Banking Business (Jersey) Law 1991

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Jersey Law 19/1991

BANKING BUSINESS (JERSEY) LAW 1991

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Arrangement of Articles

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	PART I
	Preliminary
1.	Interpretation.
2.	Meaning of “deposit”.
3.	Meaning of “deposit-taking business”.
4.	Meaning of “holding company”, “subsidiary company” and “wholly-owned subsidiary”.
5.	Power to amend definitions.
	PART II
	Functions of Finance and Economics Committee and control of deposit-taking businesses
6.	Functions of Finance and Economics Committee.
7.	Prohibition of unregistered deposit-taking business.
8.	Applications for and grant and extent of registrations.
9.	Refusal and revocation of registration.
10.	Conditions on grant of registration.
11.	Certificates of registration and maintenance of register.
12.	Display, production and delivery of registration certificates.
13.	Notification of new or increased control.
14.	Objection to existing shareholder controller.
15.	Contravention by controller.
16.	Restrictions on sale of shares.
17.	Procedure and rights of appeal.
18.	Representation to Royal Court by Committee where registration refused or revoked.
19.	Control of advertising.
20.	Advertising directions.
21.	False statements.
22.	Fraudulent inducement to make a deposit.
23.	Notification of change of director, controller or manager.
24.	Notification of acquisition of significant shareholding.
25.	Power to obtain information and require production of documents.
26.	Right of entry to obtain information and documents.
27.	Investigations on behalf of the Committee.
28.	Investigation of suspected contraventions.
29.	Powers of entry in cases of suspected contraventions.
30.	Obstruction of investigations.
31.	Audited accounts to be open for inspection.
32.	Notification in respect of auditors.
33.	Communication by auditor etc. with the Committee.
34.	Repayment of unauthorized deposits.
35.	Profits from unauthorized deposits.
36.	Compensation schemes.
	PART III
	Banking names and descriptions
37.	Restrictions on use of certain names and descriptions.
38.	Applications for and grant etc. of permission for the use of certain names by companies and businesses.
39.	Registration and change of name of companies.
40.	Registration of business names.
	PART IV
	Restrictions on disclosure of information
41.	Restricted information.
42.	Disclosure for facilitating discharge of functions of Committee.
43.	Disclosure for facilitating discharge of functions by other supervisory authorities.
44.	Other permitted disclosures.
45.	Information supplied to Committee by relevant overseas authorities.
	PART V
	Miscellaneous and supplemental
46.	Service of notices.
47.	Evidence.
48.	Orders.
49.	Criminal liability of officers; aiders and abettors, etc.
50.	Repeals and saving.
51.	Short title and commencement.
Schedule.

BANKING BUSINESS (JERSEY) LAW 1991

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A LAW to make new provision to regulate banking and other categories of deposit-taking business, to penalize fraudulent inducements to take deposits, to regulate the use of banking names and descriptions, and generally to provide for purposes connected therewith and incidental thereto, sanctioned by Order of Her Majesty in Council of the

26th day of JUNE 1991

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(Registered on the 23rd day of August 1991

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STATES OF JERSEY

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The 31st day of July 1990

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THE STATES, subject to the sanction of Her Most Excellent Majesty in Council, have adopted the following Law –

PART 1

PRELIMINARY

ARTICLE 1

Interpretation

(1) In this Law, unless the context otherwise requires –

“associate”, in relation to a person entitled to exercise or control the exercise of voting power in relation to, or holding shares in, a body corporate, means –

(a) the wife or husband or son or daughter or stepson or step-daughter of that person;

(b) any company of which that person is a director;

(d) if that person is a company –

(i) any director of that company;

(ii) any subsidiary of that company; and

(iii) any director or employee of any such subsidiary; and

(e) if that person has with any other person an agreement or arrangement with respect to the acquisition, holding or disposal of shares or other interests in that body corporate or under which they undertake to act together in exercising their voting power in relation to it, that other person;

“auditor” means a person who is a member of a firm all the partners of which are members of either the Institute of Chartered Accountants in England and Wales, the Institute of Chartered Accountants of Scotland, the Institute of Chartered Accountants in Ireland or the Association of Certified Accountants or is otherwise approved by the Committee in writing;

“authorization” means authorization granted by the Committee under this Law and authorized shall be construed accordingly;

“chief executive”, in relation to a registered person, means a person who, either alone or jointly with one or more other persons, is responsible under the immediate authority of the directors for the conduct of the business of the registered person and in relation to a registered person whose principal place of business is in a place outside the Island, includes a person who, either alone or jointly with one or more other persons, is responsible for the conduct of its business in the Island;

“the Committee” means the Finance and Economics Committee;

“company” means any body corporate incorporated with or without limited liability in any part of the world;

“controller” in relation to an institution, means –

(a) a managing director or chief executive of the institution;

(b) a managing director or chief executive of any other institution of which that institution is a subsidiary company;

(d) a person in accordance with whose directions or instructions any director of that institution or any other institution of which that institution is a subsidiary company is accustomed to act;

(e) a person who, either alone or with any associate or associates, is entitled to exercise or control the exercise of not less than 15 per cent of the voting power in general meeting of that institution or of any other institution of which that institution is a subsidiary company,

and in this Law, a person coming within sub-paragraph (d) is referred to as “an indirect controller” and a person coming within sub-paragraph (e) is referred to as a “shareholder controller”;

“Court” means the Inferior Number of the Royal Court;

“director” includes –

(a) a person who occupies the position of a director, by whatever name called;

(b) in the case of a partnership, a partner;

“deposit” has the meaning given in Article 2 but subject to any Order given under Article 5;

“deposit-taking business” has the meaning given in Article 3 but subject to any Order given under Article 5;

“documents” includes information recorded in any form and, in relation to information recorded otherwise than in legible form, references to its production include references to producing a copy of the information in legible form;

“former registered person” means a person who was formerly a registered person under the Depositors and Investors (Prevention of Fraud) (Jersey) Law 19671 and continues to have a liability in respect of any deposit for which it had a liability at a time when it was a registered person;

“holding company” has the meaning given in Article 4;

“institution” means –

(a) a body corporate, wherever incorporated;

(b) a partnership formed under the law of the Island; or

(c) a partnership or other unincorporated association of two or more persons formed under the law of a member State of the European Community;

“manager” means a person, by whatever name called, other than a director or chief executive who is responsible for the overall control and administration or having effective control of the day to day business of a registered person or an office in the Island of that registered person;

“prescribed” means prescribed by Order;

“registered” means registered under this Law or the Depositors and Investors (Prevention of Fraud) (Jersey) Law 1967;2

“relevant supervisory authority”, in relation to a country or territory outside the Island means the authority discharging in that country or territory functions corresponding to those of the Committee under this Law;

“shareholder controller” has the meaning given by sub-paragraph (e) of the definition of controller, above, and “minority shareholder controller”, “majority shareholder controller” and “principal shareholder controller” mean, respectively –

(a) a shareholder controller in whose case the percentage referred to in that paragraph does not exceed 50;

(b) a shareholder controller in whose case that percentage exceeds 50 but does not exceed 75;

“subsidiary company” has the meaning given in Article 4;

(2) Unless the context otherwise requires, references in this Law to any other enactment shall be construed as references to that enactment as amended, extended or applied by or under any other enactment and to any enactment which repeals and re-enacts the first mentioned enactment with or without further amendment.

(3) A reference in this Law to a numbered Article without further identification is a reference to the Article so numbered in this Law.

(4) A reference in any Article or other division of this Law to a paragraph, sub-paragraph or clause by number or letter only, and without further identification, is a reference to the paragraph, sub-paragraph or clause of that number or letter contained in the Article or other division of this Law in which such reference occurs.

ARTICLE 2

Meaning of “deposit”

(1) Unless the context otherwise requires, “deposit” means a sum of money paid on terms –

(a) under which it will be repaid, with or without interest or a premium, either on demand or at a time or in circumstances agreed by or on behalf of the person making the payment and the person receiving it; and

(b) which are not referable to the provision of property or services or the giving of security,

and references in this Law to money deposited and to the making of a deposit shall be construed accordingly.

(2) For the purposes of sub-paragraph (b) of paragraph (1), money is paid on terms which are referable to the provision of property or services or to the giving of security if, and only if –

(a) it is paid by way of advance or part payment under a contract for the sale, hire or other provision of property or services and is repayable only in the event that the property or services is not or are not in fact, sold, hired or otherwise provided;

(b) it is paid by way of security for the performance of a contract or by way of security in respect of loss which may result from the non-performance of a contract; or

(c) without prejudice to sub-paragraph (b), it is paid by way of security for the delivery up or return of any property, whether in a particular state of repair or otherwise.

