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This Practice Note outlines the law concerning criminal recklessness. The subjective test for recklessness Certain statutory and common law offences allow the prosecution to prove mens rea through ‘recklessness’. Put simply, recklessness is where the accused takes an unjustified risk that results in unlawful harm or damage. The House of Lords in R v G reaffirmed the subjective approach to recklessness. Before R v G, two distinct tests were used, depending on the offence charged: Subjective recklessness from R v Cunningham: the prosecution had to establish that the accused personally foresaw the risk. Objective recklessness from R v Caldwell: the prosecution only needed to show that the risk would have been obvious to a reasonable person, without proving the accused themselves foresaw it. In R v G, the House of Lords concluded that the objective test could operate unfairly where a defendant did not foresee the
This Practice Note examines the remedy of rescission, explaining when and in what manner a contract can be unwound (at common law, in equity and under statute) and thereby terminated and brought to an end. It covers the consequences and effects of rescission, the principal grounds for setting aside an agreement (misrepresentation, mistake, undue influence, duress, non‑disclosure, fiduciary misdealing and bribery) and the main obstacles to claiming rescission—affirmation, the intervention of third‑party rights and the impossibility of restitution. For further guidance on rescission in the context of misrepresentation, see Practice Note: Misrepresentation—rescission as a remedy. There are many ways in which a contract may reach its end; see: Terminating contracts—how and when a contract ends—overview for a brief and accessible summary, with links to the related further practical guidance, including Practice Note: Termination and expiry of contracts. For a table
What is a res judicata? A res judicata is a determination by a court or tribunal with jurisdiction over the cause of action and the parties, which finally disposes of the issues decided so they cannot be litigated again by those bound, save on appeal. Final judgments entered by default or by consent fall within this concept, whereas rulings on purely procedural points and any decision lacking finality do not. The doctrine’s aim is to bring litigation to an end and shield parties from being harassed by the same dispute twice. in personam—binds the parties and their privies in rem—binds all persons, privy or otherwise (ie a judgment binding the whole world) A party may rely on res judicata: as an estoppel to defeat an opponent’s claim or defence; and/or as the basis of their own claim or
The offence of causing grievous bodily harm with intent Wounding or causing grievous bodily harm (GBH) with intent can be tried solely in the Crown Court on indictment. Elements of the offence Under the Offences against the Person Act 1861 (OATPA 1861), the prosecution must establish that the defendant unlawfully and maliciously: wounded with the intention of causing GBH, or caused GBH with that intention, or wounded intending to resist or prevent the lawful arrest or detention of any person, or caused GBH intending to resist or prevent the lawful arrest or detention of any person ‘Unlawfully’ and ‘maliciously’ Unlawfully The wounding or causing of GBH must be unlawful. Such conduct may be lawful if used: in self-defence in defence of another in defence of property for the prevention of crime where the victim gave express or implied consent For further information on these defences, see below:
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FSCS FSCS was set up under Part XV of the Financial Services and Markets Act 2000 ( FSMA 2000). It is the statutory compensation scheme of last resort for customers of firms authorised by the Financial Conduct Authority ( FCA) or the Prudential Regulation Authority ( PRA). Financed by levies on authorised firms, the FSCS is independent of the FCA, the PRA and the government, and it does not charge claimants to use its service. Rule-making and oversight of the FSCS are undertaken jointly by the PRA and the FCA, and the three bodies have entered into memoranda of understanding ( Mo Us) that set out how they will co-operate in performing their functions in relation to the compensation scheme. The Mo Us can be read here ( PRA/ FSCS) and here ( FCA/ FSCS)......
The Financial Services Act 2012 ( FSA 2012) obtained Royal Assent on 19 December 2012 and came into force on 1 April 2013. It abolished the Financial Services Authority ( FSA), installing two successor regulators—the Financial Conduct Authority ( FCA) and the Prudential Regulation Authority ( PRA)—and also formed a new Financial Policy Committee ( FPC) within the Bank of England ( Bo E). In brief, this Practice Note summarises the reforms to the UK financial services regulatory framework introduced by the Act. FSA 2012 was preceded by a succession of public consultations. A draft Bill appeared in July 2011 and was examined by a Joint Committee of both Houses, which issued its report on the draft Bill on 19 December 2011. The Financial Services Bill was then presented to Parliament in January 2012. Further details on the Bill’s progress can be found on the...
