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SMALL BUSINESS, ENTERPRISE AND EMPLOYMENT ACT 2015

UK Public General Acts

Version 06/04/2017

2015 CHAPTER 26

Default Geographical Extent: E+W+S+N.I.


  • PART 1. Access to finance
    • Assignment of receivables
    • Business payment practices
    • Financial information about businesses
    • Exports
    • Presentment of cheques etc
    • Payment systems
  • PART 2. Regulatory reform
    • Streamlined company registration
    • Review of business appeals procedures
    • Report on investigations under financial regulators' complaints scheme
    • Business impact target
    • Secondary legislation: duty to review
    • Definitions of small and micro business
    • Home businesses
    • CMA recommendations
    • Liability of bodies concerned with accounting standards
  • PART 3. Public sector procurement
  • PART 4 (E+W). The Pubs Code Adjudicator and the Pubs Code
    • The Pubs Code Adjudicator (E+W)
    • Pubs Code (E+W)
    • Arbitration by Adjudicator (E+W)
    • Investigations by Adjudicator (E+W)
    • Advice and guidance by Adjudicator (E+W)
    • Adjudicator's reporting requirements (E+W)
    • Funding of Adjudicator (E+W)
    • Supervision of Adjudicator (E+W)
    • Supplementary (E+W)
  • PART 5. Childcare and schools
  • PART 6. Education evaluation
  • PART 7. Companies: Transparency
    • Register of people with significant control
    • Register of interests disclosed
    • Abolition of share warrants to bearer
    • Corporate directors (P)
    • Shadow directors
  • PART 8. Company filing requirements
    • Annual return reform
    • Additional information on the register
    • Information about dates of birth
    • Statements of capital etc
    • Registered office disputes
    • Director disputes
    • Accelerated strike-off
  • PART 9. Directors' disqualification etc
    • New grounds for disqualification
    • Determining unfitness
    • Director disqualification: other amendments
    • Compensation awards
    • Consequential amendments and corresponding provision for Northern Ireland
    • Bankruptcy: Scotland and Northern Ireland
  • PART 10. Insolvency
    • Office-holder actions
    • Removing requirements to seek sanction
    • Position of creditors
    • Administration
    • Small debts
    • Trustees in bankruptcy
    • Voluntary arrangements
    • Progress reports
    • Regulation of insolvency practitioners: amendments to existing regime
    • Power to establish single regulator of insolvency practitioners (E+W+S)
  • PART 11. Employment
    • Equal pay (P)
    • Whistleblowing
    • Employment tribunals
    • National minimum wage
    • Exclusivity in zero hours contracts
    • Public sector exit payments
    • Concessionary coal
  • PART 12. General
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  • Version 26/03/2015

Introductory Text

Small Business, Enterprise and Employment Act 2015

2015 CHAPTER 26

An Act to make provision about improved access to finance for businesses and individuals; to make provision about regulatory provisions relating to business and certain voluntary and community bodies; to make provision about the exercise of procurement functions by certain public authorities; to make provision for the creation of a Pubs Code and Adjudicator for the regulation of dealings by pub-owning businesses with their tied pub tenants; to make provision about the regulation of the provision of childcare; to make provision about information relating to the evaluation of education; to make provision about the regulation of companies; to make provision about company filing requirements; to make provision about the disqualification from appointments relating to companies; to make provision about insolvency; to make provision about the law relating to employment; and for connected purposes.

[26th March 2015]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

PART 1
Access to finance



Assignment of receivables


1 Power to invalidate certain restrictive terms of business contracts

(1) The appropriate authority may by regulations make provision for the purpose of securing that any non-assignment of receivables term of a relevant contract—

(a) has no effect;
(b) has no effect in relation to persons of a prescribed description;
(c) has effect in relation to persons of a prescribed description only for such purposes as may be prescribed.
(2) A “non-assignment of receivables term” of a contract is a term which prohibits or imposes a condition, or other restriction, on the assignment (or, in Scotland, assignation) by a party to the contract of the right to be paid any amount under the contract or any other contract between the parties.

(3) A contract is a relevant contract if—

(a) it is a contract for goods, services or intangible assets (including intellectual property) which is not an excluded financial services contract, and
(b) at least one of the parties has entered into it in connection with the carrying on of a business.
(4) An “excluded financial services contract” is a contract which—

(a) is for financial services (see section 2) or is a regulated agreement within the meaning of the Consumer Credit Act 1974 (see section 189 of that Act) ; and
(b) is of a prescribed description.
(5) “Prescribed” means prescribed by the regulations.

