§ EAA 2006 s. 61(untitled)

1 After Part 4 of the 2000 Act (control of donations to registered parties and their members) insert— Part 4A Regulation of loans and related transactions Regulated transactions 71F 1 In this Part, a reference to a regulated transaction must be construed in accordance with this section. 2 An agreement between a registered party and another person by which the other person makes a loan of money to the party is a regulated transaction. 3 An agreement between a registered party and another person by which the other person provides a credit facility to the party is a regulated transaction. 4 Where— a a registered party and another person (A) enter into a regulated transaction of a description mentioned in subsection (2) or (3) or a transaction under which any property, services or facilities are provided for the use or benefit of the party (including the services of any person), and b A also enters into an arrangement whereby another person (B) gives any form of security (whether real or personal) for a sum owed to A by the party under the transaction mentioned in paragraph (a), the arrangement is a regulated transaction. 5 An agreement or arrangement is also a regulated transaction if— a the terms of the agreement or arrangement as first entered into do not constitute a regulated transaction by virtue of subsection (2), (3) or (4), but b the terms are subsequently varied in such a way that the agreement or arrangement becomes a regulated transaction. 6 References in subsections (2) and (3) to a registered party include references to an officer, member, trustee or agent of the party if he makes the agreement as such. 7 References in subsection (4) to a registered party include references to an officer, member, trustee or agent of the party if the property, services or facilities are provided to him, or the sum is owed by him, as such. 8 Except so far as the contrary intention appears, references to a registered party in the context of— a the making of a loan to a registered party, b the provision of a credit facility to a registered party, or c a sum being owed by a registered party, must, in the case of a party with accounting units, be construed as references to the central organisation of the party or any of its accounting units. 9 A reference to a connected transaction is a reference to the transaction mentioned in subsection (4)(b). 10 In this section a reference to anything being done by or in relation to a party or a person includes a reference to its being done directly or indirectly through a third person. 11 A credit facility is an agreement whereby a registered party is enabled to receive from time to time from another party to the agreement a loan of money not exceeding such amount (taking account of any repayments made by the registered party) as is specified in or determined in accordance with the agreement. 12 An agreement or arrangement is not a regulated transaction— a to the extent that, in accordance with any enactment, a payment made in pursuance of the agreement or arrangement falls to be included in a return as to election expenses in respect of a candidate or candidates at a particular election, or b if its value is not more than £200. 13 The Secretary of State may, by order, specify circumstances or any description of circumstances in which an agreement or arrangement falling within any of subsections (2) to (5) is not a regulated transaction. Valuation of regulated transaction 71G 1 The value of a regulated transaction which is a loan is the value of the total amount to be lent under the loan agreement. 2 The value of a regulated transaction which is a credit facility is the maximum amount which may be borrowed under the agreement for the facility. 3 The value of a regulated transaction which is an arrangement by which any form of security is given is the contingent liability under the security provided. 4 For the purposes of subsections (1) and (2), no account is to be taken of the effect of any provision contained in a loan agreement or an agreement for a credit facility at the time it is entered into which enables outstanding interest to be added to any sum for the time being owed in respect of the loan or credit facility, whether or not any such interest has been so added. Authorised participants 71H 1 A registered party must not— a be a party to a regulated transaction to which any of the other parties is not an authorised participant; b derive a benefit in consequence of a connected transaction if any of the parties to that transaction is not an authorised participant. 2 This section does not apply to a regulated transaction if it was entered into before the commencement of section 61 of the Electoral Administration Act 2006. 3 In this Part, an authorised participant is a person who is a permissible donor within the meaning of section 54(2). 4 The Secretary of State may, by order, specify circumstances or any description of circumstances in which a person who is not a permissible donor is to be treated as an authorised participant. Regulated transaction involving unauthorised participant 71I 1 This section applies if a registered party is a party to a regulated transaction in which another participant is not an authorised participant. 2 The transaction is void. 3 Despite subsection (2)— a any money received by the registered party by virtue of the transaction must be repaid by the treasurer of the party to the person from whom it was received, along with interest at such rate as is determined in accordance with an order made by the Secretary of State; b that person is entitled to recover the money, along with such interest. 4 If— a the money is not (for whatever reason) repaid as mentioned in subsection (3)(a), or b the person entitled to recover the money refuses or fails to do so, the Commission may apply to the court to make such order as it thinks fit to restore (so far as is possible) the parties to the transaction to the position they would have been in if the transaction had not been entered into. 5 An order under subsection (4) may in particular— a where the transaction is a loan or credit facility, require that any amount owed by the registered party be repaid (and that no further sums be advanced under it); b where any form of security is given for a sum owed under the transaction, require that security to be discharged. 6 In the case of a regulated transaction where a party other than a registered party— a at the time the registered party enters into the transaction, is an authorised participant, but b subsequently, for whatever reason, ceases to be an authorised participant, the transaction is void and subsections (3) to (5) apply with effect from the time when the other party ceased to be an authorised participant. 