Central Bank (Supervision and Enforcement) Act 2013
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PART 7 Bank’s Power to Give Directions | ||
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Bank’s power to give directions. |
45.— (1) Where the Bank is satisfied that one or more of the circumstances specified in subsection (2) exist in relation to a regulated financial service provider, or a related undertaking of a regulated financial service provider, the Bank may, in the interests of the proper and effective regulation of financial service providers, give a direction in writing to the regulated financial service provider or related undertaking to take such of the actions specified in subsection (3) as are mentioned in the direction. | |
(2) The circumstances referred to in subsection (1) are as follows: | ||
(a) that the regulated financial service provider, or related undertaking, has become or is likely to become unable to meet its obligations to its creditors or its customers; | ||
(b) that the regulated financial service provider, or related undertaking, is not maintaining or is unlikely to be in a position to maintain adequate capital or other financial resources having regard to the volume and nature of its business; | ||
(c) that the regulated financial service provider, or related undertaking, has failed to comply with, is failing to comply with or is likely to fail to comply with any condition or requirement imposed by, or by virtue of, financial services legislation; | ||
(d) that the regulated financial service provider, or related undertaking, is conducting business in such a manner as to jeopardise or prejudice— | ||
(i) monies, securities or other investment instruments or other property held by or controlled by it on behalf of customers, or | ||
(ii) the rights and interests of customers; | ||
(e) that there may be grounds for revoking or not renewing the regulated financial service provider’s authorisation. | ||
(3) The actions referred to in subsection (1) are as follows: | ||
(a) to suspend, for such period not exceeding 12 months as is specified in the direction, any one or more of the following: | ||
(i) the provision of any financial service, or description of financial service, specified in the direction; | ||
(ii) the making of payments to which subparagraph (i) does not relate or any such payments or description of such payments specified in the direction; | ||
(iii) the acquisition or disposal of any assets or liabilities, or description of assets or liabilities, specified in the direction; | ||
(iv) entering into transactions or agreements, or description of transactions or agreements, specified in the direction, or entering into them except in specified circumstances or to a specified extent; | ||
(v) soliciting business from persons of a class specified in the direction; | ||
(vi) carrying on business in a manner specified in the direction or otherwise than in a manner so specified; | ||
(b) to dispose of, on terms specified in the direction, assets or liabilities so specified, or a part or parts of its business so specified, within such period as may be so specified; | ||
(c) to raise and maintain such capital or other financial resources as may be specified in the direction; | ||
(d) to make such modifications to its systems and controls as may be specified in the direction; | ||
(e) to make such modifications to its business practices and dealings with third parties as may be specified in the direction; | ||
(f) to comply with the condition or requirement referred to in subsection (2)(c); | ||
(g) to notify third parties of any such actions within paragraphs (a) to (f) as may be specified in the direction. | ||
(4) Where the Bank gives a direction under subsection (1) to a regulated financial service provider or a related undertaking (in this subsection referred to as the “principal provider”), the Bank may, where it considers it necessary for the purpose of securing compliance with that direction, give a direction in writing to any regulated financial service provider at which the principal provider holds an account of any description to cease making payments from, or entering into or performing other transactions in respect of, such account without the prior authorisation of the Bank. | ||
(5) The provisions of a direction under subsection (1) or (4) have effect from the date specified in the direction in relation to them. | ||
(6) A direction under subsection (1) or (4) shall set out— | ||
(a) all terms of the direction, including any specification of a date by which, or a period within which, any provision made by it is to be complied with, and | ||
(b) any incidental, consequential or supplemental provisions for implementing the direction and ensuring that it is fully and effectively carried out. | ||
(7) If the Bank gives a direction under subsection (1) or (4) the intention of which, or part of which, is the preservation or restoration of the financial position of a credit institution within the meaning of Directive 2001/24/EC of the European Parliament and of the Council of 4 April 2001 2 and which is capable of affecting the rights of third parties existing before the direction comes into effect, the Bank shall declare in the direction that the direction or part of it is made with that intention, in accordance with that Directive. | ||
(8) The Bank may publish a direction under subsection (1) or (4) in any such manner as the Bank considers appropriate. | ||
(9) A regulated financial service provider, or a related undertaking, to whom a direction is given under paragraph (a) or (b) of subsection (3) may apply to the High Court for an order setting aside the direction. | ||
(10) A regulated financial service provider to whom a direction is given under subsection (4) may apply to the High Court for an order setting aside the direction. | ||
(11) An application under subsection (9) shall be made to the High Court within 14 days beginning on the date of receipt of the direction by the regulated financial service provider, or the related undertaking, or such further period as the High Court considers just and equitable in the circumstances, and the High Court may make such interim or interlocutory order as it considers appropriate. | ||
(12) An application under subsection (10) shall be made to the High Court within 14 days beginning on the date of receipt of the direction by the regulated financial service provider or such further period as the High Court considers just and equitable in the circumstances, and the High Court may make such interim or interlocutory order as it considers appropriate. | ||
(13) Where the High Court is satisfied, because of the nature or the circumstances of the case or otherwise in the interests of justice, that it is desirable, the whole or any part of proceedings relating to an application under subsection (9) or (10) may be heard otherwise than in public. | ||
(14) A decision by the Bank to issue a direction under any of paragraphs (c) to (g) of subsection (3) is an appealable decision for the purposes of Part VIIA of the Central Bank Act 1942 . | ||