The Financial Services and Markets Act 2000 (Regulated Activities) Order 2001

Statutory Instruments

2001 No. 544

FINANCIAL SERVICES AND MARKETS

The Financial Services and Markets Act 2000 (Regulated Activities) Order 2001

Approved by both Houses of Parliament

Made

26th February 2001

Laid before Parliament

27th February 2001

Coming into force in accordance with article 2

The Treasury, in exercise of the powers conferred on them by sections 22(1) and (5), 426 and 428(3) of, and paragraph 25 of Schedule 2 to, the Financial Services and Markets Act 2000M1 , hereby make the following Order:

Marginal Citations

M1 2000 c. 8.

PART I U.K. GENERAL

Citation U.K.

1.  This Order may be cited as the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001.

Commencement U.K.

2.—(1) Except as provided by paragraph (2), this Order comes into force on the day on which section 19 of the Act comes into force.

(2) This Order comes into force—

(a) for the purposes of articles 59, 60 and 87 (funeral plan contracts) on 1st January 2002; and

(b) for the purposes of articles 61 to 63, 88, 90 and 91 (regulated mortgage contracts) [F1 on such a day as the Treasury may specify].

[F2 (3) Any day specified under paragraph (2)(b) must be caused to be notified in the London, Edinburgh and Belfast Gazettes published not later than one week before that day.]

Textual Amendments

F1 Words in art. 2(2)(b) substituted (30.8.2002) by The Financial Services and Markets Act 2000 (Commencement of Mortgage Regulation) (Amendment) Order 2002 (S.I. 2002/1777), arts. 1, 2(2)

F2 Art. 2(3) inserted (30.8.2002) by The Financial Services and Markets Act 2000 (Commencement of Mortgage Regulation) (Amendment) Order 2002 (S.I. 2002/1777), arts. 1, 2(3)

Interpretation U.K.

3.—(1) In this Order—

• “the Act" means the Financial Services and Markets Act 2000;

• [F3 “acting as an insolvency practitioner” is to be read with section 388 of the Insolvency Act 1986 or, as the case may be, article 3 of the Insolvency (Northern Ireland) Order 1989 and, in any provision of this Order which provides for activities to be excluded from a specified activity, references to things done by a person acting—

  (a)

  as an insolvency practitioner, or

  (b)

  in reasonable contemplation of that person’s appointment as an insolvency practitioner,

  include anything done by the person’s firm in connection with that person so acting;]

• [F4 “agreement provider” has the meaning given by article 63J(3);

• “agreement seller” has the meaning given by article 63J(3);]

• [F5 “AIFM” has the meaning given by regulation 4 of the Alternative Investment Fund Managers Regulations 2013;]

• [F6 “aircraft operator” has the same meaning as in the emission allowance trading directive;]

• [F7 “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;]

• “annuities on human life" does not include superannuation allowances and annuities payable out of any fund applicable solely to the relief and maintenance of persons engaged, or who have been engaged, in any particular profession, trade or employment, or of the dependants of such persons;

• [F8 “assignment”, in relation to a credit agreement, has the meaning given by article 60L;]

• [F6 “auction platform” means a platform on which auctions of greenhouse gas emissions allowances are held in accordance with the emission allowance auctioning regulation;]

• [F8 “borrower”—

  (a)

  in relation to a credit agreement other than a regulated mortgage contract [F9 or] [F9 ,] an article 36H agreement (within the meaning given by article 36H) [F10 or an agreement that is a green deal plan], has the meaning given by article 60L;

  (b)

  in relation to an article 36H agreement (within the meaning given by that article) other than a regulated mortgage contract, [F11 has the meaning given by article 36H];]

  (c)

  [F12 in relation to a credit agreement that is a green deal plan, has the meaning given by article 60LB;]

• “buying" includes acquiring for valuable consideration;

• “close relative" in relation to a person means—

  (a)

  his spouse [F13 or civil partner];

  (b)

  his children and step children, his parents and step-parents, his brothers and sisters and his step-brothers and step-sisters; and

  (c)

  the spouse [F13 or civil partner] of any person within sub-paragraph (b);

• [F14 “the Commission Regulation” means [F15 Commission Delegated Regulation of 25.4.2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive];]

• [F8 “consumer hire agreement” has the meaning given by article 60N;]

• “contract of general insurance" means any contract falling within Part I of Schedule 1;

• “contract of insurance" means any contract of insurance which is a contract of long-term insurance or a contract of general insurance, and includes—

  (a)

  fidelity bonds, performance bonds, administration bonds, bail bonds, customs bonds or similar contracts of guarantee, where these are—

  (i)

  effected or carried out by a person not carrying on a banking business;

  (ii)

  not effected merely incidentally to some other business carried on by the person effecting them; and

  (iii)

  effected in return for the payment of one or more premiums;

  (b)

  tontines;

  (c)

  capital redemption contracts or pension fund management contracts, where these are effected or carried out by a person who—

  (i)

  does not carry on a banking business; and

  (ii)

  otherwise carries on a regulated activity of the kind specified by article 10(1) or (2);

  (d)

  contracts to pay annuities on human life;

  (e)

  contracts of a kind referred to in [F16 Article 2(3)(b)(v) of the Solvency 2 Directive]; and

  (f)

  contracts of a kind referred to in [F17 Article 2(3)(c) of the Solvency 2 Directive];

  but does not include a funeral plan contract (or a contract which would be a funeral plan contract but for the exclusion in article 60);

• “contract of long-term insurance" means any contract falling within Part II of Schedule 1;

• “contractually based investment" means—

  (a)

  rights under a qualifying contract of insurance;

  (b)

  any investment of the kind specified by any of articles 83, 84, 85 and 87; or

  (c)

  any investment of the kind specified by article 89 so far as relevant to an investment falling within (a) or (b);

• [F8 [F18 “credit agreement” has the meaning given by article 60B;]

  [F18 “credit agreement”—

  (a)

  in relation to an agreement other than a green deal plan, has the meaning given by article 60B;

  (b)

  in relation to a green deal plan, has the meaning given by article 60LB;]]

• [F14 “credit institution” means—

  (a)

  a credit institution authorised under the [F19 capital requirements directive] other than an institution to which Article 2.1 of the markets in financial instruments directive [F20 (the text of which is set out in Part 1 of Schedule 3) read with any directly applicable EU regulation made under Article 2.3 or 2.4 of the markets in financial instruments directive (and the text of Article 4 of the Commission Regulation is set out in Part 2 of Schedule 3)] applies, or

  (b)

  an institution which would satisfy the requirements for authorisation as a credit institution under that directive (other than an institution to which Article 2.1 of the markets in financial instruments directive [F21 read with any directly applicable EU regulation made under Article 2.3 or 2.4 of that directive] would apply) if it had its registered office (or if it does not have a registered office, its head office) in an EEA State;]

• “deposit" has the meaning given by article 5 [F22 except where the definition given in article 60L applies];

• [F23 “designated guidance provider” has the meaning given by section 333E(1) of the Act;]

• [F5 “EEA AIFM” has the meaning given by regulation 2(1) of the Alternative Investment Fund Managers Regulations 2013;]

• [F24 “electronic money” has the meaning given by regulation 2(1) of the Electronic Money Regulations 2011;]

• [F6 “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 the emission allowance trading directive;]

• [F6 “emission allowance trading directive” means Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowances trading within the Community;]

• [F14 “financial instrument” means any instrument listed in Section C of Annex I to the markets in financial instruments directive (the text of which is set out in Part 1 of Schedule 2) read with [F25 Articles 5 to 8, 10 and 11] of the Commission Regulation (the text of which is set out in Part 2 of Schedule 2);]

• [F5 “full-scope UK AIFM” has the meaning given by regulation 2(1) of the Alternative Investment Fund Managers Regulations 2013;]

• “funeral plan contract" has the meaning given by article 59;

• [F26 “green deal plan” has the meaning given by section 1 of the Energy Act 2011;]

• [F6 “greenhouse gas emissions allowances” mean “allowances” as defined in Article 3(a) of the emission allowance trading directive;]

• [F8 “hire-purchase agreement” has the meaning given by article 60L;]

• [F8 “hirer” is to be read with the definition of “consumer hire agreement” in article 60N;]

• [F14 “home Member State”, in relation to an investment firm, has the meaning given by [F27 Article 4.1.55(a)] of the markets in financial instruments directive, and in relation to a credit institution, has the meaning given by [F28 Article 4(1)(43) of the capital requirements regulation][F29 , and, in relation to a mortgage intermediary, has the meaning given by Article 4(19) of the mortgages directive];]

• [F30 “home purchase provider” has the meaning given by article 63F(3);]

• [F30 “home purchaser” has the meaning given by article 63F(3);]

• “instrument" includes any record whether or not in the form of a document;

• [F14 “investment firm” means a person whose regular occupation or business is the provision or performance of investment services and activities on a professional basis but does not include—

  (a)

  a person to whom the markets in financial instruments directive does not apply by virtue of Article 2 of that directive [F31 (the text of which is set out in Part 1 of Schedule 3) read with any directly applicable EU regulation made under Article 2.3 or 2.4 of the markets in financial instruments directive (and the text of Article 4 of the Commission Regulation is set out in Part 2 of Schedule 3)];

  (b)

  a person whose home Member State is an EEA State other than the United Kingdom and to whom, by reason of the fact that the State has given effect to Article 3 of that directive, that directive does not apply by virtue of that Article;

  (c)

  a person who does not have a home Member State and to whom (if he had his registered office in an EEA State, or, being a person other than a body corporate or a body corporate not having a registered office, if he had his head office in an EEA State) the markets in financial instruments directive would not apply by virtue of Article 2 of that directive [F32 read with any directly applicable EU regulation made under Article 2.3 or 2.4 of the markets in financial instruments directive];]

• [F33 “investment services and activities” means—

  (a)

  any service provided to third parties listed in Section A of Annex 1 to the markets in financial instruments directive (the text of which is set out in Part 3 of Schedule 2) read with [F34 Article 9 of the Commission Regulation] (the text of which is set out in Part 4 of Schedule 2), including the reception, transmission or submission of a bid by an investment firm or credit institution on any auction platform, in relation to any financial instrument; or

  (b)

  any activity listed in Section A of Annex 1 to that directive, in relation to any financial instrument;]

• “joint enterprise" means an enterprise into which two or more persons (“the participators") enter for commercial purposes related to a business or businesses (other than the business of engaging in a regulated activity) carried on by them; and, where a participator is a member of a group, each other member of the group is also to be regarded as a participator in the enterprise;

• [F8 “lender”—

  (c)

  in relation to a credit agreement other than a regulated mortgage contract [F35 or] [F35 ,] an article 36H agreement (within the meaning given by article 36H) [F36 or an agreement that is a green deal plan], has the meaning given by article 60L;

  (d)

  in relation to an article 36H agreement (within the meaning given by that article) other than a regulated mortgage contract, [F37 has the meaning given by article 36H];]

  (e)

  [F38 in relation to a credit agreement that is a green deal plan, has the meaning given by article 60LB;]

• “local authority" means—

  (a)

  M2 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)

  M3 in Scotland, a local authority within the meaning of the Local Government (Scotland) Act 1973 ;

  (c)

  M4 in Northern Ireland, a district council within the meaning of the Local Government Act (Northern Ireland) 1972 ;

• [F39 “management company” has the meaning given by Article 2.1(b) of the UCITS directive;]

• “managing agent" means a person who is permitted by the Council of Lloyd’s in the conduct of his business as an underwriting agent to perform for a member of Lloyd’s one or more of the following functions—

  (a)

  underwriting contracts of insurance at Lloyd’s;

  (b)

  reinsuring such contracts in whole or in part;

  (c)

  paying claims on such contracts;

• [F14 “market operator” means a market operator within the meaning of [F40 Article 4.1.18] of the markets in financial instruments directive, or a person who would be a market operator if he had his registered office, or if he does not have a registered office his head office, in an EEA State, but does not include—

  (a)

  a person to whom the markets in financial instruments directive does not apply by virtue of Article 2 of that directive [F41 (the text of which is set out in Part 1 of Schedule 3) read with any directly applicable EU regulation made under Article 2.3 or 2.4 of the markets in financial instruments directive (and the text of Article 4 of the Commission Regulation is set out in Part 2 of Schedule 3)];