(3) Except so far as any provision of this Law otherwise provides, in this Law “deposit” does not include –

(a) a sum paid by a registered person;

(b) a sum paid by a person or institution mentioned in paragraph (2) of Article 7;

(c) a sum paid by a person, other than a person or institution mentioned in paragraphs (a) or (b), in the course of carrying on a business consisting wholly or mainly of lending money;

(d) a sum which is paid by one company to another at a time when one is a subsidiary of the other or both are subsidiaries of another company or the same individual is a majority or principal shareholder controller of both of them;

(e) a sum which is paid by a person who, at the time when it is paid, is a close relative of the person receiving it or who is, or is a close relative of, a director, controller or manager of that person;

(f) a sum paid on terms involving the issue of debentures or other securities;

(g) a sum paid under a transaction which is exempted by an Order made under paragraph (3) of Article 7.

(4) In the application of sub-paragraph (e) of paragraph (3) to a sum paid by a partnership that sub-paragraph shall have effect as if for the reference to the person paying the sum there were substituted a reference to each of the partners.

(5) In sub-paragraph (e) of paragraph (3) “close relative”, in relation to any person means –

(a) his spouse;

(b) his children and step-children, his parents and step-parents, his brothers and sisters and step-brothers and step-sisters; and

ARTICLE 3

Meaning of “deposit-taking business”

(1) In this Law, unless the context otherwise requires, a person carries on a deposit-taking business if –

(a) in the course of that business he lends the whole or any part of a deposit received by him to any other person; or

(b) he uses the whole or any part of any deposit received by him in the course of that business, or the whole or any part of any interest derived from a deposit received by him in the course of that business, to finance to a material extent any other activity of the business.

(2) Notwithstanding paragraph (1), a business is not a deposit-taking business if in the normal course of the business –

(a) the person carrying on that business does not hold himself out to accept deposits on a day to day basis; and

(b) any deposits which are accepted are only accepted on particular occasions.

(3) Without prejudice to the generality of the meaning of the words “in or from within the Island” in this Law, but subject always to paragraph (2), a person who –

(a) carries on a deposit-taking business outside the Island; and

(b) is a company incorporated in or registered in the Island,

carries on business from within the Island within the meaning of this Law.

ARTICLE 4

Meaning of “holding company”, “subsidiary company” and “wholly owned subsidiary”

(1) For the purposes of this Law, a company shall, subject to the provisions of paragraph (4), be deemed to be a subsidiary of another if, but only if, –

(a) that other either –

(i) is a member of it and controls the composition of its board of directors; or

(ii) holds more than one half in nominal value of its equity share capital; or

(b) the first mentioned company is a subsidiary of any company which is that other’s subsidiary.

(2) For the purposes of paragraph (1), the composition of a company’s board of directors shall be deemed to be controlled by another company if, but only if, that other company by the exercise of some power exercisable by it without the consent or concurrence of any other person can appoint or remove the holders of all or a majority of the directorships.

(3) For the purposes of paragraph (2) that other company is deemed to have power to appoint to a directorship with respect to which any of the following conditions is satisfied –

(a) that a person cannot be appointed thereto without the exercise in his favour by that other company of such a power as aforesaid; or

(b) that a person’s appointment thereto follows necessarily from his appointment as director of that other company;

(4) In determining whether a company is a subsidiary of another –

(a) any shares held or power exercisable by that other in a fiduciary capacity shall be treated as not held or exercisable by it;

(b) subject to the following two sub-paragraphs, any shares held or power exercisable –

(i) by any person as a nominee for that other (except where that other is concerned only in a fiduciary capacity);

(ii) by, or by a nominee for, a subsidiary of that other, not being a subsidiary which is concerned only in a fiduciary capacity,

shall be treated as held or exercisable by that other;

(c) any shares held or power exercisable by, or by a nominee for, the other or its subsidiary shall be treated as not held or exercisable by that other if the shares are held or the power is exercisable as above mentioned by way of security only.

(5) For the purposes of this Law –

(a) a company shall be deemed to be another’s holding company if, but only if, that other is its subsidiary; and

(b) a body corporate is deemed to be the wholly-owned subsidiary of another if it has no members except that other and that other’s wholly-owned subsidiaries and its or their nominees.

(6) In this Article “company” includes any body corporate.

ARTICLE 5

Power to amend definitions

(1) The Committee may by Order amend the meaning of deposit, deposit-taking business, holding company, subsidiary company or wholly-owned subsidiary for the purpose of all or any of the provisions of this Law.

(2) Without prejudice to the generality of paragraph (1), an Order under that paragraph amending the meaning of deposit-taking business may provide for taking into account as activities of an institution the activities of any person who is connected with it in such a manner as is specified in the Order.

(3) An Order under this Article may contain such transitional provisions as the Committee thinks necessary or expedient and may exclude or modify the effect of the Order on any other enactment which is expressed to have effect in relation to a deposit or a deposit-taking business within the meaning of this Law.

PART II

FUNCTIONS OF FINANCE AND ECONOMICS COMMITTEE AND CONTROL OF DEPOSIT-TAKING BUSINESSES

ARTICLE 6

Functions of the Finance and Economics Committee

(1) The Committee shall have the powers conferred on it by this law and the duty generally to supervise the persons registered by it in the exercise of those powers.

(2) Neither the States, nor the Committee nor any person who is a member of the Committee, or who is or is acting as an officer, servant or agent of the Committee or performing any duty on behalf of the Committee, shall be liable in damages for anything done or omitted in the discharge or purported discharge of the functions of the Committee under this Law or any Regulations or Order made or purportedly made, under this Law, unless it is shown that the act or omission was in bad faith.

ARTICLE 7

Prohibition of unregistered deposit-taking business

(1) Subject to the provisions of this Law, no person shall carry on or hold himself out as carrying on a deposit-taking business in or from within the Island unless he is for the time being registered under this Law.

(2) This Article shall not apply to the doing of anything by or on behalf of –

(a) the States;

(b) the central bank of a member State of the European Community;

(d) any other person or institution which the Committee may from time to time prescribe (subject always to such conditions or restrictions as the Committee may think fit to impose in such Order).

(3) This Article shall not apply to any transaction prescribed by the Committee for the purposes of this paragraph.

(4) An Order under paragraph (3) may prescribe transactions by reference to any factor appearing to the Committee to be appropriate and, in particular, by reference to all or any of the following –

(a) the amount of the deposit;

(b) the total liability of the person accepting the deposit to his depositors or to any other creditors;

(d) the identity of the person by whom the deposit is made or accepted, including his membership of a class whose membership is determined otherwise than by the Committee;

(e) the number of, or the amount involved in, transactions of a particular description carried out by the person accepting the deposit or the frequency with which he carries out transactions of any particular description.

(5) An Order under paragraph (3) may make any exemption for which it provides subject to compliance with specified conditions or requirements.

(6) A person who contravenes this Article shall be guilty of an offence and liable to imprisonment for a term not exceeding two years or to a fine, or both.

(7) The fact that a deposit has been accepted by a person in the course of a contravention of this Article shall not affect any civil liability arising in respect of the deposit or the money deposited.

ARTICLE 8

Applications for and grant and extent of registration

(1) Subject to the provisions of this Law, on an application in that behalf made by any person in the prescribed form and on payment of the sum of seven thousand five hundred pounds the Committee shall register that person.

(2) The provisions of Article 25 of the Public Finances (Administration) (Jersey) Law 1967,3 shall apply to any variation in the sum mentioned in paragraph (1), as if that sum were a tax or duty.

(3) Every registration shall, unless previously revoked under the provisions of Article 9, expire on the thirty-first day of January next following the day on which it takes effect.

(4) An application under this Article shall,subject to paragraph (5), be accompanied by –

(a) a statement setting out the nature and scale of the deposit-taking business which the applicant intends to carry on, any plans of the applicant for the future development of that business and particulars of the applicant’s arrangements for the management of that business; and

(b) such other information or documents as the Committee may reasonably require for the purpose of determining the application.

(5) Without prejudice to the Committee’s power to require an applicant to provide additional information or documents or information under paragraph (6), where an application under this Article is made by or on behalf of a person who is at the time of the application a registered person the applicant need not provide the statement or other information or documents required by sub-paragraphs (a) and (b) of paragraph (4), but may be required to provide a statement setting out the extent to which the information contained in the statement, information or documents accompanying the last such application has changed.

(6) At any time after receiving an application and before determining it the Committee may by written notice require the applicant or any person who is or is to be a director, controller or manager of the applicant to provide additional information or documents.