(6) The “appropriate authority” means—

(a) in relation to contracts to which the law of Scotland applies, the Scottish Ministers, and
(b) in relation to other contracts, the Secretary of State.
(7) The power of the Scottish Ministers to make regulations under this section includes power to make such provision as the Scottish Ministers consider appropriate in consequence of the regulations.

(8) The power conferred by subsection (7) includes power—

(a) to make transitional, transitory or saving provision;
(b) to amend, repeal, revoke or otherwise modify any provision made by or under an enactment (including an enactment contained in this Act and any enactment passed or made in the same Session as this Act).
(9) In subsection (8) “enactment” includes an Act of the Scottish Parliament.

(10) Regulations under this section—

(a) if made by the Scottish Ministers, are subject to the affirmative procedure;
(b) if made by the Secretary of State, are subject to affirmative resolution procedure.

2 Section 1(4)(a): meaning of “financial services”

(1) In section 1(4) (a) “financial services” means any service of a financial nature, including (but not limited to) —

(a) insurance-related services consisting of—
(i) direct life assurance;
(ii) direct insurance other than life assurance;
(iii) reinsurance and retrocession;
(iv) insurance intermediation, such as brokerage and agency;
(v) services auxiliary to insurance, such as consultancy, actuarial, risk assessment and claim settlement services;
(b) banking and other financial services consisting of—
(i) accepting deposits and other repayable funds;
(ii) lending (including consumer credit, mortgage credit, factoring and financing of commercial transactions) ;
(iii) financial leasing;
(iv) payment and money transmission services (including credit, charge and debit cards, travellers' cheques and bankers' drafts) ;
(v) providing guarantees or commitments;
(vi) financial trading (as defined in subsection (2) ) ;
(vii) participating in issues of any kind of securities (including underwriting and placement as an agent, whether publicly or privately) and providing services related to such issues;
(viii) money brokering;
(ix) asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial, depository and trust services;
(x) settlement and clearing services for financial assets (including securities, derivative products and other negotiable instruments) ;
(xi) providing or transferring financial information, and financial data processing or related software (but only by suppliers of other financial services) ;
(xii) providing advisory and other auxiliary financial services in respect of any activity listed in sub-paragraphs (i) to (xi) (including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy).
(2) In subsection (1) (b) (vi) “financial trading” means trading for own account or for account of customers, whether on an investment exchange, in an over-the-counter market or otherwise, in—

(a) money market instruments (including cheques, bills and certificates of deposit) ;
(b) foreign exchange;
(c) derivative products (including futures and options) ;
(d) exchange rate and interest rate instruments (including products such as swaps and forward rate agreements) ;
(e) transferable securities;
(f) other negotiable instruments and financial assets (including bullion).

Business payment practices


3 Companies: duty to publish report on payment practices and performance

(1) The Secretary of State may by regulations impose a requirement, on such descriptions of companies as may be prescribed, to publish, at such intervals and in such manner as may be prescribed, prescribed information about—

(a) the company's payment practices and policies relating to relevant contracts of a prescribed description, and
(b) the company's performance by reference to those practices and policies.
(2) For the purposes of this section— “company” has the meaning given by section 1(1) of the Companies Act 2006 (but see subsection (3) ) ; a contract is a “relevant contract” if— (a) it is a contract for goods, services or intangible assets (including intellectual property) , and (b) the parties to the contract have entered into it in connection with the carrying on of a business; “prescribed” means prescribed by the regulations.

(3) The regulations may not impose a requirement on a company in relation to any time during which—

(a) it qualifies as a micro-entity for the purposes of section 384A of the Companies Act 2006,
(b) the small companies regime under that Act applies to it (see section 381 of that Act) , or
(c) it qualifies as medium-sized for the purposes of section 465 or 466 of that Act.
(4) “The company's payment practices and policies” has such meaning as may be prescribed and the information which may be prescribed may, in particular, include information—

(a) about the standard payment terms of the company and whether these are part of any code of conduct or code of ethics of the company,
(b) about payment terms of the company which are not standard,
(c) about the processing and payment of invoices,
(d) by reference to such codes of conduct or standards as may be prescribed and as are applicable to companies generally or to companies of a prescribed description,
(e) about disputes relating to the payment of invoices, including any dispute resolution mechanism that the company uses,
(f) about payments owed or paid by the company due to late payment of invoices, whether in respect of interest or otherwise.
(5) The regulations may require that information published in accordance with the regulations must be approved or signed by such description of person as may be prescribed.

