Financial Services and Markets Act 2000

SCHEDULES

Section 1.

F1 SCHEDULE 1 U.K. The Financial Services Authority

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F1 Schs. 1ZA, 1ZB substituted for Sch. 1 (24.1.2013 for specified purposes, 19.2.2013 for specified purposes, 1.4.2013 in so far as not already in force) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 3 (with Sch. 20); S.I. 2013/113, art. 2(1)(b)(c)(2), Sch. Pts. 2, 3, 4; S.I. 2013/423, art. 3, Sch.

Section 1A

[F1 SCHEDULE 1ZA U.K. The Financial Conduct Authority

Modifications etc. (not altering text)

C1 Sch. 1ZA applied (with modifications) (6.4.2018 immediately after 2016 c. 16 (N.I.), s. 8(2) comes into force) by The Financial Services Act 2012 (Mutual Societies) Order 2018 (S.I. 2018/323), art. 1, Sch. 1 paras. 2(2)(a), 5(1)(2) (with art. 3)

PART 1 U.K. General

Modifications etc. (not altering text)

C2 Sch. 1ZA Pt. 1 modified by S.I. 2007/3298, reg. 4(4) (as amended) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 131(c)

C3 Sch. 1ZA Pt. 1 modified (26.6.2017) by The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (S.I. 2017/692), regs. 1(2), 46(9), 63(8) (with regs. 8, 15)

Interpretation U.K.

1 U.K. In this Schedule—

• “the Bank” means the Bank of England;

• “functions”, in relation to the FCA, means functions conferred on the FCA by or under any provision of this Act (see section 1A(6) which affects the meaning of references to such functions).

Constitution U.K.

2 (1) The constitution of the FCA must provide for the FCA to have a governing body. U.K.

(2) The governing body must consist of—

(a) a chair appointed by the Treasury,

(b) a chief executive appointed by the Treasury,

(c) the Bank's Deputy Governor for prudential regulation,

(d) 2 members appointed jointly by the Secretary of State and the Treasury, and

(e) at least one other member appointed by the Treasury.

(3) The members referred to in sub-paragraph (2)(a), (c) and (d) are to be non-executive members.

(4) In exercising its powers under sub-paragraph (2)(e) to appoint executive or non-executive members, the Treasury must secure that the majority of members of the governing body are non-executive members.

(5) An employee of the FCA may not be appointed as a non-executive member.

(6) In the following provisions of this Schedule an “appointed member” means a member of the governing body appointed under sub-paragraph (2)(a), (b), (d) or (e).

[F2 2A (1) The term of office of a person appointed as chief executive under paragraph 2(2)(b) must not begin before— U.K.

(a) the person has, in connection with the appointment, appeared before the Treasury Committee of the House of Commons, or

(b) (if earlier) the end of the period of 3 months beginning with the day on which the appointment is made.

[F3 (1A) Appointment as chief executive under paragraph 2(2)(b) is to be for a period of 5 years.]

(2) [F4 Sub-paragraphs (1) and (1A) do] not apply if the person is appointed as chief executive on an acting basis, pending a further appointment being made.

(3) The reference to the Treasury Committee of the House of Commons—

(a) if the name of that Committee is changed, is a reference to that Committee by its new name, and

(b) if the functions of that Committee (or substantially corresponding functions) become functions of a different Committee of the House of Commons, is to be treated as a reference to the Committee by which the functions are exercisable.

(4) Any question arising under sub-paragraph (3) is to be determined by the Speaker of the House of Commons.]

Textual Amendments

F2 Sch. 1ZA para. 2A inserted (6.7.2016) by Bank of England and Financial Services Act 2016 (c. 14), ss. 18, 41(3); S.I. 2016/627, reg. 2(1)(m)

F3 Sch. 1ZA para. 2A(1A) inserted (29.6.2021) by Financial Services Act 2021 (c. 22), ss. 42(2)(a), 49(2)(d)

F4 Words in Sch. 1ZA para. 2A(2) substituted (29.6.2021) by Financial Services Act 2021 (c. 22), ss. 42(2)(b), 49(2)(d)

[F5 2B (1) A person may not be appointed as chief executive under paragraph 2(2)(b) more than twice. U.K.

(2) For this purpose an appointment as chief executive on an acting basis, pending a further appointment being made, is to be ignored.]

Textual Amendments

F5 Sch. 1ZA para. 2B inserted (29.6.2021) by Financial Services Act 2021 (c. 22), ss. 42(3), 49(2)(d)

3 (1) The terms of service of the appointed members are to be determined by the Treasury. U.K.

(2) In the case of a member appointed under paragraph 2(2)(d), the Treasury must consult the Secretary of State about the terms of service.

(3) Before appointing a person as an appointed member, the Treasury (or as the case requires the Treasury and the Secretary of State) must consider whether the person has any financial or other interests that could have a material effect on the extent of the functions as member that it would be proper for the person to discharge.

(4) The terms of service of an appointed member (“M”) must be such as—

(a) to secure that M is not subject to direction by the Treasury or the Secretary of State,

(b) to require M not to act in accordance with the directions of any other person, and

(c) to prohibit M from acquiring any financial or other interests that have a material effect on the extent of the functions as member that it would be proper for M to discharge.

(5) If an appointed member is an employee of the FCA, the member's interest as employee is to be disregarded for the purposes of sub-paragraphs (3) and (4)(c) and paragraph 4(1)(b).

(6) A person who is an employee of the PRA is disqualified for appointment as an appointed member.

(7) The FCA may pay expenses to the Bank's Deputy Governor for prudential regulation in respect of that person's service as a member.

4 (1) The Treasury may remove an appointed member from office— U.K.

(a) on the grounds of incapacity or serious misconduct, or

(b) on the grounds that in all the circumstances the member's financial or other interests are such as to have a material effect on the extent of the functions as member that it would be proper for the person to discharge.

(2) Before removing from office a member appointed under paragraph 2(2)(d), the Treasury must consult the Secretary of State.

5 U.K. The validity of any act of the FCA is not affected—

(a) by any vacancy in any of the offices mentioned in paragraph 2(2)(a), (b) or (c), or

(b) by a defect in the appointment of a person—

(i) to any of those offices, or

(ii) as an appointed member.

6 U.K. The Bank's Deputy Governor for prudential regulation must not take part in any discussion by or decision of the FCA which relates to—

(a) the exercise of the FCA's functions in relation to a particular person, or

(b) a decision not to exercise those functions.

Remuneration U.K.

7 U.K. The FCA must pay to the appointed members such remuneration as may be determined—

(a) in the case of the non-executive members, by the Treasury;

(b) in the case of the executive members, by the FCA.

Arrangements for discharging functions U.K.

8 (1) The FCA may make arrangements for any of its functions to be discharged by a committee, sub-committee, officer or member of staff of the FCA, but subject to the following provisions. U.K.

(2) In exercising its legislative functions, the FCA must act through its governing body.

(3) For that purpose, the following are the FCA's legislative functions—

(a) making rules [F6 under this Act or under retained direct EU legislation];

F7 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c) issuing statements under—

(i) section [F8 63ZD,] 63C, F9 ... 69, 88C, 89S, 93, 124, 131J, 138N, [F10 142V,] 192H, 192N, 210 [F11 or 312J],

(ii) section 345D (whether as a result of section 345(2) [F12 , section 249(1) or 261K(1)]), or

(iii) section 80 of the Financial Services Act 2012;

(d) giving directions under section 316, 318 or 328.

F13 (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F14 (f) making technical standards in accordance with Chapter 2A of Part 9A;

(g) making EU Exit instruments under the Financial Regulators’ Powers (Technical Standards) (Amendment etc.) (EU Exit) Regulations 2018.]

[F15 (3A) In exercising its functions under sections 9(2) and 10 of the Financial Guidance and Claims Act 2018 (approving and reviewing standards set by [F16 Money and Pensions Service]), the FCA must act through its governing body.]

(4) The function of issuing general guidance (as defined in section 139B(5) F17 ...) may not be discharged by an officer or member of staff of the FCA.

[F18 (5) In respect of the exercise of a function under Part 1 of the Competition Act 1998, the power in sub-paragraph (1) is subject to provision in rules made under section 51 of that Act by virtue of paragraph 1A of Schedule 9 to that Act.]

Textual Amendments

F6 Words in Sch. 1ZA para. 8(3)(a) inserted (1.7.2021) by Financial Services Act 2021 (c. 22), ss. 43(3), 49(5); S.I. 2021/739, reg. 3(w)

F7 Sch. 1ZA para. 8(3)(b) omitted (3.7.2016) by virtue of The Financial Services and Markets Act 2000 (Market Abuse) Regulations 2016 (S.I. 2016/680), regs. 1, 10(22)

F8 Word in Sch. 1ZA para. 8(3)(c)(i) inserted (25.7.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 3 para. 16(b)(i); S.I. 2014/1819, art. 2(4)(b)

F9 Word in Sch. 1ZA para. 8(3)(c)(i) omitted (7.3.2016) by virtue of Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 3 para. 16(b)(ii); S.I. 2015/490, art. 2(1)(b) (with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660))

F10 Word in Sch. 1ZA para. 8(3)(c)(i) inserted (1.1.2019) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 4(6), 148(5); S.I. 2018/1306, art. 2(d)

F11 Words in Sch. 1ZA para. 8(3)(c)(i) substituted (1.1.2019) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(2)(a)(i); S.I. 2018/1330, reg. 2(g)(vi)

F12 Words in Sch. 1ZA para. 8(3)(c)(ii) substituted (6.6.2013) by The Collective Investment in Transferable Securities (Contractual Scheme) Regulations 2013 (S.I. 2013/1388), regs. 1, 3(21) (with reg. 24)

F13 Sch. 1ZA para. 8(3)(e) omitted (1.1.2019) by virtue of Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(2)(a)(ii); S.I. 2018/1330, reg. 2(g)(vi)

F14 Sch. 1ZA para. 8(3)(f)(g) inserted (26.10.2018) by The Financial Regulators Powers (Technical Standards etc.) (Amendment etc.) (EU Exit) Regulations 2018 (S.I. 2018/1115), regs. 1(2), 7(9)(a)

F15 Sch. 1ZA para. 8(3A) inserted (1.10.2018) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(2)(b); S.I. 2018/1029, reg. 2(q) (with Sch. para. 2)

F16 Words in Sch. 1ZA para. 8(3A) substituted (6.4.2019) by The Financial Guidance and Claims Act 2018 (Naming and Consequential Amendments) Regulations 2019 (S.I. 2019/383), reg. 1(1), Sch. para. 7(d)

F17 Words in Sch. 1ZA para. 8(4) omitted (1.1.2019) by virtue of Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(2)(c); S.I. 2018/1330, reg. 2(g)(vi)

F18 Sch. 1ZA para. 8(5) inserted (1.11.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 8 para. 7(2); S.I. 2014/2458, art. 2(b)(bb)(ii)

Modifications etc. (not altering text)

C4 Sch. 1ZA para. 8(2) modified (20.2.2013) by The Financial Services Act 2012 (Transitional Provisions) (Rules and Miscellaneous Provisions) Order 2013 (S.I. 2013/161), arts. 1(1), 3(8)(a)(9)

C5 Sch. 1ZA para. 8(2) modified (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), arts. 1(2)(6), 64(6)

C6 Sch. 1ZA para. 8(2) modified (E.W.S.) (29.11.2018 for specified purposes, 1.4.2019 in so far as not already in force) by The Financial Services and Markets Act 2000 (Claims Management Activity) Order 2018 (S.I. 2018/1253), arts. 1(2)(3), 85(8)

Records U.K.

9 U.K. The FCA must maintain satisfactory arrangements for—

(a) recording decisions made in the exercise of its functions, and

(b) the safe-keeping of those records which it considers ought to be preserved.

Publication of record of meetings of governing body U.K.

10 (1) The FCA must publish a record of each meeting of its governing body— U.K.

(a) before the end of the period of 6 weeks beginning with the day of the meeting, or

(b) if no meeting of the governing body is subsequently held during that period, before the end of the period of 2 weeks beginning with the day of the next meeting.

(2) The record must specify any decision taken at the meeting (including decisions to take no action) and must set out, in relation to each decision, a summary of the deliberations of the governing body.

(3) Sub-paragraphs (1) and (2) do not require the publication of information whose publication within the time required by sub-paragraph (1) would in the opinion of the governing body be against the public interest.

(4) Publication under this section is to be in such manner as the FCA thinks fit.

Modifications etc. (not altering text)

C7 Sch. 1ZA para. 10 applied (20.2.2013) by The Financial Services Act 2012 (Transitional Provisions) (Rules and Miscellaneous Provisions) Order 2013 (S.I. 2013/161), arts. 1(1), 7(3)(a)

Annual report U.K.

11 (1) At least once a year the FCA must make a report to the Treasury on— U.K.

(a) the discharge of its functions,

(b) the extent to which, in its opinion, its operational objectives have been advanced,

(c) the extent to which, in its opinion, it has acted compatibly with its strategic objective,

(d) how, in its opinion, it has complied with the duty in section 1B(4),

(e) its consideration of the matter mentioned in section 1B(5)(b),

(f) its consideration of the principles in section 3B,

(g) how it has complied with section 3D,

(h) any direction received under section 3I or 3J during the period to which the report relates,

[F19 (ha) any rules that it has made as a result of section 137C during the period to which the report relates and the kinds of regulated credit agreement (within the meaning of that section) to which the rules apply,]

F20 (hb) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(i) how it has complied with section 354A(1) so far as relating to co-operation with persons outside the United Kingdom, F21 ...

[F22 (ia) how, in its opinion, it has complied with its duties under sections 9(2) and 10 of the Financial Guidance and Claims Act 2018, and]

(j) such other matters as the Treasury may from time to time direct.

(2) Sub-paragraph (1) does not require the inclusion in the report of any information whose publication would in the opinion of the FCA be against the public interest.

(3) The report must be accompanied by—

(a) a statement of the remuneration of the appointed members of the governing body of the FCA during the period to which the report relates, and

(b) such other reports or information, prepared by such persons, as the Treasury may from time to time direct.

(4) The Treasury must lay before Parliament a copy of each report received by them under this paragraph.

Textual Amendments

F19 Sch. 1ZA para. 11(1)(ha) inserted (18.2.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 131(2), 148(2)

F20 Sch. 1ZA para. 11(1)(hb) omitted (1.1.2019) by virtue of Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(3)(a); S.I. 2018/1330, reg. 2(g)(vi)

F21 Word in Sch. 1ZA para. 11(1)(i) omitted (1.10.2018) by virtue of Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(3)(b); S.I. 2018/1029, reg. 2(q) (with Sch. para. 2)

F22 Sch. 1ZA para. 11(1)(ia) inserted (1.10.2018) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(3)(b); S.I. 2018/1029, reg. 2(q) (with Sch. para. 2)

Annual public meeting U.K.

12 (1) Not later than 3 months after making a report under paragraph 11, the FCA must hold a public meeting (“the annual meeting”) for the purposes of enabling that report to be considered. U.K.

(2) The FCA must organise the annual meeting so as to allow—

(a) a general discussion of the contents of the report which is being considered, and

(b) a reasonable opportunity for those attending the meeting to put questions to the FCA about the way in which it discharged, or failed to discharge, its functions during the period to which the report relates.

(3) But otherwise the annual meeting is to be organised and conducted in such a way as the FCA considers appropriate.

(4) The FCA must give reasonable notice of its annual meeting.

(5) That notice must—

(a) give details of the time and place at which the meeting is to be held,

(b) set out the proposed agenda for the meeting,

(c) indicate the proposed duration of the meeting,

(d) give details of the FCA's arrangements for enabling persons to attend, and

(e) be published by the FCA in the way appearing to it to be best calculated to bring the notice to the attention of the public.

(6) If the FCA proposes to alter any of the arrangements which have been included in the notice given under sub-paragraph (5), it must—

(a) give reasonable notice of the alteration, and

(b) publish that notice in the way appearing to the FCA to be best calculated to bring it to the attention of the public.

Report of annual meeting U.K.

13 U.K. Not later than one month after its annual meeting, the FCA must publish a report of the proceedings of the meeting.

Accounts and audit U.K.

14 (1) The Treasury may— U.K.

(a) require the FCA to comply with any provisions of the Companies Act 2006 about accounts and their audit which would not otherwise apply to it, or

(b) direct that any provision of that Act about accounts and their audit is to apply to the FCA with such modifications as are specified in the direction, whether or not the provision would otherwise apply to the FCA.

(2) Compliance with any requirement under sub-paragraph (1)(a) or (b) is enforceable by injunction or, in Scotland, an order for specific performance under section 45 of the Court of Session Act 1988.

(3) Proceedings under sub-paragraph (2) may be brought only by the Treasury.

15 (1) The FCA must send a copy of its annual accounts to the Comptroller and Auditor General as soon as is reasonably practicable. U.K.

(2) The Comptroller and Auditor General must—

(a) examine, certify and report on accounts received under this paragraph, and

(b) send a copy of the certified accounts and the report to the Treasury.

(3) The Treasury must lay the copy of the certified accounts and the report before Parliament.

(4) Except as provided by paragraph 14(1), the FCA is exempt from the requirements of Part 16 of the Companies Act 2006 (audit), and its balance sheet must contain a statement to that effect.

(5) In this paragraph “annual accounts” has the meaning given in section 471 of the Companies Act 2006.

PART 2 U.K. Status

Modifications etc. (not altering text)

C8 Sch. 1ZA Pt. 2 modified (26.6.2017) by The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (S.I. 2017/692), regs. 1(2), 46(9), 63(8) (with regs. 8, 15)

Status U.K.

16 U.K. In relation to any of its functions—

(a) the FCA is not to be regarded as acting on behalf of the Crown, and

(b) its members, officers and staff are not to be regarded as Crown servants.

Modifications etc. (not altering text)

C9 Sch. 1ZA para. 16 applied (20.2.2013) by The Financial Services Act 2012 (Transitional Provisions) (Rules and Miscellaneous Provisions) Order 2013 (S.I. 2013/161), arts. 1(1), 7(3)(b)

Exemption from requirement for use of “limited” in name of FCA U.K.

17 U.K. The FCA is to continue to be exempt from the requirements of the Companies Act 2006 relating to the use of “limited” as part of its name.

18 U.K. If the Secretary of State is satisfied that any action taken by the FCA makes it inappropriate for the exemption given by paragraph 17 to continue, the Secretary of State may, after consulting the Treasury, give a direction removing it.

PART 3 U.K. Penalties and fees

Modifications etc. (not altering text)

C10 Sch. 1ZA Pt. 3 modified (E.W.S.) (29.11.2018 for specified purposes, 1.4.2019 in so far as not already in force) by The Financial Services and Markets Act 2000 (Claims Management Activity) Order 2018 (S.I. 2018/1253), arts. 1(2)(3), 54(4)

C11 Sch. 1ZA Pt. 3 applied (with modifications) (31.5.2021) by The Civil Liability Act 2018 (Financial Conduct Authority) (Whiplash) Regulations 2021 (S.I. 2021/594), regs. 1, 2(2)(b)

Penalties U.K.

19 U.K. In determining its policy with respect to the amounts of penalties to be imposed by it under this Act, the FCA must take no account of the expenses which it incurs, or expects to incur, in discharging its functions.

