Exiting The European Union PART 1 General provisions Citation, commencement and interpretation 1 1 These Regulations may be cited as the Deposit Guarantee Scheme and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018. 2 Parts 1 and 2 come into force on the day after the day on which these Regulations are made. 3 Parts 3 and 4 come into force on exit day. 4 In these Regulations “ the 2015 Regulations ” means the Deposit Guarantee Scheme Regulations 2015 . PART 2 Amendments of the Deposit Guarantee Scheme Regulations 2015: European Communities Act 1972 2 1 The 2015 Regulations are amended as follows. 2 In regulation 2 (interpretation), in paragraph (1)— a after the definition of “credit union” insert— “ deposit ” means— a a deposit within the meaning of point (3) of Article 2(1) of the deposit guarantee schemes directive (including a share treated as a deposit by virtue of Article 2(3) of the directive); or b a share in a credit union other than— i a deferred share within the meaning given by section 31A of the Credit Unions Act 1979; or ii a deferred share issued by a society registered under the Credit Unions (Northern Ireland) Order 1985 or a society registered under the Industrial and Provident Societies Act (Northern Ireland) 1969 as a credit union. ; b after the definition of “deposit guarantee schemes directive” insert— “ eligible deposit ” has the meaning given in section 70A(7) of the Banking Act 2009 . 3 In regulation 6 (time limit for determining that a compensation scheme member is unable to repay deposits), in paragraph (1), for the words from “make” to the end substitute— “ determine whether in its view the compensation scheme member appears unable for the time being, for reasons which are directly related to its financial circumstances, to repay the deposit and the compensation scheme member has no current prospect of being able to do so. ” . PART 3 Amendments of Primary Legislation: European Union (Withdrawal) Act 2018 Amendments of the Financial Services and Markets Act 2000 3 1 In the Financial Services and Markets Act 2000 , Schedule 17 (the ombudsman scheme) is amended as follows. 2 In Part 1, in paragraph 1— a omit the definition of “ADR Directive”; b in the definition of “ADR entity”, for the words from “any” to the end substitute “ a person whose name appears on a list maintained in accordance with regulation 10 of the Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015 ” . 3 In Part 2, in paragraph 2(2), for “quality requirements in Chapter II of the ADR Directive” substitute “ requirements in Schedule 3 to the Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015 ” . 4 In Part 3, in paragraph 14(3A), for “quality requirements in Chapter II of the ADR Directive” substitute “ requirements in Schedule 3 to the Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015 ” . Amendment of the Financial Services Act 2012 4 In the Financial Services Act 2012 , in section 82 (publication of reports of inquiries and investigations), in subsection (3)(a), for “, enforceable EU obligation” substitute “ (including any provision of retained direct EU legislation) ” . PART 4 Modification of the Deposit Guarantee Scheme Regulations 2015: European Union (Withdrawal) Act 2018 Amendments of the Deposit Guarantee Scheme Regulations 2015 5 1 The 2015 Regulations are further amended as follows. 2 In regulation 2, in paragraph (1)— a for the definition of “deposit” substitute— “ deposit ” means— a a deposit within the meaning of point (23A) of Article 2(1) of Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/2012; b a share in a building society, as defined in section 119 of the Building Societies Act 1986, other than a share of a capital nature that is own funds, as defined in point (118) of Article 4.1 of Regulation No. 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012; or c a share in a credit union other than— i a deferred share within the meaning given by section 31A of the Credit Unions Act 1979; or ii a deferred share issued by a society registered under the Credit Unions (Northern Ireland) Order 1985 or a society registered under the Industrial and Provident Societies Act (Northern Ireland) 1969 as a credit union; ; b omit the definition of “non-UK deposit guarantee scheme”. 3 In regulation 3 (meaning of “compensation scheme member”)— a omit paragraph (1)(a); b in paragraph (2)(d)(ii), omit “an incoming firm or”; c omit paragraph (3)(a). 4 Omit regulation 4 (designation of competent authority and designated authority). 5 In regulation 7A (transitional maximum compensation level), at the end insert— 5 The amount referred to in paragraph (3) must be reviewed periodically by the PRA and at least once every five years. 6 Having reviewed the amount referred to in paragraph (3), the PRA may adjust the amount, taking account of matters the PRA considers relevant, including in particular, developments in the banking sector and the economic and monetary situation in the United Kingdom. 7 The first review carried out in accordance with paragraph (5) must be completed no later than five years after regulation 5 of the Deposit Guarantee Scheme and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 comes into force (in accordance with paragraph 1(1) of Schedule 5 to the European Union (Withdrawal Agreement) Act 2020). 8 The PRA may adjust the amount referred to in paragraph (3) in accordance with inflation in the United Kingdom during the period since the most recent alteration of the amount referred to in paragraph (3). 9 Any adjustment under paragraph (8) must be carried out on the basis of changes in the consumer prices index calculated and published by the Office for National Statistics or, where the index is not published for any year during the period, any substituted index or figures published by that Office. 10 The PRA is not required to carry out a review under paragraph (5) in order to exercise its power under paragraph (8). 11 The PRA must not adjust the amount referred to in paragraph (3) in accordance with paragraph (6) or (8) without the prior written approval of the Treasury. . 6 For regulation 8 (determination by PRA whether contributions may be raised by the scheme manager) substitute— Determination by PRA whether contributions may be raised by the scheme manager 8 1 This regulation specifies conditions which must be met before the scheme manager may request a loan under section 223B of FSMA for the purposes of— a repaying depositors in accordance with the compensation scheme; or b contributing to the costs of the special resolution regime under section 214B of FSMA or section 61(2)(b) of the Banking Act 2009. 2 The conditions are— a the PRA has determined whether the scheme manager may raise contributions under the compensation scheme; and b the PRA has notified that determination in writing to the scheme manager and the Treasury. . 7 Omit regulation 10 (payment of compensation by the scheme manager on behalf of a non-UK scheme). 8 Omit regulation 11 (notification of covered deposits and available financial means of the compensation scheme). 9 Omit regulation 12 (notification of contents of co-operation agreements). 10 In regulation 18 (review), omit paragraph (2). Transitional arrangements for payment of compensation by the scheme manager on behalf of a non-UK deposit guarantee scheme 6 1 Paragraph (2) applies if— a the conditions specified in regulation 10(1)(a) and (b) of the 2015 Regulations are met in relation to a non-UK deposit guarantee scheme before regulation 5(7) (above) comes into force; but b the conditions specified in regulation 10(1)(c) of the 2015 Regulations are not met until after regulation 5(7) (above) comes into force. 2 The scheme manager may, with the written consent of the PRA and in accordance with the instructions of the non-UK deposit guarantee scheme, make a payment of compensation referred to in regulation 10 of the 2015 Regulations. 3 Anything done or omitted by the scheme manager in accordance with this regulation or in consequence of the application of paragraph 37 of Schedule 8 to the European Union (Withdrawal) Act 2018 in relation to a non-UK deposit guarantee scheme is to be treated for the purposes of section 222(1) of the Financial Services and Markets Act 2000 (statutory immunity) as done or omitted in the discharge, or purported discharge, of the scheme manager's functions. 4 The PRA may by rules make provision in connection with the payment of compensation by the scheme manager in accordance with paragraph (2). Mike Freer Paul Maynard Two of the Lords Commissioners of Her Majesty's Treasury