(6) The regulations may require such of the information required to be published as may be prescribed to be given, in such form as may be prescribed, to prescribed persons.

(7) The regulations may make provision for a prescribed breach by a prescribed description of person of a requirement imposed by the regulations to be an offence punishable on summary conviction—

(a) in England and Wales, by a fine;
(b) in Scotland or Northern Ireland, by a fine not exceeding level 5 on the standard scale.
(8) Before making regulations under this section the Secretary of State must consult such persons as the Secretary of State considers appropriate.

(9) Regulations under this section are subject to affirmative resolution procedure.

Financial information about businesses


4 Small and medium sized businesses: information to credit reference agencies

(1) The Treasury may make regulations that impose—

(a) a duty on designated banks to provide information about their small and medium sized business customers to designated credit reference agencies, and
(b) a duty on designated credit reference agencies to provide information about small and medium sized businesses to finance providers.
(2) The regulations must provide that the duty in subsection (1) (a) only applies where—

(a) a credit reference agency makes a request to a bank, and
(b) the business customer to whom the information relates has agreed to the information being provided to a credit reference agency.
(3) The regulations must provide that the duty in subsection (1) (b) only applies where—

(a) a finance provider makes a request to a credit reference agency, and
(b) the business to whom the information relates has agreed to the information being provided to the finance provider.
(4) The regulations may provide that the duty in subsection (1) (b) only applies where other conditions are met, such as the finance provider—

(a) complying with the credit reference agency's terms and conditions, and
(b) providing information on its small and medium sized business customers to the credit reference agency (subject to the agreement of those customers).
(5) The regulations must describe the information—

(a) to which the duty in subsection (1) (a) applies;
(b) to which the duty in subsection (1) (b) applies;
(c) which may be required as mentioned in subsection (4) (b).
(6) The regulations may make provision about—

(a) how a request for information must be made by a credit reference agency or finance provider;
(b) the time period within which information must be provided following a request;
(c) the form in which information must be provided;
(d) how a business may indicate agreement for the purposes of subsection (2) (b) , (3) (b) or (4) (b) (and for the purposes of subsection (2) (b) this may include imposing an obligation on a designated bank to include an appropriate term in its standard terms and conditions or to otherwise seek agreement).
(7) The regulations must make provision for the designation of banks and credit reference agencies by the Treasury, and the regulations may in particular provide for—

(a) conditions that must be met for a bank or credit reference agency to be designated;
(b) considerations that the Treasury may take into account before deciding whether to designate a bank or credit reference agency;
(c) the Treasury to consider the advice of another person before making a designation;
(d) the procedure for designating a bank or credit reference agency;
(e) how the list of designated banks and credit reference agencies must be published;
(f) the revocation of a designation.

5 Small and medium sized businesses: information to finance platforms

(1) Where—

(a) a small or medium sized business has applied to a designated bank for a loan or other credit facility, and
(b) the application has been unsuccessful,
the Treasury may by regulations impose a duty on the bank to provide specified information about the business to designated finance platforms.
(2) The regulations—

(a) must provide that the duty only applies where the business to which the information relates agrees to its information being provided to the designated finance platforms;
(b) may require a bank—
(i) to seek the agreement of a business for the purposes of paragraph (a) ;
(ii) to ask the business for any of the specified information that the bank does not already have;
(iii) to provide the information to the finance platforms within a specified time period.
(3) The regulations may make further provision about the duty in subsection (1) , which may in particular include provision about—

(a) the types of loans and credit facilities that trigger the duty,
(b) the circumstances in which an application is to be considered unsuccessful, and
(c) the finance platforms to which information must be provided.
(4) Where a finance platform has received information by virtue of subsection (1) , the Treasury may by regulations—

(a) impose a duty on the finance platform to provide specified information to all finance providers requesting access to the information, and
(b) impose a duty on the finance platform to provide specified information about a particular business to a finance provider where—
(i) the finance provider has requested information about the business, and
(ii) the business has agreed to its information being provided to the finance provider.
(5) Information specified for the purposes of subsection (4) (a) must be in such a form that no individual business, and no person associated with the business, can be identified.