Modifications etc. (not altering text)

C12 Sch. 1ZA para. 19 applied (with modifications) by S.I. 2008/346, reg. 37 (as substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 134(b))

C13 Sch. 1ZA paras. 19-22 applied (with modifications) (E.W.) (9.7.2013) by The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Referral Fees) Regulations 2013 (S.I. 2013/1635), regs. 1, 7(2)

C14 Sch. 1ZA paras. 19-22 applied (with modifications) (12.12.2014) by The Immigration Act 2014 (Bank Accounts) Regulations 2014 (S.I. 2014/3085), regs. 1, 6

C15 Sch. 1ZA paras. 19-23 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 25(1) (with reg. 7)

C16 Sch. 1ZA paras. 19-23 applied (with modifications) (3.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Data Reporting Services Regulations 2017 (S.I. 2017/699), regs. 1(2)(a)(b), 40

C17 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2018) by The Packaged Retail and Insurance-based Investment Products Regulations 2017 (S.I. 2017/1127), reg. 1, Sch. 1 para. 9

C18 Sch. 1ZA paras. 19-23 applied (with modifications) (27.2.2018) by The Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018 (S.I. 2018/135), regs. 1(2), 26

C19 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 11 (with Sch. 1 paras. 13, 14)

C20 Sch. 1ZA paras. 19-22 applied (with modifications) (10.6.2019) by The Proxy Advisors (Shareholders Rights) Regulations 2019 (S.I. 2019/926), regs. 1, 20, 28

C21 Sch. 1ZA para. 19 modified (31.12.2020) by The Credit Rating Agencies (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/266), regs. 1(3), 14(2) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

C22 Sch. 1ZA paras. 19-21 applied (with modifications) (31.12.2020) by The Over the Counter Derivatives, Central Counterparties and Trade Repositories (Amendment, etc., and Transitional Provision) (EU Exit) Regulations 2019 (S.I. 2019/335), regs. 1(1), 78 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

C23 Sch. 1ZA paras. 19-21 applied (with modifications) (31.12.2020) by The Transparency of Securities Financing Transactions and of Reuse (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/542), regs. 1, 39 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

20 (1) The FCA must in respect of each of its financial years pay to the Treasury its penalty receipts after deducting its enforcement costs. U.K.

(2) The FCA's “penalty receipts” in respect of a financial year are any amounts received by it during the year by way of penalties imposed under this Act.

(3) The FCA's “enforcement costs” in respect of a financial year are the expenses incurred by it during the year in connection with—

(a) the exercise, or consideration of the possible exercise, of any of its enforcement powers in particular cases, or

(b) the recovery of penalties imposed under this Act [F23 or under a provision mentioned in sub-paragraph (4A)].

(4) For this purpose the FCA's enforcement powers are—

(a) its powers under any of the provisions mentioned in section 133(7A),

(b) its powers under section 56 (prohibition orders),

[F24 (ba) its powers under section 143S (Part 9C prohibition orders),]

(c) its powers under Part 25 of this Act (injunctions and restitution),

[F25 (ca) its powers under the relevant competition provisions (as applied by Part 16A of this Act),]

(d) its powers under any other enactment specified by the Treasury by order,

(e) its powers in relation to the investigation of relevant offences, and

(f) its powers in England and Wales or Northern Ireland in relation to the prosecution of relevant offences.

[F26 (4A) The relevant competition provisions” are—

(a) section 31E of the Competition Act 1998 (enforcement of commitments);

(b) section 34 of that Act (enforcement of directions);

(c) section 36 of that Act (penalties);

(d) section 40A of that Act (penalties: failure to comply with requirements);

(e) section 174A of the Enterprise Act 2002 (penalties).]

(5) “Relevant offences” are—

(a) offences under [F27 this Act],

(b) offences under subordinate legislation made under [F28 this Act],

(c) offences falling within section 402(1) F29 ...,

[F30 (ca) offences under Part 1 of the Competition Act 1998,

(cb) offences under Part 4 of the Enterprise Act 2002,]

(d) offences under Part 7 of the Financial Services Act 2012, and

(e) any other offences specified by the Treasury by order.

(6) The Treasury may give directions to the FCA as to how the FCA is to comply with its duty under sub-paragraph (1).

(7) The directions may in particular—

(a) specify descriptions of expenditure that are, or are not, to be regarded as incurred in connection with either of the matters mentioned in sub-paragraph (3),

(b) relate to the calculation and timing of the deduction in respect of the FCA's enforcement costs, and

(c) specify the time when any payment is required to be made to the Treasury.

(8) The directions may also require the FCA to provide the Treasury at specified times with specified information relating to—

(a) penalties that the FCA has imposed under this Act, or

(b) the FCA's enforcement costs.

(9) The Treasury must pay into the Consolidated Fund any sums received by them under this paragraph.

Textual Amendments

F23 Words in Sch. 1ZA para. 20(3)(b) inserted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 10 para. 4(2); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

F24 Sch. 1ZA para. 20(4)(ba) inserted (1.7.2021) by Financial Services Act 2021 (c. 22), s. 49(5), Sch. 2 para. 18 (with Sch. 2 Pt. 3); S.I. 2021/671, reg. 4(b)

F25 Sch. 1ZA para. 20(4)(ca) inserted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 10 para. 4(3); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

F26 Sch. 1ZA para. 20(4A) inserted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 10 para. 4(4); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

F27 Words in Sch. 1ZA para. 20(5)(a) substituted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 10 para. 4(5)(a); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

F28 Words in Sch. 1ZA para. 20(5)(b) substituted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 10 para. 4(5)(b); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

F29 Words in Sch. 1ZA para. 20(5)(c) omitted (1.3.2014) by virtue of Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 10 para. 4(5)(c); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

F30 Sch. 1ZA para. 20(5)(ca)(cb) inserted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 10 para. 4(5)(d); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

Modifications etc. (not altering text)

C13 Sch. 1ZA paras. 19-22 applied (with modifications) (E.W.) (9.7.2013) by The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Referral Fees) Regulations 2013 (S.I. 2013/1635), regs. 1, 7(2)

C14 Sch. 1ZA paras. 19-22 applied (with modifications) (12.12.2014) by The Immigration Act 2014 (Bank Accounts) Regulations 2014 (S.I. 2014/3085), regs. 1, 6

C15 Sch. 1ZA paras. 19-23 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 25(1) (with reg. 7)

C16 Sch. 1ZA paras. 19-23 applied (with modifications) (3.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Data Reporting Services Regulations 2017 (S.I. 2017/699), regs. 1(2)(a)(b), 40

C17 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2018) by The Packaged Retail and Insurance-based Investment Products Regulations 2017 (S.I. 2017/1127), reg. 1, Sch. 1 para. 9

C18 Sch. 1ZA paras. 19-23 applied (with modifications) (27.2.2018) by The Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018 (S.I. 2018/135), regs. 1(2), 26

C19 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 11 (with Sch. 1 paras. 13, 14)

C20 Sch. 1ZA paras. 19-22 applied (with modifications) (10.6.2019) by The Proxy Advisors (Shareholders Rights) Regulations 2019 (S.I. 2019/926), regs. 1, 20, 28

C22 Sch. 1ZA paras. 19-21 applied (with modifications) (31.12.2020) by The Over the Counter Derivatives, Central Counterparties and Trade Repositories (Amendment, etc., and Transitional Provision) (EU Exit) Regulations 2019 (S.I. 2019/335), regs. 1(1), 78 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

C23 Sch. 1ZA paras. 19-21 applied (with modifications) (31.12.2020) by The Transparency of Securities Financing Transactions and of Reuse (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/542), regs. 1, 39 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

C24 Sch. 1ZA para. 20 applied (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), regs. 1, 71(3)

C25 Sch. 1ZA para. 20 applied (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), arts. 1(5), 23(4) (with Pt. 4)

C26 Sch. 1ZA para. 20 modified (31.12.2020) by The Credit Rating Agencies (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/266), regs. 1(3), 14(3) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

21 (1) The FCA must prepare and operate a scheme (“the financial penalty scheme”) for ensuring that the amounts that, as a result of the deduction for which paragraph 20(1) provides, are retained by the FCA in respect of amounts paid to it by way of penalties imposed under this Act are applied for the benefit of regulated persons. U.K.

(2) “Regulated persons” means—

(a) authorised persons,

(b) recognised investment exchanges,

(c) issuers of securities admitted to the official list, F31 ... [F32 and]

(d) issuers who have requested or approved the admission of financial instruments to trading on a regulated market, F33 ...

F33 (e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) The financial penalty scheme may, in particular, make different provision with respect to different classes of regulated person.

(4) The financial penalty scheme must ensure that those who have become liable to pay a penalty to the FCA in any financial year of the FCA do not receive any benefit under the scheme in the following financial year.

(5) Up-to-date details of the financial penalty scheme must be set out in a document (“the scheme details”).

Textual Amendments

F31 Word in Sch. 1ZA para. 21(2)(c) omitted (3.3.2015) by virtue of Pension Schemes Act 2015 (c. 8), s. 89(1)(a), Sch. 3 para. 15(a) (with s. 87)

F32 Word in Sch. 1ZA para. 21(2)(c) inserted (1.1.2019) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(4)(a); S.I. 2018/1330, reg. 2(g)(vi)

F33 Sch. 1ZA para. 21(2)(e) and word omitted (1.1.2019) by virtue of Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(4)(b); S.I. 2018/1330, reg. 2(g)(vi)

Modifications etc. (not altering text)

C13 Sch. 1ZA paras. 19-22 applied (with modifications) (E.W.) (9.7.2013) by The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Referral Fees) Regulations 2013 (S.I. 2013/1635), regs. 1, 7(2)

C14 Sch. 1ZA paras. 19-22 applied (with modifications) (12.12.2014) by The Immigration Act 2014 (Bank Accounts) Regulations 2014 (S.I. 2014/3085), regs. 1, 6

C15 Sch. 1ZA paras. 19-23 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 25(1) (with reg. 7)

C16 Sch. 1ZA paras. 19-23 applied (with modifications) (3.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Data Reporting Services Regulations 2017 (S.I. 2017/699), regs. 1(2)(a)(b), 40

C17 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2018) by The Packaged Retail and Insurance-based Investment Products Regulations 2017 (S.I. 2017/1127), reg. 1, Sch. 1 para. 9

C18 Sch. 1ZA paras. 19-23 applied (with modifications) (27.2.2018) by The Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018 (S.I. 2018/135), regs. 1(2), 26

C19 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 11 (with Sch. 1 paras. 13, 14)

C20 Sch. 1ZA paras. 19-22 applied (with modifications) (10.6.2019) by The Proxy Advisors (Shareholders Rights) Regulations 2019 (S.I. 2019/926), regs. 1, 20, 28

C22 Sch. 1ZA paras. 19-21 applied (with modifications) (31.12.2020) by The Over the Counter Derivatives, Central Counterparties and Trade Repositories (Amendment, etc., and Transitional Provision) (EU Exit) Regulations 2019 (S.I. 2019/335), regs. 1(1), 78 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

C23 Sch. 1ZA paras. 19-21 applied (with modifications) (31.12.2020) by The Transparency of Securities Financing Transactions and of Reuse (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/542), regs. 1, 39 (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

C27 Sch. 1ZA para. 21 modified (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), arts. 1(5), 23(5) (with Pt. 4)

C28 Sch. 1ZA para. 21 modified (31.12.2020) by The Credit Rating Agencies (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/266), regs. 1(3), 14(4) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

22 (1) The scheme details must be published by the FCA in the way appearing to it to be best calculated to bring them to the attention of the public. U.K.

(2) Before making the financial penalty scheme, the FCA must publish a draft of the proposed scheme in the way appearing to the FCA to be best calculated to bring it to the attention of the public.

(3) The draft must be accompanied by notice that representations about the proposals may be made to the FCA within a specified time.

(4) Before making the scheme, the FCA must have regard to any representations made to it in accordance with sub-paragraph (3).

(5) If the FCA makes the proposed scheme, it must publish an account, in general terms, of—

(a) the representations made to it in accordance with sub-paragraph (3), and

(b) its response to them.

(6) If the scheme differs from the draft published under sub-paragraph (2) in a way which is, in the opinion of the FCA, significant, the FCA must (in addition to complying with sub-paragraph (5)) publish details of the difference.

(7) The FCA must, without delay, give the Treasury a copy of any scheme details published by it.

(8) The FCA may charge a reasonable fee for providing a person with a copy of—

(a) a draft published under sub-paragraph (2);

(b) scheme details.

(9) Sub-paragraphs (2) to (6) and (8)(a) also apply to a proposal to alter or replace the financial penalty scheme.

Modifications etc. (not altering text)

C13 Sch. 1ZA paras. 19-22 applied (with modifications) (E.W.) (9.7.2013) by The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Referral Fees) Regulations 2013 (S.I. 2013/1635), regs. 1, 7(2)

C14 Sch. 1ZA paras. 19-22 applied (with modifications) (12.12.2014) by The Immigration Act 2014 (Bank Accounts) Regulations 2014 (S.I. 2014/3085), regs. 1, 6

C15 Sch. 1ZA paras. 19-23 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 25(1) (with reg. 7)

C16 Sch. 1ZA paras. 19-23 applied (with modifications) (3.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Data Reporting Services Regulations 2017 (S.I. 2017/699), regs. 1(2)(a)(b), 40

C17 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2018) by The Packaged Retail and Insurance-based Investment Products Regulations 2017 (S.I. 2017/1127), reg. 1, Sch. 1 para. 9

C18 Sch. 1ZA paras. 19-23 applied (with modifications) (27.2.2018) by The Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018 (S.I. 2018/135), regs. 1(2), 26

C19 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 11 (with Sch. 1 paras. 13, 14)

C20 Sch. 1ZA paras. 19-22 applied (with modifications) (10.6.2019) by The Proxy Advisors (Shareholders Rights) Regulations 2019 (S.I. 2019/926), regs. 1, 20, 28

Fees U.K.

23 (1) The FCA may make rules providing for the payment to it of such fees, in connection with the discharge of any of its qualifying functions, as it considers will (taking account of its expected income from fees and charges provided for by any other provision of this Act [F34 other than sections [F35 137SA,] [F36 , 137SB] F37 ... [F38 and 333T]]) enable it— U.K.

(a) to meet expenses incurred in carrying out its functions [F39 , other than its excepted functions,] or for any incidental purpose,

(b) to repay the principal of, and pay any interest on, any relevant borrowing and to meet relevant commencement expenses, and

(c) to maintain adequate reserves.

(2) The “qualifying functions” of the FCA are—

(a) its functions under or as a result of this Act or any of the [F40 other enactments mentioned in section 1A(6)(a) to (ca)] [F41 and (e)] [F42 but not its excepted functions], and

(b) its functions under or as a result of a [F43 qualifying provision] that is specified, or of a description specified, for the purposes of this sub-paragraph by the Treasury by order.

[F44 (2ZA) The “excepted functions” of the FCA are—

F45 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) its functions under [F46 section 333T] so far as relating to the collection of payments. [F47 , and

(c) its functions under [F48 sections 137SA and 137SB].]]

[F49 (2A) The functions referred to in sub-paragraph (1)(a) include functions of the FCA under the Competition Act 1998 or the Enterprise Act 2002 as a result of Part 16A of this Act; but this sub-paragraph is not to be regarded as limiting the effect of the definition of “functions” in paragraph 1.]

(3) In sub-paragraph (1)(b)—

• “relevant borrowing” means any money borrowed by the FCA which has been used for the purpose of meeting expenses incurred in relation to its assumption of functions under this Act, and

• “relevant commencement expenses” means expenses incurred by the FCA—

  (a)

  in preparation for the exercise of functions by the FCA under this Act, or

  (b)

  for the purpose of facilitating the exercise by the FCA of those functions or otherwise in connection with their exercise by it.

(4) Neither section 1A(6)(d) nor the definition of “functions” in paragraph 1 applies for the purposes of sub-paragraph (2).

(5) For the purposes of sub-paragraph (3) it is irrelevant when the borrowing of the money, the incurring of the expenses or the assumption of functions took place (and, in particular, it is irrelevant if any of those things were done at a time when the FCA was known as the Financial Services Authority).

(6) In the case of rules made under Part 6 of this Act, the rules may, in particular, require the payment of fees in respect of—

(a) the continued inclusion of securities or persons in any list or register required to be kept by the FCA as a result of any provision made by or under that Part,

(b) access to any list or register within paragraph (a), and

(c) the continued admission of financial instruments to trading on a regulated market.

(7) In fixing the amount of any fee which is to be payable to the FCA, no account is to be taken of any sums which the FCA receives, or expects to receive, by way of penalties imposed by it under this Act.

(8) Any fee which is owed to the FCA under any provision made by or under this Act may be recovered as a debt due to the FCA.

Textual Amendments

F34 Words in Sch. 1ZA para. 23(1) inserted (3.3.2015) by Pension Schemes Act 2015 (c. 8), s. 89(1)(a), Sch. 3 para. 16(a) (with s. 87)

F35 Word in Sch. 1ZA para. 23(1) inserted (10.5.2018) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(1)(e)(iv), Sch. 3 para. 21(5)(a)(i)

F36 Word in Sch. 1ZA para. 23(1) inserted (1.10.2018) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(5)(a)(ii); S.I. 2018/1029, reg. 2(q)

F37 Words in Sch. 1ZA para. 23(1) omitted (1.1.2019) by virtue of Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(5)(a)(iii); S.I. 2018/1330, reg. 2(g)(vi)

F38 Words in Sch. 1ZA para. 23(1) substituted (6.7.2016) by Bank of England and Financial Services Act 2016 (c. 14), ss. 29(6)(a), 41(3); S.I. 2016/627, reg. 2(1)(w)

F39 Words in Sch. 1ZA para. 23(1)(a) inserted (3.3.2015) by Pension Schemes Act 2015 (c. 8), s. 89(1)(a), Sch. 3 para. 16(b) (with s. 87)

F40 Words in Sch. 1ZA para. 23(2)(a) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 33

F41 Words in Sch. 1ZA para. 23(2)(a) inserted (26.10.2018) by The Financial Regulators Powers (Technical Standards etc.) (Amendment etc.) (EU Exit) Regulations 2018 (S.I. 2018/1115), regs. 1(2), 7(9)(b)

F42 Words in Sch. 1ZA para. 23(2)(a) inserted (3.3.2015) by Pension Schemes Act 2015 (c. 8), s. 89(1)(a), Sch. 3 para. 16(c) (with s. 87)

F43 Words in Sch. 1ZA para. 23(2)(b) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 93; 2020 c. 1, Sch. 5 para. 1(1)

F44 Sch. 1ZA para. 23(2ZA) inserted (3.3.2015) by Pension Schemes Act 2015 (c. 8), s. 89(1)(a), Sch. 3 para. 16(d) (with s. 87)

F45 Sch. 1ZA para. 23(2ZA)(a) omitted (1.1.2019) by virtue of Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(5)(b)(i); S.I. 2018/1330, reg. 2(g)(vi)

F46 Words in Sch. 1ZA para. 23(2ZA)(b) substituted (1.1.2019) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(5)(b)(ii); S.I. 2018/1330, reg. 2(g)(vi)

F47 Sch. 1ZA para. 23(2ZA)(c) and word inserted (10.5.2018) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(1)(e)(iv), Sch. 3 para. 21(5)(b)(iii)

F48 Words in Sch. 1ZA para. 23(2ZA)(c) substituted (1.10.2018) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 21(5)(b)(iv); S.I. 2018/1029, reg. 2(q)

F49 Sch. 1ZA para. 23(2A) inserted (1.11.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), s. 148(5), Sch. 8 para. 7(3); S.I. 2014/2458, art. 2(b)(bb)(ii)

Modifications etc. (not altering text)

C15 Sch. 1ZA paras. 19-23 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 25(1) (with reg. 7)

C16 Sch. 1ZA paras. 19-23 applied (with modifications) (3.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Data Reporting Services Regulations 2017 (S.I. 2017/699), regs. 1(2)(a)(b), 40

