The Financial Services Act 2012 (Mutual Societies) Order 2013

JurisdictionUK Non-devolved
CitationSI 2013/496

2013 No. 496

Financial Services And Markets

The Financial Services Act 2012 (Mutual Societies) Order 2013

Made 5th March 2013

Coming into force 1st April 2013

The Treasury make the following Order in exercise of the powers conferred by sections 50, 51, 52, 115 and 118 of the Financial Services Act 2012 (“the 2012 Act”)1:

In accordance with section 116(1) of the 2012 Act, a draft of this instrument was laid before Parliament and approved by a resolution of each House of Parliament:

S-1 Citation and commencement

Citation and commencement

1.—(1) This Order may be cited as the Financial Services Act 2012 (Mutual Societies) Order 2013 and, comes into force on 1st April 2013.

S-2 Transfer of functions to the Financial Conduct Authority and the Prudential Regulation Authority

Transfer of functions to the Financial Conduct Authority and the Prudential Regulation Authority

2. The following Schedules to this Order have effect—

(a) Schedule 1 (which provides for the application of FSMA 20002to the functions made exercisable by the FCA and the functions transferred to the PRA by Schedules 2 to 10);

(b) Schedules 2 to 10 (which amend certain enactments relating to mutual societies so as to make functions of the Financial Services Authority exercisable by that body corporate as the FCA3and to transfer functions of the Financial Services Authority to the PRA);

(c) Schedule 11 (which makes amendments consequential on Schedules 2 to 10);

(d) Schedule 12 (which makes transitional provision).

Desmond Swayne

Stephen Crabb

Two of the Lords Commissioners of Her Majesty’s Treasury

5th March 2013

SCHEDULE 1

Article 2(a)

Application of the Financial Services and Markets Act 2000 to transferred functions

Interpretation

Interpretation

SCH-1.1

1. In this Schedule—

(a) “mutuals expenditure” means expenditure of the FCA or the PRA4incurred—

(i) in carrying out functions which are conferred by the legislation relating to mutual societies5or are otherwise exercisable by virtue of this Order;

(ii) for any purpose incidental to or in connection with the carrying out of such functions (including expenditure incurred before 1st April 2013 in preparation for the assumption of those functions); and

(b) any reference to a section or Schedule is a reference to FSMA 2000.

General

General

SCH-1.2

2.—(1) For the purposes of the provisions specified in sub-paragraph (2), functions transferred by this Order are to be treated as functions conferred on the FCA under a provision of FSMA 2000.

(2) The provisions are—

(a)

(a) section 1A(3) and Schedule 1ZA (which make general provision in relation to the FCA and its functions);

(b)

(b) section 1S (reviews);

(c)

(c) section 3D (duty of FCA and PRA to ensure co-ordinated exercise of functions);

(d)

(d) section 3E (memorandum of understanding);

(e)

(e) sections 3I to 3K6(power of PRA to restrain proposed action by FCA);

(f)

(f) section 139A7(power of the FCA to give guidance); and

(g)

(g) section 4158(jurisdiction in civil proceedings).

SCH-1.3

3.—(1) For the purposes of the provisions specified in sub-paragraph (2), functions transferred by this Order are to be treated as functions conferred on the PRA under a provision of FSMA 2000.

(2) The provisions are—

(a)

(a) section 2A(3) and Schedule 1ZB (which make general provision in relation to the PRA and its functions);

(b)

(b) sections 2B to 2I (the PRA’s general duties);

(c)

(c) section 2O9(reviews);

(d)

(d) sections 3D (duty of FCA and PRA to ensure co-ordinated exercise of functions);

(e)

(e) section 3E (memorandum of understanding); and

(f)

(f) sections 3I to 3K (power of PRA to restrain proposed action by FCA).

SCH-1.4

4. As it applies by virtue of paragraphs 2(2)(e) and 3(2)(f), section 3I (power of PRA to require FCA to refrain from specified action) is to be read as if—

(a) the references in subsection (2) of that section to regulatory powers were references to the functions transferred by this Order; and

(b) subsections (2)(b) and (3) of that section were omitted.

SCH-1.5

5.—(1) The FCA must maintain arrangements designed to enable it to determine whether persons are complying with requirements imposed on them by or under—

(a)

(a) the legislation relating to mutual societies;

(b)

(b) the Industrial and Provident Societies Act 197510;

(c)

(c) the Industrial and Provident Societies Act 197811.

Rules relating to fees

Rules relating to fees

SCH-1.6

6.—(1) This paragraph applies if the FCA makes, or proposes to make, rules under paragraph 23 of Schedule 1ZA (the Financial Conduct Authority: fees) which require the payment to the FCA of fees which relate in whole or in part to mutuals expenditure.

(2) In the application of paragraph 23 of Schedule 1ZA to the rules, the reference to fees and charges provided for by any other provision of FSMA 2000 includes a reference to fees and charges provided for by any provision of the legislation relating to mutual societies.