ARCHIVED: This Practice Note is archived and is no longer maintained. It summarises the principal changes to UK banking reform brought in by the Financial Services ( Banking Reform) Act 2013 ( FS( BR) A 2013, the Banking Reform Act). The legislation delivered major reforms to UK financial services regulation, granting HM Treasury and the Prudential Regulation Authority ( PRA) the powers required to put into effect recommendations by Sir John Vickers and the Independent Commission on Banking ( ICB) on ring-fencing for the banking sector, and also introduced: a criminal offence of reckless misconduct in running a bank a payment systems regulator ( PSR) the senior managers and certification regime ( SM& CR) a bail-in stabilisation option within the special resolution regime ( SRR) a cap on the cost of payday...
Awards by the FOS If a complaint made to the Financial Ombudsman Service ( FOS) is upheld, the FOS can require a respondent firm (the respondent) to pay compensation, costs and/or interest to the complainant, and/or can instruct the respondent to take any other steps the FOS deems appropriate in the circumstances. The applicable rules appear in DISP 3.7 of the FCA Handbook and derive directly from the relevant sections 229 and 230 of the Financial Services and Markets Act 2000......
Part XXIV of the Financial Services and Markets Act 2000 ( FSMA 2000) Part XXIV enables the regulators to take part in insolvency-related proceedings against firms and individuals. These powers extend to authorised firms and recognised investment exchanges, and also to those carrying on regulated activities in breach of the general prohibition ( FSMA 2000, ss 19–20). Each provision in Pt XXIV defines when rights accrue, and in some cases more than one regulator benefits. Seeking insolvency orders is a key regulatory step, particularly where unauthorised business is being conducted. Such proceedings may target insolvent firms and individuals, and those that are not technically insolvent but for which it is just and equitable that the business should stop. The FSMA 2000 provisions should be read with the UK bank recovery and resolution regime, including the special resolution regime under the Banking Act 2009 ( BA...
Background to client order handling requirements This Practice Note sets out how firms authorised by the Financial Conduct Authority ( FCA) must handle and administer client orders. For targeted guidance on best execution, see Practice Note: FCA best execution rules. The FCA’s client order handling obligations are located in chapter 11.3 of the Conduct of Business Sourcebook ( COBS 11.3) and give effect to selected provisions of the recast Markets in Financial Instruments Directive ( Directive 2014/65/ EU) ( Mi FID II Directive) and the Markets in Financial Instruments Regulation ( Regulation ( EU) 600/2014) ( Mi FIR), taken together as the Mi FID II framework, as further supplemented by the now assimilated Commission Delegated Regulation ( EU) 2017/565 (the UK Mi FID Org Regulation) (notably Articles 67–69). The Mi FID II Directive and Mi FIR entered into force on 2 July 2014....
ARCHIVED: This archived Practice Note sets out background on the Retail Distribution Review ( RDR), explaining what the review covered and its impact on personal pension schemes. It is no longer maintained. For details on measures concerning costs and charges, see Overview: Costs and charges—overview. Application of the RDR The Retail Distribution Review ( RDR) brought substantial reforms to the retail investment market and applies to regulated firms operating in that sector. This Practice Note will interest those advising such firms and anyone seeking to understand why the market has shifted. It: offers a general summary of the RDR examines in more depth certain specific issues for contract-based pension schemes Background to the RDR The RDR commenced in June 2006 as a comprehensive review of practices within the retail investment market and continued for six years, ending in a suite of regulatory changes. The reforms...
ARCHIVED: This Practice Note is archived and is not being actively updated at present. For further material on FCA investigations, please refer to relevant Practice Notes: FCA enforcement essentials—investigations; FCA and PRA search and seizure powers and dawn raids; and Offences during an FCA investigation. The Financial Conduct Authority ( FCA) carries a broad remit, encompassing the power to secure adherence to its rules and competition law so as to achieve its strategic and operational aims. For further detail, see Practice Notes: FCA—corporate governance and Financial Conduct Authority—functions. The FCA can deploy an array of powers for this purpose, including regulatory, disciplinary, civil and criminal enforcement tools. For additional guidance, see Practice Note: FCA enforcement essentials—investigations— The FCA’s Toolkit. This Practice Note offers a primer on the FCA’s criminal enforcement investigatory powers. For comprehensive guidance, consult the FCA and PRA...