C17 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2018) by The Packaged Retail and Insurance-based Investment Products Regulations 2017 (S.I. 2017/1127), reg. 1, Sch. 1 para. 9

C18 Sch. 1ZA paras. 19-23 applied (with modifications) (27.2.2018) by The Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018 (S.I. 2018/135), regs. 1(2), 26

C19 Sch. 1ZA paras. 19-23 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 11 (with Sch. 1 paras. 13, 14)

C29 Sch. 1ZA para. 23 extended (with modifications) by S.I. 2012/3122, reg. 14 (as amended) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 248(3)

C30 Sch. 1ZA para. 23 modified by S.I. 2009/209, reg. 92(1) (as amended) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 155(3)(a) (with Sch. 2 para. 156)

C31 Sch. 1ZA para. 23 applied (with modifications) by S.I. 2008/346, Sch. para. 5 (as substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 134(g)(iii))

C32 Sch. 1ZA para. 23 extended (with modifications) by S.I. 2011/99, reg. 59(1) (as amended) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 196(3)

C33 Sch. 1ZA para. 23 applied (with modifications) (12.12.2014) by The Immigration Act 2014 (Bank Accounts) Regulations 2014 (S.I. 2014/3085), regs. 1, 7

C34 Sch. 1ZA para. 23 modified (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), arts. 1(5), 25(a) (with Pt. 4)

C35 Sch. 1ZA para. 23 modified (1.1.2016) by The Small and Medium Sized Business (Credit Information) Regulations 2015 (S.I. 2015/1945), regs. 1(2), 21(1)(2) (with reg. 21(3)(4))

C36 Sch. 1ZA para. 23 applied (with modifications) (1.1.2016) by The Small and Medium Sized Business (Finance Platforms) Regulations 2015 (S.I. 2015/1946), regs. 1(2), 18(1)(2) (with reg. 18(3)(4))

C37 Sch. 1ZA para. 23 modified (18.9.2016) by The Payment Accounts Regulations 2015 (S.I. 2015/2038), regs. 1(2)(b), 39

C38 Sch. 1ZA para. 23 modified (13.8.2017) by The Payment Services Regulations 2017 (S.I. 2017/752), regs. 1(2)(a), 118(1) (with reg. 3)

C39 Sch. 1ZA para. 23 modified (10.5.2018) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(1)(f), Sch. 5 para. 13

C40 Sch. 1ZA para. 23 modified (E.W.) (6.10.2018) by Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 4 para. 8(2); S.I. 2018/1045, reg. 2(b)

C41 Sch. 1ZA para. 23 applied (with modifications) (10.6.2019) by The Proxy Advisors (Shareholders Rights) Regulations 2019 (S.I. 2019/926), regs. 1, 20, 28

C42 Sch. 1ZA para. 23(6) applied by 2009 c. 1, s. 39B(2) (as inserted (1.1.2015) by The Bank Recovery and Resolution Order 2014 (S.I. 2014/3329), arts. 1(2), 39)

C43 Sch. 1ZA para. 23(6) applied by 2009 c. 1, s. 48L(6A) (as inserted (1.1.2015) by The Bank Recovery and Resolution Order 2014 (S.I. 2014/3329), arts. 1(2), 53(6))

Services for which fees may not be charged U.K.

24 U.K. The power conferred by paragraph 23 may not be used to require—

F50 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) a fee to be paid by any person whose application for approval under section 59 has been granted.

Textual Amendments

F50 Sch. 1ZA para. 24(a) omitted (31.12.2020) by virtue of The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1149), reg. 1(3), Sch. para. 21 (with reg. 4); 2020 c. 1, Sch. 5 para. 1(1)

PART 4 U.K. Miscellaneous

Modifications etc. (not altering text)

C44 Sch. 1ZA Pt. 4 modified (26.6.2017) by The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (S.I. 2017/692), regs. 1(2), 46(9), 63(8) (with regs. 8, 15)

Exemption from liability in damages U.K.

25 (1) None of the following is to be liable in damages for anything done or omitted in the discharge, or purported discharge, of the FCA's functions— U.K.

(a) the FCA;

(b) any person (“P”) who is, or is acting as, a member, officer or member of staff of the FCA;

(c) any person who could be held vicariously liable for things done or omitted by P, but only in so far as the liability relates to P's conduct.

[F51 (1A) In sub-paragraph (1) the reference to the FCA's functions includes its functions under Part 5 of the Financial Services (Banking Reform) Act 2013 (regulation of payment systems).]

(2) Anything done or omitted by a person mentioned in sub-paragraph (1)(a) or (b) while acting, or purporting to act, as a result of an appointment under any of sections 166 to 169 is to be taken for the purposes of sub-paragraph (1) to have been done or omitted in the discharge, or as the case may be purported discharge, of the FCA's functions.

(3) Sub-paragraph (1) does not apply—

(a) if the act or omission is shown to have been in bad faith, or

(b) so as to prevent an award of damages made in respect of an act or omission on the ground that the act or omission was unlawful as a result of section 6(1) of the Human Rights Act 1998.

Textual Amendments

F51 Sch. 1ZA para. 25(1A) inserted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 109(1), 148(5); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

Modifications etc. (not altering text)

C45 Sch. 1ZA para. 25 applied (20.2.2013) by The Financial Services Act 2012 (Transitional Provisions) (Rules and Miscellaneous Provisions) Order 2013 (S.I. 2013/161), arts. 1(1), 7(3)(c)

C46 Sch. 1ZA para. 25 modified by S.I. 2008/346, reg. 45 (as amended) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 134(f)

C47 Sch. 1ZA para. 25 applied by S.I. 2012/3122, reg. 16 (as amended) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 248(4)

C48 Sch. 1ZA para. 25 extended by S.I. 2011/99, reg. 61 (as amended) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 196(4)

C49 Sch. 1ZA para. 25 modified by S.I. 2009/209, reg. 94 (as amended) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), Sch. 2 para. 155(4) (with Sch. 2 para. 156)

C50 Sch. 1ZA para. 25 modified (E.W.) (9.7.2013) by The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Referral Fees) Regulations 2013 (S.I. 2013/1635), regs. 1, 8

C51 Sch. 1ZA para. 25 applied (with modifications) (12.12.2014) by The Immigration Act 2014 (Bank Accounts) Regulations 2014 (S.I. 2014/3085), regs. 1, 8

C52 Sch. 1ZA para. 25 modified (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), arts. 1(5), 25(b) (with Pt. 4)

C53 Sch. 1ZA para. 25 modified (1.1.2016) by The Small and Medium Sized Business (Credit Information) Regulations 2015 (S.I. 2015/1945), regs. 1(2), 22

C54 Sch. 1ZA para. 25 modified (18.9.2016) by The Payment Accounts Regulations 2015 (S.I. 2015/2038), regs. 1(2)(b), 41

C55 Sch. 1ZA para. 25 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 25 (with reg. 7)

C56 Sch. 1ZA para. 25 applied (with modifications) (3.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Data Reporting Services Regulations 2017 (S.I. 2017/699), regs. 1(2)(a)(b), 40

C57 Sch. 1ZA para. 25 modified (13.8.2017) by The Payment Services Regulations 2017 (S.I. 2017/752), regs. 1(2)(a), 121 (with reg. 3)

C58 Sch. 1ZA para. 25 modified (1.1.2018) by The Packaged Retail and Insurance-based Investment Products Regulations 2017 (S.I. 2017/1127), reg. 1, Sch. 1 para. 10

C59 Sch. 1ZA para. 25 applied (with modifications) (27.2.2018) by The Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018 (S.I. 2018/135), regs. 1(2), 26

C60 Sch. 1ZA para. 25 modified by S.I. 2018/1149, reg. 65 (as inserted (1.3.2019) by The Financial Services Contracts (Transitional and Saving Provision) (EU Exit) Regulations 2019 (S.I. 2019/405), regs. 1(2), 3)

C61 Sch. 1ZA para. 25 applied (with modifications) (10.6.2019) by The Proxy Advisors (Shareholders Rights) Regulations 2019 (S.I. 2019/926), regs. 1, 20, 28

Accredited financial investigators U.K.

26 U.K. For the purposes of this Act anything done by an accredited financial investigator within the meaning of the Proceeds of Crime Act 2002 who—

(a) is, or is acting as, an officer of, or member of the staff of, the FCA, or

(b) is appointed by the FCA under section 97, 167 or 168 to conduct an investigation,

is to be treated as done in the exercise or discharge of a function of the FCA.

Amounts required by rules to be paid to the FCA U.K.

27 U.K. Any amount (other than a fee) which is required by rules to be paid to the FCA may be recovered as a debt due to the FCA.

Section [F52 2AB]

SCHEDULE 1ZB U.K. The Prudential Regulation Authority

Textual Amendments

F52 Word in Sch. 1ZB shoulder note substituted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(2) (with Sch. 3); S.I. 2017/43, reg. 2(g)

PART 1 U.K. General

Interpretation U.K.

1 U.K. In this Schedule—

• F53 ...

• “functions”, in relation to the PRA, means functions conferred on the PRA by or under any provision of this Act (see section [F54 2AB(3)] which affects the meaning of references to such functions).

Textual Amendments

F53 Words in Sch. 1ZB para. 1 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(3)(a) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F54 Word in Sch. 1ZB para. 1 substituted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(3)(b) (with Sch. 3); S.I. 2017/43, reg. 2(g)

Constitution U.K.

F55 2 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 3 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 4 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 5 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

Appointed members of governing body U.K.

F55 6 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 7 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 8 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 9 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 10 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 11 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 12 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 13 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F55 14 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

Terms of service U.K.

F55 15 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

Arrangements for discharging functions U.K.

F55 16 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F55 Sch. 1ZB paras. 2-16 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

Records U.K.

17 U.K. The PRA must maintain satisfactory arrangements for—

(a) recording decisions made in the exercise of its functions, and

(b) the safe-keeping of those records which it considers ought to be preserved.

Budget U.K.

F56 18 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F56 Sch. 1ZB para. 18 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(4) (with Sch. 3); S.I. 2017/43, reg. 2(g)

Annual report U.K.

19 (1) At least once a year the PRA must make a report to the [F57 Chancellor of the Exchequer] on— U.K.

(a) the discharge of its functions,

(b) the extent to which, in its opinion, its objectives have been advanced,

[F58 (ba) how it has complied with section 2H(1),]

(c) its consideration of the principles in section 3B F59 ...,

(d) how it has complied with section 3D,

(e) any direction given under section 3I or 3J during the period to which the report relates,

(f) how it has complied with section 354B(1) so far as relating to co-operation with persons outside the United Kingdom, and

(g) such other matters as the Treasury may from time to time direct.

[F60 (1A) In the report the PRA must also report in general terms on—

(a) the extent to which, in its opinion, ring-fenced bodies have complied with the ring-fencing provisions,

(b) steps taken by ring-fenced bodies in order to comply with the ring-fencing provisions,

(c) steps taken by it to enforce the ring-fencing provisions,

(d) the extent to which ring-fenced bodies are carrying on the regulated activity of dealing in investments as principal (whether in the United Kingdom or elsewhere) in circumstances where as a result of an order under section 142D(2) that activity is not an excluded activity,

(e) the extent to which ring-fenced bodies are carrying on activities that would be excluded activities by virtue of an order under section 142D(4) but for an exemption or exclusion made by such an order,

(f) the extent to which ring-fenced bodies are doing things that they would be prohibited from doing by an order under section 142E but for an exemption made by such an order, and

(g) the extent to which ring-fenced bodies appear to it to have acted in accordance with any guidance which it has given to ring-fenced bodies and which relates to the operation of the ring-fencing provisions.

(1B) In sub-paragraph (1A)—

(a) references to “ring-fenced bodies” relate only to ring-fenced bodies that are PRA-authorised persons, and

(b) “the ring-fencing provisions” means ring-fencing rules and the duty imposed as a result of section 142G.]

(2) [F61 Sub-paragraphs (1) and (1A) do not] require the inclusion in the report of any information whose publication would in the opinion of the PRA be against the public interest.

(3) The report must be accompanied by—

F62 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) such other reports or information, prepared by such persons, as the Treasury may from time to time direct.

(4) The [F63 Chancellor of the Exchequer] must lay before Parliament a copy of each report received by [F64 the Chancellor] under this paragraph.

[F65 (5) The Chancellor may comply with sub-paragraph (4) by laying a document containing a report under this paragraph together with a report under section 4 of the Bank of England Act 1998.]

Textual Amendments

F57 Words in Sch. 1ZB para. 19(1) substituted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(5)(a) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F58 Sch. 1ZB para. 19(1)(ba) inserted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 130(3)(a)(i), 148(5); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

F59 Words in Sch. 1ZB para. 19(1)(c) omitted (1.3.2014) by virtue of Financial Services (Banking Reform) Act 2013 (c. 33), ss. 130(3)(a)(ii), 148(5); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

F60 Sch. 1ZB para. 19(1A)(1B) inserted (1.1.2019) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 5(2), 148(5); S.I. 2018/1306, art. 2(e)

F61 Words in Sch. 1ZB para. 19(2) substituted (1.1.2019) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 5(3), 148(5); S.I. 2018/1306, art. 2(e)

F62 Sch. 1ZB para. 19(3)(a) omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(5)(b) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F63 Words in Sch. 1ZB para. 19(4) substituted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(5)(c)(i) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F64 Words in Sch. 1ZB para. 19(4) substituted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(5)(c)(ii) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F65 Sch. 1ZB para. 19(5) inserted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(5)(d) (with Sch. 3); S.I. 2017/43, reg. 2(g)

Modifications etc. (not altering text)

C62 Sch. 1ZB para. 19 applied (14.11.2018) by The Central Counterparties (Amendment, etc., and Transitional Provision) (EU Exit) Regulations 2018 (S.I. 2018/1184), regs. 1(3), 25

C63 Sch. 1ZB para. 19 applied (with modifications) (30.9.2020) by The Equivalence Determinations for Financial Services (Amendment etc.) (EU Exit) Regulations 2020 (S.I. 2020/1055), regs. 1(2), 6(1)(2)(6)

C64 Sch. 1ZB para. 19(1) applied (with modifications) (1.4.2013) by The Financial Services Act 2012 (Transitional Provisions) (Miscellaneous Provisions) Order 2013 (S.I. 2013/442), arts. 1(3), 4(2)

Consultation about annual report U.K.

20 (1) In relation to each report made under paragraph 19, the PRA must publish at the same time as the report an invitation to members of the public to make representations to the PRA, within the 3 months beginning with the date of publication— U.K.

(a) about the report,

(b) about the way in which the PRA has discharged, or failed to discharge, its functions during the period to which the report relates, and

(c) about the extent to which, in their opinion, the PRA's objectives have been advanced [F66 and the PRA has facilitated effective competition in accordance with section 2H and has considered the regulatory principles in section 3B] .

(2) The invitation must be published in the way appearing to it to be best calculated to bring the invitation to the attention of the public.

Textual Amendments

F66 Words in Sch. 1ZB para. 20(1)(c) substituted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 130(3)(b), 148(5); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

Report on consultation U.K.

21 (1) The PRA must publish a report about its consultation in accordance with paragraph 20. U.K.

(2) The report must contain an account, in general terms, of any representations received in pursuance of the invitation published under that paragraph.

(3) The report must be published not later than 4 months after the date on which the report under paragraph 19 was published.

Accounts and audit U.K.

F67 22 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F67 Sch. 1ZB paras. 22-26 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(6) (with Sch. 3); S.I. 2017/43, reg. 3(1) (with reg. 3(2)(3))

F67 23 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F67 Sch. 1ZB paras. 22-26 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(6) (with Sch. 3); S.I. 2017/43, reg. 3(1) (with reg. 3(2)(3))

PART 2 U.K. Status

Status U.K.

F67 24 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F67 Sch. 1ZB paras. 22-26 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(6) (with Sch. 3); S.I. 2017/43, reg. 3(1) (with reg. 3(2)(3))

Exemption from requirement for use of “limited” in name of PRA U.K.

F67 25 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F67 Sch. 1ZB paras. 22-26 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(6) (with Sch. 3); S.I. 2017/43, reg. 3(1) (with reg. 3(2)(3))

F67 26 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F67 Sch. 1ZB paras. 22-26 omitted (1.3.2017) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(6) (with Sch. 3); S.I. 2017/43, reg. 3(1) (with reg. 3(2)(3))

PART 3 U.K. Penalties and fees

Penalties U.K.

27 U.K. In determining its policy with respect to the amounts of penalties to be imposed by it under this Act, the PRA must take no account of the expenses which it incurs, or expects to incur, in discharging its functions.

Modifications etc. (not altering text)

C65 Sch. 1ZB paras. 27-31 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 26 (with reg. 7)

C66 Sch. 1ZB paras. 27-31 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 12 (with Sch. 1 paras. 13, 14)

28 (1) The PRA must in respect of each of its financial years pay to the Treasury its penalty receipts after deducting its enforcement costs. U.K.

(2) The PRA's “penalty receipts” in respect of a financial year are any amounts received by it during the year by way of penalties imposed under this Act.

(3) The PRA's “enforcement costs” in respect of a financial year are the expenses incurred by it during the year in connection with—

(a) the exercise, or consideration of the possible exercise, of any of its enforcement powers in particular cases, or

(b) the recovery of penalties imposed under this Act.

(4) For this purpose the PRA's enforcement powers are—

(a) its powers under any of the provisions mentioned in section 133(7A),

(b) its powers under section 56 (prohibition orders),

(c) its powers under Part 25 of this Act (injunctions and restitution),

(d) its powers under any other enactment specified by the Treasury by order,

(e) its powers in relation to the investigation of relevant offences, and

(f) its powers in England and Wales or Northern Ireland in relation to the prosecution of relevant offences.

(5) “Relevant offences” are—

(a) offences under FSMA 2000,

(b) offences under subordinate legislation made under that Act, and

(c) any other offences specified by the Treasury by order.

(6) The Treasury may give directions to the PRA as to how the PRA is to comply with its duty under sub-paragraph (1).

(7) The directions may in particular—

(a) specify descriptions of expenditure that are, or are not, to be regarded as incurred in connection with either of the matters mentioned in sub-paragraph (3),

(b) relate to the calculation and timing of the deduction in respect of the PRA's enforcement costs, and

(c) specify the time when any payment is required to be made to the Treasury.

(8) The directions may also require the PRA to provide the Treasury at specified times with information relating to—

(a) penalties that the PRA has imposed under FSMA 2000, or

(b) the PRA's enforcement costs.

(9) The Treasury must pay into the Consolidated Fund any sums received by them under this paragraph.

Modifications etc. (not altering text)

C65 Sch. 1ZB paras. 27-31 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 26 (with reg. 7)

C66 Sch. 1ZB paras. 27-31 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 12 (with Sch. 1 paras. 13, 14)

29 (1) The PRA must prepare and operate a scheme (“the financial penalty scheme”) for ensuring that the amounts that, as a result of the deduction for which paragraph 28(1) provides, are retained by the PRA in respect of amounts paid to it by way of penalties imposed under this Act are applied for the benefit of PRA-authorised persons. U.K.

(2) The financial penalty scheme may, in particular, make different provision with respect to different classes of PRA-authorised person.

(3) The financial penalty scheme must ensure that those who have become liable to pay a penalty to the PRA in any financial year of the PRA do not receive any benefit under the scheme in the following financial year.

(4) Up-to-date details of the financial penalty scheme must be set out in a document (“the scheme details”).

