OpenLegislation

Financial Services (Banking Reform) Act 2013

2013 c. 33 · Enacted 18 December 2013 · Extends to United Kingdom

Up to date with all changes known to legislation.gov.uk, revised to 20 August 2025.

An Act to make further provision about banking and other financial services, including provision about the Financial Services Compensation Scheme; to make provision for the amounts owed in respect of certain deposits to be treated as a preferential debt on insolvency; to make further provision about payment systems and securities settlement systems; to make provision about the accounts of the Bank of England and its wholly owned subsidiaries; to make provision in relation to persons providing claims management services; and for connected purposes.

[18th December 2013]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Contents

  1. Part 1: Ring-fencing
  2. Ring-fencing
  3. 1Objectives of Prudential Regulation Authority
  4. 2Modification of objectives of Financial Conduct Authority
  5. 3Amendment of PRA power of direction
  6. 4Ring-fencing of certain activities
  7. 5PRA annual report
  8. 6Ring-fencing transfer schemes
  9. 7Building societies: power to make provision about ring-fencing
  10. Reviews
  11. 8Independent review of operation of legislation relating to ring-fencing
  12. 9PRA review of proprietary trading
  13. 10Independent review of proprietary trading
  14. 11Reviews of proprietary trading: interpretation
  15. 12Right to obtain documents and information
  16. Part 2: Depositor preference and the Financial Services Compensation Scheme
  17. Depositor preference
  18. 13Preferential debts: Great Britain
  19. Financial Services Compensation Scheme
  20. 14Discharge of functions by the scheme manager
  21. 15Power to require information from scheme manager Repealed
  22. 16Scheme manager: appointment of accounting officer
  23. Part 3: Bail-in stabilisation option
  24. 17Bail-in stabilisation option
  25. Part 4: Conduct of persons working in financial services sector
  26. Amendments of FSMA 2000
  27. 18Functions for which approval is required
  28. 19Senior management functions
  29. 20Statements of responsibilities
  30. 21Vetting by relevant authorised persons of candidates for approval
  31. 22Determination of applications for approval
  32. 23Power to give approval subject to conditions or for limited period
  33. 24Changes in responsibilities of senior managers
  34. 25Duty to notify regulator of grounds for withdrawal of approval
  35. 26Variation of approval
  36. 27Statement of policy
  37. 28Extension of limitation periods for imposing sanctions
  38. 29Certification of employees by relevant authorised persons
  39. 30Rules of conduct
  40. 31Requirement to notify regulator of disciplinary action
  41. 32Definition of “misconduct”
  42. 33Meaning of “relevant authorised person” Repealed
  43. 34Recording information about senior managers
  44. 35Consequential amendments relating to Part 4
  45. Offence
  46. 36Offence relating to a decision causing a financial institution to fail
  47. 37Section 36: interpretation
  48. 38Institution of proceedings
  49. Part 5: Regulation of payment systems
  50. Overview
  51. 39Overview
  52. The Payment Systems Regulator
  53. 40The Payment Systems Regulator
  54. “Payment system” etc
  55. 41Meaning of “payment system”
  56. 42Participants in payment systems etc
  57. Designation as a regulated payment system
  58. 43Designation orders
  59. 44Designation criteria
  60. 45Procedure
  61. 46Amendment of designation order
  62. 47Revocation of designation orders
  63. 48Publication
  64. General duties of Regulator
  65. 49Regulator's general duties in relation to payment systems
  66. 50The competition objective
  67. 51The innovation objective
  68. 52The service-user objective
  69. 53Regulatory principles
  70. Regulatory and competition functions
  71. 54Directions
  72. 55System rules
  73. 56Power to require granting of access to payment systems
  74. 57Variation of agreements relating to payment systems
  75. 58Power to require disposal of interest in payment system
  76. 59The Regulator's functions under Part 4 of the Enterprise Act 2002
  77. 60Restrictions on exercise of functions under Part 4 of the Enterprise Act 2002
  78. 61The Regulator's functions under the Competition Act 1998