This Practice Note covers: the FCA’s approach to settling enforcement action under its Enforcement Guide the advantages of early resolution for the FCA, firms and individuals the settlement decision process in chapter 5 of the Decision Procedure and Penalties Manual ( DEPP 5) the Settlement Discount Scheme under DEPP 6.7 the role of the FCA’s Settlement Decision Makers the status of settlements and issues relating to publicity how settlement works in practice the Settlement Discount Scheme that existed before 2017, which remains relevant where breaches occurred before March 2017 Settlement of FCA enforcement cases—overview A large proportion of the FCA’s enforcement cases conclude by settlement. This is not comparable to an out-of-court commercial compromise, where two parties negotiate and strike a mutually acceptable deal. Instead, an FCA settlement is a regulatory...
This Practice Note considers the implications of the Financial Conduct Authority’s ( FCA) Consumer Duty for payments and electronic money (or e-money) firms For the purposes of this Practice Note, a payments firm is used as a broad term for a ‘payment service provider’ ( PSP) under the Payment Services Regulations 2017, SI 2017/752 ( PSRs 2017). Authorised payment institutions Small payment institutions Registered account information service providers References to an e-money firm mean entities within the Electronic Money Regulations 2011, SI 2011/99 ( EMRs 2011). Authorised electronic money institutions Small electronic money institutions In broad terms, the Consumer Duty (the Duty) captures firms undertaking regulated activities in the UK that fall within the FCA’s scope. Some payment and e-money firms will deal directly with retail customers, while others participate indirectly through a distribution chain that reaches a retail end user. The Duty...
Scope of this Practice Note This Practice Note outlines the authority a firm may receive to handle a client’s assets, with or without transferring title to those assets. It focuses on the Financial Conduct Authority’s ( FCA) requirements in the Client Assets Sourcebook ( CASS), specifically chapters 3 ( Collateral) and 8 ( Mandates). Where a client: authorises a firm, via a mandate, to act in relation to their assets without passing ownership provides a firm with an asset as security to secure an obligation owed to the firm, i.e. supplies collateral the firm is not subject to the client money rules or the custody rules. The applicable provisions in each scenario are uncomplicated, centring on accurate records and exercising the proper rights over the assets. Impact of Brexit on CASS and the FCA’s powers and...
Background to best execution requirements This Practice Note sets out the Financial Conduct Authority’s ( FCA) rules governing the manner in which client orders must be executed, commonly known as the best execution rules. Originating under the Markets in Financial Instruments Directive ( Directive 2004/39/ EC) ( Mi FID), these obligations form part of a common EU-wide framework for investor protection intended to support overall market efficiency more broadly and deliver the most favourable execution outcomes for individual investors in particular. Mi FID has since been superseded by the recast Markets in Financial Instruments Directive ( Directive 2014/65/ EU) (the Mi FID II Directive) and the Markets in Financial Instruments Regulation ( Regulation ( EU) 600/2014) ( Mi FIR), together comprising the Mi FID II framework. Both the Mi FID II Directive and Mi FIR entered into force on 2 July 2014....
The European Central Bank ( ECB) sits at the heart of the Eurosystem and the European System of Central Banks ( ESCB). It replaced the European Monetary Institute on 1 June 1998 and, from 1 January 1999, took full charge of monetary policy decision-making for the euro zone. In 2014, it also took on comprehensive supervisory duties for banks in Member States participating in the Single Supervisory Mechanism. The ECB works alongside the European Supervisory authorities, in particular the European Banking Authority ( EBA). The EBA’s principal role is to help develop the European Single Rulebook in banking, designed to deliver a single set of harmonised prudential rules for financial institutions across the EU. Background to the ECB The ECB was founded under Article 8 of the Treaty on the Functioning of the European Union as a specialised, independent organisation for conducting monetary policy....
BREXIT: From 31 January 2020, the UK ceased to be an EU Member State and moved into an implementation phase, during which, for many matters, the EU continues to treat it as if it were a Member State across a range of areas. In its capacity as a third country, the UK is excluded from the EU’s political institutions, agencies, offices, bodies and governance frameworks (save to the limited extent agreed), yet it must keep to its obligations under EU law (covering EU treaties, legislation, principles and international agreements) and remain subject to the ongoing jurisdiction of the Court of Justice of the European Union in line with the transitional regime in Part 4 of the Withdrawal Agreement. For further reading, see: Brexit—introduction to the Withdrawal Agreement. This affects this Practice Note. For guidance, see Practice Note: Brexit—impact on finance transactions [ Archived]— Brexit planning and...
