Jersey Financial Services Commission: Codes of Practice: Civil Financial Penalties Regime: Law drafting instructions

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A decision made 21 February 2014:

Decision Reference: MD-C-2013-0143

Decision Summary Title :

Law drafting instructions to implement a civil financial penalties regime

Date of Decision Summary:

19 February 2014

Decision Summary Author:

Director,

Finance Industry Development

Decision Summary:

Public or Exempt?

(State clauses from Code of Practice booklet)

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title :

Law drafting instructions

Date of Written Report:

4 February 2014

Written Report Author:

Director,

Finance Industry Development

Written Report :

Public or Exempt?

(State clauses from Code of Practice booklet)

Exempt

3.2.1(a)(xiv)

Subject:

Jersey Financial Services Commission (“JFSC”): law drafting instructions to implement a civil financial penalties regime.

Decision(s):

The Chief Minister agreed to instruct the Law Draftsman to prepare legislation to provide the Financial Services Commission with the power to impose civil financial penalties for breaches of the Codes of Practice issued by the Commission under the Regulatory Laws.

Reason(s) for Decision:

The attached law drafting instructions request the Law Draftsman to commence the preparation of legislation that would provide the JFSC with the power to impose civil financial penalties for breaches of the Codes of Practice issued by the JFSC under the regulatory laws.

REASONS FOR THE LEGISLATION?

There are a number of reasons to grant the JFSC the statutory power to impose civil financial penalties for breaches of the Codes of Practice. Specifically, such a power would:

act as a further deterrent to those who persistently or seriously breach the Codes of Practice;
encourage prompt and consistent remediation of any breaches of the Codes of Practice;
provide the JFSC with more flexibility to deal with non-compliant behaviour;
provide some mitigation against compliant regulated businesses subsidising, through annual licence fees, the cost of regulatory action taken against those who are not; and
be in line internationally with other regulators.

With regard to the latter point, enhancing the JFSC’s range of sanctions would match that of comparable regulatory bodies such as the United Kingdom’s Financial Conduct Authority, the Guernsey Financial Services Commission and, local bodies such as the Gambling Commission.

As with all policy development there may be particular issues that will be developed and necessitate some alterations from the initial drafting instructions.

Resource Implications:

There are no financial or manpower costs for the States.

The drafting resource required to implement the law drafting instructions will utilise drafting time paid for directly by the JFSC.

Action required:

The Chief Minister’s officers to pass the law drafting instructions to the Law Draftsman for action.

Signature:

Senator I.J. Gorst

Position:

Chief Minister of Jersey

Date Signed:

Date of Decision (If different from Date Signed):