  (b)

  a person who does not have a home Member State to whom (if he had his registered office, or if he does not have a registered office his head office, in an EEA State) the markets in financial instruments directive would not apply by virtue of Article 2 of that directive [F42 read with any directly applicable EU regulation made under Article 2.3 or 2.4 of the markets in financial instruments directive];]

• [F7 “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 (recast);

• “markets in financial instruments regulation” means Regulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments;]

• [F14 “multilateral trading facility” means—

  (a)

  a multilateral trading facility (within the meaning of [F43 Article 4.1.22] of the markets in financial instruments directive) operated by an investment firm, a credit institution or a market operator, or

  (b)

  a facility which—

  (i)

  is operated by an investment firm, a credit institution or market operator which does not have a home Member State, and

  (ii)

  if its operator had a home Member State, would be a multilateral trading facility within the meaning of [F43 Article 4.1.22] of the markets in financial instruments directive;]

• [F44 “occupational pension scheme” has the meaning given by section 1 of the Pension Schemes Act 1993 but with paragraph (b) of the definition omitted;]

• [F6 “operator” has the same meaning as in the emission allowance trading directive;]

• [F7 “organised trading facility” means—

  (a)

  an organised trading facility (within the meaning of Article 4.1.23 of the markets in financial instruments directive) operated by an investment firm, a credit institution or a market operator; or

  (b)

  a facility which—

  (i)

  is operated by an investment firm, a credit institution or a market operator which does not have a home Member State; and

  (ii)

  if its operator had a home Member State, would be an organised trading facility within the meaning of Article 4.1.23 of the markets in financial instruments directive;]

• “overseas person" means a person who—

  (a)

  carries on activities of the kind specified by any of articles 14, 21, 25, [F45 25A,] [F46 25B, 25C,] [F47 25D,] [F48 25DA,] [F49 25E,] 37 [F50 , 39A] 40, 45, [F51 51ZA, 51ZB, 51ZC, 51ZD, 51ZE], 52 [F52 , 53, 53A] [F53 , 53B, 53C, [F54 53D,] 61, 63B [F55 , 63F and 63J]] or, so far as relevant to any of those articles, article 64 (or activities of a kind which would be so specified but for the exclusion in article 72); but

  (b)

  does not carry on any such activities, or offer to do so, from a permanent place of business maintained by him in the United Kingdom;

• [F8 “owner”, in relation to a hire purchase agreement, has the meaning given by article 60N;]

• “pension fund management contract" means a contract to manage the investments of pension funds (other than funds solely for the benefit of the officers or employees of the person effecting or carrying out the contract and their dependants or, in the case of a company, partly for the benefit of officers and employees and their dependants of its subsidiary or holding company or a subsidiary of its holding company); and for the purposes of this definition, “subsidiary" and “holding company" are to be construed in accordance with [F56 section 1159 of the Companies Act 2006];

• [F57 “the person’s firm”, in relation to a person acting as an insolvency practitioner or in reasonable contemplation of that person’s appointment as an insolvency practitioner, means—

  (a)

  the person’s employer;

  (b)

  where the person is a partner in a partnership other than a limited liability partnership, that partnership;

  (c)

  where the person is a member of a limited liability partnership, that partnership;]

• [F58 “personal pension scheme” means a scheme or arrangement which is not an occupational pension scheme or a stakeholder pension scheme and which is comprised in one or more instruments or agreements, having or capable of having effect so as to provide benefits to or in respect of people—

  (a)

  on retirement,

  (b)

  on having reached a particular age, or

  (c)

  on termination of service in an employment;]

• [F59 “plan provider” has the meaning given by paragraph (3) of article 63B, read with paragraphs (7) and (8) of that article;]

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

• “qualifying contract of insurance" means a contract of long-term insurance which is not—

  (a)

  a reinsurance contract; nor

  (b)

  a contract in respect of which the following conditions are met—

  (i)

  the benefits under the contract are payable only on death or in respect of incapacity due to injury, sickness or infirmity;

  (ii)

  F60 ...

  (iii)

  the contract has no surrender value, or the consideration consists of a single premium and the surrender value does not exceed that premium; and

  (iv)

  the contract makes no provision for its conversion or extension in a manner which would result in it ceasing to comply with any of the above conditions;

• [F6 “reception”, “transmission” and “submission” have the same meaning in relation to a bid at an auction for an investment of the kind specified in article 82A as in the emission allowance auctioning regulation;]

• [F8 “regulated consumer hire agreement” has the meaning given by article 60N;]

• [F8 “regulated credit agreement” has the meaning given by article 60B;]

• [F61 “regulated home purchase plan” has the meaning given by article 63F(3);]

• [F61 “regulated home reversion plan” has the meaning given by article 63B(3);]

• “regulated mortgage contract" has the meaning given by article 61(3);

• [F62 “regulated sale and rent back agreement” has the meaning given by article 63J(3);]

• [F63 “relevant investment” means—

  (a)

  rights under a qualifying contract of insurance;

  (b)

  rights under any other contract of insurance;

  (c)

  any investment of the kind specified by any of articles 83, 84, 85 and 87; or

  (d)

  any investment of the kind specified by article 89 so far as relevant to an investment falling within (a) or (c);]

• [F8 “relevant recipient of credit” has the meaning given by article 60L;]

• [F8 “restricted-use credit agreement” has the meaning given in article 60L;]

• [F64 “reversion seller” has the meaning given by article 63B(3);]

• “security" means (except where the context otherwise requires) any investment of the kind specified by any of articles 76 to 82 [F65 or by article 82B] or, so far as relevant to any such investment, article 89;

• “selling", in relation to any investment, includes disposing of the investment for valuable consideration, and for these purposes “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 arrangements; and

  (c)

  in the case of any other investment, issuing or creating the investment or granting the rights or interests of which it consists;

• [F5 “small registered UK AIFM” has the meaning given by regulation 2(1) of the Alternative Investment Fund Managers Regulations 2013;]

• “stakeholder pension scheme" has the meaning given by section 1 of the Welfare Reform and Pensions Act 1999 [F66 in relation to Great Britain and has the meaning given by article 3 of the Welfare Reform and Pensions (Northern Ireland) Order 1999 in relation to Northern Ireland];

• [F7 “structured deposit” means a deposit which is fully repayable at maturity on terms under which interest or a premium will be paid or is at risk, according to a formula involving factors such as—

  (a)

  an index or combination of indices, excluding variable rate deposits whose return is directly linked to an interest rate index such as Euribor or Libor;

  (b)

  a financial instrument or combination of financial instruments;

  (c)

  a commodity or combination of commodities or other physical or non-physical non-fungible assets; or

  (d)

  a foreign exchange rate or combination of foreign exchange rates;]

• “syndicate" means one or more persons, to whom a particular syndicate number has been assigned by or under the authority of the Council of Lloyd’s, carrying out or effecting contracts of insurance written at Lloyd’s;

• [F67 “trade repository” means—

  (a)

  a person registered with ESMA under Article 55 of Regulation (EU) 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC derivatives, central counterparties and trade repositories or a person recognised by ESMA under Article 77 of that Regulation; or

  (b)

  a person registered with ESMA under Article 5 of the SFT regulation or a person recognised by ESMA under Article 19 of that Regulation;]

• [F5 “UCITS” has the meaning given by Article 1.2 of the UCITS directive;]

• [F5 “UK AIF” has the meaning given by regulation 2(1) of the Alternative Investment Fund Managers Regulations 2013;]

• “voting shares", in relation to a body corporate, means shares carrying voting rights attributable to share capital which are exercisable in all circumstances at any general meeting of that body corporate.

(2) For the purposes of this Order, a transaction is entered into through a person if he enters into it as agent or arranges, in a manner constituting the carrying on of an activity of the kind specified by article 25(1) [F68 , 25A(1), 25B(1) [F69 , 25C(1) or 25E(1)]], for it to be entered into by another person as agent or principal.

(3) For the purposes of this Order, a contract of insurance is to be treated as falling within Part II of Schedule 1, notwithstanding the fact that it contains related and subsidiary provisions such that it might also be regarded as falling within Part I of that Schedule, if its principal object is that of a contract falling within Part II and it is effected or carried out by an authorised person who has permission to effect or carry out contracts falling within paragraph I of Part II of Schedule 1.

Textual Amendments

F3 Words in art. 3(1) 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), art. 1(3)(4), 2(2)(a)

F4 Words in art. 3(1) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 3(1)(a)

F5 Words in art. 3(1) inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(2)(b)

F6 Words in art. 3(1) inserted (20.7.2012) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2012 (S.I. 2012/1906), arts. 1, 2(2)(b)

F7 Words in art. 3(1) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(12)

F8 Words in art. 3(1) 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), 3(1)

F9 Word in art. 3(1) substituted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 3(2)(a)(i) (with art. 1(3))

F10 Words in art. 3(1) inserted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 3(2)(a)(ii) (with art. 1(3))

F11 Words in art. 3(1) substituted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(2)(a) (with Pt. 5)

F12 Words in art. 3(1) inserted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 3(2)(b) (with art. 1(3))

F13 Words in art. 3(1) inserted (5.12.2005) by The Civil Partnership Act 2004 (Amendments to Subordinate Legislation) Order 2005 (S.I. 2005/2114), reg. 1, Sch. 16 para. 1(2)

F14 Words in art. 3(1) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 3(b)

F15 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(2)

F16 Words in art. 3(1) substituted (1.1.2016) by The Solvency 2 Regulations 2015 (S.I. 2015/575), reg. 1(2), Sch. 2 para. 11(2)(a)

F17 Words in art. 3(1) substituted (1.1.2016) by The Solvency 2 Regulations 2015 (S.I. 2015/575), reg. 1(2), Sch. 2 para. 11(2)(b)

F18 Words in art. 3(1) substituted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 3(3) (with art. 1(3))

F19 Words in art. 3(1) substituted (1.1.2014) by The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 51(2)(a)

F20 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(3)(a)

F21 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(3)(b)

F22 Words in art. 3 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), 3(2)

F23 Words in art. 3(1) inserted (26.3.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (Pensions Guidance Exclusions) Order 2015 (S.I. 2015/489), arts. 1, 2(2)

F24 Words in art. 3(1) substituted (9.2.2011 for specified purposes, 30.4.2011 in so far as not already in force) by The Electronic Money Regulations 2011 (S.I. 2011/99), reg. 1(2), Sch. 4 para. 12(a)(ii) (with reg. 3)

F25 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(4)

F26 Words in art. 3(1) inserted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 3(4) (with art. 1(3))

F27 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(5)

F28 Words in art. 3(1) substituted (1.1.2014) by The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 51(2)(b)

F29 Words in art. 3(1) 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. 4(2) (with Pt. 4)

F30 Words in art. 3(1) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 3(1)(a)

F31 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(6)(a)

F32 Words in art. 3(1) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(6)(b)

F33 Words in art. 3(1) substituted (20.7.2012) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2012 (S.I. 2012/1906), arts. 1, 2(2)(a)

F34 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(7)

F35 Word in art. 3(1) substituted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 3(5)(a)(i) (with art. 1(3))

F36 Words in art. 3(1) inserted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 3(5)(a)(ii) (with art. 1(3))

F37 Words in art. 3(1) substituted (17.3.2016) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(2)(b) (with Pt. 5)

F38 Words in art. 3(1) inserted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 3(5)(b) (with art. 1(3))

F39 Words in art. 3(1) substituted (1.7.2011) by The Undertakings for Collective Investment in Transferable Securities Regulations 2011 (S.I. 2011/1613), reg. 1, Sch. para. 1(2)

F40 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(8)(a)

F41 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(8)(b)

F42 Words in art. 3(1) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(8)(c)

F43 Words in art. 3(1) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(9)

F44 Words in art. 3(1) substituted (1.10.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2006 (S.I. 2006/1969), arts. 1(2), 2(2)(a)

F45 Word in art. 3(1) inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 3(a)

F46 Words in art. 3(1) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 3(1)(b)(i)

F47 Word in art. 3(1) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 3(a)

F48 Words in art. 3(1) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(10)

F49 Word in art. 3(1) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 3(1)(c)(i)

F50 Word in art. 3(1) inserted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 3(1)(a)

F51 Words in art. 3(1) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(2)(a)

F52 Words in art. 3(1) substituted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 3(b)

F53 Words in art. 3(1) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 3(1)(b)(ii)

