[F1Guarantees and securities: unauthorised participantsU.K.
Textual Amendments
F1Sch. 7A inserted (11.9.2006 for E.W.S. for specified purposes except for the insertion of Sch. 7A para. 16, 1.7.2008 for N.I. for specified purposes, 1.7.2009 for the insertion of Sch. 7A para. 16 for specified purposes, 4.5.2016 for the insertion of Sch. 7A para. 16 for specified purposes) by Electoral Administration Act 2006 (c. 22), ss. 61(7), 77(2), Sch. 1 para 99; S.I. 2006/1972, art. 3, Sch. 1 paras. 20(a), 25(m)(i) (subject to art. 4, Sch. 2) (as amended by S.I. 2006/2268, art. 4); S.I. 2008/1656, arts. 2 (subject to art. 3, Sch. 1); S.I. 2009/1509, art. 2(b) (with art. 3); S.I. 2016/551, art. 2(b) (with art. 3)
6(1)This paragraph applies if—U.K.
(a)a regulated participant and another person (A) enter into a transaction of a description mentioned in paragraph 2(3)(a),
(b)A is party to a controlled transaction of a description mentioned in paragraph 2(3)(b) (“the connected transaction”) with another person (B), and
(c)B is not an authorised participant.
(2)Paragraph 5(2) to (4) applies to the transaction mentioned in sub-paragraph (1)(a).
(3)The connected transaction is void.
(4)Sub-paragraph (5) applies if (but only if) A is unable to recover from the regulated participant the whole of the money mentioned in paragraph 5(3)(a) (as applied by sub-paragraph (2) above), along with such interest as is there mentioned.
(5)Despite sub-paragraph (3), A is entitled to recover from B any part of that money (and such interest) that is not recovered from the regulated participant.
(6)Sub-paragraph (5) does not entitle A to recover more than the contingent liability under the security provided by virtue of the connected transaction.
(7)In the case of a connected transaction where B—
(a)at the time A enters into the transaction, is an authorised participant, but
(b)subsequently, for whatever reason, ceases to be an authorised participant,
sub-paragraphs (2) to (6) apply with effect from the time when B ceased to be an authorised participant.
(8)This paragraph does not apply to a regulated transaction if it was entered into before the commencement of section 61 of the Electoral Administration Act 2006.
(9)If the transaction mentioned in paragraph 2(3)(a) is not a controlled transaction of a description mentioned in paragraph 2(1) or (2), references in this paragraph and paragraph 5(2) to (4) (as applied by sub-paragraph (2) above) to the repayment or recovery of money must be construed as references to (as the case may be)—
(a)the return or recovery of any property provided under the transaction,
(b)to the extent that such is incapable of being returned or recovered or its market value has diminished since the time the transaction was entered into, the repayment or recovery of the market value at that time, or
(c)the market value (at that time) of any facilities or services provided under the transaction.]