Office of Public Sector Information

Covering of risks situated in another member State

57 Covering of risks situated in another member State

(1) Where a friendly society intends to cover any insurance risks falling within any class of Head B of Schedule 2 to this Act which are situated in a member State other than the United Kingdom—

(a) through an establishment in the United Kingdom, or

(b) through an establishment in a member State other than that in which the risks will be situated,

it shall before doing so give notice of its intention to the Commission.

(2) The notice shall indicate—

(a) the member State in which the insurance is to be provided;

(b) the nature of the risks which the society intends to cover;

(c) the member state in which the establishment through which the risks will be covered is situated.

(3) Where the society intends to cover risks situated in more than one member State, the information specified above may be contained in a single notice but must be set out separately for each member State.

(4) Where a society has duly notified the Commission of its intention to cover risks situated in another member State where administrative authorisation is required to do so then, if the original notice related—

(a) only to risks in respect of which such authorisation is required; or

(b) only to risks in respect of which such authorisation is not required,

and the society subsequently intends to extend its activities to risks falling within the other category, it shall before doing so (without prejudice to the generality of the preceding provisions of this section) comply with subsections (1) to (3) above in relation to those risks.

(5) A friendly society with the intention mentioned in subsection (1) above may apply to the Commission for a certificate attesting—

(a) that the society possesses the minimum margin of solvency calculated in accordance with Article 16 and 17 of the first general insurance Directive, and

(b) that by virtue of this Act and the society’s authorisation under section 32 above, issued in accordance with Article 7(1) of that Directive, the society is able to operate outside the member State of establishment.

(6) A friendly society with the intention mentioned in subsection (1) above in respect of risks to be covered through an establishment in the United Kingdom may apply to the Commission for a certificate—

(a) indicating the classes of insurance business which the society is authorised to carry on in the United Kingdom; and

(b) stating that the Commission does not object to the society covering the risks through such an establishment.

(7) The Commission shall, if it thinks an application under subsection (5) or (6) above ought to be granted, issue the certificate.

(8) If the Commission refuses such an application it shall give notice to the society of its decision and of the reasons for it.

(9) Expressions used in this section which are defined in section 81A or 96A of the [1982 c. 50.] Insurance Companies Act 1982 have the same meanings as they have for the purposes of that Act.

Appeals

58 Rights of appeal

(1) A friendly society which is aggrieved by a decision of the Commission—

(a) to refuse to grant authorisation under section 32 above,

(b) to impose conditions, or as to the conditions imposed, under section 34 or 36 above,

(c) to withdraw authorisation under section 40 or 41 above,

(d) to give a direction under section 51 above; or

(e) to give a direction to the society, or as to the steps specified in a direction, under section 54 or 55 above,

may appeal against the decision to a tribunal constituted in accordance with section 59 below.

(2) Any person in relation to whom the Commission, in deciding to refuse to grant authorisation, to impose conditions or to withdraw authorisation—

(a) makes a determination that he is not a fit and proper person to hold or, as the case may be, to remain in an office in the society in question, or

(b) imposes a requirement that he be removed from an office in the society,

may appeal against the decision so far as it relates to that determination or requirement.

(3) The withdrawal of a society’s authorisation shall not have effect—

(a) until the end of the period within which an appeal can be brought against the Commission’s decision to withdraw that authorisation; and

(b) if such an appeal is brought, until it is determined or withdrawn.

(4) Where the Commission decides to refuse to grant authorisation to a society on an application made in pursuance of a direction under section 39 above, the society’s authorisation shall not expire under subsection (5) of that section—

(a) until the end of the period within which an appeal can be brought against the decision not to grant authorisation; and

(b) if such an appeal is brought, until it is determined or withdrawn.

(5) A direction under section 51, 54 or 55 above shall not have any effect until—

(a) the end of the period within which an appeal can be brought against the Commission’s decision to give the direction or as to any steps specified in the direction; and

(b) if such an appeal is brought, until it is determined or withdrawn.

(6) Subject to any order of the tribunal made under section 59(6) below, an appeal under subsection (1)(b) or (2) above shall not affect the operation, pending the determination of the appeal, of any condition which is the subject of the appeal.

(7) Subject to subsection (8) below, no determination of an appeal brought by any person under subsection (2) above shall affect any decision of the Commission on the ground of (or on grounds including) the determination made in relation to that person or, as the case may be, the failure of the society to comply with the requirement imposed in relation to that person.