F54 Word in art. 3(1) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 3(1)(c)(ii)

F55 Words in art. 3(1) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 3(1)(c)(iii)

F56 Words in art. 3(1) substituted (12.5.2011) by The Companies Act 2006 (Consequential Amendments and Transitional Provisions) Order 2011 (S.I. 2011/1265), arts. 1(2), 13(2)

F57 Words in art. 3(1) 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), art. 1(3)(4), 2(2)(b)

F58 Words in art. 3(1) inserted (1.10.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2006 (S.I. 2006/1969), arts. 1(2), 2(2)(b)

F59 Words in art. 3(1) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 3(1)(c)

F60 Words in art. 3(1) omitted (6.6.2007) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2007 (S.I. 2007/1339), arts. 1, 3

F61 Words in art. 3(1) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 3(1)(d)

F62 Words in art. 3(1) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 3(1)(b)

F63 Words in art. 3(1) inserted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 3(1)(b)

F64 Words in art. 3(1) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 3(1)(e)

F65 Words in art. 3(1) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 2(11)

F66 Words in art. 3(1) inserted (6.4.2005) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2005 (S.I. 2005/593), arts. 1, 2(2)(b)

F67 Words in art. 3(1) substituted (13.7.2016) by The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016 (S.I. 2016/715), reg. 1(2), Sch. 2 para. 1(2)

F68 Words in art. 3(2) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 3(2)

F69 Words in art. 3(2) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 3(2)

Modifications etc. (not altering text)

C1 Art. 3 applied (21.5.2003) by The Financial Services and Markets Act 2000 (Collective Investment Schemes) (Designated Countries and Territories) Order 2003 (S.I. 2003/1181), arts. 1, 3(2)(a)

Marginal Citations

M2 1972 c. 70. The definition of “local authority" in section 270 of the 1972 Act has been amended by Sch. 17 to the Local Government Act 1985 (c. 51); and by section 1(5) of the Local Government (Wales) Act 1994 (c. 19).

M3 1973 c. 65. The definition of “local authority" in section 235 of the 1973 Act was substituted by para. 92(66) of Sch. 13 to the Local Government etc. (Scotland) Act 1994 (c. 39).

M4 1972 c. 9 (N.I.).

PART II U.K. SPECIFIED ACTIVITIES

Chapter I U.K. General

Specified activities: general U.K.

4.—(1) The following provisions of this Part specify kinds of activity for the purposes of [F70 section 22(1)] of the Act (and accordingly any activity of one of those kinds, which is carried on by way of business M5 , and relates to an investment of a kind specified by any provision of Part III and applicable to that activity, is a regulated activity for the purposes of the Act).

(2) The kinds of activity specified by articles [F71 [F72 51ZA, 51ZB, 51ZC, 51ZD, 51ZE], 52 and 63N] are also specified for the purposes of section 22(1)(b) of the Act (and accordingly any activity of one of those kinds, when carried on by way of business, is a regulated activity when carried on in relation to property of any kind).

[F73 (2A) The kinds of activity specified by Part 3A are specified for the purposes of section 22(1A)(a) of the Act (and accordingly any activity of one of those kinds, when carried on by way of business, is a regulated activity).]

(3) Subject to paragraph (4), each provision specifying a kind of activity is subject to the exclusions applicable to that provision (and accordingly any reference in this Order to an activity of the kind specified by a particular provision is to be read subject to any such exclusions).

[F74 (4) Where an investment firm or credit institution—

(a) provides or performs investment services and activities on a professional basis, and

(b) in doing so would be treated as carrying on an activity of a kind specified by a provision of this Part but for an exclusion in any of articles 15, 16, [F75 18,] 19, 22, 23, 29, [F76 34,] 38, 67, 68, 69, 70 and 72E,

that exclusion is to be disregarded and, accordingly, the investment firm or credit institution is to be treated as carrying on an activity of the kind specified by the provision in question.]

[F77 (4A) Where a person, other than an ancillary insurance intermediary carrying out insurance distribution activities falling within Article 1.3 of the insurance distribution directive (the text of which is set out in Part 1 of Schedule 4)—

(a) for remuneration, takes up or pursues insurance distribution, or reinsurance distribution, in relation to a risk or commitment located in an EEA State, and

(b) in doing so would be treated as carrying on an activity of a specified kind by a provision of this Part but for an exclusion in any of articles 30, 66, 67 and 72AA,

that exclusion is to be disregarded (and accordingly that person is to be treated as carrying on an activity of the kind specified by the provision in question).]

[F78 (4B) Where—

(a) a person is a mortgage creditor or a mortgage intermediary; and

(b) in acting as a mortgage creditor or a mortgage intermediary [F79 in respect of an agreement entered into, or to be entered into, on or after 21st March 2016], that person would be treated as carrying on an activity of a kind specified by article 25A (arranging regulated mortgage contracts), 36A (credit broking), 53A (advising on regulated mortgage contracts), 53DA (advising on regulated credit agreements for the acquisition of land), 60B (regulated credit agreements) or 61 (entering into and administering regulated mortgage contracts), but for an exclusion or exemption provided for by this Order,

that exclusion or exemption is to be disregarded (and accordingly that person is to be treated as carrying on an activity of the kind specified by the provision in question) to the extent that such exclusion or exemption does not fall within Article 3(2) or (3) of the mortgages directive.]

[F80 (5) In this article—

“ancillary insurance intermediary” has the meaning given by Article 2.1(4) of the insurance distribution directive, the text of which is set out in Part 4 of Schedule 4;

“insurance distribution” has the meaning given by Articles 2.1(1) and 2.2 of the insurance distribution directive, the text of which is set out in Parts 2 and 5 of Schedule 4, respectively; and

“reinsurance distribution” has the meaning given by Articles 2.1(2) and 2.2 of the insurance distribution directive, the text of which is set out in Parts 3 and 5 of Schedule 4, respectively.]

Textual Amendments

F70 Words in art. 4(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), art. 1(2)(6), 3(3)(a)

F71 Words in art. 4(2) substituted (13.7.2009) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2009 (S.I. 2009/1389), arts. 1, 3

F72 Words in art. 4(2) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(3)

F73 Art. 4(2A) 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), 3(3)(b)

F74 Art. 4(4) substituted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 4(a)

F75 Word in art. 4(4)(b) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 12(2)(a)

F76 Word in art. 4(4)(b) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 12(2)(b)

F77 Art. 4(4A) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 3(a)

F78 Art. 4(4B) 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. 4(3) (with Pt. 4)

F79 Words in art. 4(4B)(b) inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 2(3) (with Pt. 5)

F80 Art. 4(5) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 3(b)

Marginal Citations

M5 The Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) Order 2001 (S.I. 2001/ ), made under section 419 of the Act, makes provision as to the circumstances in which persons are, or are not, to be regarded as carrying on activities by way of business.

Chapter II U.K. Accepting Deposits

The activity U.K.

Accepting deposits U.K.

5.—(1) Accepting deposits is a specified kind of activity if—

(a) money received by way of deposit is lent to others; or

(b) any other activity of the person accepting the deposit is financed wholly, or to a material extent, out of the capital of or interest on money received by way of deposit.

(2) In paragraph (1), “deposit" means a sum of money, other than one excluded by any of [F81 articles 6 to 9A], paid on terms—

(a) under which it will be repaid, with or without interest or 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; and

(b) which are not referable to the provision of property (other than currency) or services or the giving of security.

(3) For the purposes of paragraph (2), money is paid on terms which are referable to the provision of property or services or the giving of security if, and only if—

(a) it is paid by way of advance or part payment under a contract for the sale, hire or other provision of property or services, and is repayable only in the event that the property or services is or are not in fact sold, hired or otherwise provided;

(b) it is paid by way of security for the performance of a contract or by way of security in respect of loss which may result from the non-performance of a contract; or

(c) without prejudice to sub-paragraph (b), it is paid by way of security for the delivery up or return of any property, whether in a particular state of repair or otherwise.

Textual Amendments

F81 Words in art. 5(2) substituted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 3(1)

Exclusions U.K.

Sums paid by certain persons U.K.

6.—(1) A sum is not a deposit for the purposes of article 5 if it is—

(a) paid by any of the following persons—

(i) the Bank of England, the central bank of an EEA State other than the United Kingdom, or the European Central Bank;

(ii) an authorised person who has permission to accept deposits, or to effect or carry out contracts of insurance;

(iii) an EEA firm falling within paragraph 5(b), (c) or (d) of Schedule 3 to the Act (other than one falling within paragraph (ii) above);

(iv) the National Savings Bank;

(v) a municipal bank, that is to say a company which was, immediately before the coming into force of this article, exempt from the prohibition in section 3 of the Banking Act 1987 M6 by virtue of section 4(1) of, and paragraph 4 of Schedule 2 to, that Act;

(vi) Keesler Federal Credit Union;

(vii) a body of persons certified as a school bank by the National Savings Bank or by an authorised person who has permission to accept deposits;

(viii) a local authority;

(xi) any body which by virtue of any enactment has power to issue a precept to a local authority in England and Wales or a requisition to a local authority in Scotland, or to the expenses of which, by virtue of any enactment, a local authority in the United Kingdom is or can be required to contribute (and in this paragraph, “enactment" includes an enactment comprised in, or in an instrument made under, an Act of the Scottish Parliament);

(x) [F82 the European Union or] the European Atomic Energy Community F82 ...;

(xi) the European Investment Bank;

(xii) the International Bank for Reconstruction and Development;

(xiii) the International Finance Corporation;

(xiv) the International Monetary Fund;

(xv) the African Development Bank;

(xvi) the Asian Development Bank;

(xvii) the Caribbean Development Bank;

(xviii) the Inter-American Development Bank;

(xix) the European Bank for Reconstruction and Development;

[F83 (xx) the Council of Europe Development Bank;]

(b) paid by a person other than one mentioned in sub-paragraph (a) in the course of carrying on a business consisting wholly or to a significant extent of lending money;

(c) paid by one company to another at a time when both are members of the same group or when the same individual is a majority shareholder controller of both of them; or

(d) paid by a person who, at the time when it is paid, is a close relative of the person receiving it or who is, or is a close relative of, a director or manager of that person or who is, or is a close relative of, a controller of that person.

(2) For the purposes of paragraph (1)(c), an individual is a majority shareholder controller of a company if he is a controller of the company by virtue of paragraph (a), (c), (e) or (g) of section 422(2) of the Act, and if in his case the greatest percentage of those referred to in those paragraphs is 50 or more.

(3) In the application of sub-paragraph (d) of paragraph (1) to a sum paid by a partnership, that sub-paragraph is to have effect as if, for the reference to the person paying the sum, there were substituted a reference to each of the partners.

Textual Amendments

F82 Words in art. 6(1)(a)(x) substituted (22.4.2011) by virtue of The Treaty of Lisbon (Changes in Terminology) Order 2011 (S.I. 2011/1043), arts. 2, 3-6

F83 Art. 6(1)(a)(xx) substituted (5.6.2002) by The Financial Services and Markets Act 2000 (Financial Promotion and Miscellaneous Amendments) Order 2002 (S.I. 2002/1310), arts. 1, 4(1)

Marginal Citations

M6 1987 c. 22. Section 3 was amended by the Bank of England Act 1998 (c. 11), Sch. 5, paras 1 and 3. “Municipal bank" is defined in section 103 of the Banking Act 1987, which was amended by the Local Government Act 1992 (c. 19), Sch. 3, para. 22, and by the Local Government and Rating Act 1997 (c. 29), Sch. 3, para. 21.

Sums received by solicitors etc. U.K.

7.—(1) A sum is not a deposit for the purposes of article 5 if it is received by a practising solicitor acting in the course of his profession.

(2) In paragraph (1), “practising solicitor" means—

(a) a solicitor who is qualified to act as such under section 1 of the Solicitors Act 1974 M7 , article 4 of the Solicitors (Northern Ireland) Order 1976 M8 or section 4 of the Solicitors (Scotland) Act 1980 M9 ;

(b) a recognised body;

(c) a registered foreign lawyer in the course of providing professional services as a member of a multi-national partnership;

(d) a registered European lawyer; or

(e) a partner of a registered European lawyer who is providing professional services in accordance with—

(i) rules made under section 31 M10 of the Solicitors Act 1974;

(ii) regulations made under article 26 of the Solicitors (Northern Ireland) Order 1976; or

(iii) rules made under section 34 of the Solicitors (Scotland) Act 1980 M11 .

