The Financial Services Act 1986 (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 It was superseded by the Financial Services and Markets Act 2000.
Citation | 1986 c. 60 |
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Territorial extent | England and Wales, Scotland, Northern Ireland |
Dates | |
Royal assent | 7 November 1986 |
Repealed | 1 December 2001 |
Other legislation | |
Repealed by | The Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001 |
Status: Repealed | |
Text of statute as originally enacted |
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]
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]
The Act was repealed on 1 December 2001 by The Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001[6] and was superseded by the Financial Services and Markets Act 2000.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.