(8) The tribunal may revoke a decision of the Commission to impose a condition which is the subject of an appeal under subsection (2) above in so far as it seeks to prevent the person making the appeal from holding, or continuing to hold, office in the society.

59 Determination of appeals

(1) Where an appeal is brought under section 58 above, a tribunal to determine the appeal shall be constituted in accordance with subsection (2) below.

(2) The tribunal shall consist of—

(a) a chairman appointed by the Lord Chancellor or, where the society concerned has its registered office in Scotland, by the Lord Chancellor in consultation with the Lord Advocate; and

(b) two other members appointed by the Treasury.

(3) The chairman shall be a person who—

(a) has a seven year general qualification, within the meaning of the [1990 c. 41.] Courts and Legal Services Act 1990;

(b) is an advocate or solicitor in Scotland of at least seven years' standing; or

(c) is a member of the Bar of Northern Ireland or solicitor of the Supreme Court of Northern Ireland of at least seven years' standing;

and the other two members shall be persons appearing to the Treasury to have experience of accountancy, the business of insurance or the business of friendly societies.

(4) Subject to subsection (5) below, on any appeal against a decision of the Commission the question for the determination of the tribunal shall be whether, for the reasons adduced by the appellant, the decision was unlawful or not justified by the evidence on which it was based.

(5) In the case of an appeal against a decision to give a direction under section 54 or 55 above—

(a) the tribunal shall, on the evidence adduced before it, reconsider the decision to give the direction and the steps specified in the direction (according to the extent of the appeal);

(b) if the tribunal determines that such a direction should not be given, it shall reverse the decision; and

(c) if the tribunal determines that those steps should not be so specified, it may give the Commission such guidance as it thinks fit as to what the appropriate steps might be.

(6) The tribunal may, on the application of the friendly society concerned, order that the operation of any condition which is the subject of an appeal by the society be suspended pending the determination of the appeal.

(7) The tribunal may confirm or reverse the decision which is the subject of the appeal but shall not have power to vary it except by directing the Commission—

(a) in the case of an appeal against a decision to refuse to grant authorisation, to determine conditions to which the grant of authorisation is to be subject;

(b) in the case of an appeal against the imposition of conditions or as to the conditions imposed by the decision, to determine conditions or different conditions subject to which the authorisation is to be granted or is to continue, as the case may be;

(c) in the case of an appeal against a decision to withdraw authorisation, to determine conditions or different conditions subject to which the authorisation is to continue in force, as the case may be;

(d) in the case of an appeal against a decision as to the steps specified in a direction under section 54 or 55 above, to determine, having taken account of any guidance given under subsection (5) above, the steps which are to be so specified.

(8) Where by virtue of subsection (7)(d) above the tribunal directs the Commission to determine the steps to be specified in the direction, the society may appeal against the steps so specified.

(9) Where by virtue of subsection (7) above the tribunal directs the Commission to determine conditions or different conditions—

(a) the Commission shall in accordance with section 34 or 36 above impose such conditions as it thinks fit; and

(b) paragraphs 7 and 8 of Schedule 13 to this Act shall apply subject to the modifications made by paragraph 9 of that Schedule;

and the society may appeal to the tribunal against any condition so imposed.

(10) On any such appeal the tribunal may confirm or reverse the Commission’s decision with respect to the conditions which are the subject of the appeal or may direct the Commission to determine different conditions; and where by virtue of this subsection the tribunal directs the Commission to determine different conditions, subsection (9) above shall apply as it applies where the tribunal gives such a direction by virtue of subsection (7) above.

(11) Where the tribunal reverses a decision of the Commission to refuse to grant authorisation, it shall direct the Commission to grant it; and where the tribunal reverses a decision of the Commission to make the grant of authorisation subject to conditions, it shall direct the Commission to grant it unconditionally.

(12) Notice of a tribunal’s determination, together with a statement of its reasons, shall be given to the appellant and to the Commission; and unless the tribunal has directed the Commission to determine conditions or, in any other case, the tribunal directs otherwise, the determination shall come into operation when the notice is given to the appellant.

(13) The Treasury may out of money provided by Parliament pay to the persons appointed as members of a tribunal under this section such fees and allowances in respect of expenses as the Treasury may determine and any other expenses incurred for the purposes of this section.

60 Costs, procedure and evidence

(1) A tribunal may give such directions as it thinks fit for the payment of costs or expenses by any party to an appeal.

