Financial Services Act 1986
| Act of Parliament | |
 | |
| Long title | An Act to regulate the carrying on of investment business; to make related provision with respect to insurance business and business carried on by friendly societies; to make new provision with respect to the official listing of securities, offers of unlisted securities, takeover offers and insider dealing; to make provision as to the disclosure of information obtained under enactments relating to fair trading, banking, companies and insurance; to make provision for securing reciprocity with other countries in respect of facilities for the provision of financial services; and for connected purposes. |
|---|---|
| Citation | 1986 c. 60 |
| Territorial extent |
|
| Dates | |
| Royal assent | 7 November 1986 |
| Repealed | 1 December 2001 |
| Other legislation | |
| Repealed by | |
Status: Repealed | |
| Text of statute as originally enacted | |
The Financial Services Act 1986 (c. 60) was an Act of the Parliament of the United Kingdom passed by the government of Margaret Thatcher to regulate the financial services industry.[1] The Act used a mixture of governmental regulation and self-regulation, and created a Securities and Investments Board (SIB) presiding over various new self-regulating organisations (SROs). It was superseded by the Financial Services and Markets Act 2000.
Context
[edit]The Act may be thought of as an “emasculated Gower”. Professor Laurence Gower had been asked to produce a report on financial regulation, followed by a draft bill. He tended towards a tighter and more top-heavy regime. The Thatcher government became impatient with this process and pushed a second bill through in place of Gower with more emphasis on self-regulation but containing most of the regulatory content of the Gower bill.[2]
This relatively light approach to regulation followed a trend taking place in America under the Reagan administration.[3]
Derivative products
[edit]Section 63 of the Act abolished any oversight of the courts on derivative contracts, which might otherwise have been considered speculative and thus contrary to the Gaming Act 1845.[4] This exemption was not changed in the new Financial Services and Markets Act 2000.[5]
Repeal
[edit]The Act was repealed on 1 December 2001 by The Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001[6] and was superseded by the Financial Services and Markets Act 2000. Under this, the SIB and SROs were merged to form the Financial Services Authority (FSA), and self-regulation took a back seat.
See also
[edit]
- Gower Report
- Glass–Steagall Act of 1933
- Depository Institutions Deregulation and Monetary Control Act of 1980
- Garn–St. Germain Depository Institutions Act of 1982
- Financial Services and Markets Act 2000
- Financial Services Authority
Notes
[edit]- ^ Rider et al.
- ^ Rider et al, pp. 13-18.
- ^ For background see: Paul Krugman, 'Reagan Did It' (31 May 2009) The New York Times
- ^ Schwartz, R. J.; Smith, C. W. (1997). Derivatives Handbook: Risk Management and Control. Wiley. pp. p.183. ISBN 0471157651.
- ^ Section 412 of the 2000 Act.
- ^ "The Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001". Statutory Instrument 2001 No. 3649. Office of Public Sector Information. 9 November 2001. Retrieved 30 October 2009.
References
[edit]- Rider, B., Chaikin, D. and Abrams, C. (1987). Guide to the Financial Service Act 1986. CCH Editions.
