeship target”, in relation to a public body, is a target relating to the number of persons (“apprentices”) who work for the body under an apprenticeship agreement. (3) Public bodies for which apprenticeship targets are set under this section must have regard to— (a) the targets, and (b) any applicable guidance issued by the Secretary of State in relation to the targets. (4) The Secretary of State may require a public body to provide any information that the Secretary of State needs for the purpose of exercising functions under this section. (5) Regulations under this section may set apprenticeship targets for— (a) a prescribed public body, (b) a prescribed part of a public body, (c) a prescribed group of public bodies, or (d) public bodies of a prescribed description. A reference in this section to a public body includes a reference to a prescribed part of a public body or a prescribed group of public bodies. (6) The regulations must specify the period to which each apprenticeship target relates. (7) In this section— - “apprenticeship agreement” means— 1. an approved English apprenticeship agreement; 2. an apprenticeship agreement within the meaning given in section 32 as it applies in relation to England by virtue of provision made under section 115(9) of the Deregulation Act 2015; - “public body” means— 1. a public authority, or 2. a body or other person that is not a public authority but has functions of a public nature and is funded wholly or partly from public funds. (A10) (1) A public body for which an apprenticeship target is set must— (a) publish and send to the Secretary of State the information specified in subsection (2), and (b) send to the Secretary of State any other prescribed information, within six months after the end of each reporting period of the body in the target period. (2) The information referred to in subsection (1)(a) is— (a) the number of employees whose employment in England by the body began in the reporting period in question (“figure A”); (b) the number of apprentices who began to work for the body in that period and whose apprenticeship agreements also began in that period (“figure B”); (c) figure B expressed as a percentage of figure A; (d) the number of employees employed in England that the body has at the end of that period (“figure C”); (e) the number of apprentices who work for the body at the end of that period (“figure D”); (f) figure D expressed as a percentage of figure C; (g) if that reporting period is the first reporting period in the target period, the number of apprentices who worked for the body immediately before that period. (3) The information that may be prescribed under subsection (1)(b) includes— (a) information about action that the body has taken to meet an apprenticeship target set for it; (b) if the public body has failed to meet an apprenticeship target set for it, an explanation of why the target has not been met; (c) information about action that the body proposes to take to meet an apprenticeship target set for the body for a period that has not yet expired (“a future target”); (d) if the body considers that a future target is not likely to be met, an explanation of why that is so. (4) Regulations may specify how the information is to be published or sent. (5) A body's “reporting periods” in the target period are— (a) so much of the first financial year of the body to end in the target period as falls within that period, (b) each subsequent financial year of the body which falls wholly within the target period, and (c) if the target period ends during a financial year of the body, so much of that financial year as falls within that period. (6) But, where the target period in relation to a body does not exceed 12 months, the Secretary of State may direct in writing that for the purposes of this section the body is to be treated as having one reporting period which coincides with the target period. (7) Where, by virtue of section A9(5)(c) or (d) a target is set for more than one public body, regulations may specify which body's financial year is to be used to determine the reporting periods under subsection (5). (8) In this section— - “apprenticeship agreement” has the meaning given by section A9(7); - “apprenticeship target” has the meaning given by section A9(2); - “public body” has the meaning given by section A9(7); - “target period”, in relation to an apprenticeship target, means the period specified under section A9(6) as the period to which the target relates.

(2) In section 262(6) of that Act (regulations etc subject to affirmative resolution procedure), before paragraph (aa) insert—

(za) the first regulations under section A9; (zb) the first regulations under section A10;

Only statutory apprenticeships to be described as apprenticeships

25

(1) In Chapter A1 of Part 1 of the Apprenticeships, Skills, Children and Learning Act 2009 (apprenticeships: England), after section A10 (inserted by section 24) insert—