(7) The directions and requirements given or imposed under paragraphs (4) and (6) may differ as between different applications.

(8) Any information or statement to be provided to the Committee under this Article shall be in such form as the Committee may specify: and the Committee may by written notice require the applicant or any such person as is mentioned in paragraph (6) to provide a report by an accountant or other qualified person approved by the Committee on such aspects of that information as may be specified by the Committee.

(9) An application may be withdrawn by written notice to the Committee at any time before it is granted or refused.

ARTICLE 9

Refusal and revocation of registration

(1) The Committee may refuse to grant an application for registration or, where registration has been granted may revoke the registration, if –

(a) the applicant or the registered person has not provided information required under Article 8 or (as the case may be) has not provided to the Committee at any other time such information as the Committee may reasonably require;

(b) it appears to the Committee that any circumstances exist which either are likely to lead to the improper conduct of business by, or reflect discredit on, the method of conducting business of the applicant or the registered person (as the case may be) or any person employed by or associated with the applicant or that registered person for the purposes of his business;

(c) without prejudice to the generality of sub-paragraph (b), it appears to the Committee that by reason of the applicant or registered person (as the case may be), or any person employed by or associated with, the applicant or that registered person for the purposes of his business –

(i) having been convicted of an offence involving dishonesty in any part of the British Islands or in any other place in relation to which there is, or was at the time of the conviction, an arrangement with the Island for the extradition of offenders, or

(ii) having been convicted of an offence against this Law or any Order made under it,

the applicant or registered person is not, or as the case may be, is no longer a fit and proper person to be registered;

(d) it appears to the Committee, as a result of information provided in pursuance of the requirements of Article 8 or sub-paragraph (a) or information otherwise obtained, that it is not in the best interests of persons who have deposited, or who might deposit, money with the applicant or the registered person (as the case may be) or in order to protect the integrity of the Island in financial or commercial matters or that it is not in the best economic interests of the Island that the applicant or registered person should be registered or should continue to be registered; or

(e) without prejudice to clause (ii) of sub-paragraph (c), if in connection with any application for the grant of registration under this Law, the applicant or registered person has provided to the Committee information which is untrue or misleading in any material particular.

(2) Where the Committee refuses an application for registration or revokes a registration it shall give written notice accordingly to the applicant or registered person, as the case may be.

ARTICLE 10

Conditions on grant of registration

(1) Notwithstanding anything in Article 8, the Committee may prescribe such conditions as it thinks fit applicable either generally to all registered persons or to a class of registered persons and may attach conditions to the registration of any particular person under that Article and may from time to time vary any general condition, any condition applying to a class of registered persons or any condition attached to a registration or prescribe or attach a new condition.

(2) Without prejudice to the generality of paragraph (1), such conditions may include matters which the Committee considers to be desirable in the interests of depositors or potential depositors, whether for the purpose of safeguarding the assets of the person registered or otherwise, and may in particular –

(a) require the registered person to take certain steps or to refrain from adopting or pursuing a particular course of action or to restrict its business in a particular way;

(b) impose limitations on the acceptance of deposits, the granting of credit or the making of investments;

(c) prohibit the registered person from soliciting deposits either generally or from persons who are not already depositors with that registered person;

(d) prohibit it from entering into any other transaction or class of transactions;

(e) require the removal of any director, controller or manager.

(f) require the appointment of an auditor for a branch office of the registered person;

(g) require the production to the Committee of true and fair view audited accounts;

(h) require that the registered person shall at all times have appointed a senior officer approved by the Committee responsible for ensuring compliance with the terms and conditions of the registration.

(3) If any person fails to comply with any condition imposed under this Article, he shall for each such contravention be liable to imprisonment for a term not exceeding two years or to a fine, or both.

(4) Where the Committee varies a condition attached to a registration or attaches a condition to a registration,it shall give notice in writing to the registered person concerned.

ARTICLE 11

Certificates of registration and publication of names of registered persons

(1) Whenever the Committee registers a person it shall issue to that person, free of charge, a registration certificate.

(2) The Committee shall from time to time by Order cause to be published the names and addresses of all registered persons, together with such other information appertaining to such persons as the Committee may think appropriate.

ARTICLE 12

Display, production and delivery of registration certificates

(1) Every registered person shall –

(a) keep a copy of his registration certificate displayed in a prominent place and open to public view in every place in or from which he carries on a deposit-taking business;

(b) when required by or on behalf of the Committee to do so, produce or deliver his registration certificate to the Committee or to any person authorized in that behalf.

(2) If any registered person fails to comply with the provisions of this Article, he shall be guilty of an offence and liable to a fine not exceeding five hundred pounds and to a further fine not exceeding fifty pounds for each day during which the offence continues.

ARTICLE 13

Notification of new or increased control

(1) No person shall become a minority, majority or principal shareholder controller or an indirect controller of a registered person which is a company incorporated in the Island unless he has notified the Committee in writing of his intention to become such a controller and the Committee has notified him in writing that there is no objection to his becoming such a controller.

(2) Paragraph (1) applies also in relation to a person becoming a partner of a registered person which is a partnership formed under the law of the Island.

(3) Following receipt of a notice under paragraph (1), the Committee may, by giving written notice to the person from whom the notice was received, require him to give such additional information or documents as the Committee may require for deciding whether to serve a notice of objection.

(4) The Committee may serve a notice of objection under this Article unless it is satisfied –

(a) that the person concerned is a fit and proper person to become a controller of the description in question of the registered person;

(b) that the interests of depositors and potential depositors of the registered person would not be in any other manner prejudiced by that person becoming a controller of that description; and

(c) without prejudice to sub-paragraphs (a) and (b), that, having regard to that person’s likely influence on the registered person as such a controller the registered person would be likely to continue to fulfill the criteria which it met on registration, or, if any of those criteria is not fulfilled, that the person concerned would be likely to take remedial action.

(5) A notice of objection under this Article shall –

(a) specify which of the matters mentioned in paragraph (4) the Committee is not satisfied about and, subject to paragraph (6), the reasons for which it is not satisfied;

(b) give particulars of the rights of appeal conferred by Article 17.

(6) Paragraph (5) shall not require the Committee to specify any reason which would in its opinion involve the disclosure of confidential information the disclosure of which would be prejudicial to a third party.

ARTICLE 14

Objection to existing shareholder controller

(1) Where it appears to the Committee that a person who is a shareholder controller of any description of a registered person which is a company incorporated in the Island is not or is no longer, a fit person to be such a controller, the Committee may serve on him a written notice of objection to his being such a controller.

(2) A notice of objection under this Article shall –

(a) subject to paragraph (3), specify the reasons for which it appears to the Committee that the person in question is no longer a fit and proper person as mentioned in paragraph (1); and

(b) give particulars of the rights of appeal conferred by Article 17.

(3) Sub-paragraph (a) of paragraph (2) shall not require the Committee to specify any reason which would in its opinion involve the disclosure of confidential information the disclosure of which would be prejudicial to a third party.

ARTICLE 15

Contravention by controller

(1) Subject to paragraph (2), any person who contravenes Article 13 by –

(a) failing to give the notice required by paragraph (1) of that Article;

(b) becoming a controller of any description to which that paragraph applies before having been served with a notice by the Committee under that paragraph; or

(c) having become a controller of any description in contravention of that Article (whether before or after being served with such a notice of objection) continues to be such a controller after such a notice has been served on him,

shall be guilty of an offence.

(2) A person shall not be guilty of an offence under paragraph (1) if he shows that he did not know of the acts or circumstances by virtue of which he became a controller of the relevant description; but where a person becomes a controller of any description without such knowledge and subsequently becomes aware of the fact that he has become such a controller he shall be guilty of an offence unless he gives the Committee written notice of the fact that he has become such a controller within fourteen days of becoming aware of that fact.

(3) A person guilty of an offence under this Article shall be liable to a fine or to imprisonment for a term not exceeding two years, or both and in the case of an offence under sub-paragraph (c) of paragraph (1), to a fine not exceeding one thousand pounds for each day on which the offence has continued.

ARTICLE 16

Restrictions on sales of shares

(1) The powers conferred by this Article shall be exercisable where a person has, either by becoming a shareholder controller of any description or by continuing to be such a shareholder controller, as the case may be, contravened Article 13 or continued to be a shareholder controller of any description after being served with a notice under Article 14.