(6) The regulations may provide that the duty in subsection (4) (a) or (b) does not apply unless—

(a) the finance provider or business agrees to the finance platform's terms and conditions;
(b) the finance provider complies with specified requirements about the use and disclosure of the information.
(7) The regulations may make further provision about the duties in subsection (4) (a) and (b) , including in particular provision—

(a) requiring the finance platform to provide the information within a specified time period;
(b) setting out how a request by a finance provider must be made to a finance platform;
(c) setting out how a business may indicate agreement for the purposes of subsection (4) (b) (ii) ;
(d) about the time period for which information must be kept by the finance platform;
(e) about the removal of information from the finance platform.
(8) The regulations may make provision—

(a) prohibiting finance platforms from charging fees to small and medium sized businesses, or
(b) permitting finance platforms to charge fees to small and medium sized businesses.
(9) The regulations must make provision for the designation of banks and finance platforms by the Treasury, and the regulations may in particular provide for—

(a) conditions that must be met for a bank or finance platform to be designated;
(b) considerations that the Treasury may take into account before deciding whether to designate a bank or finance platform;
(c) the Treasury to consider the advice of another person before making a designation;
(d) the procedure for designating a bank or finance platform;
(e) how the list of designated banks and finance platforms must be published;
(f) the revocation of a designation.
(10) In this section “specified” means specified or described in the regulations.

6 Sections 4 and 5: supplementary

(1) Regulations under sections 4 and 5 may make provision enabling the Financial Conduct Authority to take action for monitoring and enforcing compliance with the regulations.

(2) The regulations may apply, or make provision corresponding to, any of the provisions of the Financial Services and Markets Act 2000 or subordinate legislation made under that Act, with or without modification.

(3) Those provisions include in particular—

(a) provisions about investigations, including powers of entry and search and criminal offences;
(b) provisions for the grant of an injunction (or, in Scotland, an interdict) in relation to a contravention or anticipated contravention;
(c) provisions giving the Financial Conduct Authority powers to impose disciplinary measures (including financial penalties) or to give directions;
(d) provisions giving a Minister of the Crown (within the meaning of the Ministers of the Crown Act 1975) or the Financial Conduct Authority powers to make subordinate legislation;
(e) provisions for the Financial Conduct Authority to charge fees.
(4) Regulations under sections 4 and 5 may make provision that enables complaints about the activities of designated credit reference agencies or designated finance platforms to be dealt with under the scheme established by Part 16 of the Financial Services and Markets Act 2000 (financial ombudsman scheme) , and for that purpose the regulations may—

(a) apply, or make provision corresponding to, any of the provisions of that Part or rules made under that Part (with or without modifications) ;
(b) impose obligations on—
(i) the Financial Conduct Authority;
(ii) the scheme operator (within the meaning of that Part) ;
(iii) an ombudsman (within the meaning of that Part).
(5) Regulations under section 4 may impose a duty on designated credit reference agencies to provide information received by virtue of section 4(1) (a) or (4) (b) to the Bank of England, and may allow or require the Bank of England to share that information with persons or for purposes specified or described in the regulations; but the regulations must include provision protecting the confidentiality of information so provided.

(6) Regulations under section 4 may provide that a failure to comply with a duty imposed by virtue of section 4(1) may be actionable at the suit of a person who has suffered loss as a result of it (subject to the defences and other incidents applying to actions for breach of statutory duty).

(7) Regulations under section 4 may provide that the following provisions apply to designated credit reference agencies in the same way as they apply to credit reference agencies within the meaning of those provisions—

(a) sections 157 to 160 of the Consumer Credit Act 1974 (duties to disclose and correct information) and regulations made under those sections;
(b) section 7 of the Data Protection Act 1998 (right of access to personal data) and regulations made under that section;
(c) section 9 of the Data Protection Act 1998 (right of access to personal data where data controller is credit reference agency) and regulations made under that section.
(8) Regulations under section 4 may provide a small or medium sized business with the right to apply to a court for an order to rectify, block, erase or destroy data held about the business by a designated credit reference agency.

(9) Regulations under section 5 may impose a duty on designated finance platforms to provide statistical information to the Treasury.

(10) Regulations under section 4 or 5 are subject to affirmative resolution procedure.

