Jersey Bank Depositors Compensation Scheme: Draft Legislation

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A decision made on 10 August 2012

Decision Reference: MD-E-2012-0093

Decision Summary Title :

Lodging of a package of draft legislation relating to the

Jersey Bank Depositors Compensation Scheme

Date of Decision Summary:

August 2012

Decision Summary Author:

Finance Industry Development

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

n/a

Written Report

Title :

Lodging of a package of draft legislation relating to the

Jersey Bank Depositors Compensation Scheme

Date of Written Report:

August 2012

Written Report Author:

Finance Industry Development

Written Report :

Public or Exempt?

Public

Subject:

Lodging of a package of draft legislation relating to the Jersey Bank Depositors Compensation Scheme (”DCS”).

Decision(s):

The Minister approved the following package of draft legislation, signed the declarations as to human rights compatibility, and directed that the documents be lodged au Greffe for debate by the States at the earliest opportunity:

i) Banking Business (Depositors Compensation) (Amendment and Miscellaneous Provision) (Jersey)

Regulations 201- (“Amendment 1”)

ii) Banking (Depositors Compensation Supplementary Provisions) (Jersey) Regulations 201-

(“Amendment 2”)

iii) Banking Business (Amendment No. 8) (Jersey) Law 201- (“Amendment 3”)

iv) Bankruptcy (Désastre) (Amendment No.6) (Jersey) Law 201- (“Amendment 4”)

Reason(s) for Decision:

Amendments to the legislation relating to the DCS are required in the light of international developments. In particular:

(i) Amendment 1 will amend the Banking Business (Depositors Compensation) (Jersey) Regulations 2009 (the “DCS Regulations”) to introduce an annual administration levy on banks to provide for the recurring administrative costs of the DCS

(ii) Amendment 2 will replace the Triennial Regulations that make offences in relation to the DCS,

which expire in November 2012

(iii) Amendment 3 will broaden the enabling power under which the DCS Regulations were made so

that these can make offences in future without requiring further Triennial Regulations to be made

(iv) Amendment 4 will give the DCS priority in a bank insolvency so that it is paid before other

unsecured creditors reducing the prospects of the States paying shortfall funding.

The Deputy Chief Minister is making this decision under delegated authority as per MD-C-2012-0081.

Resource Implications:

There are no financial or manpower considerations for the States of Jersey.

Action required:

The documents to be lodged au Greffe for debate by the States at the earliest opportunity.

Signature:

Senator Ian Le Marquand

Position:

Deputy Chief Minister

Date Signed:

Date of Decision (If different from Date Signed):