  79. 62Duty to consider exercise of powers under Competition Act 1998
  80. 63Provision of information and assistance to a CMA group
  81. 64Function of keeping markets under review
  82. 65Exclusion of general duties
  83. 66Concurrent competition powers: supplementary provision
  84. 67Amendments relating to Regulator's competition powers
  85. Complaints
  86. 68Complaints by representative bodies
  87. 69Response by Regulator
  88. 70Complaints: guidance
  89. Enforcement and appeals
  90. 71Meaning of “compliance failure”
  91. 72Publication of compliance failures etc
  92. 73Penalties
  93. 74Warning notices
  94. 75Injunctions
  95. 76Appeals: general
  96. 77Appeals to Competition Appeal Tribunal
  97. 78Appeals in relation to penalties
  98. 79Appeals to Competition and Markets Authority
  99. 80Enforcement of requirement to dispose of interest in payment system
  100. Information and investigation powers
  101. 81Power to obtain information or documents
  102. 82Reports by skilled persons
  103. 83Appointment of persons to conduct investigations
  104. 84Investigations: general
  105. 85Powers of persons appointed under section 83
  106. 86Information and documents: supplemental provisions
  107. 87Admissibility of statements made to investigators
  108. 88Entry of premises under warrant
  109. 89Retention of documents taken under section 88
  110. 90Enforcement of information and investigation powers
  111. Disclosure of information
  112. 91Restrictions on disclosure of confidential information
  113. 92Exemptions from section 91
  114. 93Offences relating to disclosure of confidential information
  115. 94Information received from Bank of England
  116. 95Disclosure of information by Bank to Regulator
  117. Guidance
  118. 96Guidance
  119. Reports
  120. 97Reports
  121. Technical Standards
  122. 97ATechnical standards
  123. 97BStandards instruments
  124. 97CTreasury approval
  125. 97DApplication of section 104 of this Act and Part 9A of the Financial Services and Markets Act 2000
  126. Relationship with other regulators
  127. 98Duty of regulators to ensure co-ordinated exercise of functions
  128. 99Memorandum of understanding
  129. 100Power of Bank to require Regulator to refrain from specified action
  130. 101Power of FCA to require Regulator to refrain from specified action
  131. 102Power of PRA to require Regulator to refrain from specified action
  132. Recommendations
  133. 102ARecommendations by Treasury in connection with general duties
  134. Consultation, accountability and oversight
  135. 102BMatters to consider when imposing generally applicable requirements
  136. 103Regulator's general duty to consult
  137. 104Consultation in relation to generally applicable requirements
  138. 104ARequirements in connection with public consultations
  139. 104BDuty of Regulator to review generally applicable requirements
  140. 104CStatement of policy relating to review of requirements
  141. 104DRequirement to review specified requirements
  142. 104EReport on certain reviews
  143. 104FPower of Treasury to require the imposition of generally applicable requirements
  144. 104GConsultation with the FCA Cost Benefit Analysis Panel
  145. 104HStatement of policy in relation to cost benefit analyses
  146. 104IStatement of policy on panel appointments
  147. 105Independent inquiries
  148. 106Investigations into regulatory failure
  149. 107Competition scrutiny
  150. 107AInternational trade obligations
  151. Miscellaneous and supplemental
  152. 108Relationship with Part 8 of the Payment Services Regulations 2017
  153. 109Exemption from liability in damages for FCA and PRA
  154. 110Interpretation of Part
  155. Part 6: Special administration for operators of certain infrastructure systems
  156. Introductory
  157. 111Financial market and cash infrastructure administration
  158. 112Interpretation: infrastructure companies
  159. 113Interpretation: other expressions
  160. FMI administration orders
  161. 114FMI administration orders
  162. 115Objective of FMI administration
  163. 116Application for FMI administration order
  164. 117Powers of court
  165. 118FMI administrators
  166. 119Continuity of supply
  167. 120Power to direct FMI administrator
  168. 121Conduct of administration, transfer schemes etc.
