BIS advice on cyber security

In a 2014 survey on cyber security breaches, the Department for Business, Innovation & Skills (BIS) reported that 81% of large companies and 60% of small businesses suffered a cyber breach. As part of its responsibility to support UK businesses to guard against this significant threat, BIS has published a number of documents providing updated guidance on cyber security.

Tracker report

On 16 January 2015, BIS published its second annual FTSE 350 Cyber Security Governance Health Check (the tracker report). The tracker report sets out the results of a BIS survey of FTSE 350 firms regarding the state of their cyber security and awareness of current threats. The results of the tracker report are generally positive, showing an improvement on the preparedness for, and awareness of, cyber threats. The tracker report’s key findings were that:

  • Awareness of cyber security as a business risk rose sharply in 2014, with 88% of those surveyed including cyber risk in their risk register, compared with 58% in 2013.
  • BIS’s “10 Steps to Cyber Security” guidance has received a good take-up by those surveyed, with 58% of respondents using it to assess their organisation’s preparedness.
  • There has been an improvement in board-level knowledge of cyber security since 2013, with 30% of those surveyed indicating that their board received regular briefings from their Chief Information Officer or head of security, compared with 18% in 2013.
  • Boardrooms also have a better understanding of risk within their supply chains, with 59% of those surveyed having either a basic or clear understanding of where their organisation’s critical information and data are being shared, up from 52% in 2013.
  • Interestingly, 92% of those surveyed had a clear or acceptable level of understanding of the value of their organisation’s critical information and data assets. However, 65% of respondents admitted that they rarely or never review their key information and data assets to confirm the legal, ethical and security implications of retaining them.

BIS hopes that UK organisations can use the tracker report to gain a better understanding of cyber security and the potential risks that they face. BIS plans to repeat its survey of FTSE 350 companies in 2015.

Cyber Essentials Scheme

BIS launched the Cyber Essentials Scheme (the scheme) in June 2014. The scheme is aimed at all organisations, regardless of their size and the sector in which they operate. The purpose of the scheme is two-fold:

  • To outline the basic measures that organisations should take to mitigate the most common cyber security risks. These focus mainly on: boundary firewalls and internet gateways; secure configuration; access control; malware protection; and patch management.
  • To provide an assurance framework and certification process for organisations to use as a means of demonstrating their cyber security to customers, investors, insurers and other interested parties. Organisations can apply for two forms of certification: Cyber Essentials, which is based on a verified self-assessment; or Cyber Essentials Plus, which is assessed by independent testing.

The scheme provides for the government to appoint accreditation bodies for Cyber Essentials and Cyber Essentials Plus. The accreditation bodies then appoint certification bodies, which can certify organisations that comply with the relevant requirements. In January 2015, BIS amended the assurance framework to remove the option for an organisation to be both an accreditation body and a certification body.

From 1 October 2014, it has been a mandatory requirement for suppliers bidding for government contracts that involve the handling of personal data or the provision of certain technical services to comply with the scheme.

Guidance for businesses

Since September 2012, BIS has maintained an online portal of cyber security guidance for businesses. A central element of the guidance is BIS’s 10 Steps to Cyber Security, which sets out a high-level summary of the ten key issues that BIS recommends organisations should address to safeguard against cyber attacks. This guidance aims to help organisations assess whether their approach to corporate risk takes adequate account of cyber security. It also sets out key questions that CEOs and boards should be asking of their organisations in order to ascertain whether the cyber security risks are being managed adequately and effectively.

On 16 January 2015, BIS updated its guidance by publishing a resource on common cyber attacks. The publication uses case studies to illustrate what a cyber attack typically looks like and aims to help businesses understand how best to manage the most common cyber risks that they face.

Communiqué on essential services

On 5 February 2015, BIS published a joint communiqué on strengthening the cyber security of the UK’s essential services following a meeting attended by ministers and senior representatives from the government and UK regulators. The meeting was held to discuss the challenges posed by cyber security to critical infrastructure in the UK at a time when it is increasingly reliant on cyber systems and networks.

The communiqué rates cyber security as a top tier national security priority and states that it is the responsibility of the government and regulators to assist providers of the UK’s essential services in securing their systems and networks. The communiqué promises that the government and regulators will:

  • Work to embed cyber security into the firms and markets that they oversee, including by encouraging organisations to use BIS’s various guidance.
  • Assess the state of cyber security across each sector and work with industry to address vulnerabilities.
  • Identify aggregated risks within and across sectors.
  • Work with industry to increase information flows on threats, vulnerabilities and mitigation strategies.
  • Support sectors to develop effective incident detection and management capabilities.