Modifications etc. (not altering text)

C65 Sch. 1ZB paras. 27-31 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 26 (with reg. 7)

C66 Sch. 1ZB paras. 27-31 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 12 (with Sch. 1 paras. 13, 14)

30 (1) The scheme details must be published by the PRA in the way appearing to it to be best calculated to bring them to the attention of the public. U.K.

(2) Before making the financial penalty scheme, the PRA must publish a draft of the proposed scheme in the way appearing to the PRA to be best calculated to bring it to the attention of the public.

(3) The draft must be accompanied by notice that representations about the proposals may be made to the PRA within a specified time.

(4) Before making the scheme, the PRA must have regard to any representations made to it in accordance with sub-paragraph (3).

(5) If the PRA makes the proposed scheme, it must publish an account, in general terms, of—

(a) the representations made to it in accordance with sub-paragraph (3), and

(b) its response to them.

(6) If the scheme differs from the draft published under sub-paragraph (2) in a way which is, in the opinion of the PRA, significant, the PRA must (in addition to complying with sub-paragraph (5)) publish details of the difference.

(7) The PRA must, without delay, give the Treasury a copy of any scheme details published by it.

(8) The PRA may charge a reasonable fee for providing a person with a copy of—

(a) a draft published under sub-paragraph (2);

(b) scheme details.

(9) Sub-paragraphs (2) to (6) and (8)(a) also apply to a proposal to alter or replace the financial penalty scheme.

Modifications etc. (not altering text)

C65 Sch. 1ZB paras. 27-31 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 26 (with reg. 7)

C66 Sch. 1ZB paras. 27-31 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 12 (with Sch. 1 paras. 13, 14)

Fees U.K.

31 (1) The PRA may make rules providing for the payment to it of such fees, in connection with the discharge of any of its qualifying functions, as it considers will (taking account of its expected income from fees and charges provided for by any other provision of this Act) enable it— U.K.

(a) to meet expenses incurred in carrying out its functions or for any incidental purpose,

(b) to repay the principal of, and pay any interest on, any relevant borrowing and to meet relevant commencement expenses, and

(c) to maintain adequate reserves.

(2) The “qualifying functions” of the PRA are—

(a) its functions under or as a result of this Act or any of the [F68 other enactments] mentioned in section [F69 2AB(3)], and

(b) its functions under or as a result of a [F70 qualifying provision] that is specified, or of a description specified, for the purposes of this sub-paragraph by the Treasury by order.

(3) In sub-paragraph (1)(b)—

• “relevant borrowing” means any money borrowed by the PRA which has been used for the purpose of meeting expenses incurred in relation to its assumption of functions under this Act, and

• “relevant commencement expenses” means expenses incurred by the PRA, the FCA or the Bank—

  (a)

  in preparation for the exercise of functions by the PRA under this Act, or

  (b)

  for the purpose of facilitating the exercise by the PRA of those functions or otherwise in connection with their exercise by it.

(4) Neither section [F71 2AB(3)(d)] nor the definition of “functions” in paragraph 1 applies for the purposes of sub-paragraph (2).

(5) For the purposes of sub-paragraph (3) it is irrelevant when the borrowing of the money, the incurring of the expenses or the assumption of functions took place (and, in particular, it is irrelevant if expenses were incurred by the FCA at a time when it was known as the Financial Services Authority).

(6) In fixing the amount of any fee which is to be payable to the PRA, no account is to be taken of any sums which the PRA receives, or expects to receive, by way of penalties imposed by it under this Act.

(7) Any fee which is owed to the PRA under any provision made by or under this Act may be recovered as a debt due to the PRA.

Textual Amendments

F68 Words in Sch. 1ZB para. 31(2)(a) substituted (26.10.2018) by The Financial Regulators Powers (Technical Standards etc.) (Amendment etc.) (EU Exit) Regulations 2018 (S.I. 2018/1115), regs. 1(2), 7(10)

F69 Word in Sch. 1ZB para. 31(2) substituted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(7)(a) (with Sch. 3); S.I. 2017/43, reg. 2(g)

F70 Words in Sch. 1ZB para. 31(2)(b) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 94; 2020 c. 1, Sch. 5 para. 1(1)

F71 Word in Sch. 1ZB para. 31(4) substituted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 50(7)(b) (with Sch. 3); S.I. 2017/43, reg. 2(g)

Modifications etc. (not altering text)

C65 Sch. 1ZB paras. 27-31 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 26 (with reg. 7)

C66 Sch. 1ZB paras. 27-31 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 12 (with Sch. 1 paras. 13, 14)

Services for which fees may not be charged U.K.

32 U.K. The power conferred by paragraph 31 may not be used to require—

F72 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) a fee to be paid by any person whose application for approval under section 59 has been granted.

Textual Amendments

F72 Sch. 1ZB para. 32(a) omitted (31.12.2020) by virtue of The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1149), reg. 1(3), Sch. para. 22 (with reg. 4); 2020 c. 1, Sch. 5 para. 1(1)

PART 4 U.K. Miscellaneous

Exemption from liability in damages U.K.

33 (1) None of the following is to be liable in damages for anything done or omitted in the discharge, or purported discharge, of the PRA's functions— U.K.

(a) the PRA;

(b) any person (“P”) who is, or is acting as, a member, officer or member of staff of the PRA;

(c) any person who could be held vicariously liable for things done or omitted by P, but only in so far as the liability relates to P's conduct.

[F73 (1A) In sub-paragraph (1) the reference to the PRA's functions includes its functions under Part 5 of the Financial Services (Banking Reform) Act 2013 (regulation of payment systems).]

(2) Anything done or omitted by a person mentioned in sub-paragraph (1)(a) or (b) while acting, or purporting to act, as a result of an appointment under any of sections 97, 166 to 169 and 284 is to be taken for the purposes of sub-paragraph (1) to have been done or omitted in the discharge, or as the case may be purported discharge, of the PRA's functions.

(3) Sub-paragraph (1) does not apply—

(a) if the act or omission is shown to have been in bad faith, or

(b) so as to prevent an award of damages made in respect of an act or omission on the ground that the act or omission was unlawful as a result of section 6(1) of the Human Rights Act 1998.

Textual Amendments

F73 Sch. 1ZB para. 33(1A) inserted (1.3.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 109(2), 148(5); S.I. 2014/377, art. 2(1)(a), Sch. Pt. 1

Modifications etc. (not altering text)

C67 Sch. 1ZB para. 33 applied (with modifications) (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 1 para. 26 (with reg. 7)

C68 Sch. 1ZB para. 33 modified by S.I. 2018/1149, reg. 65 (as inserted (1.3.2019) by The Financial Services Contracts (Transitional and Saving Provision) (EU Exit) Regulations 2019 (S.I. 2019/405), regs. 1(2), 3)

Accredited financial investigators U.K.

34 U.K. For the purposes of this Act anything done by an accredited financial investigator within the meaning of the Proceeds of Crime Act 2002 who—

(a) is, or is acting as, an officer of, or member of the staff of, the PRA, or

(b) is appointed by the PRA under section 167 or 168 to conduct an investigation,

is to be treated as done in the exercise or discharge of a function of the PRA.

Amounts required by rules to be paid to the PRA U.K.

35 U.K. Any amount (other than a fee) which is required by rules to be paid to the PRA may be recovered as a debt due to the PRA.]

Section 3S

F74 SCHEDULE 1A U.K. Further provision about the consumer financial education body

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F74 Sch. 1A omitted (6.4.2021) by virtue of Financial Guidance and Claims Act 2018 (c. 10), s. 37(5), Sch. 3 para. 22; S.I. 2021/433, reg. 2(b)(iv)

Section 22(2).

SCHEDULE 2 U.K. Regulated Activities

Modifications etc. (not altering text)

C69 Sch. 2 applied by 1974 c. 39, s. 16(6E)(c) (as inserted (1.9.2002) by S.I. 2001/544, arts. 2(1)(2)(b), 90(2); S.I. 2001/3538, art. 2(1))

C70 Sch. 2 applied by S.I. 2008/570, Sch. para. 11(2) (as substituted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 35)

C71 Sch. 2 applied by S.I. 2012/2079 reg. 2(1A) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 44(a)(ii))

C72 Sch. 2 applied by S.I. 2001/497, reg. 113(6) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 23(b))

C73 Sch. 2 applied by S.S.I. 2011/141, Sch. 4 para. 1(2) (as substituted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 43(a))

C74 Sch. 2 applied by S.I. 2001/341, reg. 114(6) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 22(b))

C75 Sch. 2 applied by S.I. 2004/400, reg. 5(7) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 25(b))

C76 Sch. 2 applied by S.I. 2008/1741, reg. 112(5) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 37(b))

C77 Sch. 2 applied by S.I. 2007/2157, reg. 23(6) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 31(5)(b))

C78 Sch. 2 applied by 2003 c. 1, s. 554O(6) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 9(c))

C79 Sch. 2 applied by S.I. 2013/380, Sch. 6 para. 11(9) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 45(b))

C80 Sch. 2 applied by S.I. 2008/700, Sch. para. 12(2) (as substituted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 36)

C81 Sch. 2 applied by 2007 c. 3, s. 564B(1A) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 12(b))

C82 Sch. 2 applied by 2009 c. 4, s. 502(1A) (as inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), art. 1(2)(6), Sch. para. 16(b))

C83 Sch. 2 applied (16.8.2013) by The Democratic People s Republic of Korea (European Union Financial Sanctions) Regulations 2013 (S.I. 2013/1877), regs. 1(1), 2(2)(c) (with reg. 21)

C84 Sch. 2 applied (8.8.2018) by The Republic of Maldives (Asset-Freezing) Regulations 2018 (S.I. 2018/861), regs. 1(1), 2(2)(c) (with reg. 17)

C85 Sch. 2 applied (31.12.2020) by The Syria (Sanctions) (EU Exit) Regulations 2019 (S.I. 2019/792), regs. 1(3), 23(2), 55(8), 70(4); 2020 c. 1, Sch. 5 para. 1(1)

C86 Sch. 2 applied (31.12.2020) by The Russia (Sanctions) (EU Exit) Regulations 2019 (S.I. 2019/855), regs. 1(2), 58(8), 71(4); 2020 c. 1, Sch. 5 para. 1(1)

Part I U.K. [F75 Regulated activities: general]

Textual Amendments

F75 Sch. 2 Pt. 1 heading substituted (12.3.2009) by Dormant Bank and Building Society Accounts Act 2008 (c. 31), ss. 15, 31(1), Sch. 2 para. 1(2); S.I. 2009/490, art. 2 (with art. 3)

General U.K.

1 U.K. The matters with respect to which provision may be made under section 22(1) in respect of activities include, in particular, those described in general terms in this Part of this Schedule.

Dealing in investments U.K.

2 (1) Buying, selling, subscribing for or underwriting investments or offering or agreeing to do so, either as a principal or as an agent. U.K.

(2) In the case of an investment which is a contract of insurance, that includes carrying out the contract.

Arranging deals in investments U.K.

3 U.K. Making, or offering or agreeing to make—

(a) arrangements with a view to another person buying, selling, subscribing for or underwriting a particular investment;

(b) arrangements with a view to a person who participates in the arrangements buying, selling, subscribing for or underwriting investments.

Deposit taking U.K.

4 U.K. Accepting deposits.

Safekeeping and administration of assets U.K.

5 (1) Safeguarding and administering assets belonging to another which consist of or include investments or offering or agreeing to do so. U.K.

(2) Arranging for the safeguarding and administration of assets belonging to another, or offering or agreeing to do so.

Managing investments U.K.

6 U.K. Managing, or offering or agreeing to manage, assets belonging to another person where—

(a) the assets consist of or include investments; or

(b) the arrangements for their management are such that the assets may consist of or include investments at the discretion of the person managing or offering or agreeing to manage them.

Investment advice U.K.

7 U.K. Giving or offering or agreeing to give advice to persons on—

(a) buying, selling, subscribing for or underwriting an investment; or

(b) exercising any right conferred by an investment to acquire, dispose of, underwrite or convert an investment.

Establishing collective investment schemes U.K.

8 U.K. Establishing, operating or winding up a collective investment scheme, including acting as—

(a) trustee of a unit trust scheme;

(b) depositary of a collective investment scheme other than a unit trust scheme; or

(c) sole director of a body incorporated by virtue of regulations under section 262.

Using computer-based systems for giving investment instructions U.K.

9 (1) Sending on behalf of another person instructions relating to an investment by means of a computer-based system which enables investments to be transferred without a written instrument. U.K.

(2) Offering or agreeing to send such instructions by such means on behalf of another person.

(3) Causing such instructions to be sent by such means on behalf of another person.

(4) Offering or agreeing to cause such instructions to be sent by such means on behalf of another person.

[F76 Part 1A U.K. Regulated activities: reclaim funds

Textual Amendments

F76 Sch. 2 Pt. 1A inserted (12.3.2009) by Dormant Bank and Building Society Accounts Act 2008 (c. 31), ss. 15, 31(1), Sch. 2 para. 1(3); S.I. 2009/490, art. 2 (with art. 3)

Activities of reclaim funds U.K.

9A (1) The matters with respect to which provision may be made under section 22(1) in respect of activities include, in particular, any of the activities of a reclaim fund.

(2) “Reclaim fund” has the meaning given by section 5(1) of the Dormant Bank and Building Society Accounts Act 2008.]

Part II U.K. Investments

General U.K.

10 U.K. The matters with respect to which provision may be made under section 22(1) in respect of investments include, in particular, those described in general terms in this Part of this Schedule.

Securities U.K.

11 (1) Shares or stock in the share capital of a company. U.K.

(2) “Company” includes—

(a) any body corporate (wherever incorporated), and

(b) any unincorporated body constituted under the law of a country or territory outside the United Kingdom,

other than an open-ended investment company.

Instruments creating or acknowledging indebtedness U.K.

12 U.K. Any of the following—

(a) debentures;

(b) debenture stock;

(c) loan stock;

(d) bonds;

(e) certificates of deposit;

(f) any other instruments creating or acknowledging a present or future indebtedness.

Modifications etc. (not altering text)

C87 Sch. 2 para. 12(f) extended (24.6.2003) by The Uncertificated Securities (Amendment) (Eligible Debt Securities) Regulations 2003 (S.I. 2003/1633), regs. 1(1), 15, Sch. 2 para. 8(2)(h)

Government and public securities U.K.

13 (1) Loan stock, bonds and other instruments— U.K.

(a) creating or acknowledging indebtedness; and

(b) issued by or on behalf of a government, local authority or public authority.

(2) “Government, local authority or public authority” means—

(a) the government of the United Kingdom, of Northern Ireland, or of any country or territory outside the United Kingdom;

(b) a local authority in the United Kingdom or elsewhere;

(c) any international organisation the members of which include the United Kingdom F77 ....

Textual Amendments

F77 Words in Sch. 2 para. 13(2)(c) omitted (31.12.2020) by virtue of The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 95; 2020 c. 1, Sch. 5 para. 1(1)

Instruments giving entitlement to investments U.K.

14 (1) Warrants or other instruments entitling the holder to subscribe for any investment. U.K.

(2) It is immaterial whether the investment is in existence or identifiable.

Certificates representing securities U.K.

15 U.K. Certificates or other instruments which confer contractual or property rights—

(a) in respect of any investment held by someone other than the person on whom the rights are conferred by the certificate or other instrument; and

(b) the transfer of which may be effected without requiring the consent of that person.

Units in collective investment schemes U.K.

16 (1) Shares in or securities of an open-ended investment company. U.K.

(2) Any right to participate in a collective investment scheme.

Options U.K.

17 U.K. Options to acquire or dispose of property.

Futures U.K.

18 U.K. Rights under a contract for the sale of a commodity or property of any other description under which delivery is to be made at a future date.

Contracts for differences U.K.

19 U.K. Rights under—

(a) a contract for differences; or

(b) any other contract the purpose or pretended purpose of which is to secure a profit or avoid a loss by reference to fluctuations in—

(i) the value or price of property of any description; or

(ii) an index or other factor designated for that purpose in the contract.

Contracts of insurance U.K.

20 U.K. Rights under a contract of insurance, including rights under contracts falling within head C of Schedule 2 to the M1 Friendly Societies Act 1992.

Marginal Citations

M1 1992 c. 40.

Participation in Lloyd’s syndicates U.K.

21 (1) The underwriting capacity of a Lloyd’s syndicate. U.K.

(2) A person’s membership (or prospective membership) of a Lloyd’s syndicate.

Deposits U.K.

22 U.K. Rights under any contract under which a sum of money (whether or not denominated in a currency) is paid on terms under which it will be repaid, with or without interest or a premium, and either on demand or at a time or in circumstances agreed by or on behalf of the person making the payment and the person receiving it.

[F78 Loans and other forms of credit] U.K.

Textual Amendments

F78 Sch. 2 para. 23 and crossheading substituted (24.1.2013) by Financial Services Act 2012 (c. 21), ss. 7(3), 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(a), Sch. Pt. 1

[F78 23 (1) Rights under any contract under which one person provides another with credit. U.K.

(2) “Credit” includes any cash loan or other financial accommodation.

(3) “Cash” includes money in any form.

(4) It is immaterial for the purposes of sub-paragraph (1) whether or not the obligation of the borrower is secured on property of any kind.]

[F79 Other finance arrangements involving land U.K.

Textual Amendments

F79 Sch. 2 para. 23A inserted (19.2.2006) by Regulation of Financial Services (Land Transactions) Act 2005 (c. 24), ss. 1, 2(2)

23A (1) Rights under any arrangement for the provision of finance under which the person providing the finance either— U.K.

(a) acquires a major interest in land from the person to whom the finance is provided, or

(b) disposes of a major interest in land to that person,

as part of the arrangement.

(2) References in sub-paragraph (1) to a “major interest” in land are to—

(a) in relation to land in England or Wales—

(i) an estate in fee simple absolute, or

(ii) a term of years absolute,

whether subsisting at law or in equity;

(b) in relation to land in Scotland—

(i) the interest of an owner of land, or

(ii) the tenant's right over or interest in a property subject to a lease;

(c) in relation to land in Northern Ireland—

(i) any freehold estate, or

(ii) any leasehold estate,

whether subsisting at law or in equity.

(3) It is immaterial for the purposes of sub-paragraph (1) whether either party acquires or (as the case may be) disposes of the interest in land—

(a) directly, or

(b) indirectly.]

[F80 Contracts for hire of goods U.K.

Textual Amendments

F80 Sch. 2 para. 23B and crossheading inserted (24.1.2013) by Financial Services Act 2012 (c. 21), ss. 7(4), 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(a), Sch. Pt. 1

23B (1) Rights under a contract for the bailment or (in Scotland) hiring of goods to a person other than a body corporate. U.K.

(2) “Goods” has the meaning given in section 61(1) of the Sale of Goods Act 1979.

(3) It is immaterial for the purposes of sub-paragraph (1) whether the rights of the person to whom the goods are bailed or hired have been assigned to a body corporate.]

Rights in investments U.K.

24 U.K. Any right or interest in anything which is an investment as a result of any other provision made under section 22(1).

[F81 PART 2A U.K. Regulated activities relating to information about persons' financial standing

Textual Amendments

F81 Sch. 2 Pts. 2A, 2B inserted (24.1.2013) by Financial Services Act 2012 (c. 21), ss. 7(5), 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(a), Sch. Pt. 1

General U.K.

24A The matters with respect to which provision may be made under section 22(1A)(a) include, in particular, those described in general terms in this Part of this Schedule.

Providing credit reference services U.K.

24B Furnishing persons with information that—

(a) is relevant to the financial standing of persons other than bodies corporate, and

(b) is collected for that purpose by the person furnishing it.

