Chapter 3: Accountability of regulators Bank of England regulatory powers Section 49: Bank of England: rule-making powers
This section amends FSMA 2000 to introduce requirements relating to the review of rules made by the Bank in relation to CCPs and CSDs. New section 300I introduces a requirement for the Bank to keep generally under review any rules made by the Bank under FSMA 2000. Subsection (2) exempts rules made for the purpose of complying with a recommendation from the Financial Policy Committee.
	New section 300J requires the Bank to prepare and publish a statement of policy on how they will carry out their obligations under new section 300I. Subsection (5) requires publication to be in a way appearing to the Bank to be best designed to bring it to the attention of the public.
	Subsection (2) requires the statements of policy to include information on how stakeholders can make representations to the regulators on the review of rules, and the arrangements to ensure those representations are considered.
	New section 300K provides HM Treasury with the power to direct the Bank to review specified rules when this is in the public interest.
	Subsection 300K(1)(a) sets out that the rules must have been in place for at least 12 months. Subsection (1)(b) sets out that HM Treasury must consider it to be in the public interest that the rules are reviewed. Subsection (1)(c) clarifies that HM Treasury can only direct so if, in the opinion of HM Treasury, the Bank is not already carrying out, or planning to carry out, an effective review of the rules in question.
	Subsection (2) clarifies that the scope of the power is those rules which fall under the Bank’s general duty to review rules in new section 300I.
	Subsection (3) requires HM Treasury to consult the Bank before giving a direction under the power.
	Subsection (4) requires HM Treasury to consider the effect of any direction under the power on the exercise of the Bank’s other functions. Subsections (5) and (6) clarify various matters that may be included in a direction issued under this section. Subsection (7) requires HM Treasury to lay any direction under the power in Parliament and publish it. Subsection (8) provides a public interest exemption to subsection (6).
	Subsection (9) allows for HM Treasury directions under the power to be varied or revoked by further directions.
	New section 300L requires reports to be made by the Bank on reviews under new section 300K. Subsection (2) defines the matters that must be contained in the Bank’s report.
	Subsection (3) requires HM Treasury to lay the report before Parliament and publish it. Subsection (4) provides a public interest exemption to subsection (3).
	The section also inserts a new section 300M into FSMA 2000. Subsection (1) of new section 300M creates a power for HM Treasury to require the Bank to use its rule-making power under FSMA 2000 to make rules in relation to a specified activity or description of person.
	Subsection (2)(a) of new section 300M enables HM Treasury to list elements that the Bank must include within the rules. Subsection (2)(b) enables HM Treasury to set a time limit within which the Bank must make the rules necessary to fulfil the requirement set by HM Treasury.
	Subsection (3) limits the power to the matters covered by subsection (2)(a), i.e. the requirement that the Bank make rules covering specified matters. Subsection (3)(a) states that the power cannot be used to require the Bank to structure their rules in a particular way or to include certain content. And subsection (3)(b) states that the power cannot be used to achieve a particular outcome.