(2) The Committee may by notice in writing served on the person concerned direct that any specified shares to which this Article applies shall, until further notice, be subject to one or more of the following restrictions –

(a) any transfer of, or agreement to transfer, those shares or, in the case of unissued shares, any transfer of or agreement to transfer the right to be issued with them shall be void;

(b) no voting rights shall be exercisable in respect of the shares;

(d) except in liquidation, no payment shall be made of any sum, due from the registered person on the shares, whether in respect of capital or otherwise.

(3) The Court may, on the application of the Committee, order the sale of any specified shares to which this Article applies and, if they are for the time being subject to any restrictions under paragraph (2), that they shall cease to be subject to those restrictions.

(4) No order shall be made under paragraph (3) in a case where a notice of objection was served under Article 13 or 14 –

(a) until the end of the period within which an appeal can be brought against the notice of objection; and

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

(5) Where an order has been made under paragraph (3) the Court may, on the application of the Committee, make such further order relating to the sale or transfer of the shares as it thinks fit.

(6) Where shares are sold in pursuance of an order under this Article the proceeds of sale, less the costs of the sale, shall be paid to the Viscount for the benefit of the persons beneficially interested in them; and any such person may apply to the Court for an order that the whole or part of the proceeds to be paid to him by the Viscount.

(7) This Article applies –

(a) to all the shares in a registered person of which the person in question is a controller of the relevant description which are held by him or any associate of his and were not so held immediately before he became such a controller of the registered person; and

(b) where the person in question became a controller of the relevant description of a registered person as a result of the acquisition by him or any associate of his of shares in another company, to all the shares in that company which are held by him or any associate of his and were not so held before he became such a controller of that registered person.

(8) A copy of the notice served on the person concerned under paragraph (2) shall be served on the registered person or the company to whose shares it relates and, if it relates to shares held by an associate of that person, on that associate.

ARTICLE 17

Procedure and rights of appeal

(1) Where the Committee, acting under Article 9, refuses an application for registration or revokes any registration or, acting under Article 10, attaches a condition to a registration of a particular person or varies any condition so attached, the applicant or the registered person, as the case may be, may require the Committee to furnish him with a statement in writing of its reasons for that decision.

(2) Any person aggrieved by such refusal or cancellation, or by the conditions attached to his registration or by any variation of such conditions may appeal to the Court, either in term or in vacation, on the ground that the decision of the Committee was unreasonable having regard to all the circumstances of the case.

(3) Where any person appeals against the revocation of his registration or against the variation of any condition attached to his registration under Article 10, or, where his original registration was granted without any conditions attached thereto, against any subsequent attaching of conditions, the registration shall not be cancelled or the condition varied or attached as the case may be, until the appeal has been determined or withdrawn.

(4) Any person on whom a notice of objection has been served under Article 13 or 14 may appeal to the Court against the decision of the Committee to serve the notice; but this paragraph does not apply to a person in any case in which he has failed to give a notice or become or continued to be a controller in circumstances in which his doing so constitutes an offence under Article 15.

ARTICLE 18

Representation to Court by Committee where registration refused or revoked

(1) Notwithstanding Article 17, where the Committee decides to refuse an application for registration or to revoke any registration or to attach or vary any condition or where a person has ceased for any other reason to be a registered person but continues to hold deposits which were accepted by him while he was a registered person, it may represent to the Court that, in order that the interests of persons who have deposited money with the applicant, the registered person or the former registered person, as the case may be, shall not be prejudicially affected, the business of the applicant or the registered person or the former registered person should be subject to such supervision, restraint or conditions from such time and for such periods as the Committee may specify in the representation.

(2) On the presentation of a representation under this Article, the Court may make such order as it thinks just.

ARTICLE 19

Control of advertising

(1) The Committee may make Orders relating to the issue, form and content of deposit advertisements.

(2) Orders made under this Article may make different provision for different cases and, without prejudice to the generality of paragraph (1), may in particular –

(a) prohibit the issue of advertisements of any description (whether by reference to their contents, to the persons by whom they are issued or otherwise);

(b) make provision with respect to matters which must be, as well as matters which may not be, included in advertisements;

(c) provide for exemptions from any prohibition or requirement imposed by the Orders, including exemptions by reference to a person’s membership of a class whose membership is determined otherwise than by the Committee.

(3) Any registered person who issues in the Island or elsewhere, or, subject to paragraph (4), any other person who issues in the Island, an advertisement the issue of which is prohibited by an Order made under this Article or which does not comply with any requirements imposed by that Order shall be guilty of an offence and liable to a fine or to imprisonment for a term not exceeding two years, or both.

(4) A person whose business it is to publish or arrange for publication of advertisements shall not be guilty of an offence under this Article if he proves that he received the advertisement for publication in the ordinary course of his business, that the matters contained in the advertisement were not (wholly or in part) devised or selected by him or by any person under his direction or control and that he did not know and had no reason for believing that publication of the advertisement would constitute an offence.

(5) In this Article “deposit advertisement“ means any advertisement containing –

(a) an invitation to make a deposit; or

(b) information which is intended or might reasonably be presumed to be intended to lead directly or indirectly to the making of a deposit;

and for the purposes of this Article an advertisement includes any means of bringing such an invitation or such information to the notice of the person or persons to whom it is addressed and references to an advertisement shall be construed accordingly.

(6) For the purposes of this Article –

(a) an advertisement issued or caused to be issued by any person by way of display or exhibition in a public place shall be treated as issued or caused to be issued by him on every day on which he causes or permits it to be displayed or exhibited;

(b) an advertisement inviting deposits with a person specified in the advertisement shall be presumed, unless the contrary is proved, to have been issued to the order of that person.

(7) For the purposes of this Article an advertisement issued outside the Island shall be treated as issued in the Island if it is directed to persons in the Island or is made available to them otherwise than in a newspaper, journal, magazine or other publication published and circulating principally outside the Island or in a sound or television broadcast transmitted principally for reception outside the Island.

ARTICLE 20

Advertising directions

(1) If the Committee considers that any deposit advertisement issued or proposed to be issued by or on behalf of a registered person is misleading, the Committee may by notice in writing give the registered person a direction under this Article.

(2) A direction under this Article may contain any or all of the following prohibitions –

(a) a prohibition on the issue of advertisements of a specified kind;

(b) a requirement that advertisements of a particular description shall be modified in a specified manner;

(c) a prohibition on the issue of any advertisements which are, wholly or substantially, repetitions of an advertisement which has been issued and which is identified in the direction.

(3) Not less than fourteen days before giving a direction under this Article the Committee shall give the registered person concerned notice in writing of its intention to give the direction stating the reasons for the proposed direction and giving particulars of the rights conferred by paragraph (4).

(4) A registered person to whom a notice under paragraph (3) is given may within the period of fourteen days beginning with the day on which the notice was given make written representations to the Committee; and the Committee shall take any such representations into account in deciding whether to give the direction.

(5) A direction under this Article may be varied by a further direction; and a direction may be revoked by the Committee by a notice in writing to the registered person concerned.

(6) Any person who issues or causes to be issued an advertisement the issue of which is prohibited by a direction under this Article or which does not comply with any requirements imposed by such a direction shall be guilty of an offence and liable to a fine or to imprisonment for a term not exceeding two years, or both.

ARTICLE 21

False statements

(1) Any person who, in giving any information for any of the purposes of this Law or of any Regulations or Order made thereunder, makes a statement which to his knowledge is false in a material particular shall be guilty of an offence and liable to a fine or to imprisonment for a term not exceeding two years, or both.

(2) A registered person or a former registered person shall be guilty of an offence if it fails to provide the Committee with any information in its possession knowing or having reasonable cause to believe –

(a) that the information is relevant to the exercise by the Committee of its functions under this Law in relation to the registered person or former registered person; and

(b) that the withholding of the information is likely to result in the Committee being misled as to any matter which is relevant to and of material significance for the exercise of those functions in relation to the registered person or former registered person.

(3) A person guilty of an offence under paragraph (2) shall be liable to a fine or to imprisonment for a term not exceeding two years, or both.

ARTICLE 22

Fraudulent inducement to make a deposit

(1) Any person who –

(a) makes a statement, promise or forecast which he knows to be misleading, false or deceptive, or fraudulently conceals any material facts; or

(b) recklessly makes (fraudulently or otherwise) a statement, promise or forecast which is misleading, false or deceptive,

is guilty of an offence if he makes the statement, promise or forecast or conceals the facts for the purpose of inducing, or is reckless as to whether it may induce, another person (whether or not the person to whom the statement, promise or forecast is made or from whom the facts are concealed) –

(i) to make, or refrain from making, a deposit with him or any other person; or

(ii) to enter or refrain from entering, into an agreement for the purpose of making such a deposit.