Please contact us about the issues raised in this article or any other legal matter relating to your business.

TV chef Ramsey loses dispute over restaurant purchase

The television celebrity chef Gordon Ramsey has lost a legal dispute after admitting that his staff often gave business guarantees in his name and used his signature without him knowing.

The issue arose after Mr Ramsey’s company leased premises from businessman Gary Love. Mr Love had bought the premises in poor condition and started to convert them into a restaurant and hotel.

Mr Ramsey’s company had agreed in principle to buy the freehold on condition that the redevelopment was completed. The agreement named Mr Ramsey as a guarantor and featured his signature.

The signature was added by Mr Ramsey’s father-in-law, who was the chief executive of Mr Ramsey’s company. He used a signature writing machine to do it. The development did not proceed to the father-in-law’s satisfaction so he withdrew from the agreement, prompting Mr Love to invoke the guarantee.

Mr Ramsey asserted that he was not bound by the guarantee because his father-in-law had no authority to place his signature on the document or to commit him to such an agreement. There had been no discussion about any guarantee and Mr Ramsey knew nothing about it. The father-in-law had since been dismissed from the company.

During the hearing, the court heard evidence that Mr Ramsey had given significant commercial responsibility to his father-in-law and trusted him totally. Mr Ramsey also acknowledged his own lack of business acumen, and that he knew that the signature writing machine was frequently and routinely used on legal documents.

The evidence also showed that he often gave a personal guarantee when his companies took over a new restaurant.

The court held that Mr Ramsey was bound by the guarantee because he had not demonstrated on the balance of probabilities that he did not know about it. It was also clear that the father-in-law had been acting within a general wide authority conferred on him by Mr Ramsey.

Please contact us if you would like more information about the issues raised in this article or any matter relating to contracts and commercial law.

 

Objectors fail to stop development in greenfield site

Developers have been granted permission to build 400 homes on a greenfield site despite local objections.

The case involved Bewley Homes PLC, which wanted to develop a 46-hectare site near Guildford.

The local borough council granted planning permission even though its local plan restricted development in the countryside beyond the green belt.

The site was in the administrative area of Ash Parish Council, which objected to the development and sought a judicial review. The officer report advising the borough council stated that the proposed development conflicted with the local plan and would have a significant and adverse effect on the landscape.

However, the report also stated that no weight should be given to the local plan because it pre-dated the National Planning Policy Framework (NPPF), which favoured sustainable development. The report added that planning permission should be granted because the adverse impacts did not significantly and demonstrably outweigh the benefits.

Planning permission was then granted by a narrow majority.

The parish council sought a judicial review, claiming the borough council had been given misleading advice about the weight that should be attached to the local plan in relation to the national framework.

The court accepted that the planning officer’s report was not a model of clarity and sometimes gave mixed messages. However, it could not be said that the councillors had been misled. They were entitled to conclude that planning permission should be granted as the adverse did not outweigh the benefits.

The application for a judicial review was therefore rejected.

Please contact us about the issues raised in this article or any other legal matter relating to development and planning.

Director not liable for £1.5m claim despite false statement

The importance of carrying out due diligence before making large purchases was highlighted in a recent case before the courts.

It involved an aviation company that faced a £1.5m compensation claim from one its customers.

The issue arose after the company sold an aircraft for £3.5m. The purchasers later became dissatisfied with the aircraft for various reasons. In April 2011, they discovered that it had been involved in a hard landing in 2009 before they bought it. This had resulted in it being grounded while repairs costing £70,000 were carried out.

The incident was recorded in the log at the time and reported to the insurers. The Federal Aviation Authority (FAA) in the United States was not informed as there was no legal obligation to do so. The purchasers sold the aircraft at a loss of £1.5m. They tried to recoup this loss from the aviation company that had sold it to them.

They alleged that a director of the company had told them that the aircraft had never been involved in an accident. They claimed this was a false statement and entitled them to recoup their money.

The judge, however, ruled against them. He held that although the director had made a false statement, he had not done so fraudulently because he didn’t think the hard landing incident amounted to an accident as it didn’t have to be reported to the FAA.

There would have been no reason for him to lie about it as the incident had been recorded in the pilot log and maintenance logs. These would, or should, have been inspected by the purchasers as part of the normal “pre-purchasing due diligence”.

The Court of Appeal has upheld the ruling.

Please contact us about the issues raised in this article or any matter relating to contracts and company law.