7 This section does not apply to a regulated transaction if it was entered into before the commencement of section 61 of the Electoral Administration Act 2006. Guarantees and securities: unauthorised participants 71J 1 This section applies if— a a registered party and another person (A) enter into a transaction of a description mentioned in section 71F(4)(a), b A is party to a regulated transaction of a description mentioned in section 71F(4)(b) (“the connected transaction”) with another person (B), and c B is not an authorised participant. 2 Section 71I(2) to (5) applies to the transaction mentioned in subsection (1)(a). 3 The connected transaction is void. 4 Subsection (5) applies if (but only if) A is unable to recover from the party the whole of the money mentioned in section 71I(3)(a) (as applied by subsection (2) above), along with such interest as is there mentioned. 5 Despite subsection (3), A is entitled to recover from B any part of that money (and such interest) that is not recovered from the party. 6 Subsection (5) does not entitle A to recover more than the contingent liability under the security provided by virtue of the connected transaction. 7 In the case of a connected transaction where B— a at the time A enters into the transaction, is an authorised participant, but b subsequently, for whatever reason, ceases to be an authorised participant, subsections (2) to (6) apply with effect from the time when B ceased to be an authorised participant. 8 This section does not apply to a regulated transaction if it was entered into before the commencement of section 61 of the Electoral Administration Act 2006. 9 If the transaction mentioned in section 71F(4)(a) is not a regulated transaction of a description mentioned in section 71F(2) or (3), references in this section and section 71I(2) to (5) (as applied by subsection (2) above) to the repayment or recovery of money must be construed as references to (as the case may be)— a the return or recovery of any property provided under the transaction, b to the extent that such property is incapable of being returned or recovered or its market value has diminished since the time the transaction was entered into, the repayment or recovery of the market value at that time, or c the market value (at that time) of any facilities or services provided under the transaction. Transfer to unauthorised participant invalid 71K If an authorised participant purports to transfer his interest in a regulated transaction to a person who is not an authorised participant the purported transfer is of no effect. Offences relating to regulated transactions 71L 1 A registered party commits an offence if— a it enters into a regulated transaction of a description mentioned in section 71F(2) or (3) in which another participant is not an authorised participant, and b an officer of the party knew or ought reasonably to have known of the matters mentioned in paragraph (a). 2 A person commits an offence if— a he is the treasurer of a registered party, b the party enters into a regulated transaction of a description mentioned in section 71F(2) or (3) in which another participant is not an authorised participant, and c he knew or ought reasonably to have known of the matters mentioned in paragraph (b). 3 A registered party commits an offence if— a it enters into a regulated transaction of a description mentioned in section 71F(2) or (3) in which another participant is not an authorised participant, b no officer of the party knew or ought reasonably to have known that the other participant is not an authorised participant, and c as soon as practicable after knowledge of the matters mentioned in paragraph (a) comes to the treasurer of the party he fails to take all reasonable steps to repay any money which the party has received by virtue of the transaction. 4 A person who is the treasurer of a registered party commits an offence if— a the party enters into a regulated transaction of a description mentioned in section 71F(2) or (3) in which another participant is not an authorised participant, b subsection (2)(c) does not apply to him, and c as soon as practicable after knowledge of the matters mentioned in paragraph (a) comes to him he fails to take all reasonable steps to repay any money which the party has received by virtue of the transaction. 5 A registered party commits an offence if— a it benefits from or falls to benefit in consequence of a connected transaction to which any of the parties is not an authorised participant, and b an officer of the party knew or ought reasonably to have known of the matters mentioned in paragraph (a). 6 A person commits an offence if— a he is the treasurer of a registered party, b the party benefits from or falls to benefit in consequence of a connected transaction to which any of the parties is not an authorised participant, and c he knew or ought reasonably to have known of the matters mentioned in paragraph (b). 7 A registered party commits an offence if— a it is a party to a transaction of a description mentioned in section 71F(4)(a), b it benefits from or falls to benefit in consequence of a connected transaction to which any of the parties is not an authorised participant, c no officer of the party knew or ought reasonably to have known of the matters mentioned in paragraphs (a) and (b), and d as soon as practicable after knowledge of the matters mentioned in paragraphs (a) and (b) comes to the treasurer of the party he fails to take all reasonable steps to pay to any person who has provided the party with any benefit in consequence of the connected transaction the value of the benefit. 8 A person who is the treasurer of a registered party commits an offence if— a the party is a party to a transaction of a description mentioned in section 71F(4)(a), b the party benefits from or falls to benefit in consequence of a connected transaction to which any of the parties is not an authorised participant, c subsection (6)(c) does not apply to him, and d as soon as practicable after knowledge of the matters mentioned in paragraphs (a) and (b) comes to him he fails to take all reasonable steps to pay to any person who has provided the party with any benefit in consequence of the connected transaction the value of the benefit. 9 A person commits an offence if he— a knowingly enters into, or b knowingly does any act in furtherance of, any arrangement which facilitates or is likely to facilitate, whether by means of concealment or disguise or otherwise, the participation by a registered party in a regulated transaction with a person other than an authorised participant. 10 It is a defence for a person charged with an offence under subsection (2) to prove that he took all reasonable steps to prevent the registered party entering the transaction. 11 It is a defence for a person charged with an offence under subsection (6) to prove that he took all reasonable steps to prevent the registered party benefiting in consequence of the connected transaction. 12 A reference to a registered party entering into a regulated transaction includes a reference to any circumstances in which the terms of a regulated transaction are varied so as to incr