(2) This Article does not apply unless –

(a) the statement, promise or forecast is made in or from, or the facts are concealed in or from, the Island or arrangements are made in or from the Island for the statement, promise or forecast to be made or the facts to be concealed;

(b) the person on whom the inducement is intended to or may have effect is in the Island; or

(3) A person guilty of an offence under this Article shall be liable to imprisonment for a term not exceeding seven years or a fine, or both.

ARTICLE 23

Notification of change of director, controller or manager

(1) Subject to paragraph (3), a registered person shall give written notice to the Committee of the fact that any person has become or ceased to be a director, controller or manager of the registered person.

(2) A notice required to be given under paragraph (1) shall be given before the end of the period of fourteen days beginning with the day on which the registered person becomes aware of the relevant facts.

(3) The Committee may by notice in writing wholly or partly dispense from the obligation imposed by paragraph (1) any registered person whose principal place of business is outside the Island.

(4) A registered person who fails to give a notice required by this Article shall be guilty of an offence and liable to a fine not exceeding two thousand pounds.

ARTICLE 24

Notification of acquisition of significant shareholding

(1) A person who becomes a significant shareholder in relation to a registered person incorporated in the Island shall within fourteen days give written notice of that fact to the Committee.

(2) For the purposes of this Article “a significant shareholder”, in relation to a registered person , means a person who, either alone or with an associate or associates, is entitled to exercise, or to control the exercise of, 3 per cent. or more but less than 15 per cent. of the voting power at any general meeting of the registered person.

(3) Subject to the provisions of paragraph (4), any person who contravenes paragraph (1) shall be guilty of an offence.

(4) A person shall not be guilty of an offence under paragraph (3) if he shows that he did not know of the acts or circumstances by virtue of which he became a significant shareholder in relation to the registered person; but where any person becomes such a shareholder without such knowledge and subsequently becomes aware of the fact that he has become such a shareholder he shall be guilty of an offence unless he gives the Committee written notice of the fact that he has become such a shareholder within fourteen days of becoming aware of that fact.

(5) A person guilty of an offence under this Article shall be liable to a fine not exceeding two thousand pounds.

ARTICLE 25

Power to obtain information and require production of documents

(1) The Committee may by notice in writing served on a registered person –

(a) require the registered person to provide the Committee, at such time or times or at such intervals or in respect of such period or periods as may be specified in the notice, with such information as the Committee may reasonably require for the performance of its functions under this Law;

(b) require the registered person to provide the Committee with a report by an accountant or other person with relevant professional skill on, or on any aspect of, any matter about which the Committee has required or could require the registered person to provide information under sub-paragraph (a).

(2) The accountant or other person appointed by a registered person to make a report under sub-paragraph (b) of paragraph (1) shall be a person nominated or approved by the Committee; and the Committee may require his report to be in such form as is specified in the notice.

(3) The Committee may –

(a) by notice in writing served on a registered person require it to produce, within such time and at such place as may be specified in the notice, such document or documents of such description as may be so specified;

(b) authorize a person as agent of the Committee, on producing evidence of his authority, to require any such registered person to provide him forthwith with such information, or to produce to him forthwith such documents, as he may specify,

being such information or documents as the Committee may reasonably require for the performance of its functions under this Law.

(4) Where, by virtue of paragraph (3), the Committee or any agent of the Committee has power to require the production of any documents from a registered person, the Committee or that agent shall have the like power to require the production of those documents from any person who appears to be in possession of them; but where any person from whom such production is required claims a lien on documents produced by him, the production shall be without prejudice to the lien.

(5) The power under this Article to require a registered person or other person to produce any documents includes power –

(a) if the documents are produced, to take copies of them or extracts from them and to require that registered person or other person, or any other person who is a present or past director, controller or manager of, or is or was at any time employed by or acting as an employee of, the registered person in question, to provide an explanation of them; and

(b) if the documents are not produced, to require the person who was required to produce them to state, to the best of his knowledge and belief, where they are.

(6) If it appears to the Committee to be desirable in the interests of the depositors or potential depositors of a registered person to do so, it may also exercise the powers conferred by paragraphs (1) and (3) in relation to any body corporate which is or has at any relevant time been –

(a) a holding company, subsidiary or related company of that registered person;

(b) a subsidiary of a holding company of that registered person;

(d) a body corporate in the case of which a shareholder controller of that registered person, either alone or with any associate or associates, is entitled to exercise, or control the exercise of, more than 50 per cent, of the voting power at a general meeting;

or in relation to any partnership of which that registered person is or has at any relevant time been a member.

(7) In this Article, “related company”, in relation to any company, means any body corporate (other than one which is a group company in relation to that company) in which that company holds on a long-term basis a qualifying capital interest for the purpose of securing a contribution to that company’s own activities by the exercise of any control or influence arising from that interest.

(8) In this Article “qualifying capital interest” means, in relation to any body corporate, an interest in shares comprised in the equity share capital of that body corporate of a class carrying rights to vote in all circumstances at general meetings of that body corporate.

(9) Where –

(a) a company holds a qualifying capital interest in a body corporate; and

(b) the nominal value of any relevant shares in that body corporate held by that company is equal to twenty per cent or more of the nominal value of all relevant shares in that body corporate;

it shall be presumed to hold that interest on the basis and for the purpose mentioned in paragraph (7), unless the contrary is shown; in this paragraph “relevant shares” means, in relation to any body corporate, any such shares in that body corporate as are mentioned in paragraph (8).

(10) The foregoing provisions of this Article shall apply to a former registered person as they apply to a registered person.

(11) The Committee may by notice in writing served on any person who is or is to be a director, controller or manager of a registered person, require him to provide the Committee, within such time as may be specified in the notice, with such information or documents as the Committee may reasonably require for determining whether he is a fit and proper person to hold the particular position which he holds or is to hold.

(12) The Committee may exercise the powers conferred by paragraphs (1) and (3) in relation to any person who is a significant shareholder in a registered person within the meaning of Article 24 if the Committee considers that the exercise of those powers is desirable in the interests of the depositors or potential depositors of that registered person.

(13) Any person who without reasonable excuse fails to comply with a requirement imposed on him under this Article shall be guilty of an offence and liable to imprisonment for a term not exceeding six months or a fine not exceeding two thousand pounds, or both.

(14) A statement made by a person in compliance with this Article may be used in evidence against him.

(15) Nothing in this Article shall compel the production by an advocate or solicitor of a document containing a privileged communication made by him or to him in that capacity.

ARTICLE 26

Right of entry to obtain information and documents

(1) Any officer or agent of the Committee may, on producing if required evidence of his authority, enter any premises occupied by a person on whom a notice has been served under Article 25 for the purpose of obtaining there the information or documents required by that notice and of exercising the powers conferred by paragraph (5) of that Article.

(2) Any officer or agent of the Committee may, on producing if required evidence of his authority, enter any premises occupied by any person on whom a notice could be served under Article 25 for the purpose of obtaining there such information or documents as are specified in the authority, being information or documents that could have been required by such a notice; but the Committee shall not authorize any person to act under this paragraph unless it has reasonable cause to believe that if such notice were served it would not be complied with or that any documents to which it would relate would be removed, tampered with or destroyed.

(3) Any person who intentionally obstructs a person exercising rights conferred by this Article shall be guilty of an offence and liable to imprisonment for a term not exceeding six months or a fine not exceeding two thousand pounds, or both.

ARTICLE 27

Investigations on behalf of the Committee

(1) If it appears to the Committee desirable to do so in the interests of the depositors or potential depositors of a registered person the Committee may appoint one or more competent persons to investigate and report to the Committee –

(a) the nature, conduct or state of the registered person’s business or any particular aspect of it; or

(b) the ownership or control of the registered person;

and the Committee shall give written notice of any such appointment to the registered person concerned.

(2) If a person appointed under paragraph (1) thinks it necessary for the purposes of his investigation, he may also investigate the business of any body corporate which is or has at any relevant time been –

(a) a holding company, subsidiary or related company of the registered person under investigation;

(b) a subsidiary or related company of a holding company of that registered person;

(d) a body corporate in the case of which a shareholder controller of that registered person, either alone or with any associate or associates, is entitled to exercise, or control the exercise of, more than 20 per cent of the voting power at a general meeting;

or the business of any partnership of which that registered person is or has at any relevant time been a member.

(3) In this Article “related company” has the same meaning as in Article 25.

(4) Where a person appointed under paragraph (1) decides to investigate the business of any body by virtue of paragraph (2) he shall give it written notice to that effect.

