[Step 3 in paragraph 15N: loss absorbing instruments issued by overseas subsidiariesU.K.
15V(1)This paragraph applies for the purposes of paragraphs 15W and 15X.U.K.
(2)References to “loss absorbing instruments” are references to—
(a)tier one capital equity and liabilities, and
(b)other instruments,
which satisfy a loss absorbing capacity or recapitalisation requirement.
(3)In this paragraph and paragraphs 15W and 15X, “tier one capital equity and liabilities” means—
(a)equity and liabilities which are “tier one equity and liabilities” within the meaning of paragraph 30, and
(b)equity and liabilities that are (or are of a description) specified, or meet such conditions as may be specified, in regulations made by the Treasury.
(4)A “loss absorbing capacity or recapitalisation requirement” is a requirement—
(a)that is imposed, in relation to tier one capital equity and liabilities or other instruments issued by an entity, by an authority in the exercise of its regulatory functions under the law of the United Kingdom or of a country or territory outside the United Kingdom, and
(b)that is (or is of a description) specified, or meets such conditions as may be specified, in regulations made by the Treasury.
15W(1)Paragraph 15X applies in relation to a chargeable UK sub-group or entity if Conditions A to C are met.U.K.
(2)Condition A is that the bank levy is charged as provided for by paragraph 4 (groups).
(3)Condition B is that, as at the end of the chargeable period, the assets of a relevant group member include—
(a)qualifying loss absorbing instruments, or
(b)assets representing qualifying loss absorbing instruments.
(4)A loss absorbing instrument is “qualifying” for the purposes of this paragraph and paragraph 15X if—
(a)it is issued by a non-UK resident entity which is a subsidiary of a UK resident entity within sub-paragraph (5), and
(b)such other conditions as may be specified in regulations made by the Treasury are met in respect of the instrument.
(5)A UK resident entity is within this sub-paragraph if—
(a)the entity is a member of the relevant group, and
(b)if the relevant group is a relevant non-banking group, the entity is a UK resident bank or a subsidiary of a UK resident bank.
(6)For the purposes of Condition B, “relevant group member” means—
(a)the chargeable UK sub-group or entity,
(b)another UK sub-group of the relevant group, or
(c)a chargeable UK resident entity which is a member of the relevant group.
(7)Condition C is that, as at the end of the chargeable period, the liabilities of the chargeable UK sub-group or entity include—
(a)tier one capital equity and liabilities (other than tier one capital equity and liabilities excluded by paragraph 30), or
(b)loss absorbing instruments, other than tier one capital equity and liabilities,
in respect of which such conditions as may be specified in regulations made by the Treasury are met.
15X(1)The amount within Step 3 in paragraph 15N(1) is the total of—U.K.
(a)the amount of the relevant group member’s assets which are, or represent, qualifying loss absorbing instruments within paragraph 15V(2)(a) as at the end of the chargeable period, so far as that amount does not exceed the liabilities amount within sub-paragraph (3), and
(b)the amount of the relevant group member’s assets which are, or represent, qualifying loss absorbing instruments within paragraph 15V(2)(b) as at the end of the chargeable period, so far as that amount does not exceed the liabilities amount within sub-paragraph (4).
(2)Sub-paragraph (1) is subject to sub-paragraph (5).
(3)The “liabilities amount” within this sub-paragraph is the total amount of the chargeable UK sub-group or entity’s equity and liabilities, adjusted in accordance with Steps 1 and 2 in paragraph 15N(1), that are tier one capital equity and liabilities within paragraph 15W(7)(a).
(4)The “liabilities amount” within this sub-paragraph is the total amount of the chargeable UK sub-group or entity’s equity and liabilities, adjusted in accordance with Steps 1 and 2 in paragraph 15N(1), that are loss absorbing instruments within paragraph 15W(7)(b).
(5)An asset (or part of an asset) of the relevant group member is to be disregarded for the purposes of sub-paragraph (1) if—
(a)for the purposes of an adjustment at Step 2 in paragraph 15N(1), it is an asset (or part of an asset) to which paragraph 15U(1) applies,
(b)in a case where this paragraph applies in relation to more than one chargeable UK sub-group or entity, the asset (or part) is taken into account in determining the amount within Step 3 in paragraph 15N(1) in relation to another chargeable UK sub-group or entity, or
(c)in a case where a relevant foreign bank is a member of the relevant group, it is an asset (or part) to which paragraph 27D(1) applies for the purposes of Step 3 of paragraph 24(1).
15Y(1)This paragraph makes provision about regulations under any provision of paragraph 15V or 15W.U.K.
(2)The regulations may include different provision for different purposes.
(3)The regulations are to be made by statutory instrument.
(4)A statutory instrument containing the regulations is subject to annulment in pursuance of a resolution of the House of Commons.]