Court fee increase ‘will hit small businesses chasing debts’

A proposed 5% increase in court fees could deter small businesses pursuing claims for late payments, according to the Bar Council, which represents barristers in England and Wales.

The Ministry of Justice is planning to impose a 5% blanket fee on businesses and individuals bringing a claim for money – such as late payments, debt and compensation – of up to £200,000.

There would also be a minimum fee of £10,000 for larger claims.

The Council believes the latest proposed increases are deliberately designed to raise more money from claimants than the cost incurred by the courts in handling money claims.

Alistair MacDonald QC, Bar Council chairman, said: “Cash-flow is the life blood of small businesses and many end up having to pursue late payments and other debts through the court system. Imposing a 5% fee may well make many small businesses think twice before making that claim, and will certainly strengthen the hand of late payers.

“Many family-run businesses know that court proceedings are available to ensure that they are paid for their services and products. This move will effectively take that option away from many smaller businesses. This move will act as a deterrent for smaller companies to challenge their larger customers.

“The Ministry of Justice does not need these fees to meet the cost of money claims. The Ministry is merely seeking to cash in on claimants who have to go to court to recovery their debts.”

We shall keep clients informed of developments.

Please contact us if you would like advice on recovering debts or late payments. A letter from a solicitor is often enough to secure payment without the need to take further action or go to court.

Government scheme helps create 60,000 new businesses

A government scheme is helping to create 450 new businesses every week, according to the latest figures.

The New Enterprise Allowance has so far led to the creation of 60,000 firms across the UK. The scheme is targeted mainly at jobseekers, lone parents and people on sickness benefit. Budding entrepreneurs with a good business idea can apply for financial support up to a total of £1,274, payable through a weekly allowance over 26 weeks.

They can also apply for government start-up loans administered by the Department for Business, Innovation and Skills. More than £130m has been loaned so far to nearly 25,000 new businesses.

The start-ups cover a wide range of fields from manufacturing, design, retail, IT and many more.

More than 4,000 young people, over 11,000 disabled people, and more than 14,000 over-50s have been helped to create new businesses.

The Minister for Employment, Esther McVey, said: “Small businesses are what make this country great – with their hard work, creativity, and entrepreneurial spirit they are fuelling Britain’s recovery. They are also providing a significant share of new vacancies, contributing to the record number of people who now have jobs.

“As part of our long term economic plan, tens of thousands of new and innovative businesses are now up and running – from milliners to caterers and designers to counsellors – all of whom have benefited from the expert mentors who have given up their time to help the next generation of entrepreneurs.”

Starting a new business can be very exciting but it’s important to make sure you do your homework first as there are so many things to consider.

For example, before starting off, you will need to decide on the best structure for your business. Should you be a sole trader, or would a partnership or a limited company suit your purposes better? There are other alternative structures, all of which have different advantages to offer depending on your circumstances.

You will also need to consider several other matters such as whether you need to lease or buy premises, or whether you need to employ people.

All of these issues have legal implications so it is advisable to seek professional advice before making important decisions.

Please contact us if you would like advice about the legal aspects of starting a new business.

Landlords and letting agents ‘liable for noisy tenants’

A court has ruled that landlords and letting agents can be held liable for disturbances caused by their tenants and could face fines of up to £20,000.

The case involved home owners at the Sandbanks development at Poole Harbour in Dorset. They complained about noise from a three-storey property which was rented out for stag and hen parties. The parties and the noise often lasted long into the night.

The letting agent, Michele King of Deluxe Holiday Homes, was issued with a noise abatement notice by Poole Borough Council. She appealed saying that she couldn’t be held responsible for disturbances caused by guests because she wasn’t present at the property at the time.

However, District Judge Stephen Nicholls rejected that argument and ruled that she could be subjected to a noise abatement order. Failure to obey such orders could leave landlords and letting agents liable for fines of up to £20,000.

Please contact us if you would like more information about the issues raised in this article or any aspect of commercial property law.

Employers urged to help older staff stay in work longer

A government minister has urged employers to keep up with changes in society and help older staff to keep working beyond the normal retirement age.

Minister for Pensions Steve Webb said: “How we all look at retirement is changing and the way in which government and businesses help older workers need to keep up with the times.”

Mr Webb’s comments followed a YouGov survey of 2,000 people over the age of 50. If found that nearly two-thirds of them no longer think that working full time and then stopping work altogether is the best way to retire, and around half of them would still like to be in work between 65 and 70.

Nearly 40% said that working part time or flexible hours before stopping work altogether would be the best way to retire. A further 25% said they would be interested in taking a few months off and then returning to work as an alternative to full retirement.