Providing credit information services U.K.

24C (1) Taking steps on behalf of a person other than a body corporate in connection with information relevant to that person's financial standing that is or may be held by a [F82 person who is carrying on a regulated activity].

F83 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F82 Words in Sch. 2 para. 24C(1) substituted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), arts. 1(2)(6), 10(17)(a)

F83 Sch. 2 para. 24C(2) omitted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 (S.I. 2013/1881), arts. 1(2)(6), 10(17)(b)

24D Giving advice to a person other than a body corporate in relation to the taking of any steps of the kind mentioned in paragraph 24C(1).]

F84 PART 2B U.K. Regulated activities relating to the setting of benchmarks

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F84 Sch. 2 Pt. 2B omitted (1.5.2020) by virtue of The Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018 (S.I. 2018/135), regs. 1(2)(b), 50

Part III U.K. Supplemental Provisions

The order-making power U.K.

25 (1) An order under section 22(1) [F85 [F86 or (1A)]] [F85 to (1B)] may— U.K.

(a) provide for exemptions;

(b) confer powers on the Treasury or [F87 either regulator];

(c) authorise the making of regulations or other instruments by the Treasury for purposes of, or connected with, any relevant provision;

(d) authorise the making of rules or other instruments by [F87 either regulator] for purposes of, or connected with, any relevant provision;

(e) make provision in respect of any information or document which, in the opinion of the Treasury or [F87 either regulator], is relevant for purposes of, or connected with, any relevant provision;

(f) make such consequential, transitional or supplemental provision as the Treasury consider appropriate for purposes of, or connected with, any relevant provision [F88 , including provision which applies (with or without modification) provision in this Act or other primary or subordinate legislation that relates to investment activity or financial services to a regulated activity that does not relate to investment activity or financial services].

(2) Provision made as a result of sub-paragraph (1)(f) may amend any primary or subordinate legislation, including any provision of, or made under, this Act.

(3) “Relevant provision” means any provision—

(a) of section 22 or this Schedule; or

(b) made under that section or this Schedule.

Textual Amendments

F85 Words in Sch. 2 para. 25(1) substituted (E.W.S.) (6.10.2018) by Financial Guidance and Claims Act 2018 (c. 10), ss. 27(13)(a)(i), 37(5); S.I. 2018/1045, reg. 2(a)

F86 Words in Sch. 2 para. 25(1) inserted (24.1.2013) by Financial Services Act 2012 (c. 21), ss. 8(2)(a), 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(a), Sch. Pt. 1

F87 Words in Sch. 2 para. 25(1) substituted (24.1.2013) by Financial Services Act 2012 (c. 21), ss. 8(2)(b), 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(a), Sch. Pt. 1

F88 Words in Sch. 2 para. 25(1)(f) inserted (E.W.S.) (6.10.2018) by Financial Guidance and Claims Act 2018 (c. 10), ss. 27(13)(a)(ii), 37(5); S.I. 2018/1045, reg. 2(a)

[F89 Parliamentary control] U.K.

Textual Amendments

F89 Sch. 2 para. 26 and crossheading substituted (24.1.2013) by Financial Services Act 2012 (c. 21), ss. 8(3), 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(a), Sch. Pt. 1

[F89 26 (1) This paragraph applies to any order made under section 22(1) [F90 or (1A)] [F90 to (1B)] which contains a statement by the Treasury that, in their opinion, the effect (or one of the effects) of the proposed order would be that an activity which is not a regulated activity would become a regulated activity. U.K.

(2) No order to which this paragraph applies may be made unless—

(a) a draft of the order has been laid before Parliament and approved by a resolution of each House, or

(b) sub-paragraph (4) applies.

(3) Sub-paragraph (4) applies if an order to which this paragraph applies also contains a statement that the Treasury are of the opinion that, by reason of urgency, it is necessary to make the order without a draft being so laid and approved.

(4) Where this sub-paragraph applies the order—

(a) must be laid before Parliament after being made, and

(b) ceases to have effect at the end of the relevant period unless before the end of that period the order is approved by a resolution of each House of Parliament (but without that affecting anything done under the order or the power to make a new order).

(5) The “relevant period” is a period of 28 days beginning with the day on which the order is made.

(6) In calculating the relevant period no account is to be taken of any time during which Parliament is dissolved or prorogued or during which both Houses are adjourned for more than 4 days.]

Textual Amendments

F90 Words in Sch. 2 para. 26(1) substituted (E.W.S.) (6.10.2018) by Financial Guidance and Claims Act 2018 (c. 10), ss. 27(13)(b), 37(5); S.I. 2018/1045, reg. 2(a)

Interpretation U.K.

27 (1) In this Schedule— U.K.

• “buying” includes acquiring for valuable consideration;

• “offering” includes inviting to treat;

• “property” includes currency of the United Kingdom or any other country or territory; and

• “selling” includes disposing for valuable consideration.

(2) In sub-paragraph (1) “disposing” includes—

(a) in the case of an investment consisting of rights under a contract—

(i) surrendering, assigning or converting those rights; or

(ii) assuming the corresponding liabilities under the contract;

(b) in the case of an investment consisting of rights under other arrangements, assuming the corresponding liabilities under the contract or arrangements;

(c) in the case of any other investment, issuing or creating the investment or granting the rights or interests of which it consists.

(3) In this Schedule references to an instrument include references to any record (whether or not in the form of a document).

Sections 31(1)(b) and 37.

SCHEDULE 3 U.K. EEA Passport Rights

Modifications etc. (not altering text)

C88 Sch. 3 extended (with modifications) (1.12.2001) by S.I. 2001/2636, arts. 1(2)(b), 25-27; S.I. 2001/3538, art. 2(1)

Sch. 3 extended (with modifications) (Gibraltar) (5.10.2001 for specified purposes, 1.12.2001 in so far as not already in force) by S.I. 2001/3084, arts. 1(1), 2-4 (as amended (16.6.2014) by The Alternative Investment Fund Managers Order 2014 (S.I. 2014/1292), arts. 1(2), 3 (which amending S.I. is itself amended by S.I. 2014/1313, arts. 1, 2(a)); and as amended (31.12.2020) by S.I. 2019/589, regs. 1(3), 5-9 (with reg. 12) (as amended by S.I. 2020/1274, regs. 1, 2)); S.I. 2001/3538, art. 2(1)

Sch. 3 modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 114(3)(b), 128(3)(b) (with art. 23(2))

Part I U.K. Defined terms

The single market directives U.K.

1 U.K. “The single market directives” means—

[F91 (a) the [F92 capital requirements directive];]

[F93 (c) the Solvency 2 Directive;]

F94 (ca) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(d) the [F95 markets in financial instruments directive][F96 ; F97 . . .

(e) [F98 the insurance distribution directive]][F99 ; F100 ...

(f) the UCITS directive] [F101 ; F102 ...

(g) the alternative investment fund managers directive] [F103 ; and

(h) the mortgages directive.]

Textual Amendments

F91 Sch. 3 para. 1(a) substituted (22.11.2000) for Sch. 3 para. 1(a)(b) by S.I. 2000/2952, reg. 8(5)(a)

F92 Words in Sch. 3 para. 1(a) substituted (1.1.2014) by The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 29(2)

F93 Sch. 3 para. 1(c) substituted (1.1.2016) by The Solvency 2 Regulations 2015 (S.I. 2015/575), reg. 1(2), Sch. 1 para. 17(2)(a)

F94 Sch. 3 para. 1(ca) omitted (1.1.2016) by virtue of The Solvency 2 Regulations 2015 (S.I. 2015/575), reg. 1(2), Sch. 1 para. 17(2)(b)

F95 Words in Sch. 3 para. 1(d) substituted (1.4.2007 for certain purposes, otherwise 1.11.2007) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007 (S.I. 2007/126), regs. 1(2), 3(4), Sch. 4 para. 2

F96 Sch. 3 para. 1(e) and preceding word inserted (14.1.2005) by The Insurance Mediation Directive (Miscellaneous Amendments) Regulations 2003 (S.I. 2004/1473), reg. 2(2)(a)(ii)

F97 Word in Sch. 3 para. 1(d) omitted (13.2.2004) by virtue of The Collective Investment Schemes (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/2066), reg. 2(2)(a)(i)

F98 Words in Sch. 3 para. 1(e) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 17(2)

F99 Sch. 3 para. 1(f) and preceding word inserted (13.2.2004) after Sch. 3 para. 1(e) by The Collective Investment Schemes (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/2066), reg. 2(2)(a)(i)

F100 Word in Sch. 3 para. 1(e) omitted (22.7.2013) by virtue of The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(2)

F101 Sch. 3 para. 1(g) and word inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(2)

F102 Word in Sch. 3 para. 1(f) omitted (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by virtue of The Mortgage Credit Directive Order 2015 (S.I. 2015/910), art. 1(5), Sch. 1 para. 1(10)(a)(i) (with Pt. 4)

F103 Sch. 3 para. 1(h) and word inserted (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), art. 1(5), Sch. 1 para. 1(10)(a)(ii) (with Pt. 4)

Commencement Information

I1 Sch. 3 Pt. I para. 1 wholly in force at 1.12.2001; Sch. 3 Pt. I para. 1 not in force at Royal Assent see s. 431(2); Sch. 3 Pt. I para. 1 in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b)(c), Sch. Pts. 2, 3; Sch. 3 Pt. I para. 1 in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; Sch. 3 Pt. I para. 1 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

The banking co-ordination directives U.K.

F104 2 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F104 Sch. 3 para. 2 omitted (1.1.2014) by virtue of The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 29(3)

[F105 The Solvency 2 Directive U.K.

Textual Amendments

F105 Sch. 3 para. 3 and cross-heading substituted (1.1.2016) by The Solvency 2 Regulations 2015 (S.I. 2015/575), reg. 1(2), Sch. 1 para. 17(3)

3 U.K. “The Solvency 2 Directive” means Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II).]

[F106 The reinsurance directive] U.K.

Textual Amendments

F106 Sch. 3 para. 3A and cross-heading inserted (10.12.2007) by The Reinsurance Directive Regulations 2007 (S.I. 2007/3253), reg. 2(1), Sch. 1 para. 6(b)

F107 3A U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F107 Sch. 3 para. 3A omitted (1.1.2016) by virtue of The Solvency 2 Regulations 2015 (S.I. 2015/575), reg. 1(2), Sch. 1 para. 17(4)

The investment services directive U.K.

4 U.K. F108 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F108 Sch. 3 para. 4 repealed (1.4.2007 for certain purposes and 1.11.2007 otherwise) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007 (S.I. 2007/126), regs. 1(2), 3(4), Sch. 4 para. 3

[F109 The insurance distribution directive U.K.

Textual Amendments

F109 Sch. 3 para. 4A and cross-heading substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 17(3)

4A U.K. “The insurance distribution directive” means Directive (EU) 2016/97 of the European Parliament and of the Council of 20 January 2016 on insurance distribution (recast) as amended by Directive (EU) 2018/411 of the European Parliament and of the Council of 14 March 2018].

[F110 The UCITS directive U.K.

Textual Amendments

F110 Sch. 3 para. 4B and cross-heading inserted (13.2.2004) by The Collective Investment Schemes (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/2066), reg. 2(2)(b)

[F111 4B U.K. “The UCITS directive ” means the Directive of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (No 2009/65/EC) [F112 , as amended by Directive 2014/91/EU of the European Parliament and of the Council of 23rd July 2014].]]

Textual Amendments

F111 Sch. 3 para. 4B substituted (1.7.2011) by The Undertakings for Collective Investment in Transferable Securities Regulations 2011 (S.I. 2011/1613), reg. 2(33)(a)

F112 Words in Sch. 3 para. 4B inserted (18.3.2016) by The Undertakings for Collective Investment in Transferable Securities Regulations 2016 (S.I. 2016/225), regs. 1, 2(9)

[F113 The markets in financial instruments directive] U.K.

Textual Amendments

F113 Sch. 3 para. 4C and preceding cross-heading inserted (6.12.2006) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) (Modification of Powers) Regulations 2006 (S.I. 2006/2975), reg. 13

[F114 4C U.K. “The markets in financial instruments directive” means Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments.]

Textual Amendments

F114 Sch. 3 para. 4C substituted (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 2 para. 54(2) (with reg. 7)

The emission allowance auctioning regulation U.K.

[F115 4D. “The emission allowance auctioning regulation” means Commission Regulation ( EU ) No 1031/2010 of 12 November 2010 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/ EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community.]

Textual Amendments

F115 Sch. 3 para. 4D inserted (20.7.2012) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2012 (S.I. 2012/1906), arts. 1, 4(2)

[F116 The alternative investment fund managers directive U.K.

Textual Amendments

F116 Sch. 3 para. 4E and cross-heading inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(3)

4E. U.K. “The alternative investment fund managers directive” means Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers.]

[F117 The mortgages directive U.K.

Textual Amendments

F117 Sch. 3 para. 4F and cross-heading inserted (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), art. 1(5), Sch. 1 para. 1(10)(b) (with Pt. 4)

4F. U.K. “The mortgages directive” means Directive 2014/17/EU of the European Parliament and of the Council of 4th February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010.]

EEA firm U.K.

5 U.K. “EEA firm” means any of the following if it does not have its [F118 relevant office] in the United Kingdom—

(a) an investment firm (as defined in [F119 Article 4.1.1 of the markets in financial instruments directive]) which is authorised (within the meaning of [F120 Article 5]) by its home state regulator;

[F121 (b) a credit institution (as defined in Article 4(1)(1) of the capital requirements regulation) which is authorised (within the meaning of Article 8 of the capital requirements directive) by its home state regulator;]

[F122 (c) a financial institution (as defined in Article 4(1)(26) of the capital requirements regulation) which is a subsidiary of the kind mentioned in Article 34 of the capital requirements directive and which fulfils the conditions of that Article;]

[F123 (d) an undertaking pursuing the activity of direct insurance (within the meaning of Article 2 of the Solvency 2 Directive) which has received authorisation under Article 14 of that directive from its home state regulator;

(da) an undertaking pursuing the activity of reinsurance (within the meaning of Article 2 of the Solvency 2 Directive) as a reinsurance undertaking which has received authorisation under Article 14 of that directive from its home state regulator;]

[F124 (e) an insurance intermediary (as defined in Article 2.1(3) of the insurance distribution directive), an ancillary insurance intermediary (as defined in Article 2.1(4) of that directive) or a reinsurance intermediary (as defined in Article 2.1(5) of that directive), which is registered with its home state regulator under Article 3 of that directive;]

[F125 (f) a management company (as defined in paragraph 11B) which is authorised (within the meaning of Article 6 of the UCITS directive) by its home state regulator] [F126 ; F127 ...

(g) a person who has received authorisation under Article 18.2 of the emission allowance auctioning regulation] [F128 ; F129 ...

(h) an AIFM (as defined in Article 4.1(b) of the alternative investment fund managers directive) which is authorised (in accordance with [F130 Article 6.1 of] that directive) by its home state regulator] [F131 ; or

(i) a mortgage intermediary which is admitted (in accordance with Article 29(1) of the mortgages directive) by its home state regulator to carry out all or part of the credit intermediation activities set out in Article 4(5) of that directive or to provide advisory services (as defined in Article 4(21) of that directive).]

Textual Amendments

F118 Words in Sch. 3 para. 5 substituted (14.1.2005) by The Insurance Mediation Directive (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/1473). {reg. 2(c)(i)}

F119 Words in Sch. 3 para. 5(a) substituted (1.4.2007 for certain purposes, otherwise 1.11.2007) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007 (S.I. 2007/126), regs. 1(2), 3(4), Sch. 4 para. 4(a)

F120 Words in Sch. 3 para. 5(a) substituted (1.4.2007 for certain purposes, otherwise 1.11.2007) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007 (S.I. 2007/126), regs. 1(2), 3(4), Sch. 4 para. 4(b)

F121 Sch. 3 para. 5(b) substituted (1.1.2014) by The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 29(4)

F122 Sch. 3 para. 5(c) substituted (1.1.2014) by The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 29(5)

F123 Sch. 3 para. 5(d)(da) substituted for Sch. 3 para. 5(d)(da) (1.1.2016) by The Solvency 2 Regulations 2015 (S.I. 2015/575), reg. 1(2), Sch. 1 para. 17(5)

F124 Sch. 3 para. 5(e) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 17(4)

F125 Sch. 3 para. 5(f) substituted (1.7.2011) by The Undertakings for Collective Investment in Transferable Securities Regulations 2011 (S.I. 2011/1613), reg. 2(33)(b)

F126 Sch. 3 para. 5(g) and preceding word inserted (20.7.2012) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2012 (S.I. 2012/1906), arts. 1, 4(3)(b)

F127 Word in Sch. 3 para. 5(f) omitted (22.7.2013) by virtue of The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(4)

F128 Sch. 3 para. 5(h) and word inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(4)

F129 Word in Sch. 3 para. 5(g) omitted (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by virtue of The Mortgage Credit Directive Order 2015 (S.I. 2015/910), art. 1(5), Sch. 1 para. 1(10)(c)(i) (with Pt. 4)

F130 Words in Sch. 3 para. 5(h) omitted (coming into force in accorance with reg. 1(3) of the amending S.I.) by The Alternative Investment Fund Managers (Amendment) Regulations 2013 (S.I. 2013/1797), reg. 1(3), Sch. 1 para. 1(5)(a)

F131 Sch. 3 para. 5(i) and word inserted (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), art. 1(5), Sch. 1 para. 1(10)(c)(ii) (with Pt. 4)

Commencement Information

I2 Sch. 3 Pt. I para. 5 wholly in force at 1.12.2001; Sch. 3 Pt. I para. 5 not in force at Royal Assent see s. 431(2); Sch. 3 Pt. I para. 5 in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b)(c), Sch. Pts. 2, 3; Sch. 3 Pt. I para. 5 in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2 Sch.; Sch. 3 Pt. I para. 5 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

[F132 5A U.K. In paragraph 5, “relevant office” means—

(a) in relation to a firm falling within sub-paragraph (e) [F133 or (i)] of that paragraph which has a registered office, its registered office;

[F134 (aa) in relation to a firm falling within sub-paragraph (h) of that paragraph, its registered office;]

(b) in relation to any other firm, its head office.]

Textual Amendments

F132 Sch. 3 para. 5A inserted (14.1.2005) by The Insurance Mediation Directive (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/1473), reg. 2(2)(d)

F133 Words in Sch. 3 para. 5A(a) inserted (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3.2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), art. 1(5), Sch. 1 para. 1(10)(d) (with Pt. 4)

F134 Sch. 3 para. 5A(aa) inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(5)

EEA authorisation U.K.

F135 6 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F135 Sch. 3 para. 6 omitted (31.12.2020) by virtue of The Financial Services (Miscellaneous) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/710), regs. 1(3), 3(3) (with regs. 36, 37, Sch.); 2020 c. 1, Sch. 5 para. 1(1)

EEA right U.K.

7 U.K. “EEA right” means the entitlement of a person to establish a branch, or provide services, in an EEA State other than that in which he has his [F136 relevant office]—

(a) in accordance with the Treaty as applied in the EEA; and

(b) subject to the conditions of the relevant single market directive [F137 or, as the case may be, the emission allowance auctioning regulation].

