HM Treasury

Consultations & legislation

Consultation on draft Regulations concerning information disclosure and publication provisions relating to the Bank of England under Part 5 of the Banking Act 2009

Background

The Banking Act 2009 (the Act) received Royal Assent on 12 February 2009. Part 5 of the Act establishes a new statutory framework for the oversight of recognised inter-bank payment systems. The sections of Part 5 of the Act were brought into force in two phases, with the remaining sections being brought into force on 31 December 2009.

2. Section 204(1) of the Act confers a power on the Bank of England (the Bank) to obtain information for specified purposes in connection with its functions under Part 5 of the Act (which includes assisting the Treasury in determining whether to specify a system as a recognised system under section 184 of the Act). Section 204 also:

  1. enables the Bank to disclose information obtained under section 204(1) to certain public authorities (including the Treasury, the Financial Services Authority (FSA) and overseas authorities with similar functions to those of the Treasury, the FSA or the Bank in respect of payment systems);
  2. enables the Bank to publish information obtained under section 204(1); and
  3. confers a power on the Treasury to make regulations permitting the disclosure of information obtained under section 204(1) to other persons and specifying the manner and extent of publication of such information (section 204(6) and (8) respectively).

The purpose of the Regulations

3. Under the provisions of Part 5 of the Act, the Bank is currently unable to share information it has obtained under section 204(1) for other purposes such as criminal and civil investigations and proceedings initiated by UK public authorities other than those specified in section 204(4).

4. The Treasury consider that it is in the public interest for the Bank to have the power to share information with a broader range of authorities (in particular in the light of the need for public authorities to have adequate powers to enable information to be shared to reduce or resolve threats to the stability of the financial markets). Accordingly, the Treasury propose to make Regulations under section 204(6) to extend the Bank’s power of disclosure to specified persons and in specified cases. Draft Regulations have been prepared to this effect, together an accompanying draft Explanatory Memorandum, which make provision for the Bank to disclose information:

  1.  to public authorities for the purposes of, or in connection with, criminal investigations and proceedings which can be brought in the UK;
  2. to public authorities for the purposes of, or in connection with, investigations and proceedings which could result in the imposition of civil penalties and can be brought in the UK (such as regulatory investigations);
  3. to specified public authorities for the purposes of enabling or assisting them to discharge specified functions (see the Schedule to the Regulations, which includes bodies such as the Takeover Panel, the OFT and the European Commission);
  4. to any person where the information has already entered the public domain;
  5. to any person where:
  1. the person from whom the Bank has obtained the information and, if different, the person to whom the information relates has consented; or
  2. the information is in the form of a summary or collection of information such that information relating to a particular person cannot be identified.

5. The draft Regulations also make provision in respect of the manner and extent of publication under section 204(7) and specify that where information relates to persons regulated or overseen by the FSA that the Bank must consult with the FSA before publishing that information, for example to ensure that information is not published which could harm the operation of regulated bodies, or could affect FSA investigations or enforcement proceedings. 

6. As the Regulations do not place a burden on business no Impact Assessment has been prepared.

How to respond

7. We invite comments on the draft Regulations by Friday 19 February 2010. Please send your responses to:

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