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Clause 32

Part of Banking Bill – in a Public Bill Committee at 11:00 am on 11th November 2008.

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Photo of Ian Pearson Ian Pearson Parliamentary Under-Secretary (Economic and Business), Department for Business, Enterprise & Regulatory Reform, Economic Secretary (Economic and Business), HM Treasury 11:00 am, 11th November 2008

No, I am afraid that I shall not do so. The hon. Member for South-West Hertfordshire asks a good question. If I explain the intention behind the wording, perhaps matters will become a little clearer.

Clause 32 provides that a property transfer instrument may transfer any property, rights and liabilities, and gives specific examples of the types of property that that may include. For instance, the instrument may transfer property acquired between the making of the instrument and the transfer date. It may also make provision for foreign property owned by the bank to be transferred. Having consulted those who prepared the Bill, I want to make it clear that the intention is to enable the transfer of the broadest possible range of property, rights and liabilities. As we explained elsewhere during the passage of the Bill, we have tried to future-proof it, which is a matter of course in legislation, so that we do not have to keep revising it.

The final example of what transferable property may be, as the hon. Gentleman noted, is rights and liabilities under the enactment, including legislation of the European Union. The hon. Gentleman seeks to probe us by removing that reference to Community law. I tried to  think of examples in which that might be appropriate. The first example that my officials came up with was milk quotas, which would not normally apply to the banking sector, but it is an example of a property right under European law. Carbon trading permits under the EU emissions trading scheme may well be an appropriate example. We do not know what instruments may be included in the future.

Why is there a problem with including EU legislation, given the possibility that something might be applicable and could be transferred if the special resolution regime was engaged? It seems a sensible and logical thing to do. It would be rather perverse to exclude something because it originated in EU legislation.