Upper Tribunal Tax and Chancery Chamber

[2025] UKUT 00185 (TCC)

Fecha: 09-Abr-2025

The Authority’s case

The Authority’s case

270.

The Authority’s case was that the Bank had breached LR1.3.3R of the Listing Rules, which as set out earlier, provides that an issuer, such as a bank:

“must take reasonable care to ensure that any information it notifies to a RIS…is not misleading, false or deceptive and does not omit anything likely to affect the import of the information”.

271.

The Authority’s position was that:

(1)

The Bank had breached LR 1.3.3R when it published the Q3 Update because:

(a)

that Update contained an unqualified statement of the Bank’s RWA, and the capital ratios based on it, at a time when the Bank knew that a material error had been made in relation to the CLIP loans, but it did not inform the market about that; and

(b)

if the Bank considered that longstanding systems and controls issues meant that it could not provide accurate quarterly announcements, it was not entitled to publish announcements containing information which it knew to be unverifiable, unreliable and/or inaccurate, while it worked to establish the correct information.

(2)

Mr Donaldson and Mr Arden, who were intimately involved in the decision to make the Q3 Update, were knowingly concerned in that breach.

(3)

The penalties charged were appropriate and the Tribunal was asked to uphold them.

272.

It was however not the Authority’s case that:

(1)

the Bank was required under Article 17 of the MAR to inform the market that the RWAs previously published were incorrect (but as the Bank had decided to publish information about the RWAs, that information could not be “misleading, false or deceptive”);

(2)

the Bank had to provide a precise figure for the RWAs. If it did not know that figure; the Bank could instead have provided an estimate, or a figure with a qualification, or no figure at all;

(3)

the Bank should not have instructed Deloitte to carry out an exercise it hoped and believed would produce more reliable figures; instead, the Authority’s case was that the Bank was not entitled, while that work was being carried out, to provide figures to the market which were known to be materially incorrect; or

(4)

that the Bank had breached the Listing Rules in relation to the RWAs for the PBTL loans, because it was a more complex issue: at the time of the Q3 Update

(a)

there was genuine uncertainty about the regulatory requirements for PBTL loans, and

(b)

the estimated quantum of any PBTL categorisation error was only £37m (see §174).