(3) In this article—

(a) “a recognised body" means a body corporate recognised by—

(i) the Council of the Law Society under section 9 of the Administration of Justice Act 1985 M12 ;

(ii) the Incorporated Law Society of Northern Ireland under article 26A of the Solicitors (Northern Ireland) Order 1976 M13 ; or

(iii) the Council of the Law Society of Scotland under section 34 of the Solicitors (Scotland) Act 1980;

(b) “registered foreign lawyer" has the meaning given by section 89 of the Courts and Legal Services Act 1990 M14 or, in Scotland, section 65 of the Solicitors (Scotland) Act 1980 M15 ;

(c) “multi-national partnership" has the meaning given by section 89 of the Courts and Legal Services Act 1990 but, in Scotland, is a reference to a “multi-national practice" within the meaning of section 60A of the Solicitors (Scotland) Act 1980 M16 “registered European lawyer" has the meaning given by regulation 2(1) of the European Communities (Lawyer’s Practice) Regulations 2000 M17 or regulation 2(1) of the European Communities (Lawyer’s Practice) (Scotland) Regulation 2000 M18 .

Modifications etc. (not altering text)

C2 Art. 7(1) applied (with modifications) (E.W.S.) (23.12.2011) by The Legal Services Act 2007 (Designation as a Licensing Authority) (No. 2) Order 2011 (S.I. 2011/2866), arts. 1(2), 8(3), Sch. 3

Marginal Citations

M7 1974 c. 47.

M8 S.I. 1976/582 (N.I. 12); relevant amending instrument is S.I. 1989/1343 (N.I. 14).

M9 1980 c. 46.

M10 Section 31 was amended by para. 10 of Sch. 17 to the Courts and Legal Services Act 1990 (c. 41), and by para. 3 of Sch. 6 to, and para. 1 of Sch. 7 to, the Access to Justice Act 1999 (c. 22).

M11 Amended by section 31 of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 (c. 40).

M12 1985 c. 61; section 9 was amended by para. 54 of Sch. 18 to the Courts and Legal Services Act 1990, and by para. 1 of Sch. 4 to the European Communities (Lawyer's Practice) Regulations 2000 (S.I. 2000/1119), and was repealed in part by Part II of Sch. 15 to the Access to Justice Act 1999.

M13 Inserted by article 10 of the Solicitors (Amendment) (Northern Ireland) Order 1989 (S.I. 1989/1343) (N.I. 14).

M14 1990 c. 41; section 89 was amended by para. 14 of Sch. 4 to the European Communities (Lawyer's Practice) Regulations 2000 (S.I. 2000/1119).

M15 Amended by para. 29(15) of Sch. 8 to the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 (c. 40).

M16 Inserted by section 32 of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 (c. 40).

M17 S.I. 2000/1119.

M18 Scottish Statutory Instruments 2000 No. 121.

Sums received by persons authorised to deal etc. U.K.

8.  A sum is not a deposit for the purposes of article 5 if it is received by a person who is—

(a) an authorised person with permission to carry on an activity of the kind specified by any of articles 14, 21, 25, 37, [F84 51ZA, 51ZB, 51ZC, 51ZD, 51ZE] and 52, or

(b) an exempt person in relation to any such activity,

in the course of, or for the purpose of, [F85 carrying on any such activity (or any activity which would be such an activity but for any exclusion made by this Part)] with or on behalf of the person by or on behalf of whom the sum is paid.

Textual Amendments

F84 Words in art. 8(a) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(3)

F85 Words in art. 8 substituted (1.12.2001) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2001 (S.I. 2001/3544), arts. 1(a), 3

Sums received in consideration for the issue of debt securities U.K.

9.—(1) Subject to paragraph (2), a sum is not a deposit for the purposes of article 5 if it is received by a person as consideration for the issue by him of any investment of the kind specified by article 77 or 78.

(2) The exclusion in paragraph (1) does not apply to the receipt by a person of a sum as consideration for the issue by him of commercial paper unless—

(a) the commercial paper is issued to persons—

(i) whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their businesses; or

(ii) who it is reasonable to expect will acquire, hold, manage or dispose of investments (as principal or agent) for the purposes of their businesses; and

(b) the redemption value of the commercial paper is not less than £100,000 (or an amount of equivalent value denominated wholly or partly in a currency other than sterling), and no part of the commercial paper may be transferred unless the redemption value of that part is not less than £100,000 (or such an equivalent amount).

[F86 (3) In paragraph (2), “commercial paper” means an investment of the kind specified by article 77 or 78 having a maturity of less than one year from the date of issue.]

Textual Amendments

F86 Art. 9(3) substituted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 12

[F87 Sums received in exchange for electronic money U.K.

9A.   A sum is not a deposit for the purposes of article 5 if it is immediately exchanged for electronic money.]

Textual Amendments

F87 Art. 9A inserted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 3(2)

[F88 Information society services [F89 and managers of UCITS and AIFs] U.K.

9AA.   Article 5 is subject to the [F90 exclusions] in article 72A (information society services) [F91 and article 72AA (managers of UCITS and AIFs).]]

Textual Amendments

F88 Art. 9AA inserted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(2)

F89 Words in art. 9AA heading inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(4)(a)

F90 Word in art. 9AA substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(4)(b)

F91 Words in art. 9AA inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(4)(c)

[F92 Funds received for payment services U.K.

9AB.— (1) A sum is not a deposit for the purposes of article 5 if it is received by an authorised payment institution, an EEA authorised payment institution[F93 , a small payment institution, an electronic money institution or an EEA authorised electronic money institution] from a payment service user with a view to the provision of payment services.

(2) For the purposes of paragraph (1), “authorised payment institution”, “EEA authorised payment institution”, “small payment institution”, “payment services” and “payment service user” have the meanings given in the Payment Services Regulations [F94 2017] [F95 and “electronic money institution” and “EEA authorised electronic money institution” have the meanings given in the Electronic Money Regulations 2011.]]

Textual Amendments

F92 Art. 9AB inserted (1.11.2009) by The Payment Services Regulations 2009 (S.I. 2009/209), reg. 1(2)(c), Sch. 6 para. 4(a)

F93 Words in art. 9AB(1) substituted (9.2.2011 for specified purposes, 30.4.2011 in so far as not already in force) by The Electronic Money Regulations 2011 (S.I. 2011/99), reg. 1(2), Sch. 4 para. 12(b)(i) (with reg. 3)

F94 Word in art. 9AB(2) substituted (13.1.2018) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(6), Sch. 8 para. 8(a) (with reg. 3)

F95 Words in art. 9AB(2) inserted (9.2.2011 for specified purposes, 30.4.2011 in so far as not already in force) by The Electronic Money Regulations 2011 (S.I. 2011/99), reg. 1(2), Sch. 4 para. 12(b)(ii) (with reg. 3)

[F96 Local authorities U.K.

9AC.   Article 5 is subject to the exclusion in article 72G (local authorities).]

Textual Amendments

F96 Art. 9AC 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), art. 1(3)(4), 2(3)

[F97 CHAPTER IIA U.K. ELECTRONIC MONEY

Textual Amendments

F97 Pt. 2 Ch. 2A inserted (11.4.2002 for specified purposes, 27.4.2002 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2), 4 (with arts. 9, 10)

The activity U.K.

Issuing electronic money U.K.

9B.   Issuing electronic money [F98 by—

(a) a credit institution, a credit union or a municipal bank; or

(b) a person who is deemed to have been granted authorisation under regulation 74 of the Electronic Money Regulations 2011 or who falls within regulation 76(1) of those Regulations,]

is a specified kind of activity.

Textual Amendments

F98 Art. 9B(a)(b) and word inserted (9.2.2011 for specified purposes, 30.4.2011 in so far as not already in force) by The Electronic Money Regulations 2011 (S.I. 2011/99), reg. 1(2), Sch. 4 para. 12(c) (with reg. 3)

[F99 9BA.   Articles 9C to 9I and 9K apply only in the case of a person falling within regulation 76(1) of the Electronic Money Regulations 2011.] U.K.

Textual Amendments

F99 Art. 9BA inserted (9.2.2011 for specified purposes, 30.4.2011 in so far as not already in force) by The Electronic Money Regulations 2011 (S.I. 2011/99), reg. 1(2), Sch. 4 para. 12(d) (with reg. 3)

Exclusions U.K.

Persons certified as small issuers etc. U.K.

9C.— (1) There is excluded from article 9B the issuing of electronic money by a person to whom [F100 the FCA] has given a certificate under this article (provided the certificate has not been revoked).

(2) An application for a certificate may be made by—

(a) a body corporate, or

(b) a partnership,

(other than a credit institution as defined in [F101 Article 4(1)(1) of the capital requirements regulation]) which has its head office in the United Kingdom.

(3) [F102 The FCA] must, on the application of such a person (“A”), give A a certificate if it appears to [F103 the FCA] that paragraph (4), (5) or (6) applies.

(4) This paragraph applies if—

(a) A does not issue electronic money except on terms that the electronic device on which the monetary value is stored is subject to a maximum storage amount of not more than 150 euro; and

(b) A’s total liabilities with respect to the issuing of electronic money do not (or will not) usually exceed 5 million euro and do not (or will not) ever exceed 6 million euro.

(5) This paragraph applies if—

(a) the condition in paragraph (4)(a) is met;

(b) A’s total liabilities with respect to the issuing of electronic money do not (or will not) exceed 10 million euro; and

(c) electronic money issued by A is accepted as a means of payment only by—

(i) subsidiaries of A which perform operational or other ancillary functions related to electronic money issued or distributed by A; or

(ii) other members of the same group as A (other than subsidiaries of A).

(6) This paragraph applies if—

(a) the conditions in paragraphs (4)(a) and (5)(b) are met; and

(b) electronic money issued by A is accepted as a means of payment, in the course of business, by not more than one hundred persons where—

(i) those persons accept such electronic money only at locations within the same premises or limited local area; or

(ii) those persons have a close financial or business relationship with A, such as a common marketing or distribution scheme.

(7) For the purposes of paragraph (6)(b)(i), locations are to be treated as situated within the same premises or limited local area if they are situated within—

(a) a shopping centre, airport, railway station, bus station, or campus of a university, polytechnic, college, school or similar educational establishment; or

(b) an area which does not exceed four square kilometres;

but sub-paragraphs (a) and (b) are illustrative only and are not to be treated as limiting the scope of paragraph (6)(b)(i).

(8) For the purposes of paragraph (6)(b)(ii), persons are not to be treated as having a close financial or business relationship with A merely because they participate in arrangements for the acceptance of electronic money issued by A.

(9) In this article, references to amounts in euro include references to equivalent amounts in sterling.

(10) A person to whom a certificate has been given under this article (and whose certificate has not been revoked) is referred to in this Chapter as a “certified person”.

Textual Amendments

F100 Words in art. 9C(1) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

F101 Words in art. 9C(2) substituted (1.1.2014) by The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 51(3)

F102 Words in art. 9C(3) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(b)

F103 Words in art. 9C(3) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

Applications for certificates U.K.

9D.   The following provisions of the Act apply to applications to [F104 the FCA] for certificates under 9C (and the determination of such applications) as they apply to applications for Part IV permissions (and the determination of such applications)—

[F105 (a) section 55U(1)(b) and (4) to (8);

(b) section 55V;

(c) section 55X(2) and (4)(f); and

(d) section 55Z3(1).]

Textual Amendments

F104 Words in art. 9D substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

F105 Art. 9D(a)-(d) substituted for art. 9D(a)-(c) (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(c)

Revocation of certificate on [F106 FCA’s] own initiative U.K.

9E.— (1) [F107 The FCA] may revoke a certificate given to a person (“A”) under article 9C if—

(a) it appears to it that A does not meet the relevant conditions, or has failed to meet the relevant conditions at any time since the certificate was given; or

(b) the person to whom the certificate was given has contravened any rule or requirement to which he is subject as a result of article 9G.

(2) For the purposes of paragraph (1), A meets the relevant conditions at any time if, at that time, paragraph (4), (5) or (6) of article 9C applies.

(3) Sections [F108 55Z and 55Z3(2)] of the Act apply to the revocation of a certificate under paragraph (1) as they apply to the cancellation of a Part IV permission on [F109 the FCA’s] own initiative, as if references in those sections to an authorised person were references to a certified person.