(2) On an appeal under section 58(2) above the friendly society in relation to which the determination was made, or upon which the requirement was imposed, shall be entitled to be heard.

(3) The Treasury may make regulations with respect to appeals under section 58 above; and those regulations may in particular make provision—

(a) as to the period within which and the manner in which such appeals are to be brought;

(b) as to the manner in which such appeals are to be conducted, including provision for any hearing to be held in private;

(c) for requiring any person, on tender of the necessary expenses of his attendance, to attend and give evidence or produce documents in his custody or under his control and for authorising the administration of oaths to witnesses;

(d) for granting to any person such discovery or inspection of documents or right to further particulars as might be granted by a county court in England and Wales or Northern Ireland or, in Scotland, for granting to any person such recovery or inspection of documents as might be granted by the sheriff;

(e) for enabling an appellant to withdraw an appeal or the Commission to withdraw its opposition to an appeal and for the consequences of any such withdrawal;

(f) for taxing or otherwise settling any costs or expenses directed to be paid by the tribunal and for the enforcement of any such direction;

(g) for enabling any functions in relation to an appeal to be discharged by the chairman of the tribunal; and

(h) as to any other matter connected with such appeals.

(4) Regulations under this section with respect to appeals where the friendly society concerned has its registered office in Scotland shall be made by the Lord Advocate.

(5) A person who, having been required in accordance with regulations under this section to attend and give evidence, fails without reasonable excuse to attend or give evidence shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.

(6) A person who intentionally alters, suppresses, conceals, destroys or refuses to produce any document which he has been required to produce in accordance with regulations under this section, or which he is liable to be so required to produce, shall be liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine or both;

(b) on summary conviction, to a fine not exceeding the statutory maximum.

61 Further appeals on points of law

(1) An appeal shall lie to the High Court at the instance of the friendly society or other person concerned or of the Commission on any question of law arising from any decision of a tribunal under section 59 above; and if the court is of the opinion that the decision was erroneous in law, it shall remit the matter to the tribunal for re-hearing and determination by it.

(2) In the application of this section to a friendly society whose registered office is in Scotland or Northern Ireland, references to the High Court shall be construed as references to the Court of Session or, as the case may be, the High Court in Northern Ireland.

(3) No appeal to the Court of Appeal or to the Court of Appeal in Northern Ireland shall be brought from a decision under subsection (1) above except with the leave of that court or of the court or judge from whose decision the appeal is brought.

(4) An appeal shall lie, with the leave of the Court of Session or the House of Lords, from any decision of the Court of Session under this section, and such leave may be given on such terms as to costs, expenses or otherwise as the Court of Session or the House of Lords may determine.

Information

62 Powers to obtain information and documents etc

(1) This section applies to information, documents or other material, or explanations of matters which relate to—

(a) the activities or the plans for future development of a friendly society; or

(b) the activities or the plans for future development of a subsidiary of or body jointly controlled by an incorporated friendly society;

and, in relation to the imposition of requirements under this section, “the purposes of its supervisory functions” means the purposes of the discharge by the Commission of any of its functions under this Act.

(2) This section does not authorise any requirement in relation to information, documents or other material to be imposed on a subsidiary of or body jointly controlled by an incorporated friendly society unless that subsidiary or body carries on business in the United Kingdom; but a requirement may be imposed under this section on a friendly society in relation to information, documents or other material in the possession or control of a subsidiary of or body jointly controlled by the society which does not carry on business in the United Kingdom.

(3) Subject to subsection (2) above, the Commission may by notice to a friendly society or to a subsidiary of, or body jointly controlled by, an incorporated friendly society, require the body to which it is addressed—

(a) to furnish to it, within a specified period or at a specified time or times, such specified information as the Commission considers it needs for the purposes of its supervisory functions;

(b) to produce to it, at a specified time and place, such specified documents or other material as the Commission considers it needs for the purposes of its supervisory functions;

(c) to provide to it, within a specified period, such explanations of specified matters as the Commission considers it needs for the purposes of its supervisory functions;

(d) to furnish to it, within a specified period, a report by an accountant or actuary approved by the Commission on, or on specified aspects of, information or documents or other material furnished or produced to the Commission.

(4) Where by virtue of subsection (3)(a), (b) or (c) above the Commission has power to require the furnishing of any information, the production of any document or material or the provision of any explanation by a friendly society, the Commission shall have the like power as regards any person who—

(a) is or has been an officer, employee or agent of the society, or

(b) in the case of documents or material, appears to the Commission to have the document or material in his possession or under his control.

