Short selling rules
131B
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Services and Markets Act 2000 Part 8A — Short selling
Short selling rules
Short selling rules: definitions etc
131C
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Short selling rules: procedure in urgent cases
131D
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power to require information
Power to require information
131E
(1) The FCA may, by notice in writing, require a person ...— (a) to provide specified information or information of a specified description; or (b) to produce specified documents or documents of a specified description. (2) This section applies only to information and documents that the FCA reasonably requires for the purpose of the exercise by it of functions under the short selling regulation or to respond to a request referred to in subsection (5A) . (3) Information or documents required under this section must be provided or produced— (a) before the end of such reasonable period as may be specified; and (b) at such place as may be specified. (4) The FCA may require any information provided under this section to be provided in such form as it may reasonably require. (5) The FCA may require— (a) any information provided, whether in a document or otherwise, to be verified in such manner as it may reasonably require; or (b) any document produced to be authenticated in such manner as it may reasonably require. (5A) The FCA's powers under this section may be exercised on a request made in the exercise of relevant functions by— (a) an overseas regulator, or (b) ESMA . (5B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6) In this section— “ overseas regulator ” means— the competent authority of an EEA State for the purposes of the short selling regulation, as that regulation has effect in the European Union (the “ EU short selling regulation ”); or the authority of a third country which is not an EEA State which exercises functions corresponding to those of a competent authority under the EU short selling regulation; “ relevant functions ” means— in relation to a competent authority of an EEA State, its functions under the EU short selling regulation; in relation to ESMA, its functions under the EU short selling regulation; in relation to an authority of a third country which is not an EEA state, its functions corresponding to the functions referred to in paragraph (a); “ specified ” means specified in the notice. (7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power to require information: supplementary
131F
(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2) If a document is produced in response to a requirement imposed under section 131E, the FCA may— (a) take copies of or extracts from the document; or (b) require the person producing the document, or any relevant person, to provide an explanation of the document. (3) In subsection (2)(b) “ relevant person ”, in relation to a person who is required to produce a document, means a person who— (a) has been or is or is proposed to be a director or controller of that person; (b) has been or is an auditor of that person; (c) has been or is an actuary, accountant or lawyer appointed or instructed by that person; or (d) has been or is an employee of that person. (4) If a person who is required under section 131E to produce a document fails to do so, the FCA may require the person to state, to the best of the person's knowledge and belief, where the document is. (5) A lawyer may be required under section 131E to provide the name and address of the lawyer's client. (6) A person (“P”) may not be required under section 131E to disclose information or produce a document in respect of which P owes an obligation of confidence by virtue of carrying on the business of banking unless— (a) the FCA suspects that P or a member of P’s group has contravened any provision of the short selling regulation ; (b) the FCA suspects that the person to whom the obligation of confidence is owed or a member of that person’s group has contravened any provision of the short selling regulation ; or (c) the person to whom the obligation of confidence is owed consents to the disclosure or production. (6A) Where the FCA is exercising its powers under section 131E in response to a request from an overseas regulator or ESMA, references to the short selling regulation are to be read as including the EU short selling regulation, within the meaning of section 131E(6). (7) If a person claims a lien on a document, its production under section 131E does not affect the lien.
Breach of short selling regulation etc
Power to impose penalty or issue censure
131G
(1) This section applies if the FCA is satisfied that a person has contravened— (a) any provision of the short selling regulation ; or (b) any requirement imposed on the person under section 131E or 131F. (2) The FCA may impose a penalty of such amount as it considers appropriate on— (a) the person who contravened the provision or requirement; or (b) any person who was knowingly concerned in the contravention. (3) It may, instead of imposing a penalty on a person, publish a statement censuring the person. (4) The FCA may not take action against a person under this section after the end of the limitation period unless, before the end of that period, it has given a warning notice to the person under section 131H. (5) “ The limitation period ” means the period of three years beginning with the first day on which the FCA knew of the contravention. (6) For this purpose the FCA is to be treated as knowing of a contravention if it has information from which the contravention can reasonably be inferred.