(A11) (1) A person (“P”) providing or offering any course or training that is, or is to be, undertaken (wholly or partly) in England commits an offence if— (a) in the course of business P describes the course or training as an apprenticeship, and (b) the course or training is not a statutory apprenticeship. (2) No offence is committed under subsection (1) where the course or training is, or is to be, provided to an individual under or in pursuance of a contract of employment between the individual and P. (3) In subsection (1) “statutory apprenticeship” means any course or training that is, or is to be, provided under— (a) an approved English apprenticeship; (b) an apprenticeship agreement within the meaning given in section 32; (c) an arrangement to undertake any other kind of working— (i) in relation to which alternative English completion conditions apply under section 1(5), and (ii) in connection with which training is to be provided in accordance with an apprenticeship framework within the meaning given in section 12; or (d) arrangements made under— (i) section 2 of the Employment and Training Act 1973, (ii) section 17B(1)(a) of the Jobseekers Act 1995, (iii) section 2(3) of the Enterprise and New Towns (Scotland) Act 1990, or (iv) section 1 of the Employment and Training Act (Northern Ireland) 1950, that are identified by the person making the arrangements as arrangements for the provision of apprenticeships. (4) The reference to section 32 in subsection (3)(b) includes a reference to that section as it applies in relation to England by virtue of provision made under section 115(9) of the Deregulation Act 2015; and a reference to a section in subsection (3)(c) is a reference to the section as it so applies. (5) A person guilty of an offence under this section is liable on summary conviction to a fine. (6) Where an offence under this section committed by a body corporate— (a) is committed with the consent or connivance of an officer of the body corporate, or (b) is attributable to neglect on the part of an officer of the body corporate, the officer also commits the offence and is liable to be proceeded against and punished accordingly. (7) Every local weights and measures authority in England— (a) has a duty to enforce the provisions of this section within their area; (b) must make to the Secretary of State, whenever he or she so directs, a report on the exercise of the authority's functions under this section. A report under paragraph (b) must be in such form, and contain such particulars, as the Secretary of State may direct. (8) Proceedings for an offence under this section may be instituted only— (a) by or on behalf of a local weights and measures authority in England, (b) by or on behalf of the Secretary of State, or (c) with the consent of the Director of Public Prosecutions. (9) In this section— - “contract of employment” has the same meaning as in the Employment Rights Act 1996 (see section 230(2) of that Act); - “offering”, in relation to any course or training, includes offering or marketing it to the public generally or to any section of the public; - “officer”, in relation to a body corporate, means— 1. a director, manager, secretary or similar officer of the body, or a person purporting to act in such capacity; 2. a governor of an educational institution conducted by the body. (10) The reference in subsection (1) to describing any course or training as an apprenticeship includes a reference to describing an individual who undertakes it as an apprentice.

(2) In Schedule 5 to the Consumer Rights Act 2015 (investigatory powers etc), in paragraph 10, at the appropriate place insert— “ section A11(7)(a) of the Apprenticeships, Skills, Children and Learning Act 2009; ”.

26

(1) After Part 1 of the Apprenticeships, Skills, Children and Learning Act 2009 (apprenticeships, study and training) insert—

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Enterprise Act 2016

PART 1 — The Small Business Commissioner

The Commissioner

The Institute for Apprenticeships

1

“Small businesses”

Small businesses in relation to which the Commissioner has functions

2

General advice and information

General advice and information

3

Complaints scheme

The SBC complaints scheme

4

Enquiry into, consideration and determination of complaints

5

Reports on complaints

6

Scheme regulations

7

Confidentiality

8

Reports and reviews

Annual report

9

Review of Commissioner’s performance

10

Power to abolish

Power to abolish the Commissioner

11

Regulations under section 11: procedure

12

Definitions

Definitions used in Part 1

13

PART 2 — Regulators

...

Extension of target to provisions made by regulators

14

Reporting requirements

Duty to report on effect of regulators’ code

15

Duty to report on effect of economic growth duty

16

Application of regulators' principles and code of practice

Power of Welsh Ministers to apply regulators’ principles and code of practice

17

Removal of restrictions

18

Secondary legislation: duty to review

Secondary legislation: duty to review

19

PART 3 — Regulatory Enforcement and Sanctions Act 2008

Extending the primary authority scheme

20

Devolved Welsh matters

21

PART 4 — Apprenticeships

The Institute for Apprenticeships

22

The Institute for Apprenticeships: transitional provision

23

Public sector apprenticeship targets

24

Only statutory apprenticeships to be described as apprenticeships

25

Apprenticeships: information sharing

26