delete Business, &c. transferred from ACo to BCo
Emergency statutory instrument enacted during the 2008 financial crisis to transfer Northern Rock plc's (ACo) property, rights, and liabilities to Gosforth Subsidiary No.1 plc (BCo), a newly created entity. The Order establishes a £8.581bn loan from ACo to BCo, grants BCo temporary Part IV FSMA permissions, modifies various financial regulations to facilitate the transfer, creates transitional service arrangements between the entities, shields Treasury-related persons from director/managerial liability while BCo is Treasury-owned, and provides for Freedom of Information exemptions for Treasury-owned BCo.
This was an emergency crisis measure for the 2008 bank run/nationalization of Northern Rock - a temporary intervention now largely historical. The regulation contains provisions antithetical to free markets: regulatory exemptions for state-owned entities (Article 10-11 special Part IV permissions), immunity from Freedom of Information for Treasury-owned entities (Article 18), and protection of government officials from normal director liability rules (Article 16-17). Such discriminatory treatment of state-owned entities distorts competition and creates moral hazard. Furthermore, the Order's temporary 'deemed authorisation period' and 'deemed approval period' have long since expired. A properly functioning market would not require emergency legislation granting special exemptions to a nationalized entity - this represents exactly the kind of regulatory favoritism that erodes the rule of law and competitive markets that characterized pre-crisis Britain.