(1) Schedule 10 to the Act (Recognised Supervisory Bodies) is amended as follows.

(2) In paragraph 13 [Paragraph 13 was substituted by S.I. 2007/3494, regulation 23. The substituted paragraph was then amended by S.I. 2011/1856, regulation 5(1) and (3); and by S.I. 2012/1741, article 5(1) and (3).] (monitoring of audits), for sub-paragraph (1)(ba) substitute -

"(ba) in the case of members of the body who perform any third country audit functions -

(i) participate in arrangements within paragraph 23A(1); and

(ii) have rules and practices designed to ensure that a sanction determined under paragraph 23A(1)(b) is to be treated as if it were a sanction which the body had determined under arrangements for enforcement within paragraph 12(1A);".

(3) In paragraph 23A [Paragraph 23A was inserted by S.I. 2011/1856, regulation 5.] (arrangements for independent monitoring of third country audits), for sub-paragraph (1) substitute -

"(1) The arrangements referred to in paragraph 13(1)(ba)(i) are appropriate arrangements -

(a) for enabling the performance by members of the supervisory body of third country audit functions to be monitored by means of inspections carried out under the arrangements;