Part XVIIIRecognised investment exchanges, clearing houses , CSDs and other parties

Chapter I Exemption

Supervision

296F1Appropriate regulator's power to give directions.

(1)

This section applies if it appears to F2the appropriate regulator that a recognised body—

(a)

has failed, or is likely to fail, to satisfy the recognition requirements; or

(b)

has failed to comply with any other obligation imposed on it by or under this Act.

F3(1A)

This section also applies F4if it appears to the appropriate regulator that a recognised body has failed, or is likely to fail, to comply with any obligation imposed on it by F5or under F6any qualifying provision specified (or of a description specified) F7for the purposes of this subsection in an order made by the Treasury.

F8(1B)

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

F9(1C)

This section also applies if it appears to the Bank of England that a Tier 2 third country central counterparty has failed to comply with an obligation imposed on it by or under this Act, or by or under the EMIR regulation.

(2)

F10The regulator concerned may direct F11the recognised body F12... to take specified steps for the purpose of securing the body’s compliance with—

(a)

the recognition requirements; or

(b)

any obligation of the kind in question.

F13(2ZA)

Where this section applies by virtue of subsection (1C), the Bank of England may direct the Tier 2 third country central counterparty to take specified steps for the purpose of securing compliance with the obligations referred to in that subsection.

F14(2A)

In the case of F15a recognised body other than an overseas investment exchange or overseas clearing house, those steps may include—

(a)

the granting to F16the regulator concerned of access to the premises of F17the body for the purpose of inspecting—

(i)

those premises; or

(ii)

any documents on the premises which appear to F16the regulator concerned to be relevant for the purpose mentioned in subsection (2);

(b)

the suspension of the carrying on of any regulated activity by F18the body for the period specified in the direction.

F19(2B)

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

F20(2C)

In the case of a Tier 2 third country central counterparty, those steps may include—

(a)

the granting to the Bank of England of access to any premises of the Tier 2 third country central counterparty for the purposes of inspecting—

(i)

those premises; or

(ii)

any documents on the premises which appear to the Bank of England to be relevant for the purposes mentioned in subsection (2ZA);

(b)

the suspension for the period specified in the direction of the carrying on in the United Kingdom by the Tier 2 third country central counterparty of any activity in respect of which the third country central counterparty is exempt from the general prohibition.

(2D)

The Bank of England may not inspect the premises or documents on the premises of a Tier 2 third country central counterparty without first informing the relevant third country competent authority, and inspections must be conducted in accordance with cooperation arrangements established under Article 25.7 of the EMIR regulation.

(2E)

In subsection (2D), relevant third country competent authority means a regulatory authority of a country other than the United Kingdom which is responsible for the authorisation and supervision of central counterparties in its territory.

(3)

A direction under this section F21(except a direction made under subsection (2ZA)) is enforceable, on the application of F22the regulator concerned, by an injunction or, in Scotland, by an order for specific performance under section 45 of the M1Court of Session Act 1988.

(4)

The fact that a rule made by a recognised body has been altered in response to a direction given by F23an appropriate regulator does not prevent it from being subsequently altered or revoked by the recognised body.