Textual Amendments

F136 Words in Sch. 3 para. 7 substituted (14.1.2005) by The Insurance Mediation Directive (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/1473), reg. 2(2)(f)

F137 Words in Sch. 3 para. 7(b) inserted (20.7.2012) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2012 (S.I. 2012/1906), arts. 1, 4(4)

Commencement Information

I3 Sch. 3 Pt. I para. 7 wholly in force at 1.12.2001; Sch. 3 Pt. I para. 7 not in force at Royal Assent see s. 431(2); Sch. 3 Pt. I para. 7 in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b)(c), Sch. Pts. 2, 3; Sch. 3 Pt. I para. 7 in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; Sch. 3 Pt. I para. 7 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

[F138 7A U.K. In paragraph 7, “relevant office” means—

(a) in relation to a person who has a registered office and whose entitlement is subject to the conditions of the [F139 insurance distribution directive] [F140 or the mortgages directive], his registered office;

[F141 (aa) [F142 in relation to a person whose entitlement is subject to the conditions of the alternative investment fund managers directive, its registered office;]]

[F142 (aa) in relation to a person whose entitlement derives from the alternative investment fund managers directive—

(i) if the person’s registered office is in an EEA State, its registered office;

(ii) if the person’s registered office is not in an EEA State, the registered office or branch of its legal representative (as defined in Article 4(1)(u) of the alternative investment fund managers directive);]

(b) in relation to any other person, his head office.]

Textual Amendments

F138 Sch. 3 para. 7A inserted (14.1.2005) by The Insurance Mediation Directive (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/1473), reg. 2(2)(g)

F139 Words in Sch. 3 para. 7A(a) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 17(6)

F140 Words in Sch. 3 para. 7A(a) inserted (20.4.2015 for specified purposes, 21.12.2015 for specified purposes, 21.3 2016 in so far as not already in force) by The Mortgage Credit Directive Order 2015 (S.I. 2015/910), art. 1(5), Sch. 1 para. 1(10)(e) (with Pt. 4)

F141 Sch. 3 para. 7A(aa) inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(6)

F142 Sch. 3 para. 7AA(aa) substituted (coming into force in accordance with reg. 1(3) of the amending S.I.) by The Alternative Investment Fund Managers (Amendment) Regulations 2013 (S.I. 2013/1797), reg. 1(3), Sch. 1 para. 1(5)(b) (as amended by S.I. 2019/328, regs. 1(3), 20(2)(d) (as amended by S.I. 2019/325, reg. 58))

EEA State U.K.

[F143 8 U.K. “EEA State ” has the meaning given by Schedule 1 to the Interpretation Act 1978.]

Textual Amendments

F143 Sch. 3 para. 8 substituted (13.2.2007) by The Financial Services (EEA State) Regulations 2007 (S.I. 2007/108), reg. 2

Commencement Information

I4 Sch. 3 Pt. I para. 8 wholly in force at 1.12.2001; Sch. 3 Pt. I para. 8 not in force at Royal Assent see s. 431(2); Sch. 3 Pt. I para. 8 in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b)(c), Sch. Pts. 2, 3; Sch. 3 Pt. I para. 8 in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; Sch. 3 Pt. I para. 8 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

Home state regulator U.K.

9 U.K. “Home state regulator” means the competent authority (within the meaning of the relevant single market directive [F144 or, as the case may be, the emission allowance auctioning regulation]) of an EEA State (other than the United Kingdom) in relation to the EEA firm concerned.

Textual Amendments

F144 Words in Sch. 3 para. 9 inserted (20.7.2012) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2012 (S.I. 2012/1906), arts. 1, 4(4)

Commencement Information

I5 Sch. 3 Pt. I para. 9 wholly in force at 1.12.2001; Sch. 3 Pt. I para. 9 not in force at Royal Assent see s. 431(2); Sch. 3 Pt. I para. 9 in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b)(c), Sch. Pts. 2, 3; Sch. 3 Pt. I para. 9 in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2, Sch.; Sch. 3 Pt. I para. 9 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

UK firm U.K.

10 U.K. “UK firm” means a person whose [F145 relevant office] is in the UK and who has an EEA right to carry on activity in an EEA State other than the United Kingdom.

Textual Amendments

F145 Words in Sch. 3 para. 10 substituted (14.1.2005) by The Insurance Mediation Directive (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/1473), reg. 2(2)(h)

Commencement Information

I6 Sch. 3 Pt. I para. 10 wholly in force at 1.12.2001; Sch. 3 Pt. I para. 10 not in force at Royal Assent see s. 431(2); Sch. 3 Pt. I para. 10 in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b)(c), Sch. Pts. 2, 3 Sch. 3 Pt. I para. 10 in force for specified purposes at 18.6.2001 by S.I. 2001/1820, art. 2 Sch.; Sch. 3 para. 10 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

[F146 10A U.K. In paragraph 10, “relevant office” means—

(a) in relation to a firm whose EEA right derives from the [F147 insurance distribution directive] and which has a registered office, its registered office;

[F148 [F149 (aa) in relation to a firm whose EEA right derives from the alternative investment fund managers directive, its registered office;]]

[F149 (aa) in relation to a firm whose EEA right derives from the alternative investment fund managers directive—

(i) if the firm’s registered office is in an EEA State, its registered office;

(ii) if the firm’s registered office is not in an EEA State, the registered office or branch of its legal representative (as defined in Article 4(1)(u) of the alternative investment fund managers directive);]

(b) in relation to any other firm, its head office.]

Textual Amendments

F146 Sch. 3 para. 10A inserted (14.1.2005) by The Insurance Mediation Directive (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/1473), reg. 2(2)(i)

F147 Words in Sch. 3 para. 10A(a) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 17(7)

F148 Sch. 3 para. 10A(aa) inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(7)

F149 Sch. 3 para. 10A(aa) substituted (coming into force in accordance with reg. 1(3) of the amending S.I.) by The Alternative Investment Fund Managers (Amendment) Regulations 2013 (S.I. 2013/1797), reg. 1(3), Sch. 1 para. 1(5)(c)

[F150 UK investment firm U.K.

Textual Amendments

F150 Sch. 3 para. 10B inserted (1.4.2007 for certain purposes, otherwise 1.11.2007) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007 (S.I. 2007/126), regs. 1(2), 3(4), Sch. 4 para. 5

10B U.K. ”UK investment firm” means a UK firm—

(a) which is an investment firm, and

(b) whose EEA right derives from the markets in financial instruments directive.]

Host state regulator U.K.

11 U.K. “Host state regulator” means the competent authority (within the meaning of the relevant single market directive [F151 or, as the case may be, the emission allowance auctioning regulation]) of an EEA State (other than the United Kingdom) in relation to a UK firm’s exercise of EEA rights there.

Textual Amendments

F151 Words in Sch. 3 para. 11 inserted (20.7.2012) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2012 (S.I. 2012/1906), arts. 1, 4(4)

Commencement Information

I7 Sch. 3 Pt. I para. 11 wholly in force at 1.12.2001; Sch. 3 Pt. I para. 11 not in force at Royal Assent see s. 431(2); Sch. 3 Pt. I para. 11 in force for certain purposes (25.2.2001) by S.I. 2001/516, art. 2 Sch. Pts. 2, 3; Sch. 3 Pt. I para. 11 in force for specified purposes (18.6.2001) by S.I. 2001/1820, art. 2 Sch.; Sch. 3 Pt. I para. 11 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)

[F152 Tied agent U.K.

Textual Amendments

F152 Sch. 3 para. 11A inserted (1.4.2007 for certain purposes, otherwise 1.11.2007) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007 (S.I. 2007/126), regs. 1(2), 3(4), Sch. 4 para. 6

11A U.K. ”Tied agent” has the meaning given in Article [F153 4.1.29] of the markets in financial instruments directive.]

Textual Amendments

F153 Word in Sch. 3 para. 11A substituted (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 2 para. 54(3) (with reg. 7)

[F154 Management company U.K.

Textual Amendments

F154 Sch. 3 paras. 11B, 11C inserted (1.7.2011) by The Undertakings for Collective Investment in Transferable Securities Regulations 2011 (S.I. 2011/1613), reg. 2(33)(c)

11B U.K. “Management company” has the meaning given in Article 2.1(b) of the UCITS directive.

UCITS] U.K.

F155 11C U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F155 Sch. 3 para. 11C omitted (28.6.2018 for specified purposes, 21.7.2018 in so far as not already in force) by virtue of The Money Market Funds Regulations 2018 (S.I. 2018/698), regs. 1(2), 2(19)

[F156 EEAAIFM] U.K.

Textual Amendments

F156 Sch. 3 para. 11D and cross-heading inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 34(8)

F157 11D. U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F157 Sch. 3 para. 11D omitted (31.12.2020) by virtue of The Financial Services (Miscellaneous) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/710), regs. 1(3), 3(3) (with regs. 36, 37, Sch.); 2020 c. 1, Sch. 5 para. 1(1)

F158 Part II U.K. Exercise of Passport Rights by EEA Firms

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F158 Sch. 3 Pt. 2 omitted (31.12.2020) by virtue of The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1149), regs. 1(3), 2(5)(a) (with reg. 4); 2020 c. 1, Sch. 5 para. 1(1)

F159 Part III U.K. Exercise of Passport Rights by UK Firms

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F159 Sch. 3 Pt. 3 omitted (31.12.2020) by virtue of The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1149), regs. 1(3), 2(5)(b) (with reg. 4); 2020 c. 1, Sch. 5 para. 1(1)

Section 31(1)(c).

F160 SCHEDULE 4 U.K. Treaty Rights

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F160 Sch. 4 omitted (31.12.2020) by virtue of The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1149), regs. 1(3), 2(6) (with reg. 4); 2020 c. 1, Sch. 5 para. 1(1)

Section 36.

SCHEDULE 5 U.K. Persons Concerned in Collective Investment Schemes

Authorisation U.K.

1 F161 (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . U.K.

F161 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) An authorised open-ended investment company is an authorised person.

[F162 (4) A body—

(a) incorporated by virtue of regulations made under section 1 of the Open-Ended Investment Companies Act (Northern Ireland) 2002 in respect of which an authorisation order is in force, and

[F163 (b) which is a UCITS as defined in section 236A,]

is an authorised person.

(5) “Authorisation order” means an order made under (or having effect as made under) any provision of those regulations which is made by virtue of section 1(2)(1) of that Act (provision corresponding to Chapter 3 of Part 17 of the Act).]

Textual Amendments

F161 Sch. 5 para. 1(1)(2) omitted (31.12.2020) by virtue of The Collective Investment Schemes (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/325), regs. 1(2), 32(2)(a) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F162 Sch. 5 para. 1(4)(5) inserted (13.2.2004) by The Collective Investment Schemes (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/2066), reg 10(a)

F163 Sch. 5 para. 1(4)(b) substituted (31.12.2020) by The Collective Investment Schemes (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/325), regs. 1(2), 32(2)(b) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

Permission U.K.

2 F164 (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . U.K.

(2) A person authorised as a result of paragraph 1(3) [F165 or (4)] has permission to carry on, so far as it is a regulated activity [F166 other than the activity of managing an AIF]—

(a) the operation of the scheme;

(b) any activity in connection with, or for the purposes of, the operation of the scheme.

Textual Amendments

F164 Sch. 5 para. 2(1) omitted (31.12.2020) by virtue of The Collective Investment Schemes (Amendment etc.) (EU Exit) Regulations 2019 (S.I. 2019/325), regs. 1(2), 32(3) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)

F165 Words in Sch. 5 para. 2(2) inserted (13.2.2004) by The Collective Investment Schemes (Miscellaneous Amendments) Regulations 2003 (S.I. 2003/2066), reg 10(b)

F166 Words in Sch. 5 para. 2(2) inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 35

[F167 Section 55B]

SCHEDULE 6 U.K. Threshold Conditions

Textual Amendments

F167 Words in Sch. 6 substituted (1.4.2013) by The Financial Services and Markets Act 2000 (Threshold Conditions) Order 2013 (S.I. 2013/555), arts. 1, 2(1)

Modifications etc. (not altering text)

C89 Sch. 6 modified (3.9.2001) by S.I. 2001/2507, arts. 1(1), 3(1); S.I. 2001/2632, art. 2(2), Sch. Pt. 2

[F168 PART 1 U.K. Introduction

Textual Amendments

F168 Sch. 6 Pts. 1-1G substituted for Sch. 6 Pts. 1, 2 (1.4.2013) by The Financial Services and Markets Act 2000 (Threshold Conditions) Order 2013 (S.I. 2013/555), arts. 1, 2(2)

1A. (1) In this Schedule— U.K.

• “assets” includes contingent assets;

• “consolidated supervision” has the same meaning as in section 3M;

• “consumers” has the meaning given in section 425A;

• “financial crime” is to be read with section 1H(3);

• “functions”, in relation to the FCA or the PRA, means functions conferred on that regulator by or under this Act;

• [F169 “implementing provisions” has the same meaning as in section 3M;]

• “liabilities” includes contingent liabilities;

• “relevant directives” has the same meaning as in section 3M;

• [F170 “relevant implementing provisions” means—

  (a)

  any implementing provision contained in subordinate legislation (within the meaning of the Interpretation Act 1978) made otherwise than by any of the following–

  (i)

  statutory instrument, and

  (ii)

  statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979 (S.I. 1979/1573 (N.I. 12)); or

  (b)

  any other implementing provision (as amended from time to time));]

• “Society” means the society incorporated by Lloyd’s Act 1871 by the name of Lloyd’s;

• “subsidiary undertaking” includes all the instances mentioned in Article 1(1) and (2) of the Seventh Company Law Directive in which an entity may be a subsidiary of an undertaking.

(2) For the purposes of this Schedule, the “non-financial resources” of a person include any systems, controls, plans or policies that the person maintains, any information that the person holds and the human resources that the person has available.

(3) In this Schedule, References to “integrity” of the UK financial system are to be read in accordance section 1D(2).

(4) References to the failure of a person are to be read in accordance with section 2J(3) and (4).

Textual Amendments

F169 Words in Sch. 6 para. 1A(1) inserted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 97(2); 2020 c. 1, Sch. 5 para. 1(1)

F170 Words in Sch. 6 para. 1A(1) inserted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 97(3); 2020 c. 1, Sch. 5 para. 1(1)

PART 1B U.K. Part 4A permission: authorised persons who are not PRA-authorised persons

Introduction U.K.

2A. If the person concerned (“A”) carries on, or is seeking to carry on, regulated activities which do not consist of or include a PRA-regulated activity, the threshold conditions that are relevant to the discharge by the FCA of its functions in relation to A are the conditions set out in paragraphs 2B to 2F.

Location of offices U.K.

2B. (1) Unless sub-paragraph (3) [F171 , (4)(a) or (7)] applies, if A is a body corporate incorporated in the United Kingdom—

(a) A’s head office, and

(b) if A has a registered office, that office,

must be in the United Kingdom.

(2) If A is not a body corporate but A’s head office is in the United Kingdom, A must carry on business in the United Kingdom.

(3) If—

(a) A is seeking to carry on, or is carrying on, a regulated activity which is any of the investment services and activities,

(b) A is a body corporate with no registered office, and

(c) A’s head office is in the United Kingdom,

A must carry on business in the United Kingdom.

(4) If A is seeking to carry on, or is carrying on, an insurance [F172 distribution] activity—

(a) where A is a body corporate incorporated in the United Kingdom, A’s registered office, or if A has no registered office, A’s head office, must be in the United Kingdom;

(b) where A is an individual, A is to be treated for the purposes of sub-paragraph (2) as having a head office in the United Kingdom if A is resident in the United Kingdom.

(5) “Insurance [F173 distribution] activity” means any of the following activities—

(a) dealing in rights under a contract of insurance as agent;

(b) arranging deals in rights under a contract of insurance;

(c) assisting in the administration and performance of a contract of insurance;

(d) advising on buying or selling rights under a contract of insurance;

(e) agreeing to do any of the activities specified in paragraphs (a) to (d).

(6) Sub-paragraph (5) must be read with—

(a) section 22,

(b) any relevant order under that section, and

(c) Schedule 2.

[F174 (7) If A is seeking to carry on, or is carrying on, the regulated activity of managing an AIF and is, or upon being granted Part 4A permission to carry on that regulated activity would be, [F175 a full-scope UKAIFM, A’s head office and registered office must be in the United Kingdom] [F175 a full-scope UKAIFM—

(a) A’s head office and registered office must be in the United Kingdom, or

(b) A’s registered office must be in a third country].]

Textual Amendments

F171 Words in Sch. 6 para. 2B(1) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 36(a)

F172 Word in Sch. 6 para. 2B(4) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 18(4)

F173 Word in Sch. 6 para. 2B(5) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 18(4)

F174 Sch. 6 para. 2B(7) inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 1 para. 36(b)

F175 Words in Sch. 6 para. 2B(7) substituted (coming into force in accordance with reg. 1(3) of the amending S.I.) by The Alternative Investment Fund Managers (Amendment) Regulations 2013 (S.I. 2013/1797), reg. 1(3), Sch. 2 para. 1(6) (as amended by S.I. 2019/328, regs. 1(3), 20(2)(e) (as amended by S.I. 2019/325, reg. 58))

Effective supervision U.K.

2C. (1) A must be capable of being effectively supervised by the FCA having regard to all the circumstances including—

(a) the nature (including the complexity) of the regulated activities that A carries on or seeks to carry on;

(b) the complexity of any products that A provides or will provide in carrying on those activities;

(c) the way in which A’s business is organised;

(d) if A is a member of a group, whether membership of the group is likely to prevent the FCA’s effective supervision of A;

(e) whether A is subject to consolidated supervision required under any [F176 relevant implementing provisions];

(f) if A has close links with another person (“CL”)—

(i) the nature of the relationship between A and CL,

(ii) whether those links are or that relationship is likely to prevent the FCA’s effective supervision of A, and

(iii) if CL is subject to the laws, regulations or administrative provisions of a [F177 country or territory outside the United Kingdom] (“the foreign provisions”), whether those foreign provisions, or any deficiency in their enforcement, would prevent the FCA’s effective supervision of A.

[F178 (1A) Paragraphs (a), (b) and (e) of sub-paragraph (1) do not apply where the only regulated activities that the person carries on, or seeks to carry on, are—

(a) relevant credit activities, and

(b) if any, activities to which, by virtue of section 39(1D), sections 20(1) and (1A) and 23(1A) do not apply when carried on by the person.]

(2) A has close links with CL if—

(a) CL is a parent undertaking of A,

(b) CL is a subsidiary undertaking of A,

(c) CL is a parent undertaking of a subsidiary undertaking of A,

(d) CL is a subsidiary undertaking of a parent undertaking of A,

(e) CL owns or controls 20% or more of the voting rights or capital of A, or

(f) A owns or controls 20% or more of the voting rights or capital of CL.

Textual Amendments

F176 Words in Sch. 6 para. 2C(1)(e) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 98(a); 2020 c. 1, Sch. 5 para. 1(1)

F177 Words in Sch. 6 para. 2C(1)(f)(iii) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 98(b); 2020 c. 1, Sch. 5 para. 1(1)

F178 Sch. 6 para. 2C(1A) substituted (14.2.2014 for specified purposes) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(2)

Appropriate resources U.K.

2D. (1) The resources of A must be appropriate in relation to the regulated activities that A carries on or seeks to carry on.

(2) The matters which are relevant in determining whether A has appropriate resources include—

(a) the nature and scale of the business carried on, or to be carried on, by A;

(b) the risks to the continuity of the services provided by, or to be provided by, A;

(c) A’s membership of a group and any effect which that membership may have.

(3) [F179 Except in a case within sub-paragraph (3A), the matters] which are relevant in determining whether A has appropriate financial resources include—

(a) the provision A makes and, if A is a member of a group, which other members of the group make, in respect of liabilities;

(b) the means by which A manages and, if A is a member of a group, by which other members of the group manage, the incidence of risk in connection with A’s business.