(5) It shall be the duty of every person who is or was a director, controller, manager, employee, banker, auditor or legal adviser (subject to the preservation of legal professional privilege) of a body which is under investigation (whether by virtue of paragraph (1) or (2), any person appointed to make a report in respect of that body under sub-paragraph (b) of paragraph (1) of Article 25 and anyone who is a significant shareholder in relation to that body within the meaning of Article 24 –

(a) to produce to the persons appointed under paragraph (1), within such time and at such place as they may require, all documents relating to the body concerned which are in his custody or power;

(b) to attend before the persons appointed at such time and place as they may require; and

(c) otherwise to give those persons all assistance in connection with the investigation which he is reasonably able to give;

and those persons may take copies of or extracts from any documents produced to them under sub-paragraph (a).

(6) The foregoing provisions of this Article shall apply to a former registered person as they apply to a registered person.

(7) For the purpose of exercising his power under this Article a person appointed under paragraph (1) may enter any premises occupied by a body which is being investigated by him under this Article; but he shall not do so without prior notice in writing unless he has reasonable cause to believe that if such a notice were given any documents whose production could be required under this Article would be removed, tampered with or destroyed.

(8) A person exercising powers by virtue of an appointment under this Article shall, if so required, produce evidence of his authority.

(9) Any person who –

(a) without reasonable excuse fails to produce any documents which it is his duty to produce under paragraph (5);

(b) without reasonable excuse fails to attend before the persons appointed under paragraph (1) when required to do so;

(c) without reasonable excuse fails to answer any question which is put to him by persons so appointed with respect to a registered person which is under investigation or a body which is being investigated by virtue of paragraph (1) or (2); or

(d) intentionally obstructs a person in the exercise of the rights conferred by paragraph (7),

shall be guilty of an offence and liable to imprisonment for a term not exceeding six months or a fine not exceeding two thousand pounds, or both.

(10) A statement made by a person in compliance with a requirement imposed by virtue of this Article may be used in evidence against him.

(11) Nothing in this Article shall compel the production by an advocate or solicitor of a document containing a privileged communication made by him or to him in that capacity.

ARTICLE 28

Investigation of suspected contraventions

(1) Where the Committee has reasonable grounds for suspecting that a person is guilty of contravening Article 7 or 22 the Committee or any duly authorized officer or agent of the Committee may by notice in writing require that or any other person–

(a) to provide, at such place as may be specified in the notice and either forthwith or at such time as may be so specified, such information as the Committee may reasonably require for the purpose of investigating the suspected contravention;

(b) to produce, at such place as may be specified in the notice and either forthwith or at such time as may be so specified, such documents, or documents of such description, as may be specified, being documents the production of which may be reasonably required by the Committee for that purpose;

(c) to attend at such place and time as may be specified in the notice and answer questions relevant for determining whether such a contravention has occurred.

(2) The Committee or a duly authorized officer or agent of the Committee may take copies of or extracts from any documents produced under this Article.

(3) Any officer or agent of the Committee may, on producing if required evidence of his authority, enter any premises occupied by a person on whom a notice has been served under paragraph (1) for the purpose of obtaining there the information or documents required by the notice, putting the questions referred to in sub-paragraph (c) of that paragraph or exercising the powers conferred by paragraph (2).

(4) Any person who without reasonable excuse fails to comply with a requirement imposed on him under this Article or intentionally obstructs a person in the exercise of his rights conferred by paragraph (3) shall be guilty of an offence and liable to imprisonment for a term not exceeding six months or a fine not exceeding two thousand pounds, or both.

(5) A statement made by a person in compliance with a requirement imposed by virtue of this Article may be used in evidence against him.

(6) Nothing in this Article shall compel the production by an advocate or solicitor of a document containing a privileged communication made by him or to him in that capacity.

ARTICLE 29

Powers of entry in cases of suspected contraventions

(1) If the Bailiff is satisfied by information on oath that there is reasonable cause to suspect that a person is guilty of such a contravention as is mentioned in Article 28 and –

(a) that that person has failed to comply with a notice served on him under that Article; or

(b) that there are reasonable grounds for suspecting the completeness of any information provided or documents produced by him in response to such a notice; or

(c) that there are reasonable grounds for suspecting that if a notice were served on him under that Article it would not be complied with or that any documents to which it would relate would be removed, tampered with or destroyed,

he may grant a warrant under this Article.

(2) A warrant under this Article shall authorize any police officer, together with any other person named in the warrant –

(a) to enter any premises occupied by the person mentioned in paragraph (1) which are specified in the warrant, using such force as is reasonably necessary for the purpose;

(b) to search the premises and take possession of any documents appearing to be such documents as are mentioned in sub-paragraph (c) of paragraph (1) or to take, in relation to any such documents, any other steps which may appear to be necessary to preserve them or prevent interference with them;

(d) to require any person named in the warrant to answer questions relevant for determining whether that person is guilty of any such contravention as is mentioned in Article 28.

(3) A warrant under this Article shall continue in force until the end of the period of one month beginning with the date on which it was issued.

(4) Any documents of which possession is taken under this Article may be retained –

(a) for a period of three months; or

(b) if within that period proceedings to which the documents are relevant are commenced against any person for any such contravention as is mentioned in Article 28, until the conclusion of those proceedings.

(5) Any person who intentionally obstructs the exercise of any right conferred by a warrant issued under this Article or fails without reasonable excuse to comply with any requirement imposed in accordance with sub-paragraph (d) of paragraph (2) shall be guilty of an offence and liable to imprisonment for a term not exceeding two years or a fine, or both.

ARTICLE 30

Obstruction of investigations

(1) A person who knows or suspects that an investigation is being or is likely to be carried out –

(a) under Article 27; or

(b) into a suspected contravention of Article 7 or 22,

shall be guilty of an offence if he falsifies, conceals, destroys or otherwise disposes of, or causes or permits the falsification, concealment, destruction or disposal of, documents which he knows or suspects are or would be relevant to such an investigation unless he proves that he had no intention of concealing facts disclosed by the documents from persons carrying out such an investigation.

(2) A person guilty of an offence under this Article shall be liable to imprisonment for a term not exceeding two years or a fine, or both.

ARTICLE 31

Audited accounts to be open to inspection

(1) A registered person shall at each of its offices in the Island at which it holds itself out as accepting deposits –

(a) keep a copy of its most recent audited accounts; and

(b) during normal business hours make that copy available for inspection by any person on request.

(2) In the case of a registered person incorporated in the Island the accounts referred to in paragraph (1) include the auditors’ report on the accounts.

(3) A registered person which fails to comply with sub-paragraph (a) of paragraph (1) or with any request made in accordance with sub-paragraph (b) of that paragraph shall be guilty of an offence and liable to a fine not exceeding two thousand pounds.

ARTICLE 32

Notification in respect of auditors

(1) A registered person incorporated in the Island shall forthwith give written notice to the Committee if the registered person –

(a) proposes to give special notice to its shareholders of any resolution removing an auditor before the expiration of his term of office; or

(b) gives notice to its shareholders of a resolution replacing an auditor at the expiration of his term of office with a different auditor;

or if a person ceases to be an auditor of a registered person otherwise than in consequence of such a resolution.

(2) A registered person not incorporated in the Island who has been required by the Committee under Article 10 to appoint an auditor of its business operation in the Island shall not replace that auditor before giving notice to the Committee of his intended replacement.

(3) An auditor of a registered person who is appointed by virtue of –

(a) any provision of this Law; or

(b) any enactment in force in the Island relating to companies; or

shall forthwith give notice to the Committee if –

(i) he resigns before the expiration of his term of office;

(ii) he does not seek to be re-appointed;

(iii) he decides to include in his report any qualification as to any matter.

(4) The foregoing provisions of this Article shall apply to a former registered person as they apply to a registered person.

(5) A registered person or an auditor who fails to comply with this Article shall be guilty of an offence and liable to a fine not exceeding two thousand pounds.

ARTICLE 33

Communication by auditor, etc. with the Committee

(1) No duty to which –

(a) an auditor of a registered person; or

(b) a person appointed to make a report under Article 25,

may be subject shall be regarded as contravened by reason of his communicating in good faith to the Committee, whether or not in response to a request made by it, any information or opinion on a matter to which this Article applies and which is relevant to any function of the Committee under this Law.

(2) In relation to an auditor of a registered person, this Article applies to any matter of which he becomes aware in his capacity as auditor and which relates to the business or affairs of the registered person or any associated body.