(5) Where by virtue of subsection (3)(a), (b) or (c) above the Commission has power to require the furnishing of any information, the production of any document or material or the provision of any explanation by a subsidiary of or body jointly controlled by an incorporated friendly society, the Commission shall have the like power as regards any person who—

(a) is or has been an officer, employee or agent of the subsidiary or jointly controlled body, or

(b) in the case of documents or material, appears to the Commission to have the document or material in his possession or under his control.

(6) Where any person from whom production of a document or material is required under subsection (4) or (5) above claims a lien on the document or material, the production of it shall be without prejudice to the lien.

(7) Nothing in the foregoing provisions of this section shall compel the production—

(a) by a barrister, solicitor, advocate or licensed conveyancer of a document or material contained in a privileged communication or, in Scotland, a communication which is protected from disclosure on the ground of confidentiality, made by him or to him in that capacity or the furnishing of information contained in such communication so made;

(b) by a person who is not a barrister or solicitor of a document or material contained in a communication made by him or to him which is privileged by virtue of section 63 of the [1990 c. 41.] Courts and Legal Services Act 1990 or the furnishing of information contained in such a communication; or

(c) by an independent qualified conveyancer, an executry practitioner or a recognised financial institution of a document or material contained in a communication made by him or to him which is protected from disclosure by virtue of section 22 of the [1990 c. 40.] Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 or the furnishing of information contained in such a communication.

(8) Where, by virtue of subsection (3), (4) or (5) above, the Commission requires the production by a friendly society or other body or any other person of documents or material, the Commission may—

(a) if the documents or material are not produced, require that person to state, to the best of his knowledge and belief, where the documents or material are;

(b) if the documents or material are produced, take copies of or extracts from them and require that person or any other person who is or has been an officer, employee or agent of the friendly society or other body, as the case may be, to provide an explanation of the documents or material.

(9) Any person who, when required to do so under this section, fails without reasonable excuse to furnish any information or report, to produce any documents or material, or to provide any explanation or make any statement, shall be guilty of an offence and liable on summary conviction—

(a) to a fine not exceeding level 5 on the standard scale; and

(b) in the case of a continuing offence, to an additional fine not exceeding one tenth of that level for every day during which the offence continues.

(10) Any friendly society which furnishes any information, provides any explanation or makes any statement which is false or misleading in a material particular, shall be guilty of an offence and liable—

(a) on conviction on indictment, to a fine; and

(b) on summary conviction to a fine not exceeding the statutory maximum.

(11) Any person who knowingly or recklessly furnishes any information, provides any explanation or makes any statement which is false or misleading in a material particular shall be guilty of an offence and liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding 2 years or to a fine or both; and

(b) on summary conviction, to a fine not exceeding the statutory maximum.

(12) In this section—

• “specified” means specified in a notice under this section; and

• “agent”, in relation to a friendly society or a subsidiary of, or body jointly controlled by, an incorporated friendly society, includes its bankers, accountants, solicitors and auditors and the appropriate actuary.

63 Confidentiality of certain information

(1) Subject to section 64 below, no restricted information which relates to the business or other affairs of a friendly society, a registered branch of a friendly society or any other person shall be disclosed (otherwise than to an officer or employee of the primary recipient) by—

(a) the primary recipient; or

(b) any person obtaining the information directly or indirectly from him,

without the consent of the person from whom the primary recipient obtained the information and, if different, the person to whom it relates.

(2) For the purposes of this section—

• “the primary recipient” means the Commission, the Chief Registrar, the central office or any officer or servant of any such person; and

• “restricted information” means information which is obtained by the primary recipient for the purposes of, or in the discharge of his functions under, this Act or the 1974 Act;

but information shall not be treated as restricted information if it has been made available to the public by virtue of being disclosed in any circumstances in which, or for any purpose for which, disclosure is not precluded by this section.

(3) Any information disclosed to the Commission or the Chief Registrar by an overseas regulatory authority (within the meaning of section 64 below) shall be treated as restricted information for the purposes of this section.

(4) A person who discloses information in contravention of this section shall be guilty of an offence and liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine or both; and

(b) on summary conviction, to imprisonment for a term not exceeding three months or to a fine not exceeding the statutory maximum, or both.