[F180 (3A) Where the only regulated activities that A carries on or seeks to carry on are—

(a) relevant credit activities, and

(b) if any, activities to which, by virtue of section 39(1D), sections 20(1) and (1A) and 23(1A) do not apply when carried on by A,

A has adequate financial resources if A is capable of meeting A’s debts as they fall due.]

(4) The matters which are relevant in determining whether A has appropriate non-financial resources include—

(a) the skills and experience of those who manage A’s affairs;

(b) whether A’s non-financial resources are sufficient to enable A to comply with—

(i) requirements imposed or likely to be imposed on A by the FCA in the exercise of its functions, or

(ii) any other requirement in relation to whose contravention the FCA would be the appropriate regulator for the purpose of any provision of Part 14 of this Act.

Textual Amendments

F179 Words in Sch. 6 para. 2D(3) substituted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2013 (S.I. 2013/1881), arts. 1(2)(6), 10(19)(b)(i)

F180 Sch. 6 para. 2D(3A) substituted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(3)

Suitability U.K.

2E. A must be a fit and proper person having regard to all the circumstances, including—

(a) A’s connection with any person;

(b) the nature (including the complexity) of the regulated activities that A carries on or seeks to carry on;

(c) the need to ensure that A’s affairs are conducted in an appropriate manner, having regard in particular to the interests of consumers and the integrity of the UK financial system;

(d) whether A has complied and is complying with requirements imposed by the FCA in the exercise of its functions, or requests made by the FCA, relating to the provision of information to the FCA and, where A has so complied or is so complying, the manner of that compliance;

(e) whether those who manage A’s affairs have adequate skills and experience and have acted and may be expected to act with probity;

(f) whether A’s business is being, or is to be, managed in such a way as to ensure that its affairs will be conducted in a sound and prudent manner;

(g) the need to minimise the extent to which it is possible for the business carried on by A, or to be carried on by A, to be used for a purpose connected with financial crime.

Business model U.K.

2F. (1) A’s business model (that is, A’s strategy for doing business) must be suitable for a person carrying on the regulated activities that A carries on or seeks to carry on.

(2) The matters which are relevant in determining whether A satisfies the condition in sub-paragraph (1) include—

(a) whether the business model is compatible with A’s affairs being conducted, and continuing to be conducted, in a sound and prudent manner;

(b) the interests of consumers;

(c) the integrity of the UK financial system.

(3) [F181 This paragraph does not apply where the only regulated activities that the person carries on, or seeks to carry on, are—

(a) relevant credit activities, and

(b) if any, activities to which, by virtue of section 39(1D), sections 20(1) and (1A) and 23(1A) do not apply when carried on by the person.]

Textual Amendments

F181 Sch. 6 para. 2F(3) substituted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(4)

Interpretation U.K.

[F182 2G. (1) In this Part of this Schedule, each of the following is a “relevant credit activity”—

(a) an activity of the kind specified by article 36A of the Regulated Activities Order (credit broking) when carried on in the case specified in sub-paragraph (3), (4) or (5),

(b) an activity of the kind specified by article 39D of that Order (debt adjusting) when carried on—

(i) in the case specified in sub-paragraph (3), by a person who also carries on an activity of the kind specified by paragraph (a),

[F183 (ii) by a person in connection with an activity of the kind specified by paragraph (d) or (e) which the person also carries on,]

(iii) by a not-for-profit body,

(c) an activity of the kind specified by article 39E of that Order (debt-counselling) when carried on—

(i) in the case specified in sub-paragraph (3), by a person who also carries on an activity of the kind specified by paragraph (a),

[F184 (ii) by a person in connection with an activity of the kind specified by paragraph (d) or (e) which the person also carries on,]

(iii) by a not-for-profit body,

(d) an activity of the kind specified by article 60B of that Order (regulated credit agreements) if—

(i) it is carried on by a supplier,

(ii) no charge (by way of interest or otherwise) is payable by the borrower in connection with the provision of credit under the regulated credit agreement, and

(iii) the regulated credit agreement is not a hire-purchase agreement or a conditional sale agreement,

[F185 (da) an activity of the kind specified by article 60B of that Order (regulated credit agreements) if carried on by a local authority,]

(e) an activity of the kind specified by article 60N of that Order (regulated consumer hire agreements),

(f) an activity of the kind specified by article 89A of that Order (providing credit information services) where carried on by a person [F186 in connection with an activity of the kind specified by any of paragraphs (a) to (e) which the person also carries on], or

(g) an activity of the kind specified by article 64 of that Order (agreeing to carry on specified kinds of activity) so far as relevant to any of the activities specified in paragraphs (a) to (f).

(2) [F187 Except where the activity is carried on by a not-for-profit body,] an activity is not a relevant credit activity for the purposes of—

(a) paragraph (a) to (e) of sub-paragraph (1), and

(b) paragraph (g) of that sub-paragraph so far at it relates to activities of the kind specified by any of those paragraphs,

if it relates to an agreement under which the obligation of the borrower to repay [F188 or the hirer to pay] is secured, or is to be secured, by a legal mortgage on land.

(3) The case specified in this sub-paragraph is where a supplier (other than a domestic premises supplier) carries on the activity for the purposes of, or in connection with, the sale of goods or supply of services by the supplier to a customer (who need not be the borrower under the credit agreement or the hirer under the consumer hire agreement).

[F189 (3A) For the purposes of sub-paragraph (3), “domestic premises supplier” means a supplier who—

(a) sells, offers to sell or agrees to sell goods, or

(b) offers to supply services or contracts to supply services,

to customers who are individuals while the supplier, or the supplier’s representative, is physically present at the dwelling of the individual (but see sub-paragraph (3B)).

(3B) A supplier who acts as described in sub-paragraph (3A) on an occasional basis only will not be a domestic premises supplier unless the supplier indicates to the public at large, or any section of the public, the supplier’s willingness to attend (in person or through a representative) the dwelling of potential customers in order to carry on any of the activities mentioned in sub-paragraph (3A)(a) or (b).]

(4) The case specified in this sub-paragraph is where the activity relates to a green deal plan.

[F190 (5) The case specified in this sub-paragraph is where the activity relates to a consumer hire agreement or a hire-purchase agreement.]

(6) For the purposes of this paragraph—

• “borrower” includes—

  (a)

  any person providing a guarantee or indemnity under an agreement, and

  (b)

  a person to whom the rights and duties of the borrower under an agreement or a person falling within paragraph (a) have passed by assignment or operation of law;

• “conditional sale agreement” has the meaning given by article 60L of the Regulated Activities Order;

• [F191 “consumer hire agreement” has the meaning given by article 60N(3) of the Regulated Activities Order;]

• “customer” means a person to whom a supplier sells goods or supplies services or agrees to do so;

• F192 ...

• “green deal plan” has the meaning given by section 1 of the Energy Act 2011;

• “hire-purchase agreement” has the meaning given by the Regulated Activities Order;

• [F193 “local authority” means—

  (a)

  in England and Wales, a local authority within the meaning of the Local Government Act 1972, the Greater London Authority, the Common Council of the City of London or the Council of the Isles of Scilly;

  (b)

  in Scotland, a local authority within the meaning of the Local Government (Scotland) Act 1973; and

  (c)

  in Northern Ireland, a district council within the meaning of the Local Government Act (Northern Ireland) 1972;]

• “not-for-profit body” means a body which, by virtue of its constitution or any enactment—

  (a)

  is required (after payment of outgoings) to apply the whole of its income and any capital it expends for charitable or public purposes, and

  (b)

  is prohibited from directly or indirectly distributing amongst its members any part of its assets (otherwise than for charitable or public purposes);

• “Regulated Activities Order” means the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;

• “regulated credit agreement” has the meaning given by the Regulated Activities Order;

• “supplier” means a person whose main business is to sell goods or supply services and not to carry on a regulated activity, other than an activity of the kind specified by article 60N of the Regulated Activities Order (regulated consumer hire agreements).]

Textual Amendments

F182 Sch. 6 para. 2G inserted (26.7.2013 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2013 (S.I. 2013/1881), arts. 1(2)(6), 10(19)(d)

F183 Sch. 6 para. 2G(1)(b)(ii) substituted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(5)(a)(i)

F184 Sch. 6 para. 2G(1)(c)(ii) substituted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(5)(a)(ii)

F185 Sch. 6 para. 2G(1)(da) inserted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(5)(a)(iii)

F186 Words in Sch. 6 para. 2G(1)(f) substituted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(5)(a)(iv)

F187 Words in Sch. 6 para. 2G(2) substituted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(5)(b)(i)

F188 Words in Sch. 6 para. 2G(2) inserted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(5)(b)(ii)

F189 Sch. 6 para. 2G(3A)(3B) inserted (24.3.2015) by The Financial Services and Markets Act 2000 (Miscellaneous Provisions) Order 2015 (S.I. 2015/853), arts. 1(2), 2(2)

F190 Sch. 6 para. 2G(5) substituted (24.3.2015) by The Financial Services and Markets Act 2000 (Miscellaneous Provisions) Order 2015 (S.I. 2015/853), arts. 1(2), 2(3)

F191 Words in Sch. 6 para. 2G(6) inserted (24.3.2015) by The Financial Services and Markets Act 2000 (Miscellaneous Provisions) Order 2015 (S.I. 2015/853), arts. 1(2), 2(4)(a)

F192 Words in Sch. 6 para. 2G(6) omitted (24.3.2015) by virtue of The Financial Services and Markets Act 2000 (Miscellaneous Provisions) Order 2015 (S.I. 2015/853), arts. 1(2), 2(4)(b)

F193 Words in Sch. 6 para. 2G(6) inserted (14.2.2014 for specified purposes, 1.4.2014 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 (S.I. 2014/366), arts. 1(3)(4), 5(5)(c)

PART 1C U.K. Part 4A permission: conditions for which FCA is responsible in relation to PRA-authorised persons

Introduction U.K.

3A. If the person concerned (“B”) carries on, or is seeking to carry on, regulated activities which consist of or include a PRA-regulated activity, the threshold conditions which are relevant to the discharge by the FCA of its functions in relation to B are the conditions set out in paragraphs 3B to 3E.

Effective supervision U.K.

3B. (1) B must be capable of being effectively supervised by the FCA having regard to all the circumstances including—

(a) the nature (including the complexity) of the regulated activities that B carries on or seeks to carry on;

(b) the complexity of any products that B provides or will provide in carrying on those activities;

(c) the way in which B’s business is organised;

(d) if B is a member of a group, whether membership of the group is likely to prevent the FCA’s effective supervision of B;

(e) whether B is subject to consolidated supervision required under any [F194 relevant implementing provisions];

(f) if B has close links with another person (“CL”)—

(i) the nature of the relationship between B and CL,

(ii) whether those links are or that relationship is likely to prevent the FCA’s effective supervision of B, and

(iii) if CL is subject to the laws, regulations or administrative provisions of a [F195 country or territory outside the United Kingdom] (“the foreign provisions”), whether those foreign provisions, or any deficiency in their enforcement, would prevent the FCA’s effective supervision of B.

(2) B has close links with CL if—

(a) CL is a parent undertaking of B,

(b) CL is a subsidiary undertaking of B,

(c) CL is a parent undertaking of a subsidiary undertaking of B,

(d) CL is a subsidiary undertaking of a parent undertaking of B,

(e) CL owns or controls 20% or more of the voting rights or capital of B, or

(f) B owns or controls 20% or more of the voting rights or capital of CL.

Textual Amendments

F194 Words in Sch. 6 para. 3B(1)(e) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 99(a); 2020 c. 1, Sch. 5 para. 1(1)

F195 Words in Sch. 6 para. 3B(1)(f)(iii) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 99(b); 2020 c. 1, Sch. 5 para. 1(1)

Appropriate non-financial resources U.K.

3C. (1) The non-financial resources of B must be appropriate in relation to the regulated activities that B carries on or seeks to carry on, having regard to the operational objectives of the FCA.

(2) The matters which are relevant in determining whether the condition in sub-paragraph (1) is met include—

(a) the nature and scale of the business carried on, or to be carried on, by B;

(b) the risks to the continuity of the services provided by, or to be provided by, B;

(c) B’s membership of a group and any effect which that membership may have;

(d) the skills and experience of those who manage B’s affairs;

(e) whether B’s non-financial resources are sufficient to enable B to comply with—

(i) requirements imposed or likely to be imposed on B by the FCA in the exercise of its functions, or

(ii) any other requirement in relation to whose contravention the FCA would be the appropriate regulator for the purpose of any provision of Part 14 of this Act.

Suitability U.K.

3D. (1) B must be a fit and proper person, having regard to the operational objectives of the FCA.

(2) The matters which are relevant in determining whether B satisfies the condition in sub-paragraph (1) include—

(a) B’s connection with any person;

(b) the nature (including the complexity) of the regulated activities that B carries on or seeks to carry on;

(c) the need to ensure that B’s affairs are conducted in an appropriate manner, having regard in particular to the interests of consumers and the integrity of the UK financial system;

(d) whether B has complied and is complying with requirements imposed by the FCA in the exercise its functions, or requests made by the FCA, relating to the provision of information to the FCA and, where B has so complied or is so complying, the manner of that compliance;

(e) whether those who manage B’s affairs have adequate skills and experience and have acted and may be expected to act with probity;

(f) the need to minimise the extent to which it is possible for the business carried on by B, or to be carried on by B, to be used for a purpose connected with financial crime.

Business model U.K.

3E. B’s business model (that is, B’s strategy for doing business) must be suitable for a person carrying on the regulated activities that B carries on or seeks to carry on, having regard to the FCA’s operational objectives.

PART 1D U.K. Part 4A permission: conditions for which the PRA is responsible in relation to insurers etc.

Introduction U.K.

4A. (1) If the person concerned (“C”) carries on, or is seeking to carry on, regulated activities which consist of or include a PRA-regulated activity relating to the effecting or carrying out of contracts of insurance, the threshold conditions which are relevant to the discharge by the PRA of its functions in relation to C are the conditions set out in paragraphs 4B to 4F.

(2) If the person concerned (“C”) carries on, or is seeking to carry on, regulated activities which consist of or include a PRA-regulated activity relating to managing the underwriting capacity of a Lloyd’s syndicate as a managing agent at Lloyd’s, the conditions which are relevant to the discharge by the PRA of its functions in relation to C are the conditions set out in paragraphs 4C to 4F except for sub-paragraphs (5)(d) and (5)(e) of paragraph 4D which are not relevant for that purpose.

(3) If the person concerned (“C”) carries on, or is seeking to carry on, regulated activities which consist of or include a PRA-regulated activity relating to the arranging, by the Society, of deals in contracts of insurance written at Lloyd’s, the conditions which are relevant to the discharge by the PRA of its functions in relation to C are the conditions set out in paragraphs 4C to 4F, subject to sub-paragraph (4).

(4) Paragraph 4D has effect in relation to persons of the kind specified by sub-paragraph (3) as if—

(a) for paragraph (d) and (e) of sub-paragraph (5) there were substituted—

“(d) the effect that the carrying on of business by C might be expected to have on the stability of the UK financial system or on those who are or may become policyholders of members of C;

(e) the effect that the failure of C might be expected to have on the stability of the UK financial system or on those who are or may become policyholders of members of C;”, and

(b) sub-paragraph (6) were omitted.

[F196 (5) If the person concerned (“C”) carries on, or is seeking to carry on, regulated activities which consist of or include a PRA-regulated activity relating to an assumption of risk falling within article 13A of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, the threshold conditions which are relevant to the discharge by the PRA of its functions in relation to C are the conditions set out in paragraphs 4B to 4F, subject to sub-paragraph (6).

(6) Paragraphs 4B to 4F have effect in relation to persons of the kind specified by sub-paragraph (5) as if—

[F197 (a) the persons are undertakings, whether incorporated or not, other than an existing insurance or reinsurance undertaking, which assume risks from insurance or reinsurance undertakings and which fully fund their exposure to such risks through the proceeds of a debt issuance or any other financing mechanism where the repayment rights of the providers of such debt or financing mechanism are subordinated to the reinsurance obligations of such an undertaking;]

[F198 (b) the persons are not insurance undertakings;]

(c) references to contracts of insurance are references to contracts for the assumption of risk; and

(d) references to C’s policyholders are references to undertakings from whom C assumes a risk.]

[F199 (7) In paragraph (6)(a), references to undertakings which assume risks from insurance or reinsurance undertakings include references to undertakings which assume risks from third country insurance or reinsurance undertakings and Gibraltarian insurance or reinsurance undertakings; and for these purposes “third country insurance undertakings”, “third country reinsurance undertakings”, “Gibraltarian insurance undertakings” and “Gibraltarian reinsurance undertakings” have the same meaning as in the Solvency 2 Regulations 2015 (S.I. 2015/575), as amended under the European Union (Withdrawal) Act 2018 (see, in particular, regulation 2(1)).]

Textual Amendments

F196 Sch. 6 para. 4A(5)(6) inserted (8.12.2017) by The Risk Transformation Regulations 2017 (S.I. 2017/1212), regs. 1(2), 4(2)(a)

F197 Sch. 6 para. 4A(6)(a) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 100(a); 2020 c. 1, Sch. 5 para. 1(1)

F198 Sch. 6 para. 4A(6)(b) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 100(b); 2020 c. 1, Sch. 5 para. 1(1)

F199 Sch. 6 para. 4A(7) inserted by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 100(c) (as inserted by S.I. 2019/1233, regs. 1(3), 5(d)); 2020 c. 1, Sch. 5 para. 1(1))

Legal status U.K.

4B. C must be—

(a) a body corporate (other than a limited liability partnership),

(b) a registered friendly society, or

(c) a member of Lloyd’s.

Location of offices U.K.

4C. (1) If C is a body corporate incorporated in the United Kingdom—

(a) C’s head office, and

(b) if C has a registered office, that office,

must be in the United Kingdom.

(2) If C is not a body corporate but C’s head office is in the United Kingdom, C must carry on business in the United Kingdom.

Business to be conducted in a prudent manner U.K.

4D. (1) The business of C must be conducted in a prudent manner.

(2) To satisfy the condition in sub-paragraph (1), C must in particular have appropriate financial and non-financial resources.

(3) To have appropriate financial resources C must satisfy the following conditions—

(a) C’s assets must be appropriate given C’s liabilities, and

(b) the liquidity of C’s resources must be appropriate given C’s liabilities and when they fall due or may fall due.

(4) To have appropriate non-financial resources C must satisfy the following conditions—

(a) C must be willing and able to value C’s assets and liabilities appropriately,

(b) C must have resources to identify, monitor, measure and take action to remove or reduce risks to the safety and soundness of C,

(c) C must have resources to identify, monitor, measure and take action to remove or reduce risks to the accuracy of C’s valuation of C’s assets and liabilities,

(d) the effectiveness with which C’s business is managed must meet a reasonable standard of effectiveness, and

(e) C’s non-financial resources must be sufficient to enable C to comply with—

(i) requirements imposed or likely to be imposed on C by the PRA in the exercise of its functions, and

(ii) any other requirement in relation to whose contravention the PRA would be the appropriate regulator for the purpose of any provision of Part 14 of this Act.

(5) The matters which are relevant in determining whether C satisfies the condition in sub-paragraph (1) or (2) include—

(a) the nature (including the complexity) of the regulated activities that C carries on or seeks to carry on;

(b) the nature and scale of the business carried on or to be carried on by C;

(c) the risks to the continuity of the services provided by, or to be provided by, C;

(d) the effect that the carrying on of the business of effecting or carrying out contracts of insurance by C might be expected to have on the stability of the UK financial system or on those who are or may become C’s policyholders;

(e) the effect that C’s failure or C being closed to new business might be expected to have on the stability of the UK financial system or on those who are or may become C’s policyholders;

(f) C’s membership of a group and any effect which that membership may have.