Textual Amendments

F106 Word in art. 9E heading substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(d)(i)

F107 Words in art. 9E(1) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

F108 Words in art. 9E(3) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(d)(ii)(aa)

F109 Words in art. 9E(3) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(d)(ii)(bb)

Revocation of certificate on request U.K.

9F.— (1) A certified person (“B”) may apply to [F110 the FCA] for his certificate to be revoked, and [F110 the FCA] must then revoke the certificate and give B written notice that it has done so.

(2) An application under paragraph (1) must be made in such manner as [F110 the FCA] may direct.

(3) If—

(a) B has made an application under Part IV of the Act for permission to carry on a regulated activity of the kind specified by article 9B (or for variation of an existing permission so as to add a regulated activity of that kind), and

(b) on making an application for revocation of his certificate under paragraph (1), he requests that the revocation be conditional on the granting of his application under Part IV of the Act,

the revocation of B’s certificate is to be conditional on the granting of his application under Part IV of the Act.

Textual Amendments

F110 Words in art. 9F substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

Obtaining information from certified persons etc. U.K.

9G.— (1) [F111 The FCA] may make rules requiring certified persons to provide information to [F111 the FCA] about their activities so far as relating to the issuing of electronic money, including the amount of their liabilities with respect to the issuing of electronic money.

(2) [F112 Section 138A] of the Act (modification or waiver of rules) applies in relation to rules made under paragraph (1) as if references in that section to an authorised person were references to a certified person.

(3) [F113 Section 138D] of the Act (actions for damages) applies in relation to a rule made under paragraph (1) as if the reference in subsection (1) of that section to an authorised person were a reference to a certified person.

(4) [F114 The FCA] may, by notice in writing given to a certified person, require him—

(a) to provide specified information or information of a specified description; or

(b) to produce specified documents or documents of a specified description.

(5) Paragraph (4) applies only to information or documents reasonably required for the purposes of determining whether the certified person meets, or has met, the relevant conditions.

(6) Subsections (2), (5) and (6) of section 165 of the Act ([F115 Regulator’s] power to require information) apply to a requirement imposed under paragraph (4) as they apply to a requirement imposed under that section.

(7) Section 166 of the Act (reports by skilled persons) has effect as if—

F116 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) the reference in section 166(2)(a) of the Act to an authorised person included a reference to a certified person.

(8) Subsection (4) of section 168 of the Act (appointment of persons to carry out investigations in particular cases) has effect as if it provided for subsection (5) of that section to apply if it appears to [F117 the FCA] that there are circumstances suggesting that a certified person may not meet, or may not have met, the relevant conditions.

(9) Sections 175 (information and documents: supplemental provisions), 176 (entry of premises under warrant) and 177 (offences) of the Act apply to a requirement imposed under paragraph (4) as they apply to a requirement imposed under section 165 of the Act (the reference in section 176(3)(a) to an authorised person being read as a reference to a certified person).

(10) In this article—

(a) “specified”, in paragraph (4), means specified in the notice mentioned in that paragraph;

(b) a certified person (“A”) meets the relevant conditions at any time if, at that time, paragraph (4), (5) or (6) of article 9C applies.

Textual Amendments

F111 Words in art. 9G(1) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

F112 Words in art. 9G(2) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(e)(i)

F113 Words in art. 9G(3) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(e)(ii)

F114 Words in art. 9G(4) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

F115 Words in art. 9G(6) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(e)(iii)

F116 Art. 9G(7)(a) omitted (1.4.2013) by virtue of The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(e)(iv)

F117 Words in art. 9G(8) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

Supplemental U.K.

Rules prohibiting the issue of electronic money at a discount U.K.

9H.— (1) [F118 The FCA] may make rules applying to authorised persons with permission to carry on an activity of the kind specified by article 9B, prohibiting the issue of electronic money having a monetary value greater than the funds received.

(2) [F119 Section 138A] of the Act (modification or waiver of rules) applies in relation to rules made under paragraph (1).

Textual Amendments

F118 Words in art. 9H(1) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

F119 Words in art. 9H(2) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(f)

False claims to be a certified person U.K.

9I.   A person who is not a certified person is to be treated as guilty of an offence under section 24 of the Act (false claims to be authorised or exempt) if he—

(a) describes himself (in whatever terms) as a certified person;

(b) behaves, or otherwise holds himself out, in a manner which indicates (or which is reasonably likely to be understood as indicating) that he is a certified person.

Exclusion of electronic money from the compensation scheme U.K.

9J.   The compensation scheme established under Part XV of the Act is not to provide for the compensation of persons in respect of claims made in connection with any activity of the kind specified by article 9B.

Record of certified persons U.K.

9K.   The record maintained by [F120 the FCA] under section 347 of the Act (public record of authorised persons etc.) must include every certified person.]

Textual Amendments

F120 Words in art. 9K substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

Funds received for payment services U.K.

F121 9L.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F121 Art. 9L omitted (9.2.2011 for specified purposes, 30.4.2011 in so far as not already in force) by virtue of The Electronic Money Regulations 2011 (S.I. 2011/99), reg. 1(2), Sch. 4 para. 12(e) (with reg. 3)

Chapter III U.K. Insurance

The activities U.K.

Effecting and carrying out contracts of insurance U.K.

10.—(1) Effecting a contract of insurance as principal is a specified kind of activity.

(2) Carrying out a contract of insurance as principal is a specified kind of activity.

Exclusions U.K.

Community co-insurers U.K.

11.—(1) There is excluded from article 10(1) or (2) the effecting or carrying out of a contract of insurance by an EEA firm falling within paragraph 5(d) of Schedule 3 to the Act—

(a) other than through a branch in the United Kingdom; and

(b) pursuant to a Community co-insurance operation in which the firm is participating otherwise than as the leading insurer.

(2) In paragraph (1), “Community co-insurance operation" and “leading insurer" have the same meaning as in [F122 Article 190 of the Solvency 2 Directive].

Textual Amendments

F122 Words in art. 11(2) substituted (1.1.2016) by The Solvency 2 Regulations 2015 (S.I. 2015/575), reg. 1(2), Sch. 2 para. 11(3)

Breakdown insurance U.K.

12.—(1) There is excluded from article 10(1) or (2) the effecting or carrying out, by a person who does not otherwise carry on an activity of the kind specified by that article, of a contract of insurance which—

(a) is a contract under which the benefits provided by that person (“the provider") are exclusively or primarily benefits in kind in the event of accident to or breakdown of a vehicle; and

(b) contains the terms mentioned in paragraph (2).

(2) Those terms are that—

(a) the assistance takes either or both of the forms mentioned in paragraph (3)(a) and (b);

(b) the assistance is not available outside the United Kingdom and the Republic of Ireland except where it is provided without the payment of additional premium by a person in the country concerned with whom the provider has entered into a reciprocal agreement; and

(c) assistance provided in the case of an accident or breakdown occurring in the United Kingdom or the Republic of Ireland is, in most circumstances, provided by the provider’s servants.

(3) The forms of assistance are—

(a) repairs to the relevant vehicle at the place where the accident or breakdown has occurred; this assistance may also include the delivery of parts, fuel, oil, water or keys to the relevant vehicle;

(b) removal of the relevant vehicle to the nearest or most appropriate place at which repairs may be carried out, or to—

(i) the home, point of departure or original destination within the United Kingdom of the driver and passengers, provided the accident or breakdown occurred within the United Kingdom;

(ii) the home, point of departure or original destination within the Republic of Ireland of the driver and passengers, provided the accident or breakdown occurred within the Republic of Ireland or within Northern Ireland;

(iii) the home, point of departure or original destination within Northern Ireland of the driver and passengers, provided the accident or breakdown occurred within the Republic of Ireland;

and this form of assistance may include the conveyance of the driver or passengers of the relevant vehicle, with the vehicle, or (where the vehicle is to be conveyed only to the nearest or most appropriate place at which repairs may be carried out) separately, to the nearest location from which they may continue their journey by other means.

(4) A contract does not fail to meet the condition in paragraph (1)(a) solely because the provider may reimburse the person entitled to the assistance for all or part of any sums paid by him in respect of assistance either because he failed to identify himself as a person entitled to the assistance or because he was unable to get in touch with the provider in order to claim the assistance.

(5) In this article—

• “the assistance" means the benefits to be provided under a contract of the kind mentioned in paragraph (1);

• “breakdown" means an event—

  (a)

  which causes the driver of the relevant vehicle to be unable to start a journey in the vehicle or involuntarily to bring the vehicle to a halt on a journey because of some malfunction of the vehicle or failure of it to function, and

  (b)

  after which the journey cannot reasonably be commenced or continued in the relevant vehicle;

• “the relevant vehicle" means the vehicle (including a trailer or caravan) in respect of which the assistance is required.

[F123 Information society services [F124 and managers of UCITS and AIFs] U.K.

12A.   Article 10 is subject to the [F125 exclusions] in article 72A (information society services), as qualified by paragraph (2) of that article [F126 , and article 72AA (managers of UCITS and AIFs).]]

Textual Amendments

F123 Art. 12A and words inserted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(3)

F124 Words in art. 12A heading inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(5)(a)

F125 Word in art. 12A substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(5)(b)

F126 Words in art. 12A inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(5)(c)

[F127 Transformer vehicles: insurance risk transformation U.K.

12B.   A transformer vehicle does not carry on an activity of a kind specified by article 10 by assuming a risk from an undertaking, provided the assumption of the risk is a specified kind of activity falling within article 13A (transformer vehicles: insurance risk transformation).]

Textual Amendments

F127 Art. 12B inserted (8.12.2017) by The Risk Transformation Regulations 2017 (S.I. 2017/1212), regs. 1(2), 5(2)

Supplemental U.K.

Application of sections 327 and 332 of the Act to insurance market activities U.K.

13.—(1) In sections 327(5) and (7) and 332(3)(b) of the Act (exemption from the general prohibition for members of the professions, and rules in relation to such persons), the references to “a regulated activity" and “regulated activities" do not include—

(a) any activity of the kind specified by article 10(1) or (2), where—

(i) P is a member of the Society; and

(ii) by virtue of section 316 of the Act (application of the Act to Lloyd’s underwriting), the general prohibition does not apply to the carrying on by P of that activity; or

(b) any activity of the kind specified by article 10(2), where—

(i) P is a former underwriting member; and

(ii) the contract of insurance in question is one underwritten by P at Lloyd’s.

(2) In paragraph (1)—

• “member of the Society" has the same meaning as in Lloyd’s Act 1982 M19 ; and

• “former underwriting member" has the meaning given by section 324(1) of the Act.

Marginal Citations

M19 1982 c. 14.

[F128 CHAPTER 3A U.K. Insurance risk transformation

Textual Amendments

F128 Pt. II Ch. 3A inserted (8.12.2017) by The Risk Transformation Regulations 2017 (S.I. 2017/1212), regs. 1(2), 5(3)

Transformer vehicles: insurance risk transformation U.K.

13A.   It is a specified kind of activity for a transformer vehicle to assume a risk from an undertaking where—

(a) the undertaking assumes a risk under a contract of insurance (“the underlying risk”); and

(b) the assumption of risk by the transformer vehicle has the legal or economic effect of transferring some or all of the underlying risk to the transformer vehicle.]

Chapter IV U.K. Dealing in Investments as Principal

The activity U.K.

Dealing in investments as principal U.K.

14.— [F129 (1)] Buying, selling, subscribing for or underwriting securities or contractually based investments (other than investments of the kind specified by article 87, or article 89 so far as relevant to that article) as principal is a specified kind of activity.

[F130 (2) Paragraph (1) does not apply to a kind of activity to which article 25D [F131 or 25DA] applies.]

Textual Amendments

F129 Art. 14(1): art. 14 renumbered as art. 14(1) (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 5(a)

F130 Art. 14(2) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 5(b)

F131 Words in art. 14(2) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 12(3)

Exclusions U.K.

Absence of holding out etc. U.K.

