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44(1)“Relevant regulated activity” means an activity which is a regulated activity for the purposes of FISMA 2000 by virtue of any of the following provisions of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544)—E+W+S+N.I.
(a)article 5 (accepting deposits),
(b)article 14 (dealing in investments as principal),
(c)article 21 (dealing in investments as agent),
(d)article 25 (arranging deals in investments),
(e)article 40 (safeguarding and administering investments), and
(f)article 61 (entering into regulated mortgage contracts).
(2)“The capital resources condition” is that the company has a capital resources requirement of at least £100 million.
(3)But if the company is a member of a group, “the capital resources condition” is that the company and—
(a)any other companies which—
(i)are members of the group,
(ii)meet either of the conditions in sub-paragraph (4),
(iii)are not excluded companies, and
(iv)are not members of any partnership within paragraph (b), and
(i)the members of which are or include one or more companies that are members of the group and not excluded companies, and
(ii)which meets either of those conditions,
have (in aggregate) capital resources requirements of at least that amount.
(4)The conditions referred to in sub-paragraph (3) are that the company or partnership—
(a)is both a BIPRU 730k firm and a full scope BIPRU investment firm, or
(b)is a company or partnership which carries on in the United Kingdom activities including the relevant regulated activity described in the provision mentioned in sub-paragraph (1)(a).
(5)For the purposes of sub-paragraphs (2) and (3) the capital resources requirement of a company or a partnership is that as at the end of the last period of account of the company or partnership ending no later than the end of the chargeable period.
(6)In determining whether the company is a UK resident bank or a relevant foreign bank by virtue of paragraph 43(2) or (4), the references in sub-paragraph (2) to the company are to the partnership.
(7)If any company or partnership whose capital resources may be material for the purposes of sub-paragraph (2) or (3) prepares its accounts in a currency other than sterling, the amount of its capital resources at the end of the period of account mentioned in that sub-paragraph is to be translated into its sterling equivalent by reference to the average spot rate of exchange on the day on which that period ends.
(8)If any company whose capital resources may be material for the purposes of sub-paragraph (2) or (3) carries on a trade in the United Kingdom through a permanent establishment in the United Kingdom, its capital resources are to be determined as they would be for the purposes of corporation tax (see Chapter 4 of Part 2 of CTA 2009).
(9)“Excluded company” means a company which is—
(a)an insurance company or an insurance special purpose vehicle,
(b)a company which is a member of a group and does not carry on any relevant regulated activities otherwise than on behalf of an insurance company or insurance special purpose vehicle which is a member of the same group,
(c)a company which does not carry on any relevant regulated activities otherwise than as the manager of a pension scheme,
(d)an investment trust (within the meaning given by section 1158 of CTA 2010),
(e)a company which does not carry on any relevant regulated activities other than asset management activities,
(f)an exempt BIPRU commodities firm,
(g)a company which does not carry on any relevant regulated activities otherwise than for the purpose of trading in commodities or commodity derivatives,
(h)a company which does not carry on any relevant regulated activities otherwise than for the purpose of dealing in contracts for differences as principal with persons all or all but an insignificant proportion of whom are retail clients or of dealing in contracts for differences with another person to enable the company or other person to deal in contracts for differences as principal with such persons,
(i)a society incorporated under the Friendly Societies Act 1992,
(j)a society registered as a credit union under the Industrial and Provident Societies Act 1965 or the Credit Unions (Northern Ireland) Order 1985 (S.I. 1985/1205 (NI 12)), or
(k)a building society.
(10)“Asset management activities” means activities which consist (or, if they were carried on in the United Kingdom, would consist) of any or all of the following—
(a)acting as the operator of a collective investment scheme (within the meaning of Part 17 of FISMA 2000: see sections 235 and 237 of that Act),
(b)acting as a discretionary investment manager for clients none of which is a linked entity, and
(c)acting as an authorised corporate director.
(11)“”, in relation to a company (“C”), means—
(a)a member of the same group as C,
(b)a company in which a company which is a member of the same group as C has a major interest (within the meaning of Part 5 of CTA 2009: see section 473 of that Act), or
(c)a partnership the members of which include a company—
(i)which is a member of the same group as C, and
(ii)whose share of the profits or losses of a trade carried on by the partnership for an accounting period of the partnership any part of which falls within the chargeable period is at least a 40% share (see Part 17 of CTA 2009 for provisions about shares of partnership profits and losses).
(12)The following have the meanings given in the Handbook of Rules and Guidance made by the Financial Services Authority (as that Handbook has effect from time to time)—
“authorised corporate director”,
“BIPRU 730k firm”,
“capital resources requirement”,
“contracts for differences”,
“discretionary investment manager”,
“exempt BIPRU commodities firm”,
“full scope BIPRU investment firm”,
(13)A company which would be a BIPRU 730k firm and a full scope BIPRU investment firm by virtue of activities carried on in the United Kingdom but for the fact that its registered office (or, if it does not have a registered office, its head office) is not in the United Kingdom is to be treated as being one.
(14)The Treasury may by order amend this paragraph.
(15)An order under this paragraph may be made so as to have effect in relation to any time after the beginning of the chargeable period.
(16)An order under this paragraph is to be made by statutory instrument.
(17)An order under this paragraph may not be made unless a draft of the instrument containing it has been laid before, and approved by a resolution of, the House of Commons.
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