(3) In relation to a person appointed to make a report under Article 25, this Article relates to any matter of which he becomes aware in his capacity as the person making the report and which –

(a) relates to the business or affairs of the registered person in relation to which his report is made or any associated body of that registered person; or

(b) if by virtue of paragraph (6) of Article 25 the report relates to an associated body of a registered person, to the business affairs of that body.

(4) In this Article “associated body”, in relation to a registered person, means any such body as is mentioned in paragraph (6) of Article 25.

(5) The Committee may, after consultation with such bodies as appear to the Committee to represent the interests of accountants and registered persons, make Orders specifying circumstances in which matters are to be communicated to the Committee as mentioned in paragraph (1) and it shall be the duty of an accountant to whom the Orders apply to communicate a matter to the Committee in the circumstances specified in the Orders.

(6) Orders under this Article may make different provision for different cases and this Article shall apply to the auditor of a former registered person as it applies to the auditor of a registered person.

ARTICLE 34

Repayment of unauthorized deposits

(1) If on a representation to the Court made by the Committee it appears to the Court that a person has accepted deposits in contravention of Article 7, the Court may –

(a) order him and any other person who appears to the Court knowingly to have been concerned in the contravention to repay the deposits forthwith or at such time as the Court may direct; or

(b) appoint the Viscount to recover those deposits;

but in deciding whether and, if so, on what terms to make an order under this Article the Court shall have regard to the effect that repayment in accordance with the order would have on the solvency of the person concerned or otherwise on his ability to carry on his business in a manner satisfactory to his creditors.

ARTICLE 35

Profits from unauthorized deposits

(1) If on the representation of the Committee the Court is satisfied that profits have accrued to a person as a result of a contravention of Article 7, the Court may either order him to pay to the Viscount or may appoint the Viscount to recover from him, such sum as appears to the Court to be just having regard to the profits appearing to the Court to have accrued to him.

(2) In deciding whether, and if so, on what terms to make an order under this Article the Court shall have regard to the effect that payment in accordance with the order would have on the solvency of the person concerned or otherwise on his ability to carry on his business in a manner satisfactory to his creditors.

(3) Any amount paid to the Viscount or recovered from a person in pursuance of an order under this Article shall be paid out to such person or distributed among such persons as the Court may direct, being a person or persons appearing to the Court to have made the deposits as a result of which the profits mentioned in paragraph (1) have accrued or such other person or persons as the Court thinks just.

ARTICLE 36

Compensation schemes

The States may by Regulations establish in relation to any deposit taking business schemes for compensating depositors in cases where registered persons or former registered persons are unable, or are likely to be unable, to satisfy claims in respect of any description of civil liability incurred by them in connection with their deposit-taking business.

Part III

BANKING NAMES AND DESCRIPTIONS

ARTICLE 37

Restriction on use of certain names and descriptions

(1) Notwithstanding anything contained in any other enactment no person carrying on any business in the Island other than the States, the central bank of a member State of the European Community or the National Savings Bank of the United Kingdom shall use any name which indicates or may reasonably be understood to indicate (whether in English or any other language) that he is a bank or banker or is carrying on a banking business unless he is a registered person or has first obtained the permission of the Committee under Article 38.

(2) No person carrying on any business in the Island other than a registered person, the States, the central bank of a member state of the European Community, the National Savings Bank of the United Kingdom or a person who has obtained the permission of the Committee under Article 38 and is acting in accordance with the terms of that permission, shall so describe himself, or hold himself out as to indicate or reasonably be understood to indicate (whether in English or any other language) that he is a bank or banker or is carrying on a banking business.

(3) Any person who contravenes paragraph (1) or (2) shall be guilty of an offence and liable to imprisonment for a term not exceeding six months or a fine not exceeding two thousand pounds, or both and, where the offence consists of continuing any such contravention after conviction therefor, to a daily penalty not exceeding two hundred pounds.

ARTICLE 38

Applications for and grant, etc. of permission for the use of certain names by companies and businesses

(1) Any person other than a registered person desirous of obtaining the permission of the Committee to use any name which indicates or might reasonably be understood to indicate (whether in English or any other language) that he is a bank or banker or is carrying on a banking business in the Island may make application in that behalf to the Committee.

(2) An application under paragraph (1) shall be in such form and accompanied by such information as the Committee may from time to time require and the Committee may require the applicant to provide such further information as it considers necessary or desirable at any time after receipt of an application.

(3) Upon consideration of an application under paragraph (1), the Committee may grant permission or grant permission subject to such conditions or restrictions as it considers necessary or expedient, or refuse permission.

ARTICLE 39

Registration and change of name of companies

No application made in pursuance of the provisions of the Companies (Jersey) Laws 1861 to 19684 for –

(a) the registration of a company in the proposed name of which there appears any of the words “bank”, “banker” or “banking” or any cognate expression, whether in English or any other language; or

(b) the change of the name of a company registered in the Island by the inclusion of the word “bank”, “banker” or “banking” or any cognate expression, whether in English or any other language,

shall be granted unless the applicant establishes that he is a registered person or has obtained the permission of the Committee under Article 38.

ARTICLE 40

Registration of business names

Notwithstanding Article 12 of the Registration of Business Names (Jersey) Law 1956,5 upon an application being made to the Judicial Greffier in pursuance of the provisions of that Law for the registration of a business name in which there appears any of the words “bank”, “banker” or “banking” or any cognate expression, whether in English or any other language, the Judicial Greffier shall not grant the application unless he is satisfied that the applicants are registered persons or have obtained the permission of the Committee under Article 38 to use the word or expression concerned in the business name.

PART IV

RESTRICTION ON DISCLOSURE OF INFORMATION

ARTICLE 41

Restricted information

(1) Except as provided by the subsequent provisions of this Part –

(a) no person who under or for the purposes of this Law receives information relating to the business or other affairs of any person; and

(b) no person who obtains any such information directly or indirectly from a person who has received it as aforesaid,

shall disclose the information without the consent of the person to whom it relates and (if different) the person from whom it was received as aforesaid.

(2) This Article does not apply to information which at the time of the disclosure is or has already been made available to the public from other sources or to information in the form of a summary or collection of information so framed as not to enable information relating to any particular person to be ascertained from it.

(3) Any person who discloses information in contravention of this Article shall be guilty of an offence and liable to imprisonment for a term not exceeding two years or a fine, or both.

ARTICLE 42

Disclosure for facilitating discharge of functions of Committee

(1) Article 41 does not preclude the disclosure of information in any case in which disclosure is for the purpose of enabling or assisting the Committee to discharge its functions under this Law.

(2) Without prejudice to the generality of paragraph (1), Article 41 does not preclude the disclosure of information by the Committee to the auditor of a registered person or former registered person if it appears to the Committee that disclosing the information would enable or assist the Committee to discharge the functions mentioned in paragraph (1) or would otherwise be in the interests of depositors.

(3) If, in order to enable or assist the Committee properly to discharge any of its functions under this Law, the Committee considers it necessary to seek advice from any qualified person on any matter requiring the exercise of professional skill, Article 41 does not preclude the disclosure by the Committee to that person of such information as appears to the Committee to be necessary to ensure that he is properly informed with respect to the matters on which his advice is sought.

ARTICLE 43

Disclosure for facilitating discharge of functions by other supervisory authorities

(1) Article 41 does not preclude the disclosure by the Committee of information to the Viscount or to any person exercising in the Island a statutory function.

(2) Article 41 does not preclude the disclosure of information for the purpose of enabling or assisting an authority in a country or territory outside the Island to exercise supervisory functions in respect of banking, insurance or investment business or other financial services corresponding to those of the Committee in the Island.

ARTICLE 44

Other permitted disclosures

(1) Article 41 does not preclude the disclosure of information –

(a) for the purpose of enabling or assisting a person to do anything which he is required to do in pursuance of a requirement imposed by sub-paragraph (b) of paragraph (1) of Article 25;

(b) with a view to the institution of, or otherwise for the purposes of, any criminal proceedings, whether under this Law or not;

(d) with a view to the institution of, or otherwise for the purposes of, any disciplinary proceedings relating to the exercise of his professional duties by an auditor of a registered person or former registered person or an accountant or other person nominated or approved for the purposes of sub-paragraph (b) of paragraph (1) of Article 25 or appointed under Article 27;

(2) Article 41 does not preclude the disclosure by the Committee to the Attorney General or a police officer of information obtained by virtue of Article 27, 28 or 29 or of information in the possession of the Committee as to any suspected contravention in relation to which the powers conferred by those Articles are exercisable but any information so disclosed may only be disclosed by a police officer for the purposes of a prosecution either in the Island or, with the prior consent of the Attorney General, elsewhere.