15.—(1) Subject to paragraph (3), a person (“A") does not carry on an activity of the kind specified by article 14 by entering into a transaction which relates to a security or is the assignment (or, in Scotland, the assignation) of a qualifying contract of insurance (or an investment of the kind specified by article 89, so far as relevant to such a contract), unless—

(a) A holds himself out as willing, as principal, to buy, sell or subscribe for investments of the kind to which the transaction relates at prices determined by him generally and continuously rather than in respect of each particular transaction;

(b) A holds himself out as engaging in the business of buying investments of the kind to which the transaction relates, with a view to selling them;

(c) A holds himself out as engaging in the business of underwriting investments of the kind to which the transaction relates; or

(d) A regularly solicits members of the public with the purpose of inducing them, as principals or agents, to enter into transactions constituting activities of the kind specified by article 14, and the transaction is entered into as a result of his having solicited members of the public in that manner.

(2) In paragraph (1)(d), “members of the public" means any persons other than—

(a) authorised persons or persons who are exempt persons in relation to activities of the kind specified by article 14;

(b) members of the same group as A;

(c) persons who are or who propose to become participators with A in a joint enterprise;

(d) any person who is solicited by A with a view to the acquisition by A of 20 per cent or more of the voting shares in a body corporate;

(e) if A (either alone or with members of the same group as himself) holds more than 20 per cent of the voting shares in a body corporate, any person who is solicited by A with a view to—

(i) the acquisition by A of further shares in the body corporate; or

(ii) the disposal by A of shares in the body corporate to the person solicited or to a member of the same group as the person solicited;

(f) any person who—

(i) is solicited by A with a view to the disposal by A of shares in a body corporate to the person solicited or to a member of the same group as that person; and

(ii) either alone or with members of the same group holds 20 per cent or more of the voting shares in the body corporate;

(g) any person whose head office is outside the United Kingdom, who is solicited by an approach made or directed to him at a place outside the United Kingdom and whose ordinary business involves him in carrying on activities of the kind specified by any of articles 14, 21, 25, 37, 40, 45, [F132 51ZA, 51ZB, 51ZC, 51ZD, 51ZE], 52 and 53 or (so far as relevant to any of those articles) article 64, or would do so apart from any exclusion from any of those articles made by this Order.

(3) This article does not apply where A enters into the transaction as bare trustee or, in Scotland, as nominee for another person and is acting on that other person’s instructions (but the exclusion in article 66(1) applies if the conditions set out there are met).

[F133 (4) This article is subject to article 4(4).]

Textual Amendments

F132 Words in art. 15(2)(g) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(3)

F133 Art. 15(4) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 6

Dealing in contractually based investments U.K.

16.— [F134 (1)] A person who is not an authorised person does not carry on an activity of the kind specified by article 14 by entering into a transaction relating to a contractually based investment—

(a) with or through an authorised person, or an exempt person acting in the course of a business comprising a regulated activity in relation to which he is exempt; or

(b) through an office outside the United Kingdom maintained by a party to the transaction, and with or through a person whose head office is situated outside the United Kingdom and whose ordinary business involves him in carrying on activities of the kind specified by any of articles 14, 21, 25, 37, 40, 45, [F135 51ZA, 51ZB, 51ZC, 51ZD, 51ZE], 52 and 53 or, so far as relevant to any of those articles, article 64 (or would do so apart from any exclusion from any of those articles made by this Order).

[F136 (2) This article is subject to article 4(4).]

Textual Amendments

F134 Art. 16(1): art. 16 renumbered as art. 16(1) (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 7(a)

F135 Words in art. 16(1)(b) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(3)

F136 Art. 16(2) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 7(b)

Acceptance of instruments creating or acknowledging indebtedness U.K.

17.—(1) A person does not carry on an activity of the kind specified by article 14 by accepting an instrument creating or acknowledging indebtedness in respect of any loan, credit, guarantee or other similar financial accommodation or assurance which he has made, granted or provided.

(2) The reference in paragraph (1) to a person accepting an instrument includes a reference to a person becoming a party to an instrument otherwise than as a debtor or a surety.

Issue by a company of its own shares etc. U.K.

18.—(1) There is excluded from article 14 the issue by a company of its own shares or share warrants, and the issue by any person of his own debentures or debenture warrants.

(2) In this article—

(a) “company" means any body corporate other than an open-ended investment company;

(b) “shares" and “debentures" include any investment of the kind specified by article 76 [F137 , 77 or 77A];

(c) “share warrants" and “debenture warrants" mean any investment of the kind specified by article 79 which relates to shares in the company concerned or, as the case may be, debentures issued by [F138 the person concerned].

[F139 (3) This article is subject to article 4(4).]

Textual Amendments

F137 Words in art. 18(2)(b) substituted (24.2.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2010 (S.I. 2010/86), art. 1(2), Sch. para. 5(a)

F138 Words in art. 18(2)(c) substituted (1.12.2001) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2001 (S.I. 2001/3544), arts. 1(a), 4

F139 Art. 18(3) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 12(4)

[F140 Dealing by a company in its own shares U.K.

18A.— (1) A company does not carry on an activity of the kind specified by article 14 by purchasing its own shares where [F141 section 724 of the Companies Act 2006] (Treasury shares) applies to the shares purchased.

(2) A company does not carry on an activity of the kind specified by article 14 by dealing in its own shares held as treasury shares, in accordance with [F142 section 727 (Treasury shares: disposal) or 729 (Treasury shares: cancellation) of that Act].

(3) In this article “shares held as treasury shares” has the same meaning as in that Act.]

Textual Amendments

F140 Art. 18A inserted (1.12.2003) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 3) Order 2003 (S.I. 2003/2822), arts. 1, 3

F141 Words in art. 18A(1) substituted (12.5.2011) by The Companies Act 2006 (Consequential Amendments and Transitional Provisions) Order 2011 (S.I. 2011/1265), arts. 1(2), 13(3)(a)

F142 Words in art. 18A(2) substituted (12.5.2011) by The Companies Act 2006 (Consequential Amendments and Transitional Provisions) Order 2011 (S.I. 2011/1265), arts. 1(2), 13(3)(b)

Risk management U.K.

19.—(1) A person (“B") does not carry on an activity of the kind specified by article 14 by entering as principal into a transaction with another person (“C") if—

(a) the transaction relates to investments of the kind specified by any of articles 83 to 85 (or article 89 so far as relevant to any of those articles);

(b) neither B nor C is an individual;

(c) the sole or main purpose for which B enters into the transaction (either by itself or in combination with other such transactions) is that of limiting the extent to which a relevant business will be affected by any identifiable risk arising otherwise than as a result of the carrying on of a regulated activity; and

(d) the relevant business consists mainly of activities other than—

(i) regulated activities; or

(ii) activities which would be regulated activities but for any exclusion made by this Part.

(2) In paragraph (1), “relevant business" means a business carried on by—

(a) B;

(b) a member of the same group as B; or

(c) where B and another person are, or propose to become, participators in a joint enterprise, that other person.

[F143 (3) This article is subject to article 4(4).]

Textual Amendments

F143 Art. 19(3) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 8

[F144 Transformer vehicles: insurance risk transformation U.K.

19A.   A transformer vehicle does not carry on an activity of a kind specified by article 14 by assuming a risk from an undertaking, provided the assumption of the risk is a specified kind of activity falling within article 13A (transformer vehicles: insurance risk transformation).]

Textual Amendments

F144 Art. 19A inserted (8.12.2017) by The Risk Transformation Regulations 2017 (S.I. 2017/1212), regs. 1(2), 5(4)

Other exclusions U.K.

20.  Article 14 is also subject to the exclusions in articles 66 (trustees etc.), 68 (sale of goods and supply of services), 69 (groups and joint enterprises), 70 (sale of body corporate), 71 (employee share schemes) [F145 , 72 (overseas persons)[F146 , 72A (information society services)[F147 , 72AA (managers of UCITS and AIFs) and 72H (insolvency practitioners)]]].

Textual Amendments

F145 Words in art. 20 substituted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(4)

F146 Words in art. 20 substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(6)

F147 Words in art. 20 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), art. 1(3)(4), 2(4)

Chapter V U.K. Dealing in Investments as Agent

The activity U.K.

Dealing in investments as agent U.K.

21.— [F148 (1)] Buying, selling, subscribing for or underwriting securities[F149 , structured deposits] or [F150 relevant investments] (other than investments of the kind specified by article 87, or article 89 so far as relevant to that article) as agent is a specified kind of activity.

[F151 (2) Paragraph (1) does not apply to a kind of activity to which article 25D [F152 or 25DA] applies.]

Textual Amendments

F148 Art. 21(1): art. 21 renumbered as art. 21(1) (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 9(a)

F149 Words in art. 21(1) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 4(1)

F150 Words in art. 21 substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 4(1)

F151 Art. 21(2) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 9(b)

F152 Words in art. 21(2) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 12(3)

Exclusions U.K.

Deals with or through authorised persons U.K.

22.—(1) A person who is not an authorised person does not carry on an activity of the kind specified by article 21 by entering into a transaction as agent for another person (“the client") with or through an authorised person if—

(a) the transaction is entered into on advice given to the client by an authorised person; or

(b) it is clear, in all the circumstances, that the client, in his capacity as an investor, is not seeking and has not sought advice from the agent as to the merits of the client’s entering into the transaction (or, if the client has sought such advice, the agent has declined to give it but has recommended that the client seek such advice from an authorised person).

[F153 (2) But the exclusion in paragraph (1) does not apply if—

(a) the transaction relates to a contract of insurance; or

(b) the agent receives from any person other than the client any pecuniary reward or other advantage, for which he does not account to the client, arising out of his entering into the transaction.]

[F154 (3) This article is subject to article 4(4).]

Textual Amendments

F153 Art. 22(2) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 4(2)

F154 Art. 22(3) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 10

Modifications etc. (not altering text)

C3 Art. 22 modified (31.10.2001) by The Financial Services and Markets Act 2000 (Interim Permissions) Order 2001 (S.I. 2001/3374), art. 1, Sch. para. 10 (with Sch. para. 4)

C4 Art. 22 modified (31.10.2004) by The Financial Services and Markets Act 2000 (Transitional Provisions) (Mortgages) Order 2004 (S.I. 2004/2615), art. 1(2)(b), Sch. para. 11 (with Sch. para. 4)

C5 Art. 22 modified (14.1.2005) by The Financial Services and Markets Act 2000 (Transitional Provisions) (General Insurance Intermediaries) Order 2004 (S.I. 2004/3351), art. 1(2)(b), Sch. para. 10(1) (with Sch. para. 4)

C6 Art. 22 modified (6.4.2007) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2006 (S.I. 2006/1969), art. 1(3), Sch. para. 11 (with Sch. para. 4)

Risk management U.K.

23.—(1) A person (“B") does not carry on an activity of the kind specified by article 21 by entering as agent for a relevant person into a transaction with another person (“C") if—

(a) the transaction relates to investments of the kind specified by any of articles 83 to 85 (or article 89 so far as relevant to any of those articles);

(b) neither B nor C is an individual;

(c) the sole or main purpose for which B enters into the transaction (either by itself or in combination with other such transactions) is that of limiting the extent to which a relevant business will be affected by any identifiable risk arising otherwise than as a result of the carrying on of a regulated activity; and

(d) the relevant business consists mainly of activities other than—

(i) regulated activities; or

(ii) activities which would be regulated activities but for any exclusion made by this Part.

(2) In paragraph (1), “relevant person" means—

(a) a member of the same group as B; or

(b) where B and another person are, or propose to become, participators in a joint enterprise, that other person;

and “relevant business" means a business carried on by a relevant person.

[F155 (3) This article is subject to article 4(4).]

Textual Amendments

F155 Art. 23(3) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 11

Other exclusions U.K.

24.  Article 21 is also subject to the exclusions in articles 67 (profession or non-investment business), 68 (sale of goods and supply of services), 69 (groups and joint enterprises), 70 (sale of body corporate), 71 (employee share schemes) [F156 , 72 (overseas persons)][F157 , 72A (information society services), 72B (activities carried on by a provider of relevant goods or services)[F158 , 72AA (managers of UCITS and AIFs)[F159 , 72D (large risks contracts where risk situated outside the EEA), 72G (local authorities) and 72H (insolvency practitioners)]]].

Textual Amendments

F156 Words in art. 24 substituted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(5)

F157 Words in art. 24 substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 4(3)

F158 Words in art. 24 substituted (22.7.2013) by virtue of The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(7)

F159 Words in art. 24 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), art. 1(3)(4), 2(5)

[F160 Chapter 5A U.K. Bidding in Emissions Auctions

Textual Amendments

F160 Pt. 2 Ch. 5A inserted (20.7.2012) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2012 (S.I. 2012/1906), arts. 1, 2(3)

The activity U.K.