However, the survey also found that many older workers believe they are sometimes treated unfairly:

  • 23% feel they are viewed less favourably than younger workers
  • 15% of those not currently retired report experiencing age-based discrimination in the workplace
  • among those who have been unemployed at some point since turning 50 but are currently working, 41% agreed that their age affected their confidence in applying for jobs, and 53% agreed that they felt employers were not interested in hiring them because of their age.

From April, the government is rolling out a project that will see ‘older workers champions’ introduced into Jobcentres across every part of Britain. They will help tackle the age discrimination that can lead to much higher levels of long-term unemployment among over-50s than among their younger counterparts.

The government is also urging employers to support older staff in the workplace, such as by making changes to working patterns or finding alternative roles for those with age-related health difficulties.

Pensions Minister Steve Webb said: “The results show there is no single view of retirement any more, but the message from older workers is clear; employers need to keep up with changes to society and we have to ensure over-50s have the skills in place to continue developing their careers throughout their working lives.

Please contact us if you would like more information about the issues raised in this article or any aspect of employment law.

Bus company wins appeal over disability discrimination claim

A bus company has won its appeal against a ruling that it had discriminated against a disabled passenger.

The issue arose after 36-year-old Doug Paulley from West Yorkshire was unable to board a bus because the area designated for wheelchairs was occupied by a woman and her baby who was in a buggy. The woman refused to move because her baby was sleeping.

The company involved, First Group Ltd, had a policy that in such cases, the person occupying the disabled space would be asked to move. However, if the person refused then nothing more was to be done and the disabled person would have to wait for the next bus.

Mr Paulley claimed that this policy contravened the Equality Act 2010, which requires companies to make reasonable adjustments for disabled people.  His claim was upheld by the County Court, which awarded him £5,500 damages.

However, that ruling was overturned by the Court of Appeal. The court accepted the company’s submission that although it could alter its conditions of carriage, it would achieve nothing as it would not have the legal powers to enforce such conditions and compel other passengers to move.

The appeal judges also held that if the policy was amended, bus drivers would have to adjudicate between competing claims to the space. It would be unreasonable to require a driver to do this.

The court ruled that bus companies had to take all reasonable steps to help the disabled short of compelling passengers to move from the wheelchair space.

Lord Justice Underhill said: “It has to be accepted that our conclusion and reasoning in this case means that wheelchair users will occasionally be prevented by other passengers from using the wheelchair space on the bus.

“I do not, however, believe that the fact that some passengers will – albeit rarely – act selfishly and irresponsibly is a sufficient reason for imposing on bus companies a legal responsibility for a situation which is not of their making and which they are not in a position to prevent.”

Please contact us if you would like more information about the issues raised in this article or any other matters relating to anti-discrimination policies.

Stamp duty changes could save buy to let investors £50m a year

Buy to let investors could save a total of £50m a year because of the stamp duty reforms, if property purchases continue at the current level.

The reforms, announced by Chancellor George Osborne in the Autumn Statement, swept away the much criticised ‘slab tax’ approach to stamp duty and replaced it with a more progressive system. It means 98% of purchasers will now pay less stamp duty. Only those buying properties costing more than £937,000 are likely to pay more.

The rates of stamp duty now only apply to the amount of the purchase price that falls within each band.

This means that a buy to let investor purchasing a house for £200,000 will pay nothing on the first £125,000, which is zero rated. They will then pay 2% on the next £75,000, making a total tax bill of £1,500. Under the previous system they would have paid 1% on the total purchase price, providing them with a bill of £2,000.

The new system therefore saves them £500.

Figures from the Council of Mortgage Lenders suggest 100,000 buy to let mortgages are being taken out each year with the average property costing about £200,000. With each of these properties now costing an average of £500 less in stamp duty, the total annual saving to investors should be in the region of £50m.

The reforms have been welcomed by the National Landlords Association. Chief Executive Richard Lambert said: “We are delighted that the Chancellor has listened to the NLA and recognised the inequity of the SDLT ‘slab’ system. The NLA has argued for many years that a progressive system would offer a fairer and far less distorting means of taxing property purchases.

“What’s more important is that the introduction of a straightforward marginal system of taxation will mean private landlords will now not only face lower costs when acquiring property, but also have funds to implement property improvements and keep rents down.”

The new rates are:

  • Up to £125,000 : 0%
  • £125,001 to £250,000 : 2%
  • £250,001 to £925,000 : 5%
  • £925,001 to £1.5m : 10%
  • Above £1.5m : 12%.

Please contact us if you would like advice about commercial property law or landlord and tenant issues.