  169. Restrictions on other insolvency procedures
  170. 122Restriction on winding-up orders and voluntary winding up
  171. 123Restriction on making of ordinary administration orders
  172. 124Restriction on enforcement of security
  173. Powers to participate in Part 26A proceedings
  174. 124APowers of Bank to participate in Part 26A proceedings
  175. Financial support for companies in FMI administration
  176. 125Loans
  177. 126Indemnities
  178. Interpretation
  179. 127Interpretation of Part
  180. Application of Part to Northern Ireland Not yet in force
  181. 128Northern Ireland Not yet in force
  182. Part 7: Miscellaneous
  183. Competition
  184. 129Functions of FCA under competition legislation
  185. 130Competition as a secondary objective of the PRA
  186. Consumers
  187. 131Duty of FCA to make rules restricting charges for high-cost short-term credit
  188. 132Role of FCA Consumer Panel in relation to PRA
  189. Parent undertakings
  190. 133Power of FCA and PRA to make rules applying to parent undertakings
  191. Meetings with auditors
  192. 134Duty to meet auditors of certain institutions
  193. Fees to meet Treasury expenditure
  194. 135Fees to meet Treasury expenditure relating to international organisations
  195. Parliamentary control of statutory instruments under FSMA 2000
  196. 136Amendments of section 429 of FSMA 2000
  197. Bank of England
  198. 137Accounts of Bank of England and its wholly-owned subsidiaries
  199. Building societies
  200. 138Building societies
  201. Claims management services
  202. 139Power to impose penalties on persons providing claims management services Repealed
  203. 140Recovery of expenditure incurred by Office for Legal Complaints Repealed
  204. Minor amendments
  205. 141Minor amendments
  206. Part 8: Final provisions
  207. 142Orders and regulations: general
  208. 143Orders and regulations: Parliamentary control
  209. 144Interpretation
  210. 145Power to make further consequential amendments
  211. 146Transitional provisions and savings
  212. 147Extent
  213. 148Commencement and short title
  214. Schedule 1: Ring-fencing transfer schemes
  215. 1Paragraph 1
  216. 2Paragraph 2
  217. 3Paragraph 3
  218. 4Paragraph 4
  219. 5Paragraph 5
  220. 6Paragraph 6
  221. 7Paragraph 7
  222. 8Paragraph 8
  223. 9Paragraph 9
  224. 10Paragraph 10
  225. 11Paragraph 11
  226. 12Paragraph 12
  227. 13Paragraph 13
  228. Schedule 2: Bail-in stabilisation option
  229. Part 1: Amendments of Banking Act 2009
  230. 1Paragraph 1
  231. New stabilisation option: bail-in
  232. 2Paragraph 2
  233. 3Paragraph 3
  234. Further provision about the bail-in option
  235. 4Paragraph 4
  236. Transfers of property
  237. 5Paragraph 5
  238. Compensation
  239. 6Paragraph 6
  240. Groups
  241. 7Paragraph 7
  242. Banks regulated by the Financial Conduct Authority
  243. 8Paragraph 8
  244. Recognised central counterparties
  245. 9Paragraph 9 Repealed
  246. Insolvency proceedings
  247. 10Paragraph 10
  248. State aid
  249. 11Paragraph 11 Repealed
  250. Other amendments of the Act
  251. 12Paragraph 12
  252. 13Paragraph 13
  253. 14Paragraph 14
  254. 15Paragraph 15
  255. 16Paragraph 16
  256. 17Paragraph 17
  257. 18Paragraph 18
  258. 19Paragraph 19
  259. 20Paragraph 20
  260. 21Paragraph 21
  261. 22Paragraph 22
  262. 23Paragraph 23
  263. 24Paragraph 24
  264. 25Paragraph 25
  265. 26Paragraph 26
  266. 27Paragraph 27
  267. 28Paragraph 28
  268. 29Paragraph 29
  269. 30Paragraph 30
  270. 31Paragraph 31
  271. 32Paragraph 32
  272. Part 2: Modification of Investment Bank Special Administration Regulations 2011
  273. 33Paragraph 33
  274. Schedule 3: Consequential amendments relating to Part 4
  275. Financial Services and Markets Act 2000
  276. 1Paragraph 1
  277. 2Paragraph 2
  278. 3Paragraph 3
  279. 4Paragraph 4
  280. 5Paragraph 5
  281. 6Paragraph 6
  282. 7Paragraph 7
  283. 8Paragraph 8
  284. 9Paragraph 9
  285. 10Paragraph 10
  286. 11Paragraph 11
  287. 12Paragraph 12
  288. 13Paragraph 13
  289. 14Paragraph 14
  290. 15Paragraph 15
  291. 16Paragraph 16
  292. 17Paragraph 17 Repealed
  293. Financial Services Act 2012
  294. 18Paragraph 18
  295. 19Paragraph 19
  296. Schedule 4: The Payment Systems Regulator
  297. Introductory
  298. 1Paragraph 1
  299. Constitution
  300. 2Paragraph 2
  301. Status
  302. 3Paragraph 3
