xmlns:atom="http://www.w3.org/2005/Atom" xmlns:atom="http://www.w3.org/2005/Atom"

TITLE IU.K.SUBJECT MATTER, SCOPE AND DEFINITIONS

Article 3U.K.Intragroup transactions

1.In relation to a non-financial counterparty, an intragroup transaction is an OTC derivative contract entered into with another counterparty which is part of the same group provided that both counterparties are included in the same consolidation on a full basis and they are subject to an appropriate centralised risk evaluation, measurement and control procedures and that counterparty is established in the [F1United Kingdom] or, if it is established in a third country, the Commission has adopted an implementing act under Article 13(2) in respect of that third country [F2before IP completion day or the Treasury have made regulations under that Article in respect of that third country after IP completion day].

2.In relation to a financial counterparty, an intragroup transaction is any of the following:

(a)an OTC derivative contract entered into with another counterparty which is part of the same group, provided that the following conditions are met:

(i)

the financial counterparty is established in the [F3United Kingdom] or, if it is established in a third country, the Commission has adopted an implementing act under Article 13(2) in respect of that third country [F4before IP completion day or the Treasury have made regulations under that Article in respect of that third country after IP completion day];

(ii)

the other counterparty is a financial counterparty, a financial holding company, a financial institution or an ancillary services undertaking subject to appropriate prudential requirements;

(iii)

both counterparties are included in the same consolidation on a full basis; and

(iv)

both counterparties are subject to appropriate centralised risk evaluation, measurement and control procedures; [F5or]

F6(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F7(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(d)an OTC derivative contract entered into with a non-financial counterparty which is part of the same group provided that both counterparties are included in the same consolidation on a full basis and they are subject to an appropriate centralised risk evaluation, measurement and control procedures and that counterparty is established in the [F8United Kingdom] or in a third-country jurisdiction for which the Commission has adopted an implementing act as referred to in Article 13(2) in respect of that third country [F9before IP completion day or the Treasury have made regulations under that Article in respect of that third country after IP completion day].

3.For the purposes of this Article, counterparties shall be considered to be included in the same consolidation when they are both either:

[F10(a)included in a consolidation in accordance with:

(i)legislation of the United Kingdom that was relied upon immediately before IP completion day to implement Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC;

(ii)UK-adopted international accounting standards, having the meaning given by section 474(1) of the Companies Act 2006; or

(iii)in relation to a group the parent undertaking of which has its head office in a third country, the generally accepted accounting principles of a third country determined to be equivalent to—

(aa)International Financial Reporting Standards by the Commission before IP completion day in accordance with Regulation (EC) No. 1569/2007 of 21 December 2007 establishing a mechanism for the determination of equivalence of accounting standards applied by third country issuers of securities pursuant to Directives 2003/71/EC and 2004/109/EC of the European Parliament and of the Council; or

(ab)UK-adopted international accounting standards (within the meaning of section 474(1) of the Companies Act 2006) in accordance with regulations made by the Treasury after IP completion day under Regulation (EC) No. 1569/2007 of 21 December 2007 establishing a mechanism for the determination of equivalence of accounting standards applied by third country issuers of securities pursuant to Directives 2003/71/EC and 2004/109/EC of the European Parliament and of the Council;]

[F11(b)covered by the same supervision on a consolidated basis in accordance with the Capital Requirements Regulation, or in relation to a group the parent undertaking of which has its head office in a third country, the same supervision on a consolidated basis by a third-country competent authority verified as equivalent to that governed by the principles laid down in accordance with the Capital Requirements Regulation.]

Textual Amendments