Bidding in emissions auctions U.K.

24A.— (1) The reception, transmission or submission of a bid at an auction of an investment of the kind specified by article 82A conducted—

(a) on a recognised auction platform, or

(b) on any other auction platform which has been appointed under the emission allowance auctioning regulation,

is a specified kind of activity.

(2) An activity which falls within paragraph (1) (or would do so but for the exclusions in article 24B) does not form part of any other activity specified under any other article of this Order.

(3) In this article, “recognised auction platform” has the meaning given in regulation 1(3) of the Recognised Auction Platform Regulations 2011.

Exclusions U.K.

Miscellaneous exclusions U.K.

24B.— (1) There is excluded from article 24A any activity carried on by—

(a) an operator or an aircraft operator having an operator holding account, in either case bidding on its own account, including any parent undertaking, subsidiary undertaking or affiliate undertaking forming part of the same group of undertakings as the operator or the aircraft operator;

(b) business groupings of persons listed in sub-paragraph (a) bidding on their own account or acting as an agent on behalf of their members; or

(c) public bodies or state-owned entities of the Member States that control any of the persons listed in sub-paragraph (a).

(2) There is excluded from article 24A the reception, transmission or submission of a bid by an investment firm or a credit institution on any auction platform on their own account for investments of the kind specified by article 82A which are not financial instruments.

(3) In this article, the expressions “parent undertaking”, “subsidiary undertaking”, “affiliate undertaking”, “business grouping”, “public bodies” and “state-owned entities” have the same meaning as in the emission allowance auctioning regulation.]

Chapter VI U.K. Arranging Deals in Investments

The activities U.K.

Arranging deals in investments U.K.

25.—(1) Making arrangements for another person (whether as principal or agent) to buy, sell, subscribe for or underwrite a particular investment which is—

(a) a security,

(b) a [F161 relevant investment], F162 ...

(c) an investment of the kind specified by article 86, or article 89 so far as relevant to that article[F163 , or

(d) a structured deposit,]

is a specified kind of activity.

(2) Making arrangements with a view to a person who participates in the arrangements buying, selling, subscribing for or underwriting investments falling within paragraph (1)(a), (b)[F164 , (c) or (d)] (whether as principal or agent) is also a specified kind of activity.

[F165 (3) Paragraphs (1) and (2) do not apply to a kind of activity to which article 25D [F166 or 25DA] applies.]

Textual Amendments

F161 Words in art. 25(1) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(1)

F162 Word in art. 25(1)(b) omitted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 4(2)(a)(i)

F163 Art. 25(1)(d) and preceding word inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 4(2)(a)(ii)

F164 Words in art. 25(2) substituted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 4(2)(b)

F165 Art. 25(3) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 12

F166 Words in art. 25(3) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 12(3)

[F167 Arranging regulated mortgage contracts U.K.

25A.— (1) Making arrangements—

(a) for another person to enter into a regulated mortgage contract as borrower; or

(b) for another person to vary the terms of a regulated mortgage contract [F168 falling within paragraph (1A)] entered into by him as borrower F169 ..., in such a way as to vary his obligations under that contract,

is a specified kind of activity.

[F170 (1A) A regulated mortgage contract falls within this paragraph if—

(a) the contract was entered into on or after 31st October 2004; or

(b) the contract—

(i) was entered into before 31st October 2004; and

(ii) was a regulated credit agreement immediately before 21st March 2016.]

(2) Making arrangements with a view to a person who participates in the arrangements entering into a regulated mortgage contract as borrower is also a specified kind of activity.

[F171 (2A) Making arrangements to enter into a regulated mortgage contract with a borrower on behalf of a lender is also a specified kind of activity.]

(3) In this article [F172 “borrower” and “lender” have the meanings] given by article 61(3)(a)(i).]

Textual Amendments

F167 Art. 25A inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 4

F168 Words in art. 25A(1)(b) inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 2(4)(a)(i) (with Pt. 5)

F169 Words in art. 25A(1)(b) omitted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 2(4)(a)(ii) (with Pt. 5)

F170 Art. 25A(1A) inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 2(4)(b) (with Pt. 5)

F171 Art. 25A(2A) 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. 4(4)(a) (with Pt. 4)

F172 Words in art. 25A(3) substituted (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. 4(4)(b) (with Pt. 4)

[F173 Arranging regulated home reversion plans U.K.

25B.— (1) Making arrangements—

(a) for another person to enter into a regulated home reversion plan as reversion seller or as plan provider; or

(b) for another person to vary the terms of a regulated home reversion plan, entered into on or after 6th April 2007 by him as reversion seller or as plan provider, in such a way as to vary his obligations under that plan,

is a specified kind of activity.

(2) Making arrangements with a view to a person who participates in the arrangements entering into a regulated home reversion plan as reversion seller or as plan provider is also a specified kind of activity.]

Textual Amendments

F173 Arts. 25B, 25C inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 4

[F173 Arranging regulated home purchase plans U.K.

25C.— (1) Making arrangements—

(a) for another person to enter into a regulated home purchase plan as home purchaser; or

(b) for another person to vary the terms of a regulated home purchase plan, entered into on or after 6th April 2007 by him as home purchaser, in such a way as to vary his obligations under that plan,

is a specified kind of activity.

(2) Making arrangements with a view to a person who participates in the arrangements entering into a regulated home purchase plan as home purchaser is also a specified kind of activity.]

Textual Amendments

F173 Arts. 25B, 25C inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 4

[F174 Operating a multilateral trading facility U.K.

25D.— (1) The operation of a multilateral trading facility on which MiFID instruments are traded is a specified kind of activity.

(2) In paragraph (1), “MiFID instrument” means any investment—

(a) of the kind specified by article 76, 77, [F175 77A,] 78, 79, 80, 81, [F176 82B,] 83, 84 or 85; or

(b) of the kind specified by article 89 so far as relevant to an investment falling within sub-paragraph (a),

that is a financial instrument.]

Textual Amendments

F174 Art. 25D inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 13

F175 Word in art. 25D(2)(a) inserted (24.2.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2010 (S.I. 2010/86), art. 1(2), Sch. para. 5(b)

F176 Word in art. 25D(2)(a) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 12(5)

[F177 Operating an organised trading facility U.K.

25DA.— (1) The operation of an organised trading facility on which non-equity MiFID instruments are traded is a specified kind of activity.

(2) In paragraph (1) a “non-equity MiFID instrument” means any investment—

(a) of the kind specified by article 77, 77A, 78, 79, 80, 81, 82B, 83, 84 or 85; or

(b) of the kind specified by article 89 so far as relevant to an investment falling within sub-paragraph (a),

that is a bond, a structured finance product (within the meaning of Article 2.1.28 of the markets in financial instruments regulation), an emission allowance, or a derivative (within the meaning of Article 2.1.29 of the markets in financial instruments regulation).]

Textual Amendments

F177 Art. 25DA inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 3

[F178 Arranging regulated sale and rent back agreements U.K.

25E.— (1) Making arrangements—

(a) for another person to enter into a regulated sale and rent back agreement as an agreement seller or as an agreement provider; or

(b) for another person (“A”) to vary the terms of a regulated sale and rent back agreement, entered into on or after 1st July 2009 by A as agreement seller or agreement provider, in such a way as to vary A’s obligations under that agreement,

is a specified kind of activity.

(2) Making arrangements with a view to a person who participates in the arrangements entering into a regulated sale and rent back agreement as agreement seller or agreement provider is also a specified kind of activity.]

Textual Amendments

F178 Art. 25E inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 4

Exclusions U.K.

Arrangements not causing a deal U.K.

26.  There are excluded from [F179 articles 25(1), 25A(1), 25B(1) [F180 , 25C(1) and 25E(1)]] arrangements which do not or would not bring about the transaction to which the arrangements relate.

Textual Amendments

F179 Words in art. 26 substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 5

F180 Words in art. 26 substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 5

Enabling parties to communicate U.K.

27.  A person does not carry on an activity of the kind specified by [F181 article 25(2), 25A(2), 25B(2) [F182 , 25C(2) or 25 E(2)]] merely by providing means by which one party to a transaction (or potential transaction) is able to communicate with other such parties.

Textual Amendments

F181 Words in art. 27 substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 6

F182 Words in art. 27 substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 6

Arranging transactions to which the arranger is a party U.K.

28.—(1) There are excluded from article 25(1) any arrangements for a transaction into which the person making the arrangements enters or is to enter as principal or as agent for some other person.

(2) There are excluded from article 25(2) any arrangements which a person makes with a view to transactions into which he enters or is to enter as principal or as agent for some other person.

[F183 (3) But the exclusions in paragraphs (1) and (2) do not apply to arrangements made for or with a view to a transaction which relates to a contract of insurance, unless the person making the arrangements either—

(a) is the only policyholder; or

(b) as a result of the transaction, would become the only policyholder.]

Textual Amendments

F183 Art. 28(3) inserted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(2)

[F184 Arranging contracts [F185 , plans or agreements] to which the arranger is a party U.K.

28A.— (1) There are excluded from [F186 articles 25A(1), 25B(1) [F187 , 25C(1) and 25E(1)]] any arrangements—

(a) for a [F188 contract [F189 , plan or agreement]] into which the person making the arrangements enters or is to enter; or

(b) for a variation of a [F188 contract [F189 , plan or agreement]] to which that person is (or is to become) a party.

(2) There are excluded from [F190 articles 25A(2), 25B(2) [F191 , 25C(2) and 25E(2)]] any arrangements which a person makes with a view to contracts [F192 , plans or agreements] into which he enters or is to enter.]

Textual Amendments

F184 Art. 28A inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 7

F185 Words in art. 28A title substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 7(1)

F186 Words in art. 28A(1) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 7(2)(a)(i)

F187 Words in art. 28A(1) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 7(2)(a)(i)

F188 Words in art. 28A(1) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 7(2)(a)(ii)

F189 Words in art. 28A(1) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 7(2)(a)(ii)

F190 Words in art. 28A(2) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 7(2)(b)(i)

F191 Words in art. 28A(2) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 7(2)(b)(i)

F192 Words in art. 28A(2) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 7(2)(b)(ii)

Arranging deals with or through authorised persons U.K.

29.—(1) There are excluded from [F193 articles 25(1) and (2), [F194 25A(1), (2) and (2A)], 25B(1) and (2) [F195 , 25C(1) and (2) and 25E(1) and (2)]] arrangements made by a person (“A") who is not an authorised person for or with a view to a transaction which is or is to be entered into by a person (“the client") with or though an authorised person if—

(a) the transaction is or is to be entered into on advice to the client by an authorised person; or

(b) it is clear, in all the circumstances, that the client, in his capacity as an [F196 investor, borrower, reversion seller, plan provider, home purchaser, agreement provider or (as the case may be) agreement seller], is not seeking and has not sought advice from A as to the merits of the client’s entering into the transaction (or, if the client has sought such advice, A has declined to give it but has recommended that the client seek such advice from an authorised person).

[F197 (2) But the exclusion in paragraph (1) does not apply if—

(a) the transaction relates, or would relate, to a contract of insurance; or

(b) A receives from any person other than the client any pecuniary reward or other advantage, for which he does not account to the client, arising out of his making the arrangements.]

[F198 (3) This article is subject to article 4(4) [F199 and (4B)].]

Textual Amendments

F193 Words in art. 29(1) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 8(a)

F194 Words in art. 29(1) substituted (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. 4(5)(a) (with Pt. 4)

F195 Words in art. 29(1) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 8(a)

F196 Words in art. 29(1)(b) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 8(b)

F197 Art. 29(2) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(3)

F198 Art. 29(3) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 14

F199 Words in art. 29(3) 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. 4(5)(b) (with Pt. 4)

Modifications etc. (not altering text)

C7 Art. 29 modified (31.10.2001) by The Financial Services and Markets Act 2000 (Interim Permissions) Order 2001 (S.I. 2001/3374), art. 1, Sch. para. 11 (with Sch. para. 4)

C8 Art. 29 modified (31.10.2004) by The Financial Services and Markets Act 2000 (Transitional Provisions) (Mortgages) Order 2004 (S.I. 2004/2615), art. 1(2)(b), Sch. para. 11 (with Sch. para. 4)

C9 Art. 29 modified (14.1.2005) by The Financial Services and Markets Act 2000 (Transitional Provisions) (General Insurance Intermediaries) Order 2004 (S.I. 2004/3351), art. 1(2)(b), Sch. para. 10(2) (with Sch. para. 4)

C10 Art. 29 modified (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), art. 1(2), Sch. para. 9

C11 Art. 29 modified (6.4.2007) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2006 (S.I. 2006/1969), art. 1(3), Sch. para. 12 (with Sch. para. 4)

C12 Art. 29 modified (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), art. 1(2), Sch. para. 8

[F200 Arrangements made in the course of administration by authorised person U.K.