64 Exceptions from restrictions on disclosure

(1) Information which is restricted information for the purposes of section 63 above may be disclosed—

(a) to any person with a view to the institution of, or otherwise for the purposes of, relevant proceedings;

(b) if it is information which is or has been available to the public from other sources;

(c) in the form of a summary or collection of information so framed as not to enable information related to any particular body or person to be ascertained from it;

(d) to the extent that it is information which is provided for the purpose, under any provision of this Act or the 1974 Act, of its being made available to the public in any manner;

(e) in pursuance of any Community obligation;

(f) for the purpose of facilitating the discharge by the Commission, the Chief Registrar or the central office of any of their functions under this Act or the 1974 Act;

(g) to the Treasury, if the disclosure is made for the purpose of facilitating the discharge of any functions of the Treasury under this Act or the 1974 Act or otherwise in the interests of members of friendly societies or in the public interest;

(h) for the purpose of enabling or assisting any person appointed investigator under section 65 below or inspector under section 66 below to discharge his duties under that section; or

(i) for the purpose of facilitating the discharge by the auditors of a friendly society of their duties to the Commission.

(2) For the purposes of subsection (1)(a) above “relevant proceedings” are—

(a) any criminal proceedings;

(b) any civil proceedings by or at the relation of or against the Commission or the Chief Registrar arising out of the discharge of any of their functions under this Act or the 1974 Act;

(c) any disciplinary proceedings relating to—

(i) the exercise by a solicitor, auditor, accountant, actuary or valuer of his professional duties;

(ii) the discharge by a public servant of his duties;

and in paragraph (c) above “public servant” means an officer or servant of the Crown (including an officer or servant of the Crown in right of Her Majesty’s Government in Northern Ireland) or of any public or other authority designated for the purpose by order made by the Treasury.

(3) Nothing in section 63 above prohibits the disclosure of information to the Secretary of State or the Department of Economic Development in Northern Ireland in circumstances where it is desirable or expedient—

(a) that the information should be disclosed in the interests of members of a friendly society or in the public interest; or

(b) it is desirable or expedient that the information should be disclosed for the purpose of facilitating the discharge—

(i) by the Secretary of State, of any functions of his under the enactments relating to companies, insurance companies, or insolvency or under the [1986 c. 60.] Financial Services Act 1986 or any provision of Parts II, III or VII of the [1989 c. 40.] Companies Act 1989; or

(ii) by the Department, of any of its functions relating to companies or insolvency, or under Part III of the [S.I. 1990/593 (N.I. 5).] Companies (Northern Ireland) Order 1990 or Part II or V of the [S.I. 1990/1504 (N.I. 10).] Companies (No. 2) (Northern Ireland) Order 1990;

nor does that section prohibit further disclosure of the information by the Secretary of State or the Department with the consent of the Commission.

(4) Nothing in section 63 above prohibits the disclosure of information to an authority mentioned in subsection (5) below (a “relevant authority”) in circumstances where, in the opinion of the Commission, it is desirable or expedient that the information should be disclosed—

(a) in the interests of members of a friendly society or in the public interest; or

(b) with a view to facilitating the discharge by the authority, of any functions of the authority (including functions in relation to proceedings) mentioned in that subsection (“relevant functions”);

nor does that section prohibit further disclosure of the information, with the consent of the Commission.

(5) The relevant authorities mentioned in subsection (4) above and the relevant functions in relation to each such authority, are as follows—

(6) The Commission, with the consent of the Treasury, may by order—

(a) amend the Table in subsection (5) above so as to—

(i) add any public or other authority to the Table and specify the relevant functions of that authority;

(ii) remove any authority from the Table; or

(iii) add functions to, or remove functions from, those which are relevant functions in relation to an authority specified in the Table;

(b) restrict the circumstances in which information may, by virtue of subsection (4) above, be disclosed or further disclosed; and

(c) impose conditions subject to which the information may be disclosed or further disclosed.

(7) Nothing in section 63 above prohibits the disclosure to an overseas regulatory authority of information for the purpose of assisting that authority in the discharge of its functions.

(8) In this section—

• “authority” includes any body (corporate or unincorporate) which is charged with the regulation of the carrying on of any description of financial or insurance business or the practice of any profession to which the carrying on of such business is incidental;

• “overseas regulatory authority” means any government department or public or other authority in a country or territory outside the United Kingdom which is charged under the law of that country or territory with the regulation of companies, insurance companies, financial services, banking or any business corresponding to the business which may be carried on by friendly societies (or their subsidiaries); and

• “regulation”, in relation to any public or other authority, means regulation in the public interest or for the protection of private interests.