Bank charges case

In case you are not attending court in person to watch proceedings, you can see the BBC’s comments on the test case on bank charges at this page.   Some of the comments are tantalising.  Bank Law Blogger is not snoozing away the working day in the arms of Morpheus in the International Dispute Resolution Centre and so doesn’t understand some of the reporting but we have the full judgment to look forward to in due course.

Implementation of the Payment Services Directive

The Government have issued this consultation document showing how it proposes to implement the PSD.  It explains where the Government has some flexibility. It looks at the type of firms which will be subject to the requirements of the PSD; the conditions for waiving the application of the prudential authorisation requirements; the waiving of some of the conduct of business conditions for low-value payment instruments and electronic money; and the potential changes to payer liability for unauthorised use of payment instruments.

Added on 11 February 2008: Your questions on PSD – EC Questions & Answers

The EC has published a Q&A to which inerested parties are invited to submit questions.  some topics covered:

• the application of the payment institution
• grandfathering
• the debit value date in the case of bank holidays

Duty of bank in customer relationship

In a case involving the operation of a bank account, consideration of the complex facts of the particular case led the court to hold that the director of the claimant company account holder had given authority for the transfers (which happened to ease his personal financial difficulties).  The bank’s procedures for operating the account were correctly followed although the judgment does have some adverse comments about the bank’s training of its staff at the time.  The claimant’s claim was dismissed.

Empty property rates relief for companies in administration

The Government (the Department for Communities and Local Government) have announced a permanent exemption from empty property rates for companies in admininstration that redresses the anomaly shown up by the Trident case, that companies in liquidation, but not administration, have such an exemption.  It has also been decided that empty listed buildings like shops, offices and visitor attractions should continue to qualify for tax concessions because of the extra work required to bring them back into beneficial use. It is aimed to bring these new provisions into effect on 1 April 2008.

Silver linings and other cliches

In the period of Christmas quiet , it has been easier than usual to spot patterns of publishing in the trade rags. It’s a rare disaster that brings no good to lawyers, and the credit crunch is no exception. On the surface it is more surprising that it also benefits bankers. An article in “Hedge Fund Week” (23.11.07) by P Feinberg, “Turning misfortune into a fortune – easy if you know how” shows the credit collapse means big business for the distressed debt investors, especially those in the Asset-backed Securities market. And “ABL: Beneficiaries of the Credit Crunch?” by Swillman & Cropley in the Journal of International Banking and Financial Law, Issue 11 follows a similar theme for Asset Based Lending.

Statement of principles for banks and business

The BBA issued a summary of its statement of principles for banks and business on its nice new website on 8 January 2008.  So far as I know, there are no changes to the existing statement of principles which sets out how high street banks deal with their business customers who borrow from them.

Leased plant and machinery

HMRC has been spending a bit of time drafting laws to prevent people avoiding tax on “mismatched chains of leases” and on leases granted at a premium.  They have published a Technical Note with draft legislation to be included in the Finance Bill 2008, that affects:

• 1. Arrangements involving head leases and sub-leases which create tax losses where there are no commercial losses (mismatched chains of leases).
• 2. Arrangements involving the grant of a lease for a premium.

HMRC has invited comments to be received no later than 14 February 2008.

Buy-to-let funding – CCA exemption?

The Department for Business Enterprise and Regulatory Reform has issued a consultation paper on proposals to exempt buy-to-let lending from regulation under the Consumer Credit Act 1974, as amended by the Consumer Credit Act 2006. In April 2008, the financial limit of £25,000 for agreements regulated by the CCA will be abolished, extending the protection of the CCA.  As a result, all buy-to-let funding would become a regulated activity, changing the current position which was not the policy intention of the 2006 Act.  The consultation is on a proposed Legislative Reform Order to create an exemption for buy-to-let funding, which is likely to come into force on 1 October 2008.The consultation also proposes to clarify that creditors, under fixed-sum credit agreements, need to give debtors consecutive statements each covering a period of not more than one year and to do so within 30 days of the end of the period to which they relate.