Procedure and right to refer to Tribunal
131H
(1) If the FCA proposes to take action against a person under section 131G, it must give the person a warning notice. (2) A warning notice about a proposal to impose a penalty must state the amount of the penalty. (3) A warning notice about a proposal to publish a statement must set out the terms of the statement. (4) If the FCA decides to take action against a person under section 131G, it must give the person a decision notice. (5) A decision notice about the imposition of a penalty must state the amount of the penalty. (6) A decision notice about the publication of a statement must set out the terms of the statement. (7) If the FCA decides to take action against a person under section 131G, the person may refer the matter to the Tribunal.
Duty on publication of statement
131I
After a statement under section 131G(3) is published, the FCA must send a copy of the statement to— (a) the person in respect of whom it is made; and (b) any person to whom a copy of the decision notice was given under section 393(4).
Imposition of penalties under section 131G: statement of policy
131J
(1) The FCA must prepare and issue a statement of its policy with respect to— (a) the imposition of penalties under section 131G; and (b) the amount of penalties under that section. (2) The FCA's policy in determining what the amount of a penalty should be must include having regard to— (a) the seriousness of the contravention; (b) the extent to which the contravention was deliberate or reckless; and (c) whether the person on whom the penalty is to be imposed is an individual. (3) The FCA may at any time alter or replace a statement issued under this section. (4) If a statement issued under this section is altered or replaced, the FCA must issue the altered or replaced statement. (5) The FCA must, without delay, give the Treasury a copy of any statement which it publishes under this section. (6) A statement issued under this section must be published by the FCA in the way appearing to the FCA to be best calculated to bring it to the attention of the public. (7) The FCA may charge a reasonable fee for providing a person with a copy of the statement. (8) In exercising, or deciding whether to exercise, a power under section 131G in the case of any particular contravention, the FCA must have regard to any statement of policy published under this section and in force at a time when the contravention occurred.
Statement of policy: procedure
131K
(1) Before issuing a statement under section 131J, the FCA must publish a draft of the proposed statement in the way appearing to the FCA to be best calculated to bring it to the attention of the public. (2) The draft must be accompanied by notice that representations about the proposal may be made to the FCA within a specified time. (3) Before issuing the proposed statement, the FCA must have regard to any representations made to it in accordance with subsection (2). (4) If the FCA issues the proposed statement it must publish an account, in general terms, of— (a) the representations made to it in accordance with subsection (2); and (b) its response to them. (5) If the statement differs from the draft published under subsection (1) in a way which is, in the opinion of the FCA , significant, the FCA must (in addition to complying with subsection (4)) publish details of the difference. (6) The FCA may charge a reasonable fee for providing a person with a copy of a draft published under subsection (1). (7) This section also applies to a proposal to alter or replace a statement.
Offences
131L
(1) If a relevant person (“A”) fails to comply with a requirement imposed on A under section 131E or 131F the FCA may certify that fact in writing to the court. (2) If the court is satisfied that A failed without reasonable excuse to comply with the requirement, it may deal with A (and where A is a body corporate, any director or officer) as if A (or as the case may be the director or officer) were in contempt; and “officer”, in relation to a limited liability partnership, means a member of the limited liability partnership. (3) A relevant person (“B”) who, in purported compliance with a requirement imposed on B under section 131E or 131F— (a) provides information which B knows to be false or misleading in a material particular, or (b) recklessly provides information which is false or misleading in a material particular, is guilty of an offence. (4) A person guilty of an offence under subsection (3) is liable— (a) on summary conviction, to imprisonment for a term not exceeding three months or a fine not exceeding the statutory maximum, or both; (b) on conviction on indictment, to imprisonment for a term not exceeding two years or a fine, or both. (5) Any person who intentionally obstructs the exercise of any rights conferred by a warrant under section 131FB is guilty of an offence and liable on summary conviction to imprisonment for a term not exceeding three months or a fine not exceeding level 5 on the standard scale, or both. (6) In relation to any contravention by a person, the FCA may not exercise both— (a) its powers under section 131G(2), and (b) its powers under subsection (1). (7) In this section— “court” means— the High Court; in Scotland, the Court of Session; “relevant person” means— an authorised person, a person who has been an authorised person, a person who is for the purposes of section 165 connected with an authorised person or with a person within paragraph (b).
Back to Financial Services and Markets Act 2000 — full text
Provisions on this page are reproduced verbatim from official open data. See the attribution line.
Contains public sector information licensed under the Open Government Licence v3.0 (legislation.gov.uk).