(3) To the extent that the fees relate to mutuals expenditure—

(a)

(a) section 138I(2)(d) (requirement for draft rules to be accompanied by an explanation of the FCA’s reasons for believing that making the proposed rules is compatible with section 1B(1))12does not apply in relation to the rules; and

(b)

(b) the rules are not to be treated as a “regulating provision” within the meaning of section 140A(1)13(interpretation of Chapter 4 of Part 9A (competition scrutiny)).

SCH-1.7

7.—(1) This paragraph applies if the PRA makes, or proposes to, make rules under paragraph 31 of Schedule 1ZB (the Prudential Regulation Authority: fees) which require the payment to the PRA of fees which relate in whole or in part to mutuals expenditure.

(2) In the application of paragraph 31 of Schedule 1ZB to the rules, the reference to fees and charges provided for by any other provision of FSMA 2000 includes a reference to fees and charges provided for by any provision of the legislation relating to mutual societies.

(3) To the extent that the fees relate to mutuals expenditure, the rules are not to be treated as a “regulating provision” within the meaning of section 140A(1).

Guidance

Guidance

SCH-1.8

8. Sections 139A(3) (power of FCA to give guidance) and 139B(5)14(notification of FCA guidance to the Treasury) apply to guidance given to building societies, friendly societies and industrial and provident societies generally or to a class of such societies.

SCH-1.9

9.—(1) This paragraph applies if guidance is given by the FCA under section 139A on the operation of a rule of the kind mentioned in paragraph 6 above.

(2) To the extent that the fees required to be paid by the rule relate to mutuals expenditure, the guidance is not to be treated as a “regulating provision” within the meaning of section 140A(1).

SCH-1.10

10.—(1) This paragraph applies if general guidance is given by the FCA under section 139A with respect to any matter relating to functions exercisable under, or to any provision of or made under, the legislation relating to mutual societies, unless paragraph 8 above applies.

(2) The guidance is not to be treated as a “regulating provision” within the meaning of section 140A(1).

SCHEDULE 2

Article 2(b)

Amendments of the Industrial and Provident Societies Act 1965

SCH-2.1

1. The Industrial and Provident Societies Act 196515is amended as follows.

SCH-2.2

2.—(1) In the provisions listed in paragraph (2)—

(a) for “Authority” substitute “FCA”; and

(b) for “Authority’s” substitute “FCA’s”.

(2) The provisions are—

(a)

(a) section 1(1)(a)16(societies which may be registered) as in force immediately before this Order comes into effect;

(b)

(b) section 1(2) and (3)17as substituted by section 1 of the Co-operative and Community Benefit Societies and Credit Unions Act 201018;

(c)

(c) section 219(registration of society);

(d)

(d) section 520(name of society);

(e)

(e) section 7A(7)21(capacity of society not limited by its rules);

(f)

(f) section 1022(amendment of registered rules);

(g)

(g) section 1623(cancellation of registration of society);

(h)

(h) section 1724(suspension of registration of society);

(i)

(i) section 1825(appeal from refusal, cancellation or suspension of registration of society or rules);

(j)

(j) section 39(1)26(annual returns);

(k)

(k) section 39A27(year of account (existing registrations));

(l)

(l) section 39B(7)28(year of account (new registrations));

(m)

(m) section 4329(duties of receiver or manager of society’s property);

(n)

(n) section 44(4)30(register of members and officers);

(o)

(o) section 4731(inspection of books);

(p)

(p) section 4832(production of documents and provision of information for certain purposes);

(q)

(q) section 4933(appointment of inspectors and calling of special meetings);

(r)

(r) section 50(4)34(amalgamation of societies);

(s)

(s) section 5235(conversion into, amalgamation with, or transfer of engagements to company);

(t)

(t) section 5336(conversion of company into registered society);

(u)

(u) section 5937(restriction on dissolution or cancellation of registration of society);

(v)

(v) section 7238(form, deposit and evidence of documents);

(w)

(w) section 74(2)39(interpretation); and

(x)

(x) section 7640(Northern Ireland societies).

SCH-2.3

3.—(1) Section 16 (cancellation of registration of society) is further amended as follows.

(2) After subsection (2), insert—

SCH-2.2A

“2A The FCA must consult the PRA before cancelling the registration of a registered society which is a PRA-authorised person.”.

(3) After subsection (4), insert—

SCH-2.4A

“4A The FCA must consult the PRA before issuing directions under subsection (4) to a registered society which is a PRA-authorised person.”.

SCH-2.4

4. After section 17(5) (suspension of registration of society), insert—

SCH-2.5A

“5A The FCA must consult the PRA before suspending, or renewing the suspension of, the registration of a registered society which is a PRA-authorised person.”.

SCH-2.5

5.—(1) Section 43 (duties of receiver or manager of society’s property) is further amended as follows.

(2) Number the...

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