(6) C is “closed to new business” for the purposes of this paragraph if C has ceased to effect contracts of insurance or has substantially reduced the number of such contracts which C effects.

Suitability U.K.

4E. (1) C must be a fit and proper person, having regard to the PRA’s objectives.

(2) The matters which are relevant in determining whether C satisfies the condition in sub-paragraph (1) include—

(a) whether C has complied and is complying with requirements imposed by the PRA in the exercise of its functions, or requests made by the PRA relating to the provision of information to the PRA and, if C has so complied or is so complying, the manner of that compliance;

(b) whether those who manage C’s affairs have adequate skills and experience and have acted and may be expected to act with probity.

Effective supervision U.K.

4F. (1) C must be capable of being effectively supervised by the PRA.

(2) The matters which are relevant in determining whether C satisfies the condition in sub-paragraph (1) include—

(a) the nature (including the complexity) of the regulated activities that C carries on or seeks to carry on;

(b) the complexity of any products that C provides or will provide in carrying on those activities;

(c) the way in which C’s business is organised;

(d) if C is a member of a group, whether membership of the group is likely to prevent the PRA’s effective supervision of C;

(e) whether C is subject to consolidated supervision required under any [F200 relevant implementing provisions];

(f) if C has close links with another person (“CL”)—

(i) the nature of the relationship between C and CL,

(ii) whether those links are or that relationship is likely to prevent the PRA’s effective supervision of C, and

(iii) if CL is subject to the laws, regulations or administrative provisions of a [F201 country or territory outside the United Kingdom] (“the foreign provisions”), whether those foreign provisions, or any deficiency in their enforcement, would prevent the PRA’s effective supervision of C.

(3) C has close links with CL if—

(a) CL is a parent undertaking of C,

(b) CL is a subsidiary undertaking of C,

(c) CL is a parent undertaking of a subsidiary undertaking of C,

(d) CL is a subsidiary undertaking of a parent undertaking of C,

(e) CL owns or controls 20% or more of the voting rights or capital of C, or

(f) C owns or controls 20% or more of the voting rights or capital of CL.

Textual Amendments

F200 Words in Sch. 6 para. 4F(2)(e) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 101(a); 2020 c. 1, Sch. 5 para. 1(1)

F201 Words in Sch. 6 para. 4F(2)(f)(iii) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 101(b); 2020 c. 1, Sch. 5 para. 1(1)

PART 1E U.K. Part 4A permission: conditions for which the PRA is responsible in relation to other PRA-authorised persons

Introduction U.K.

5A. If the person concerned (“D”) carries on, or is seeking to carry on, PRA-regulated activities which do not consist of or include a regulated activity relating to—

(a) the effecting or carrying out of contracts of insurance,

(b) managing the underwriting capacity of a Lloyd’s syndicate as a managing agent at Lloyds, F202 ...

(c) arranging, by the Society, of deals in contracts of insurance written at Lloyd’s, [F203 or]

[F204 (d) an assumption of risk falling within article 13A of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001,]

the threshold conditions which are relevant to the discharge by the PRA of its functions in relation to D are the conditions set out in paragraphs 5B to 5F.

Textual Amendments

F202 Word in Sch. 6 para. 5A(b) omitted (8.12.2017) by virtue of The Risk Transformation Regulations 2017 (S.I. 2017/1212), regs. 1(2), 4(2)(b)(i)

F203 Word in Sch. 6 para. 5A(c) inserted (8.12.2017) by The Risk Transformation Regulations 2017 (S.I. 2017/1212), regs. 1(2), 4(2)(b)(ii)

F204 Sch. 6 para. 5A(d) inserted (8.12.2017) by The Risk Transformation Regulations 2017 (S.I. 2017/1212), regs. 1(2), 4(2)(b)(iii)

Legal status U.K.

5B. If D carries on or is seeking to carry on a regulated activity which consists of or includes accepting deposits or issuing electronic money, D must be—

(a) a body corporate, or

(b) a partnership.

Location of offices U.K.

5C. (1) If D is a body corporate incorporated in the United Kingdom—

(a) D’s head office, and

(b) if D has a registered office, that office,

must be in the United Kingdom.

(2) If D is not a body corporate but D’s head office is in the United Kingdom, D must carry on business in the United Kingdom.

Business to be conducted in a prudent manner U.K.

5D. (1) The business of D must be conducted in a prudent manner.

(2) To satisfy the condition in sub-paragraph (1), D must in particular have appropriate financial and non-financial resources.

(3) To have appropriate financial resources D must satisfy the following conditions—

(a) D’s assets must be appropriate given D’s liabilities, and

(b) the liquidity of D’s resources must be appropriate given D’s liabilities and when they fall due or may fall due.

(4) To have appropriate non-financial resources D must satisfy the following conditions—

(a) D must be willing and able to value D’s assets and liabilities appropriately,

(b) D must have resources to identify, monitor, measure and take action to remove or reduce risks to the safety and soundness of D,

(c) D must have resources to identify, monitor, measure and take action to remove or reduce risks to the accuracy of D’s valuation of D’s assets and liabilities,

(d) the effectiveness with which D’s business is managed must meet a reasonable standard of effectiveness, and

(e) D’s non-financial resources must be sufficient to enable D to comply with—

(i) requirements imposed or likely to be imposed on D by the PRA in the exercise of its functions, and

(ii) any other requirement in relation to whose contravention the PRA would be the appropriate regulator for the purpose of any provision of Part 14 of this Act.

(5) The matters which are relevant in determining whether D satisfies the condition in sub-paragraph (1) or (2) include—

(a) the nature (including the complexity) of the regulated activities that D carries on or seeks to carry on;

(b) the nature and scale of the business carried on or to be carried on by D;

(c) the risks to the continuity of the services provided or to be provided by D;

(d) the effect that the carrying on of the business carried on or to be carried on by D might be expected to have on the stability of the UK financial system;

(e) the effect that D’s failure might be expected to have on the stability of the UK financial system;

(f) D’s membership of a group and any effect which that membership may have.

Suitability U.K.

5E. (1) D must be a fit and proper person, having regard to the PRA’s objectives.

(2) The matters which are relevant in determining whether D satisfies the condition in sub-paragraph (1) include—

(a) whether D has complied and is complying with requirements imposed by the PRA in the exercise of its functions, or requests made by the PRA relating to the provision of information to the PRA and, if D has so complied or is so complying, the manner of that compliance;

(b) whether those who manage D’s affairs have adequate skills and experience and have acted and may be expected to act with probity.

Effective supervision U.K.

5F. (1) D must be capable of being effectively supervised by the PRA.

(2) The matters which are relevant in determining whether D satisfies the condition in sub-paragraph (1) include—

(a) the nature (including the complexity) of the regulated activities that D carries on or seeks to carry on;

(b) the complexity of any products that D provides or will provide in carrying on those activities;

(c) the way in which D’s business is organised;

(d) if D is a member of a group, whether membership of the group is likely to prevent the PRA’s effective supervision of D;

(e) whether D is subject to consolidated supervision required under any [F205 relevant implementing provisions];

(f) if D has close links with another person (“CL”)—

(i) the nature of the relationship between D and CL,

(ii) whether those links are or that relationship is likely to prevent the PRA’s effective supervision of D, and

(iii) if CL is subject to the laws, regulations or administrative provisions of a [F206 country or territory outside the United Kingdom] (“the foreign provisions”), whether those foreign provisions, or any deficiency in their enforcement, would prevent the PRA’s effective supervision of D.

(3) D has close links with CL if—

(a) CL is a parent undertaking of D,

(b) CL is a subsidiary undertaking of D,

(c) CL is a parent undertaking of a subsidiary undertaking of D,

(d) CL is a subsidiary undertaking of a parent undertaking of D,

(e) CL owns or controls 20% or more of the voting rights or capital of D, or

(f) D owns or controls 20% or more of the voting rights or capital of CL.]

Textual Amendments

F205 Words in Sch. 6 para. 5F(2)(e) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 102(a); 2020 c. 1, Sch. 5 para. 1(1)

F206 Words in Sch. 6 para. 5F(2)(f)(iii) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 102(b); 2020 c. 1, Sch. 5 para. 1(1)

F207 PART 1F U.K. Authorisation under Schedule 3

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F207 Sch. 6 Pt. 1F omitted (31.12.2020) by virtue of The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1149), reg. 1(3), Sch. para. 23(2) (with reg. 4); 2020 c. 1, Sch. 5 para. 1(1)

F208 PART 1G U.K. Authorisation under Schedule 4

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F208 Sch. 6 Pt. 1G omitted (31.12.2020) by virtue of The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1149), reg. 1(3), Sch. para. 23(3) (with reg. 4); 2020 c. 1, Sch. 5 para. 1(1)

Part II U.K. Authorisation

Authorisation under Schedule 3 U.K.

F168 ... U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F168 Sch. 6 Pts. 1-1G substituted for Sch. 6 Pts. 1, 2 (1.4.2013) by The Financial Services and Markets Act 2000 (Threshold Conditions) Order 2013 (S.I. 2013/555), arts. 1, 2(2)

Part III U.K. Additional Conditions

8 (1) If this paragraph applies to the person concerned, he must, for the purposes of such provisions of this Act as may be specified, satisfy specified additional conditions. U.K.

(2) This paragraph applies to a person who—

(a) has his head office outside the [F209 United Kingdom]; and

(b) appears to [F210 such of the FCA or the PRA as may be specified,] to be seeking to carry on a regulated activity relating to insurance business.

(3) “Specified” means specified in, or in accordance with, an order made by the Treasury.

Textual Amendments

F209 Words in Sch. 6 para. 8(2)(a) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 103; 2020 c. 1, Sch. 5 para. 1(1)

F210 Words in Sch. 6 para. 8(2)(b) substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 18 para. 26 (with Sch. 20); S.I. 2013/423, art. 3, Sch.

Commencement Information

I8 Sch. 6 Pt. III para. 8 wholly in force at 3.9.2001; Sch. 6 Pt. III para. 8 not in force at Royal Assent see s. 431(2); Sch. 6 Pt. III para. 8 in force for certain purposes at 25.2.2001 by S.I. 2001/516, art. 2(b), Sch. Pt. 2; Sch. 6 Pt. III para. 8 in force in so far as not already in force at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2

F211 9 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F211 Sch. 6 para. 9 omitted (1.4.2013) by virtue of Financial Services Act 2012 (c. 21), ss. 11(3), 122(3) (with Sch. 20); S.I. 2013/423, art. 3, Sch.

Section 55JA

[F212 SCHEDULE 6A U.K. Variation or cancellation of Part 4A permission on initiative of FCA: additional power

Textual Amendments

F212 Sch. 6A inserted (1.7.2021) by Financial Services Act 2021 (c. 22), s. 49(5), Sch. 11 para. 3; S.I. 2021/739, reg. 3(p)

Additional power U.K.

1 (1) If it appears to the FCA that an FCA-authorised person with a Part 4A permission is carrying on no regulated activity to which the permission relates, the FCA may exercise its power under this paragraph. U.K.

(2) The FCA's power under this paragraph is the power—

(a) to vary the Part 4A permission by—

(i) removing a regulated activity from those to which the permission relates, or

(ii) varying the description of a regulated activity to which the permission relates, or

(b) to cancel the Part 4A permission.

(3) The circumstances in which the FCA may form the view that an authorised person is carrying on no regulated activity include (but are not limited to) circumstances where the person fails—

(a) to pay any periodic fee or levy as is required by the FCA Handbook, or

(b) to provide such information to the FCA as is required by the FCA Handbook.

(4) “The FCA Handbook” means the Handbook made by the FCA under this Act (as that Handbook is amended from time to time).

(5) If, as a result of a variation of a permission under this paragraph, there are no longer any regulated activities for which the person has permission, the FCA must, once it is satisfied that it is no longer necessary to keep the permission in force, cancel it.

(6) The power to vary a permission under this paragraph extends to including in the permission as varied any provision that could be included if a fresh permission were being given in response to an application to the FCA under section 55A.

(7) The FCA's power under this paragraph must be exercised in accordance with paragraph 2.

Procedure etc U.K.

2 (1) The FCA may exercise its power under paragraph 1 in relation to an authorised person with a Part 4A permission only if the following conditions are met. U.K.

(2) The first condition is that the FCA has given a notice in writing to the person—

(a) stating that it appears to the FCA that the person is carrying on no regulated activity to which the permission relates,

(b) inviting the person to respond in a specified manner, and

(c) warning of the potential consequences that may arise under this Schedule of a failure to do so.

(3) The second condition is that—

(a) at least 14 days beginning with the date on which the notice was given have elapsed, and

(b) the person has failed to respond in the specified manner.

(4) The third condition is that the FCA has given a further notice in writing to the person setting out—

(a) in a case where the FCA proposes to vary the permission—

(i) the proposed variation,

(ii) the date on which the FCA proposes to vary the permission (and, if different, the date on which the variation is to take effect), and

(iii) any specified steps the person may take that would (if taken) result in the FCA deciding not to vary the permission as proposed;

(b) in a case where the FCA proposes to cancel the permission—

(i) the date on which the FCA proposes to cancel the permission (and, if different, the date on which the cancellation is to take effect), and

(ii) any specified steps the person may take that would (if taken) result in the FCA deciding not to cancel the permission.

(5) The fourth condition is that the date specified in the notice under sub-paragraph (4) is not earlier than the end of the period of 14 days beginning with the date on which the notice is given.

(6) Where the FCA decides to publicise a notice given under this paragraph (or any details relating to it), it may do so in such manner as it considers appropriate.

Notice of decision U.K.

3 (1) Where the FCA decides to vary or cancel an authorised person's Part 4A permission under paragraph 1, the FCA must give the person a notice in writing setting out— U.K.

(a) in a case where the FCA varies the permission, the variation,

(b) the date on which the variation or cancellation takes effect, and

(c) the person's power to make an application under paragraph 4.

(2) Where the FCA—

(a) has given the person a notice under paragraph 2(4), but

(b) decides not to vary or cancel the permission (whether or not because the specified steps referred to in that notice have been taken),

the FCA must give the person a notice in writing of that decision.

(3) A notice given under this paragraph may include such other information as the FCA considers appropriate.

(4) Where the FCA decides to publicise a notice given under this paragraph (or any details relating to it), it may do so in such manner as it considers appropriate.

Application for decision to be annulled U.K.

4 (1) This paragraph applies where the FCA decides to vary or cancel an authorised person's Part 4A permission under paragraph 1. U.K.

(2) If the person is aggrieved by the FCA's decision, the person may apply to the FCA to have the decision annulled.

(3) An application under this paragraph must be made before the end of the period of 12 months beginning with the day on which the variation or cancellation took effect.

(4) An application under this paragraph must be determined before the end of the period of 6 months beginning with the date on which the FCA received the completed application.

(5) The applicant may withdraw the application, by giving the FCA written notice, at any time before the FCA determines it.

(6) The FCA may direct that an application under this paragraph must—

(a) contain specified information, or

(b) take a specified form.

Annulment etc U.K.

5 (1) This paragraph applies where the FCA receives an application under paragraph 4 in relation to a decision to vary or cancel an authorised person's Part 4A permission under paragraph 1. U.K.

(2) The FCA may—

(a) annul the decision unconditionally,

(b) annul the decision subject to such conditions as it considers appropriate, or

(c) refuse to annul the decision.

(3) The FCA may annul the decision (unconditionally or subject to conditions) only if satisfied that, in all the circumstances, it is just and reasonable to do so.

(4) The FCA's power under sub-paragraph (2)(b) includes the power—

(a) to remove or describe differently a regulated activity specified in the permission, and

(b) to withdraw or vary an approval given under section 59 that has effect in relation to the carrying on of a regulated activity specified in the permission,

provided that the activity in question was one to which the permission related immediately before the decision was taken.

(5) Where the FCA annuls the decision it must give the person a notice in writing setting out—

(a) where the annulment is subject to conditions, the conditions, and

(b) the date on which the annulment takes effect.

(6) If the FCA proposes to refuse to annul the decision it must give the person a warning notice.

(7) If the FCA decides to refuse to annul the decision it must give the person a decision notice.

Effect U.K.

6 (1) Where the FCA— U.K.

(a) varies or cancels an authorised person's Part 4A permission under paragraph 1, but

(b) that decision is subsequently annulled under paragraph 5,

the variation or cancellation is treated as if it had not taken place, subject as follows.

(2) The FCA does not become subject to any statutory obligation by virtue of sub-paragraph (1).

(3) Where, by virtue of sub-paragraph (1)—

(a) a person becomes subject to a statutory obligation, and

(b) the FCA has functions in relation to the obligation,

the FCA may, in exercising those functions, treat the person as if the person had not become subject to the obligation.

(4) If the FCA treats a person as not having become subject to an obligation, it must notify the person of that fact in such manner as it considers appropriate.

(5) In a case where paragraph 5(4)(a) applies—

(a) the permission is treated as if it had been varied in accordance with the FCA's own-initiative variation power, and

(b) that variation is treated as if it took effect on the date on which the annulment took effect.

(6) In a case where paragraph 5(4)(b) applies—

(a) the approval is treated as if it had been withdrawn in accordance with section 63 or varied in accordance with section 63ZB (as the case may be), and

(b) that withdrawal or variation is treated as if it took effect on the date on which the annulment took effect.

(7) In this paragraph “statutory obligation” means any obligation arising under or by virtue of this Act or any other enactment.

(8) In sub-paragraph (7) “enactment” includes—

(a) the enactments listed in section 3T, and

(b) any retained direct EU legislation.

Right to refer matter to Tribunal U.K.

7 (1) This paragraph applies where the FCA— U.K.

(a) decides to vary or cancel an authorised person's Part 4A permission under paragraph 1,

(b) receives an application from the person under paragraph 4 in respect of that decision, and

(c) has disposed of that application under paragraph 5(2).

(2) Either party may refer the matter to the Tribunal.

(3) In determining a reference made under this paragraph, the Tribunal may give such directions, and may make such provision, as it considers reasonable for placing the person and other persons in the same position (as nearly as may be) as if the permission had not been varied or cancelled.

Supplementary U.K.

8 (1) Nothing in this Schedule affects the generality of any other provision made under or by virtue of this Act that confers power on the FCA to vary or cancel an authorised person's Part 4A permission. U.K.

(2) Nothing in paragraph 6(5) and (6) gives rise to a right to make a reference to the Tribunal.

(3) Sections 55U to 55X (applications made under Part 4A: procedure) do not apply in relation to an application made under paragraph 4.

(4) Section 55Z (cancellation of Part 4A permission: procedure) does not apply in relation to a proposal, or decision, to cancel an authorised person's Part 4A permission under paragraph 1.

(5) Section 55Z3(1) (right to refer matters to the Tribunal) does not apply in relation to the determination of an application under paragraph 4.

(6) In this Schedule “specified” means specified in a direction given by the FCA under this Schedule.

(7) A direction made by the FCA under this Schedule may make different provision for different cases.

(8) The FCA may revoke or amend a direction it makes under this Schedule.]

Section 72(2).

F213 SCHEDULE 7 U.K.

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Textual Amendments

F213 Sch. 7 omitted (24.1.2013 for specified purposes, 1.4.2013 in so far as not already in force) by virtue of Financial Services Act 2012 (c. 21), ss. 16(14)(k), 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(c), Sch. Pt. 3; S.I. 2013/423, art. 3, Sch.

Section 72(3).

F214 SCHEDULE 8 U.K.

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