The Financial Services and Markets Act 2000 (Liability of Issuers) Regulations 2010

Made: 7th April 2010

Coming into force: 1st October 2010

In accordance with section 429(2) of that Act, a draft of these Regulations has been laid before Parliament and approved by a resolution of each House of Parliament.

Citation and commencement

1

• (1) These Regulations may be cited as the Financial Services and Markets Act 2000 (Liability of Issuers) Regulations 2010.

• (2) These Regulations come into force on 1st October 2010.

Amendments to the Financial Services and Markets Act 2000

2

• (1) The Financial Services and Markets Act 2000 is amended as follows.

• (2) For section 90A (compensation for statements in certain publications) substitute—

(90A) Schedule 10A makes provision about the liability of issuers of securities to pay compensation to persons who have suffered loss as a result of— (a) a misleading statement or dishonest omission in certain published information relating to the securities, or (b) a dishonest delay in publishing such information.

• (3) After Schedule 10 insert the Schedule 10A contained in the Schedule to these Regulations.

Transitional provision

3

• (1) The amendments made to the Financial Services and Markets Act 2000 by these Regulations have effect in relation to information first published on or after 1st October 2010.

• (2) Section 90A of that Act, in the form inserted by the Companies Act 2006, continues to apply to information first published before that date.

SCHEDULE

Signed

Dave Watts — Tony Cunningham — Two of the Lords Commissioners of Her Majesty’s Treasury — 7th April 2010

Explanatory note

(This note is not part of the Order)

EXPLANATORY NOTE

These Regulations amend the regime for the liability of issuers to third parties in respect of loss suffered as a result of misleading statements or dishonest omissions in information published by the issuer, or dishonest delays in publishing such information.

Regulation 2 substitutes a new section 90A into the Financial Services and Markets Act 2000, and inserts Schedule 10A into the Act. The new Schedule is set out in the Schedule to the Regulations.

Paragraph 1 defines the securities which are to be subject to the new liability regime.

Paragraph 2 defines the information to which the new regime is to apply. This will include all information published by an issuer via a recognised information service, or where the availability of the information has been announced by use of such a service.

Paragraphs 3 and 4 set out the circumstances in which an issuer will be liable to pay compensation for loss suffered as a result of untrue or misleading statements, or dishonest omissions by a person who has acquired, continued to hold or disposed of securities in reliance on published information.

Paragraph 5 sets out the circumstances in which an issuer is liable to pay compensation for loss suffered by a person in respect of securities as a result of dishonest delay by the issuer in publishing information to which the Schedule applies.

Paragraph 6 defines “dishonesty” for the purposes of the Schedule.

Paragraph 7 limits the other forms of liability to which a issuer may be subject in respect of loss suffered as a result of misstatements, omissions and delay.

Paragraph 8 sets out the definitions for the Schedule.

An Impact Assessment of the effect of this instrument on the costs of business has been prepared and is available on HM Treasury’s website (www.hm-treasury.gov.uk) and is annexed to the Explanatory Memorandum which is available alongside the instrument on the OPSI website (www.opsi.gov.uk).

Footnotes

[^f00001]: 2000 c.8; sections 90A and 90B were inserted by section 1270 of the Companies Act 2006 (c. 46).

[^f00002]: As defined in section 103(1) of the Financial Services and Markets Act 2000, as amended by the Companies Act 2006 (c. 46), section 1265.

[^f00003]: As defined in section 425(1)(a) of, and paragraph 46 of Schedule 3 to the Financial Services and Markets Act 2000, as amended by regulations 2 and 13 of the Financial Services and Markets Act 2000 (Markets in Financial Instruments)(Modification of Powers) Regulations 2006 (S.I.2006/2975).

[^f00004]: Sections 102A to 102C and 103 were substituted for section 103 as originally enacted by regulation 2(1) of and paragraph 1 of Schedule 11 to the Prospectus Regulations 2005 (S.I. 2005/1433).