(3) Article 41 does not preclude the disclosure of information to any person or body responsible for a scheme for compensating depositors or investors (whether in the Island or elsewhere) if it appears to the Committee that disclosing the information would enable or assist the recipient of the information or the Committee to discharge its functions but any such disclosure by the Committee may only be made if the recipient of the information has given to the Committee a written undertaking that the information will not be further disclosed without the prior consent of the Committee.

ARTICLE 45

Information supplied to Committee by relevant overseas authority

Article 41 applies also to information supplied to the Committee for the purposes of its functions under this Law by a relevant supervisory authority in a country or territory outside the Island but no such information shall be disclosed except as provided in that Article or for the purpose of enabling or assisting the Committee to discharge those functions or with a view to the institution of, or otherwise for the purposes of, criminal proceedings, whether under this Law or otherwise.

PART V

MISCELLANEOUS AND SUPPLEMENTAL

ARTICLE 46

Service of notices

(1) No notice required by this Law to be given to or served on the Committee shall be regarded as given or served until it is received.

(2) Subject to paragraph (1), any notice may be given or served by telex or facsimile transmission or by any similar means which produce a document containing the text of the communication.

(3) Any notice, direction or other document required or authorized by or under this Law to be given or served on any person other than the Committee may be given or served on the person in question –

(a) by delivering it to him; or

(b) by leaving it at his proper address; or

(d) by sending it to him at that address by telex, facsimile or other similar means which produce a document containing the text of the communication.

(4) Any such document may –

(a) in the case of a company incorporated in the Island, be given to or served on its secretary; and

(b) in the case of any other description of institution, be given or served on a controller or manager of the institution.

(5) For the purposes of this Article and Article 12 of the Interpretation (Jersey) Law 1954,6 in its application to this Article, the proper address of any person to or on whom a document is to be given or served by post shall be his last known address, except that –

(a) in the case of a body corporate or its secretary, it shall be the address of the registered or principal office of that body in the Island; and

(b) in the case of any other description of institution or a person having control or management of its business in the Island, it shall be that of the principal office of the institution in the Island.

(6) If the person to or on whom any document mentioned in paragraph (3) is to be given or served has notified the Committee of an address within the Island other than his proper address within the meaning of paragraph (5), as the one at which he or someone on his behalf will accept documents of the same description as that document, that address shall also be treated for the purposes of this Article and Article 12 of the Interpretation (Jersey) Law 19547 as his proper address.

ARTICLE 47

Evidence

(1) In any proceedings, a certificate purporting to be signed on behalf of the Committee and certifying –

(a) that a particular person is or is not a registered person or was or was not a registered person at a particular time;

(b) the date on which a particular registered person became or ceased to be registered;

shall be admissible in evidence.

(2) A certificate purporting to be signed as mentioned in paragraph (1) shall be deemed to have been duly signed unless the contrary is shown.

ARTICLE 48

Orders

(1) The Committee may make Orders for the purposes of carrying this Law into effect and in particular, without prejudice to the generality of the foregoing power, for prescribing any matter which is to be prescribed by any provision of this Law.

(2) The Subordinate Legislation (Jersey) Law 1960,8 shall apply to Orders made under this Law.

ARTICLE 49

Criminal liability of officers; aiders and abettors, etc

(1) Where an offence under this Law committed by a body corporate is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any director, controller, manager, secretary or other similar officer of that body corporate or any person purporting to act in any such capacity, he, as well as the body corporate shall be guilty of the same offence and liable in the same manner to the penalty provided for that offence.

(2) Without prejudice to paragraph (1), any person who knowingly and wilfully aids, abets, counsels, causes, procures or commands the commission of an offence under this Law shall be liable to be dealt with, tried and punished as a principal offender.

(3) No proceedings for an offence under this Law shall be instituted except by or with the consent of the Attorney General.

(4) Notwithstanding any enactment or rule of law to the contrary, proceedings for an offence against this Law may be commenced within the period of a year and a day from the date on which evidence, sufficient in the opinion of the Attorney General to justify the proceedings comes to the knowledge of the Committee or, where the person against whom the proceedings may be taken was outside the Island at that date, within the period of a year and a day from the date on which he first lands in the Island thereafter, whichever of the said periods last expires.

(5) For the purposes of paragraph (4), a certificate under the hand of the President of the Committee as to the date on which such evidence came to the knowledge of the Committee shall be conclusive evidence of that fact.

ARTICLE 50

Repeals and saving

(1) The Depositors and Investors (Prevention of Fraud) (Jersey) Law 19679 (hereinafter referred to as “the 1967 Law”) is amended as set out in the Schedule to this Law.

(2) A reference in any enactment, instrument or document (whether express or implied, and in whatever phraseology) to a provision of the 1967 Law which is replaced by a corresponding provision of this Law is to be read, where necessary to retain for the enactment, instrument or document the same force and effect as it would have had but for the enactment of this Law, as, or as including, a reference to the corresponding provision by which it is replaced in this Law.

(3) Without prejudice to the generality of paragraph (2), in paragraph (1) of Article 1 of the Bankers Books Evidence (Jersey) Law 198610 in the definition of “bank” and “banker” –

(a) in sub-paragraph (a), for the words “the Depositors and Investors (Prevention of Fraud) (Jersey) Law 1967” there shall be substituted the words “the Banking Business (Jersey) Law 1991”; and

(b) in sub-paragraph (b), for the words “Article 3 of the Depositors and Investors (Prevention of Fraud) (Jersey) Law 1967” there shall be substituted the words “Article 7 of the Banking Business (Jersey) Law 1991”.

(4) The Loi (1931) sur les heures d’ouverture et de fermeture des Maisons de Banques11 is repealed.

(5) Notwithstanding paragraph (1), every person who immediately before the commencement of this Law is registered under the 1967 Law shall on the commencement of this Law be deemed to have been registered under Article 8 of this Law and the provisions of this Law shall apply to such registered persons accordingly and, without prejudice to the generality of the foregoing, any condition attached to the registration of that person under the 1967 Law shall be deemed to have been attached under Article 10 of this Law.

(6) Any Order or permission in force or effect immediately before the commencement of this Law made under the 1967 Law shall be deemed to have been made under the corresponding provision of this Law and shall, except to the extent that it is inconsistent with the provisions of this Law, continue in force and effect until amended, repealed or replaced under this Law.

ARTICLE 51

Short title and commencement

(1) This Law may be cited as the Banking Business (Jersey) Law 1991.

(2) This Law shall come into force on such day or days as the States may by act appoint and different days may be appointed for the coming into force of different provisions or for different purposes of the same provision.

E.J.M. POTTER

Greffier of the States.

SCHEDULE

(Article 50)

Amendments to the Depositors and Investors (Prevention of Fraud) (Jersey) Law 196712

Provision amended	Extent of amendment
Long title	delete the words “to provide for the registration of persons carrying on the business of accepting money on deposit” and “and generally to provide for purposes connected with the matters aforesaid”.
Article 1	delete all definitions except that for “securities”.
Articles 2 to 11	repealed.
Articles 12A to 15	repealed.
Article 16(1)	delete the words “Depositors and”.
Schedule	repealed.

1 Volume 1966–1967, page 613, Volume 1970–1972, page 181, Volume 1975–1978, pages 99 and 405, Volume 1982–1983, pages 9, 10, 11 and 14, Volume 1990–1991, page 106, and No. 7621.

2 Volume 1966–1967, page 613, Volume 1970–1972, page 181, Volume 1975–1978, pages 99 and 405, Volume 1982–1983, pages 9, 10, 11 and 14, Volume 1990–1991, page 106, and No. 7621.

3 Volume 1966–1967, page 608.

4 Tomes I–III, page 232, and Volume 1968–1969, page 103.

5 Tome VIII, page 526.

6 Tome VIII, page 381.

7 Tome VIII, page 381.

8 Tome VIII, page 849.

9 Volume 1966–1967, page 613, Volume 1970–1972, page 181, Volume 1975–1978, pages 99 and 405. Volume 1982–1983, pages 9, 10, 11 and 14, Volume 1990–1991, page 106, and No. 7621.

10 Volume 1986–1987, pages 51 and 52.

11 Tome VII, page 31.

12 Volume 1966–1967, pages 613, 614, 615, 616, 617, 618, 619, 622 and 623, Volume 1970–1972, page 181, Volume 1975–1978, pages 99 and 405, Volume 1982–1983, pages 9, 10, 11 and 14, Volume 1990–1991, page 106, and No. 7621.

Page Last Updated: 07 Jun 2015

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Banking Business (Jersey) Law 1991

PART III

Banking names and descriptions