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Macrory Review of Regulatory Penalties

The final report of the Macrory Review of Regulatory Penalties was published in November 2006. The Government accepted the recommendations of the Report in full and we are now consulting on draft legislation to take forward four key recommendations from this report.

The review considered a broad spectrum of sanctions as well as the major motivations for non–compliance. The review made a number of recommendations that aim to ensure that regulators have access to a flexible set of modern fit–for–purpose sanctions that would allow regulators to sanction in a risk based proportionate and appropriate manner as outlined in the Hampton Report.

The review made nine recommendations:

• That the Government initiate a review of the drafting and formulation of criminal offences relating to regulatory non–compliance;
• That in designing the appropriate regulatory sanctions, regulators should have regard to the six penalties principles and seven characteristics outlined in the Macrory Review;
• That measures should be put in place to increase the effectiveness of criminal courts for regulatory offences;
• The introduction of Monetary Administrative Penalties as an intermediate sanction;
• Improving the system of Statutory Notices;
• The introduction of a new type of sanction: Enforceable Undertakings and Undertakings Plus;
• That the Government considers introducing pilot schemes for Restorative Justice for regulatory non–compliance;
• The introduction of alternative sentencing options that could be available in criminal courts.
• The use of measures to improve transparency and accountability, including:
  • A working group of regulators to share best practice in enforcement and sanctioning;
  • Publishing enforcement activities on a regular basis.

We intend to take forward four recommendations of the Macrory Review through Part 2 of the draft Regulatory Enforcement and Sanctions Bill, which will be published for consultation in May 2007. This will take the form of the following tools:

• Fixed Monetary Penalties
• Discretionary Requirements
  • This includes Variable Monetary Penalties, Compliance Notices, Restoration Notices, and Variable Monetary Penalties with Voluntary Undertakings.
• Cessation Notices
• Enforcement Undertakings

We will continue to look at how the other recommendations proposed in the Macrory Review can best be taken forward.

Implementation

• Regulatory and Enforcement Sanctions Bill – consultation document [PDF 2.82MB, 160 pages]
• Regulatory Enforcement and Sanctions Draft Bill

Final Report

• News Release 28/11/2006: Penalties Review - rogue businesses should redress the harm they cause
• Regulatory Justice: Making Sanctions Effective [PDF, 587KB]
• Summary of recommendations
• Background and terms of reference

The Review also issued a call for evidence on 7 December 2005 and published a consultation document in May 2006. This consultation paper offered his initial analysis of UK penalties practice, and proposes options for reform

• News Release 6/5/06: Macrory Regulatory penalties review interim report published
• Regulatory Justice: Sanctioning in a post-Hampton World [PDF 579KB]
  • Annexes [PDF 116KB]

Copies of the report are also available from the review team through the contact details below.

Email: Bre-Penalties.Review@berr.gsi.gov.uk

Better Regulation Executive
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Telephone: 020 7276 0939
Fax: 020 7276 2157