7 Sections 4 to 6: interpretation

(1) For the purposes of sections 4 to 6, a business is a small or medium sized business if—

(a) it has an annual turnover of less than £25 million,
(b) it carries out commercial activities,
(c) it does not carry out regulated activities as its principal activity, and
(d) it is not owned or controlled by a public authority.
Regulations under those sections may make further provision for the purposes of determining which businesses they apply to (including provision about the calculation of turnover and the determination of control).
(2) In sections 4 to 6 and this section— “designated bank” means a bank that has been designated by the Treasury by virtue of section 4(7) or 5(9) ; “designated credit reference agency” means a credit reference agency that has been designated by the Treasury by virtue of section 4(7) ; “designated finance platform” means a finance platform that has been designated by the Treasury by virtue of section 5(9) ; “finance platform” means a person that provides a service for the exchange of information between finance providers and businesses that require finance; “finance provider” means a body corporate that— (a) lends money or provides credit in the course of a business, (b) arranges or facilitates the provision of debt or equity finance in the course of a business, or (c) provides, arranges or facilitates invoice discounting or factoring in the course of a business, and regulations under sections 4 and 5 may make further provision for the purpose of determining which finance providers they apply to; “public authority” has the same meaning as in the Freedom of Information Act 2000 (see section 3 of that Act) ; “regulated activities” has the same meaning as in the Financial Services and Markets Act 2000 (see section 22 of that Act) ; “subordinate legislation” has the same meaning as in the Interpretation Act 1978 (see section 21 of that Act).

(3) The Treasury may by regulations change the figure for the time being specified in subsection (1) (a).

(4) Before making regulations under subsection (3) the Treasury must consult such persons as they consider appropriate.

(5) Regulations under subsection (3) are subject to affirmative resolution procedure.

8 Disclosure of VAT registration information

(1) The Commissioners for Her Majesty's Revenue and Customs may disclose to a person (“P”) any of the information included in the VAT registration of another person (“V”) if the disclosure is for the purpose of enabling or assisting P to assess—

(a) V's creditworthiness,
(b) V's compliance with regulatory requirements relating to financial matters, or
(c) the risk of fraud by V.
(2) But subsection (1) does not authorise the Commissioners to disclose any information which is, in the Commissioners' view, financial information relating to any business carried on by V.

(3) If VAT registration information is disclosed to a person in accordance with subsection (1) , that person must not further disclose any of the information unless the Commissioners consent to the disclosure.

(4) If VAT registration information is disclosed to a person in accordance with subsection (3) or this subsection, that person must not further disclose any of the information unless the Commissioners consent to the disclosure.

(5) A person does not contravene subsection (3) or (4) by disclosing a financial assessment made wholly or partly in reliance on the VAT registration information, if the financial assessment itself does not include any VAT registration information.

(6) If VAT registration information is disclosed to a person in accordance with subsection (1) , (3) or (4) , that person must not use that information except for the purposes of making a financial assessment.

(7) A person does not contravene subsection (6) by using, for any purpose, a financial assessment made wholly or partly in reliance on the VAT registration information.

(8) The Commissioners for Her Majesty's Revenue and Customs may make arrangements with any person about disclosures of information to that person (the “recipient”) under subsection (1).

(9) The arrangements may (in particular) provide for—

(a) a fee to be payable by the recipient for the disclosure of information;
(b) conditions to apply to the recipient in relation to information disclosed (including conditions relating to the transfer, holding and processing of the information) ;
(c) financial penalties to be payable by the recipient for a failure to meet conditions which apply to the recipient under the arrangements.
(10) The Treasury may, by regulations, amend this section so that it authorises the Commissioners to disclose VAT registration information included in a person's VAT registration for additional purposes.

(11) In this section— “financial assessment” means an assessment of a kind mentioned in subsection (1) (a) , (b) or (c) ; “VAT registration” means registration under the Value Added Tax Act 1994; “VAT registration information” means information of the kind that the Commissioners are authorised to disclose under subsection (1) (as read with subsection (2) ).

(12) Regulations under this section are subject to affirmative resolution procedure.

9 Offences for the purposes of section 8

(1) A person commits an offence if the person discloses information in contravention of section 8(3) or (4).

(2) It is a defence for a person charged with an offence under subsection (1) to prove that the person reasonably believed that the disclosure of the information was lawful.

(3) A person commits an offence if the person uses information in contravention of section 8(6).

(4) It is a defence for a person charged with an offence under subsection (3) to prove that the person reasonably believed that the use of the information was lawful.

(5) Section 19(4) to (7) of the Commissioners for Revenue and Customs Act 2005 apply to an offence under this section as they apply to an offence under section 19 of that Act.

(6) This section is without prejudice to the pursuit of any remedy or the taking of any action in relation to a contravention of section 8(1) , (3) , (4) or (6) (whether or not this section applies to the contravention).

Exports