BREXIT: From 31 January 2020, the UK ceased to be a Member State of the EU, yet moved into an implementation phase in which, for numerous purposes, the EU continues to regard it as a Member State. As a third country, the UK is excluded from participation in the EU’s political institutions, agencies, offices, bodies and governance frameworks (save to the limited extent agreed), yet it must still comply with obligations under EU law (covering EU treaties, legislation, principles and international agreements) and accept the ongoing jurisdiction of the Court of Justice of the European Union, in accordance with the transitional provisions in Part 4 of the Withdrawal Agreement. For further reading and context, see: Brexit—introduction to the Withdrawal Agreement. This development affects this Practice Note. For related guidance, see Practice Note: Brexit—impact on finance transactions [ Archived]— Brexit planning and...
The Bank Recovery and Resolution Directive 2014/59/ EU ( EU BRRD) The Bank Recovery and Resolution Directive 2014/59/ EU ( EU BRRD) provides the EU-wide architecture for the recovery and orderly resolution of credit institutions and investment firms, creating a common resolution regime that empowers authorities to address failing entities and fosters dialogue and co-operation between home and host authorities. This Practice Note reviews a number of technical standards and guidelines issued by the European Banking Authority ( EBA), under mandates in the EU BRRD as amended by Directive 2019/879 ( EU BRRD II). A package of legislation aimed at reducing risks in the EU banking sector, the ‘banking package’, was published in the Official Journal of the EU on 7 June 2019. It included revised bank recovery and resolution rules set out in EU BRRD II, which amended the EU BRRD. EU BRRD II...
Why have ESMA published Q& As on EMIR? The European Securities and Markets Authority ( ESMA) issued a Q& A to foster consistent supervisory approaches and practices in applying the European Markets and Infrastructure Regulation ( EMIR). The document answers enquiries on the practical implications, encouraging both common supervisory approaches and practices in the application of EMIR......
What does EIOPA do? The European Insurance and Occupational Pensions Authority ( EIOPA) is one of the three European Supervisory Authorities ( ESAs), set up to reinforce the EU supervisory framework and to curb the risk and harm of any future financial crisis. Operating as an independent advisory body, it counsels the European Parliament, the Council of the European Union (the Council) and the European Commission (the Commission). Serving as the EU’s micro‑prudential supervisor for insurance and occupational pensions, it was established by Regulation ( EU) No 1094/2010 (the EIOPA Regulation), replacing the Committee of European Insurance and Occupational Pensions Supervisors ( CEIOPS) in January 2011. EIOPA is based in Frankfurt, Germany. EIOPA’s main goals are: safeguarding consumers and restoring confidence in the financial system ensuring a high, effective and consistent level of regulation and supervision, reflecting the varied interests of all EU Member...
ARCHIVED : This Practice Note has been archived and is no longer kept up to date; please see Practice Note: Money Laundering Regulations 2017 ( MLRs)— FCA supervision of cryptoasset firms, Annex 1 financial institutions, MSB/ TCSP activities. It explores the risks posed by cryptoassets from the angles of financial crime, money laundering and terrorist financing. It assesses how and why cryptoassets can be vulnerable to, and enable, criminality, and how regulators have addressed these perceived risks. It also reviews criminal matters involving cryptoassets, notably Bitcoin. What are cryptoassets? A key obstacle to grasping non‑traditional currencies and assets is the inconsistent terminology. Regulators, tax authorities and commentators variously speak of digital currencies, virtual currencies, cryptocurrencies, cryptoassets and crypto tokens; and it is often uncertain whether these labels are being used as synonyms or with distinct meanings in mind. For definitions, see Practice Note Web 3.0, digital assets and...
This Practice Note This Practice Note sets out an overview of what constitutes Mi FID business as that term appears in the Financial Conduct Authority ( FCA) Glossary, as defined there, and includes a flowchart to navigate the particular components involved in deciding whether the UK provisions derived from the Markets in Financial Instruments Directive ( Directive 2014/65/ EU) ( Mi FID II) apply within the UK. It also flags the exemptions that could allow firms to fall outside Mi FID II’s scope. Firms that are within the reach of the UK provisions implementing Mi FID II must be authorised under Part 4A of the Financial Services and Markets Act 2000 ( FSMA 2000) and observe a range of organisational, conduct of business and other requirements. The Note also sketches the regime that governs UK data reporting services. Although the UK has now left the EU, the FCA...
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When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...
This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...
Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...
I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...
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