  303. Budget
  304. 4Paragraph 4
  305. Arrangements for discharging functions
  306. 5Paragraph 5
  307. Annual plan
  308. 6Paragraph 6
  309. Annual report
  310. 7Paragraph 7
  311. Other reports
  312. 7AParagraph 7A
  313. Audit of accounts
  314. 8Paragraph 8
  315. Funding (participants in regulated payment systems)
  316. 9Paragraph 9
  317. Funding (regulated persons)
  318. 9AParagraph 9A
  319. Penalty receipts
  320. 10Paragraph 10
  321. 11Paragraph 11
  322. 12Paragraph 12
  323. Records
  324. 13Paragraph 13
  325. Exemption from liability in damages
  326. 14Paragraph 14
  327. Engagement with Parliamentary Committees
  328. 14AParagraph 14A
  329. 14BParagraph 14B
  330. Freedom of information
  331. 15Paragraph 15
  332. Equality
  333. 16Paragraph 16
  334. Schedule 5: Procedure for appeals to the CMA
  335. Functions of CMA to be discharged by group
  336. 1Paragraph 1
  337. 2Paragraph 2
  338. Application for permission to bring appeal
  339. 3Paragraph 3
  340. Suspension of decision
  341. 4Paragraph 4
  342. Time limit for representations and observations by the Regulator
  343. 5Paragraph 5
  344. Consideration and determination of appeal by group
  345. 6Paragraph 6
  346. Time limits for determining appeal
  347. 7Paragraph 7
  348. Matters to be considered on appeal
  349. 8Paragraph 8
  350. Production of documents etc
  351. 9Paragraph 9
  352. Oral hearings
  353. 10Paragraph 10
  354. Written statements
  355. 11Paragraph 11
  356. Expert advice
  357. 12Paragraph 12
  358. Defaults in relation to evidence
  359. 13Paragraph 13
  360. 14Paragraph 14
  361. Determination of appeal by CMA
  362. 15Paragraph 15
  363. Appeal rules
  364. 16Paragraph 16
  365. Costs
  366. 17Paragraph 17
  367. Interpretation
  368. 18Paragraph 18
  369. Schedule 6: Conduct of FMI administration
  370. 1Paragraph 1
  371. 2Paragraph 2
  372. 3Paragraph 3
  373. 4Paragraph 4
  374. 5Paragraph 5
  375. 6Paragraph 6
  376. Schedule 7: Financial market infrastructure transfer schemes
  377. Application of Schedule
  378. 1Paragraph 1
  379. Interpretation of Schedule
  380. 2Paragraph 2
  381. FMI administrator to act on behalf of old company
  382. 3Paragraph 3
  383. Making of FMI transfer schemes
  384. 4Paragraph 4
  385. Provision that may be made by a scheme
  386. 5Paragraph 5
  387. Further provision about transfers
  388. 6Paragraph 6
  389. Effect of scheme
  390. 7Paragraph 7
  391. Subsequent modification of scheme
  392. 8Paragraph 8
  393. Provision relating to foreign property
  394. 9Paragraph 9
  395. Application of Schedule to transfers to subsidiaries
  396. 10Paragraph 10
  397. Schedule 8: Functions of FCA under competition legislation
  398. Part 1: Amendments of Financial Services and Markets Act 2000
  399. 1Paragraph 1
  400. 2Paragraph 2
  401. 3Paragraph 3
  402. 4Paragraph 4
  403. 5Paragraph 5
  404. 6Paragraph 6
  405. 7Paragraph 7
  406. Part 2: Amendments of other legislation
  407. Company Directors Disqualification Act 1986
  408. 8Paragraph 8
  409. Competition Act 1998
  410. 9Paragraph 9
  411. Enterprise Act 2002
  412. 10Paragraph 10
  413. Enterprise and Regulatory Reform Act 2013
  414. 11Paragraph 11
  415. 12Paragraph 12
  416. Schedule 9: Building societies
  417. Introductory
  418. 1Paragraph 1
  419. Exclusion of small business deposits from funding limit
  420. 2Paragraph 2
  421. 3Paragraph 3
  422. Ability to create floating charges
  423. 4Paragraph 4
  424. Annual business statements
  425. 5Paragraph 5
  426. Summary financial statements
  427. 6Paragraph 6
  428. 7Paragraph 7
  429. Transfers of business: distributions and share rights
  430. 8Paragraph 8
  431. Methods of communicating with members etc
  432. 9Paragraph 9
  433. 10Paragraph 10
  434. 11Paragraph 11
  435. 12Paragraph 12
  436. 13Paragraph 13
  437. 14Paragraph 14
  438. Financial year
  439. 15Paragraph 15
  440. 16Paragraph 16
  441. 17Paragraph 17
  442. 18Paragraph 18
  443. Schedule 10: Minor amendments
  444. Companies Act 1985
  445. 1Paragraph 1
  446. Financial Services and Markets Act 2000
  447. 2Paragraph 2
  448. 3Paragraph 3
  449. 4Paragraph 4
  450. 5Paragraph 5
  451. Income Tax Act 2007
  452. 6Paragraph 6
  453. Banking Act 2009
  454. 7Paragraph 7 Repealed
  455. 8Paragraph 8
  456. Financial Services Act 2012
  457. 9Paragraph 9
  458. 10Paragraph 10