This chapter discusses banking supervision in practice. It focuses on two jurisdictions: the UK and the European Banking Union (EBU), and considers in particular the type of powers enjoyed by the UK and EBU regulators, and the way they exercise them in their supervisory approaches. In the process the chapter highlights loopholes in the respective regimes and to some extent evaluates their effectiveness. On 1 April 2013 the Financial Services Act 2012 came into force, removing the Financial Services Authority and delivering a new regulatory structure for the UK, which comprises the Prudential Regulation Authority responsible for microprudential regulation and supervision of banks, building societies, and investment firms; and the Financial Conduct Authority, in addition to a financial stability (macroprudential) body within the Bank of England, the Financial Policy Committee. The EBU brought about the centralization of bank supervision and resolution within the Eurozone. The trigger for the establishment of the EBU was the Eurozone debt crisis.
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Ross Cranston, Emilios Avgouleas, Kristin van Zweiten, Theodor van Sante, and Christoper Hare
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Clare Firth, Jennifer Seymour, Lucy Crompton, Helen Fox, Frances Seabridge, Jennifer Seymour, and Elizabeth Smart
This chapter first introduces the regulation of financial services. It puts the Financial Services and Markets Act 2000 (FSMA 2000) into context and explains the need for authorisation under the Act. It considers what is covered by the general prohibition as well as the meanings of ‘regulated activity’ and ‘specified investment’. The chapter then discusses the position of solicitors, specifically those who are regulated by the Law Society, a designated professional body. The FSMA 2000 has been amended by the Financial Services Act 2012. This introduced changes to the regulation of financial services, including the renaming of the Financial Services Authority as the Financial Conduct Authority.
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This chapter deals with abuses committed in the trading of shares, with particular reference to insider dealing and market manipulation, and the laws intended to control them. The chapter considers forms of control to prevent market abuse under three key pieces of legislation: Regulation (EU) No 596/2014, the Criminal Justice Act 1993 and the Financial Services Act 2012. It looks at regulations governing disclosure to regulated markets and the fiduciary duty of directors, and offences involving insider dealing and creating a false market. The chapter analyses a particularly significant case: Percival v Wright [1902] 2 Ch 421.
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This chapter deals with abuses committed in the trading of shares, with particular reference to insider dealing and market manipulation, and the laws intended to control them. The chapter considers forms of control to prevent market abuse under three key pieces of legislation: Regulation (EU) No 596/2014, the Criminal Justice Act 1993 and the Financial Services Act 2012. It looks at regulations governing disclosure to regulated markets and the fiduciary duty of directors, and offences involving insider dealing and creating a false market. The chapter analyses a particularly significant case: Percival v Wright [1902] 2 Ch 421.
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Iris Chiu and Joanna Wilson
This chapter addresses the UK bank supervision and regulatory architecture. Although banking business has existed in England since the seventeenth century, banks enjoyed no formal system of regulation until the introduction of the Banking Act of 1979. Over the years, the scope and intensity of regulation increased. After the global financial crisis, further changes were made to bank regulation as well as the regulatory architecture in the UK for bank regulation. The regulatory architecture introduced in April 2013 is characterised as ‘twin peaks’, that is, having two main agencies that are responsible for different regulatory objectives. The Prudential Regulation Authority (PRA) is responsible for ‘prudential’ objectives—that is, the solvency and financial soundness of financial institutions—while the Financial Conduct Authority (FCA) is responsible for conduct of business and market regulation, including promoting competition. The PRA and FCA enjoy a wide berth of rule-making and enforcement powers.
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D Fox, RJC Munday, B Soyer, AM Tettenborn, and PG Turner
This chapter deals with the principles of insurance law. First, the chapter explains how insurance works, with a particular focus on insurable interest, the statutes that govern insurance contracts, and the power of the Financial Conduct Authority to authorise persons wishing to conduct business as insurers. The chapter then considers how an insurance contract is formed and goes on to describe the content and interpretation of the contract. It also discusses the liability and rights of the insurer before concluding with an analysis of marine insurance and insurance claims.
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Titles in the Core Text series take the reader straight to the heart of the subject, providing focused, concise, and reliable guides for students at all levels. This chapter focuses on raising equity from the general public and its consequences for the operation of the company. It begins by outlining the basics of raising equity before turning to the consequences of operating in a public market, with emphasis on areas such as takeovers and insider dealing. It then considers the distinction between public and private companies in terms of capital raising, how such companies are regulated, and how public companies differ from listed companies. It also discusses various methods of raising money from the public, the role of the Financial Conduct Authority and the London Stock Exchange in ensuring the proper functioning of the listed market in the UK, and the regulation of listed companies as well as takeovers and other public offers.
Chapter
Titles in the Core Text series take the reader straight to the heart of the subject, providing focused, concise, and reliable guides for students at all levels. This chapter focuses on raising equity from the general public and its consequences for the operation of the company. It begins by outlining the basics of raising equity before turning to the consequences of operating in a public market, with emphasis on areas such as takeovers and insider dealing. It then considers the distinction between public and private companies in terms of capital raising, how such companies are regulated, and how public companies differ from listed companies. It also discusses various methods of raising money from the public, the role of the Financial Conduct Authority and the London Stock Exchange in ensuring the proper functioning of the listed market in the UK, and the regulation of listed companies as well as takeovers and other public offers.
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The effective enforcement of law requires that liability be appropriately allocated, that those with the appropriate incentives be in a position to enforce the liabilities thus created and that the sanctions available be effective. Otherwise, the substantive law may be ineffective in practice.This chapter examines these issues in relation to companies and individuals connected to companies in three contexts: civil law (mainly contract and tort), criminal law, and regulatory rules. Although much of the background law is of general application, it applies in a particular way to companies and individuals engaged in corporate activities.
