Tag: Lord Myners

The below Parliamentary question was asked by Lord Myners on 2016-07-20.

To ask Her Majesty’s Government what powers they have to review the financial capacity of SoftBank to support ARM Holdings, and in particular whether they can require a further injection of capital into ARM Holdings before any takeover occurs.

Baroness Neville-Rolfe

It is for the parties to the proposed transaction to consider their relative positions in compliance with the Takeover Code. The board of the target company must take independent advice on the offer, and evaluate its effects on the company’s interests, before giving the board’s opinion to shareholders.

The below Parliamentary question was asked by Lord Myners on 2016-03-21.

To ask Her Majesty’s Government why the budget made concessions available on capital gains to non-domiciled residents of the UK that are not available to standard UK tax payers.

Lord O’Neill of Gatley

The Summer Budget reforms to the domicile tax regime are the most significant since the rules were introduced. They are forecast to raise £1.2 billion this Parliament. The transitional provisions announced at Budget 2016 are necessary for a reform of this scale as they help to ensure that non-doms remain here and continue to pay UK tax on their income and gains within the new domicile tax regime. In April 2017, over 3,000 non-doms will still become subject to UK taxation on their worldwide income and gains.

The below Parliamentary question was asked by Lord Myners on 2016-04-12.

To ask Her Majesty’s Government what actions they have taken, if any, to ensure that the proposed cross-margining arrangements between Eurex and LCH do not subordinate counter-parties in the latter in the event of a failure of Eurex.

Lord O’Neill of Gatley

I refer the noble Lord to the investor relations section of the London Stock Exchange Group website, which contains information about the proposed merger, including some information on the combined group’s proposed structure. I also refer the noble Lord to my previous written answer HL7153.

Once formally notified of the proposed merger, the Bank of England and the Financial Conduct Authority (as supervisors of the London Stock Exchange Group’s UK-authorised subsidiaries) must assess the proposal from a regulatory standpoint.

In addition the proposed merger must be approved by competition authorities and is subject to a range of other assessments including those of overseas regulators and shareholders.

European Regulation No 648/2012 (EMIR) sets out detailed standards on the quality of collateral that a central counterparty (CCP) can accept, and includes a general requirement that the CCP can demonstrate to its supervisor that the form of collateral in question does not present unmanageable risk to the CCP. Furthermore, CCPs are permitted under EMIR to invest their collateral “only in cash or in highly liquid financial instruments with minimal market and credit risk.”

Any proposals for inter-CCP links would need to be assessed against relevant parts of EMIR by the Bank of England, as supervisor of LCH. EMIR requires that models used to set CCP margin requirements (and any changes to them) are validated by the CCP’s supervisor. EMIR also requires that a CCP wishing to extend its business to additional products or services must obtain the authorisation of its supervisor.

The below Parliamentary question was asked by Lord Myners on 2016-04-25.

To ask Her Majesty’s Government whether they have considered the risk to the solvency of the Pension Protection Fund of owners of companies with funding deficits selling the business for a nominal consideration or to an unsuitable purchaser.

Baroness Altmann

The independent Pensions Regulator, which oversees worked based pensions, has a statutory objective to reduce the risk of situations arising which may lead to compensation being payable from the Pension Protection Fund. It was given a significant range of anti-avoidance powers in the Pensions Act 2004, which can be deployed where it is appropriate and where the legal tests laid down in legislation are met.

The below Parliamentary question was asked by Lord Myners on 2016-05-11.

To ask Her Majesty’s Government whether they will consider giving the owners of Alternative Tier One instruments capital voting rights in banks which are approaching a contingent convertible conversion point.

Lord O’Neill of Gatley

The Government does not have plans to propose changes to Additional Tier 1 (AT1) instruments. These instruments have been designed without voting rights for investors because it is necessary for issuing banks to have the capital readily available in times of stress. Introduction of voting rights before a bank reaches a trigger point could undermine the ability to quickly convert these instruments and secure the capital necessary to prevent additional stress.

The below Parliamentary question was asked by Lord Myners on 2016-06-07.

To ask Her Majesty’s Government, further to the answer by Baroness Neville-Rolfe on 6 June (HL Deb, col 627), whether they have the necessary power to pursue pension contribution payments from companies where the parent company is based in the Cayman Islands, the British Virgin Islands, or Monaco.

