Legislation – Financial Services and Markets Act 2023

those provisions of legislation are specified, or fall within a description of provisions specified, in relation to the making of rules by the regulator in regulations made by the Treasury for the purposes of this section.

(2)

A relevant requirement does not apply to the making of rules by a regulator if and to the extent that—

(a)

the proposed rules make excluded changes to provision of existing rules made by the regulator containing a retained EU obligation, and

(b)

the retained EU obligation is specified, or falls within a description of obligations specified, in relation to the making of rules by the regulator in regulations made by the Treasury for the purposes of this section.

(3)

A relevant requirement does not apply to the revocation of rules by a regulator if and to the extent that—

(a)

the rules being revoked make provision containing a retained EU obligation, and

(b)

the rules are revoked without being replaced by other rules made by the regulator.

(4)

For the purposes of subsection (1), rules make excluded provision in relation to provisions of legislation if, in the opinion of the regulator making the rules, the rules reproduce those provisions—

(a)

without any changes that are material, or

(b)

with changes that are material but their effect is to reduce a regulatory burden without having any other effects that are material.

(5)

For the purposes of subsection (2), rules make excluded changes to provision of existing rules if, in the opinion of the regulator making the rules—

(a)

the effect of the changes is to reduce a regulatory burden, and

(b)

the changes have no other effects that are material.

(6)

In this section references to a “regulatory burden” include (among other things) references to—

(a)

a financial cost;

(b)

an administrative inconvenience;

(c)

an obstacle to trade or innovation;

(d)

an obstacle to efficiency, productivity or profitability.

(7)

Where a relevant requirement does not apply to the making or revocation of rules by virtue of subsection (1), (2) or (3), the requirement also does not apply to any rules that contain incidental, supplemental, consequential or transitional provision so far as made in connection with provision made by virtue of that subsection.

(8)

“Relevant requirement” means—

(a)

in relation to rules made by the FCA, the requirements imposed by—

(i)

section 138I of FSMA 2000, except for subsection (1)(a), and

(ii)

section 138K of FSMA 2000;

(b)

in relation to rules made by the PRA, the requirements imposed by—

(i)

section 138J of FSMA 2000, except for subsection (1)(a), and

(ii)

section 138K of FSMA 2000;

(c)

in relation to rules made by the Bank of England, the requirements imposed by paragraph 10(1)(i) of Schedule 17A to FSMA 2000;

(d)

in relation to rules made by the Payment Systems Regulator, the requirements imposed by section 104 of the Financial Services (Banking Reform) Act 2013, except for subsection (2)(a).

(9)

Where a regulator makes or revokes rules without complying with a relevant requirement by virtue of subsection (1), (2) or (3), the regulator must publish a statement which must—

(a)

in a case falling within subsection (1), list the provisions of legislation that have been restated by the rules;

(b)

in a case falling within subsection (2), specify or describe the retained EU obligations in relation to which changes have been made by the rules;

(c)

in a case falling within subsection (3), specify or describe the retained EU obligations that have been removed by the revocation of the rules.

(10)

Where the statement relates to the making of rules that include provision of a kind mentioned in subsection (4)(b) or (5)(a) and (b), the statement must—

(a)

if made by the FCA, include an explanation of the FCA’s reasons for believing that making the proposed rules is compatible with its duties under section 1B(1), (4A) and (5)(a) of FSMA 2000;

(b)

if made by the PRA, include an explanation of the PRA’s reasons for believing that making the proposed rules is compatible with its duties under—

(i)

section 2B(1) or, as the case requires, section 2C(1) or 2D(3) of FSMA 2000, and

(ii)

section 2H of FSMA 2000;

(c)

if made by the Bank of England, include an explanation of the Bank’s reasons for believing that making the proposed rules is compatible with—

(i)

the Bank’s financial stability objective under section 2A of the Bank of England Act 1998, and

(ii)

the Bank’s duties under section 30D(1)(a) of that Act;

(d)

if made by the Payment Systems Regulator, include an explanation of the Regulator’s reasons for believing that making the proposed rules is compatible with its duties under section 49 of the Financial Services (Banking Reform) Act 2013.

(11)

The statement must be published in the way appearing to the regulator to be best calculated to bring the statement to the attention of the public.

(12)

Regulations under this section are subject to the affirmative procedure.

(13)

In this section “rules”—

(a)

in relation to the Payment Systems Regulator, means—

(i)

generally applicable requirements within the meaning of Part 5 of the Financial Services (Banking Reform) Act 2013 (as amended by Schedule 7 to this Act), or

(ii)

directions of general application imposed under any other enactment;

(b)

in relation to any other regulator, means rules made by that regulator under FSMA 2000 or any other enactment.