Baroness Altmann

Each case will need to be considered on its own merits but the Pensions Regulator can use its anti-avoidance powers against targets that are based abroad. Section 303 of the Pensions Act 2004, governing the service of documents abroad, is intended to operate outside the UK jurisdiction The power to enforce any regulatory action against a non-UK company is likely to require the approval or cooperation of the relevant overseas authorities. By and large, these provisions should be enforceable in other EU and Commonwealth jurisdictions.

The Pensions Regulator has demonstrated that it is prepared to use its anti-avoidance powers against targets that are based abroad, as was shown in its handling of the cases involving Sea Containers and the Lehman Brothers group and a complex investigation into the Carrington Wire Defined Benefit Pension Scheme resulted in a £8.5m settlement with two Russian companies.

The below Parliamentary question was asked by Lord Myners on 2016-07-20.

To ask Her Majesty’s Government what assessment they have made of the proposed EU-wide recovery and resolution frameworks for failed central counterparties, and whether in their assessment there are any outstanding issues.

Lord O’Neill of Gatley

The government welcomes the European Commission’s commitment to publish a legislative proposal on a recovery and resolution framework for central counterparties (CCPs) and will assess the proposals once published. Given the global nature of CCPs, the recovery and resolution framework will need to take into account ongoing work by the Financial Stability Board, the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO).

The below Parliamentary question was asked by Lord Myners on 2016-03-21.

To ask Her Majesty’s Government whether they plan to increase or reduce total taxation as a percentage of GDP over the remainder of this Parliament.

Lord O’Neill of Gatley

The Office for Budget Responsibility (OBR) forecast that public sector current receipts (PSCR) will be 36.3% of GDP in 2015-16. As a share of GDP, PSCR is forecast to increase over the remainder of the Parliament. The OBR forecast PSCR to be 36.9% of GDP in 2016-17 and 2017-18, 37% of GDP in 2018-19, and reaching 37.5% of GDP in the final year of this Parliament. However, the Budget represents a net tax cut, worth £3bn over the scorecard period (2016-17 to 2020-21). The Budget backs business with a major overhaul of corporation tax reliefs, a lower corporation tax rate and a big reduction in small business rates.

The below Parliamentary question was asked by Lord Myners on 2016-04-12.

To ask Her Majesty’s Government what assessment they have made of whether, in the event of the takeover of the London Stock Exchange by Deutsche Börse, LCH and Eurex will have a regulator in common, and if so, whether that regulator will be the Financial Conduct Authority.

Lord O’Neill of Gatley

I refer the noble Lord to the investor relations section of the London Stock Exchange Group website, which contains information about the proposed merger, including some information on the combined group’s proposed structure. I also refer the noble Lord to my previous written answer HL7153.

Once formally notified of the proposed merger, the Bank of England and the Financial Conduct Authority (as supervisors of the London Stock Exchange Group’s UK-authorised subsidiaries) must assess the proposal from a regulatory standpoint.

In addition the proposed merger must be approved by competition authorities and is subject to a range of other assessments including those of overseas regulators and shareholders.

European Regulation No 648/2012 (EMIR) sets out detailed standards on the quality of collateral that a central counterparty (CCP) can accept, and includes a general requirement that the CCP can demonstrate to its supervisor that the form of collateral in question does not present unmanageable risk to the CCP. Furthermore, CCPs are permitted under EMIR to invest their collateral “only in cash or in highly liquid financial instruments with minimal market and credit risk.”

Any proposals for inter-CCP links would need to be assessed against relevant parts of EMIR by the Bank of England, as supervisor of LCH. EMIR requires that models used to set CCP margin requirements (and any changes to them) are validated by the CCP’s supervisor. EMIR also requires that a CCP wishing to extend its business to additional products or services must obtain the authorisation of its supervisor.

The below Parliamentary question was asked by Lord Myners on 2016-04-21.

To ask Her Majesty’s Government what plans they have, if any, to review the competition implications for central counterparty clearing of the proposed takeover of the London Stock Exchange by Deutsche Bourse.

Lord O’Neill of Gatley

I refer the noble Lord to my written answer of 26 April (HL7583, HL7584, HL7585, and HL7586).