29A.— [F201 (1)]  A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 25A(1)(b) as a result of—

(a) anything done by an authorised person (“B”) in relation to a regulated mortgage contract which B is administering pursuant to an arrangement of the kind mentioned in article 62(a); or

(b) anything A does in connection with the administration of a regulated mortgage contract in circumstances falling within article 62(b).

[F202 (2) A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 25B(1)(b) as a result of—

(a) anything done by an authorised person (“B”) in relation to a regulated home reversion plan which B is administering pursuant to an arrangement of the kind mentioned in article 63C(a); or

(b) anything A does in connection with the administration of a regulated home reversion plan in circumstances falling within article 63C(b).

(3) A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 25C(1)(b) as a result of—

(a) anything done by an authorised person (“B”) in relation to a regulated home purchase plan which B is administering pursuant to an arrangement of the kind mentioned in article 63G(a); or

(b) anything A does in connection with the administration of a regulated home purchase plan in circumstances falling within article 63G(b).]

[F203 (4) A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 25E(1)(b) as a result of—

(a) anything done by an authorised person (“B”) in relation to a regulated sale and rent back agreement which B is administering pursuant to an arrangement of the kind mentioned in article 63K(a); or

(b) anything A does in connection with the administration of a regulated sale and rent back agreement in circumstances falling within article 63K(b).]]

Textual Amendments

F200 Art. 29A inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 9

F201 Art. 29A(1): art. 29A renumbered as art. 29A(1) (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 9(a)

F202 Art. 29A(2)(3) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 9(b)

F203 Art. 29A(4) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 9

Modifications etc. (not altering text)

C13 Art. 29A(2)(a) applied (with modifications) (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), art. 1(2), Sch. para. 10

C14 Art. 29A(3)(a) applied (with modifications) (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), art. 1(2), Sch. para. 10

C15 Art. 29A(4)(a) modified (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), art. 1(2), Sch. para. 9

Arranging transactions in connection with lending on the security of insurance policies U.K.

30.—(1) There are excluded from article 25(1) and (2) arrangements made by a money-lender under which either—

[F204 (a) a relevant authorised person or a person acting on his behalf will introduce to the money-lender persons with whom the relevant authorised person has entered, or proposes to enter, into a relevant transaction, or will advise such persons to approach the money-lender, with a view to the money-lender lending money on the security of any contract effected pursuant to a relevant transaction;]

(b) a relevant authorised person gives an assurance to the money-lender as to the amount which, on the security of any contract effected pursuant to a relevant transaction, will or may be received by the money-lender should the money-lender lend money to a person introduced to him pursuant to the arrangements.

(2) In paragraph (1)—

• “money-lender" means a person who is—

  (a)

  a money-lending company within the meaning of [F205 section 209 of the Companies Act 2006];

  (b)

  a body corporate incorporated under the law of, or of any part of, the United Kingdom relating to building societies; or

  (c)

  a person whose ordinary business includes the making of loans or the giving of guarantees in connection with loans;

• “relevant authorised person" means an authorised person who has permission to effect [F206 contracts of insurance] or to sell investments of the kind specified by article 89, so far as relevant to such contracts;

• “relevant transaction" means the effecting of a [F207 contract of insurance] or the sale of an investment of the kind specified by article 89, so far as relevant to such contracts.

[F208 (3) This article is subject to article 4(4A).]

Textual Amendments

F204 Art. 30(1)(a) substituted (1.12.2001) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2001 (S.I. 2001/3544), arts. 1(a), 5

F205 Words in art. 30(2)(a) substituted (12.5.2011) by The Companies Act 2006 (Consequential Amendments and Transitional Provisions) Order 2011 (S.I. 2011/1265), arts. 1(2), 13(4)

F206 Words in art. 30(2) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(4)(a)

F207 Words in art. 30(2) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(4)(b)

F208 Art. 30(3) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 15

Arranging the acceptance of debentures in connection with loans U.K.

31.—(1) There are excluded from article 25(1) and (2) arrangements under which a person accepts or is to accept, whether as principal or agent, an instrument creating or acknowledging indebtedness in respect of any loan, credit, guarantee or other similar financial accommodation or assurance which is, or is to be, made, granted or provided by that person or his principal.

(2) The reference in paragraph (1) to a person accepting an instrument includes a reference to a person becoming a party to an instrument otherwise than as a debtor or a surety.

Provision of finance U.K.

32.  There are excluded from article 25(2) arrangements having as their sole purpose the provision of finance to enable a person to buy, sell, subscribe for or underwrite investments.

Introducing U.K.

33.  There are excluded from [F209 articles 25(2), 25A(2), 25B(2) [F210 , 25C(2) and 25E(2)]] arrangements where—

(a) they are arrangements under which persons (“clients") will be introduced to another person;

(b) the person to whom introductions are to be made is—

(i) an authorised person;

(ii) an exempt person acting in the course of a business comprising a regulated activity in relation to which he is exempt; or

(iii) a person who is not unlawfully carrying on regulated activities in the United Kingdom and whose ordinary business involves him in engaging in an activity of the kind specified by any of articles 14, 21, 25, [F211 25A,] [F212 25B, 25C,] [F213 25E,] 37 [F214 , 39A] 40, 45, [F215 51ZA, 51ZB, 51ZC, 51ZD, 51ZE], [F216 52, 53][F217 , 53A, 53B[F218 , 53C and 53D]] (or, so far as relevant to any of those articles, article 64), or would do so apart from any exclusion from any of those articles made by this Order; F219 ...

(c) the introduction is made with a view to the provision of independent advice or the independent exercise of discretion in relation to investments generally or in relation to any class of investments to which the arrangements relate [F220 ; and

[F221 (d) The arrangements—

(i) are made with a view to a person entering into a transaction which does not relate to a contract of insurance, or

(ii) are of the type specified in article 33B (provision of information – contracts of insurance).]]

Textual Amendments

F209 Words in art. 33 substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 10(a)

F210 Words in art. 33 substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 10(a)

F211 Words in art. 33(b)(iii) inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 10(b)(i)

F212 Words in art. 33(b)(iii) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 10(b)(i)

F213 Word in art. 33(b)(iii) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 10(b)(i)

F214 Word in art. 33(b)(iii) inserted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(5)(a)

F215 Words in art. 33(b)(iii) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(3)

F216 Words in art. 33(b)(iii) substituted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 10(b)(ii)

F217 Words in art. 33(b)(iii) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 10(b)(ii)

F218 Words in art. 33(b)(iii) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 10(b)(ii)

F219 Word in art. 33(b)(iii) omitted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(5)(b)

F220 Art. 33(d) and preceding word inserted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(5)(c)

F221 Art. 33(d) substituted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 4

[F222 Introducing to authorised persons etc. U.K.

33A— (1) There are excluded from article 25A(2) arrangements where—

(a) they are arrangements under which a client is introduced to a person (“N”) who is—

(i) an authorised person who has permission to carry on a regulated activity of the kind specified by any of articles 25A, 53A, and 61(1),

(ii) an appointed representative who may carry on a regulated activity of the kind specified by either of articles 25A and 53A without contravening the general prohibition, or

(iii) an overseas person who carries on activities specified by any of articles 25A, 53A and 61(1); and

(b) the conditions mentioned in paragraph (2) are satisfied.

[F223 (1A) There are excluded from article 25B(2) arrangements where—

(a) they are arrangements under which a client is introduced to a person (“N”) who is—

(i) an authorised person who has permission to carry on a regulated activity of the kind specified by any of articles 25B, 53B and 63B(1),

(ii) an appointed representative who may carry on a regulated activity of the kind specified by either of articles 25B and 53B without contravening the general prohibition, or

(iii) an overseas person who carries on activities specified by any of articles 25B, 53B and 63B(1); and

(b) the conditions mentioned in paragraph (2) are satisfied.

(1B) There are excluded from article 25C(2) arrangements where—

(a) they are arrangements under which a client is introduced to a person (“N”) who is—

(i) an authorised person who has permission to carry on a regulated activity of the kind specified by any of articles 25C, 53C and 63F(1),

(ii) an appointed representative who may carry on a regulated activity of the kind specified by either of articles 25C and 53C without contravening the general prohibition, or

(iii) an overseas person who carries on activities specified by any of articles 25C, 53C and 63F(1); and

(b) the conditions mentioned in paragraph (2) are satisfied.]

[F224 (1C) There are excluded from article 25E(2) arrangements where—

(a) they are arrangements under which a client is introduced to a person (“N”) who is—

(i) an authorised person who has permission to carry on a regulated activity of the kind specified by any of articles 25E, 53D and 63J(1),

(ii) an appointed representative who may carry on a regulated activity of the kind specified by either of articles 25E or 53D without contravening the general prohibition, or

(iii) an overseas person who carries on activities specified by any of articles 25E, 53D and 63J(1); and

(b) the conditions mentioned in paragraph (2) are satisfied.]

(2) Those conditions are—

(a) that the person making the introduction (“P”) does not receive any money, other than money payable to P on his own account, paid by the client for or in connection with any transaction which the client enters into with or through N as a result of the introduction; and

(b) that before making the introduction P discloses to the client such of the information mentioned in paragraph (3) as applies to P.

(3) That information is—

(a) that P is a member of the same group as N;

(b) details of any payment which P will receive from N, by way of fee or commission, for introducing the client to N;

(c) an indication of any other reward or advantage received or to be received by P that arises out of his introducing clients to N.

[F225 (4) In this article, “client” means—

(a) for the purposes of paragraph (1), a borrower within the meaning given by article 61(3)(a)(i), or a person who is or may be contemplating entering into a regulated mortgage contract as such a borrower;

(b) for the purposes of paragraph (1A), a reversion seller, a plan provider or a person who is or may be contemplating entering into a regulated home reversion plan as a reversion seller or as a plan provider;

(c) for the purposes of paragraph (1B), a home purchaser or a person who is or may be contemplating entering into a regulated home purchase plan as a home purchaser[F226 ;

(d) for the purposes of paragraph (1C), an agreement provider, an agreement seller or a person who is or may be contemplating entering into a regulated sale and rent back agreement as an agreement provider or agreement seller.]]]

Textual Amendments

F222 Art. 33A inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 11

F223 Art. 33A(1A)(1B) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 11(a)

F224 Art. 33A(1C) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 11(a)

F225 Art. 33A(4) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 11(b)

F226 Art. 33A(4)(d) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 11(b)

[F227 Provision of information – contracts of insurance U.K.

33B.— (1) There is excluded from article 25(1) and (2) (arranging deals in investments) the making of arrangements for, or with a view to, a transaction for the sale or purchase of a contract of insurance, where that activity meets the conditions specified in paragraphs (2) and (3).

(2) The conditions specified in this paragraph are that the activity—

(a) consists of the provision of information about a potential policyholder to a relevant insurer or an insurance or reinsurance intermediary, or

(b) consists of the provision of information to a potential policyholder about—

(i) a contract of insurance, or

(ii) a relevant insurer or insurance or reinsurance intermediary.

(3) The condition specified in this paragraph is that the provider of the information does not take any step other than the provision of information to assist in the conclusion of a contract of insurance.

(4) In this article—

“insurance intermediary” has the meaning given in Article 2.1(3) of the insurance distribution directive;

“reinsurance intermediary” has the meaning given in Article 2.1(5) of the insurance distribution directive;

“relevant insurer” has the meaning given in article 39B(2) (claims management on behalf of an insurer etc.).]

Textual Amendments

F227 Art. 33B inserted (1.10.2018) by The Insurance Distribution (Regulated Activities and Miscellaneous Amendments) Order 2018 (S.I. 2018/546), arts. 1(2), 5

Arrangements for the issue of shares etc. U.K.

34.—(1) There are excluded from article 25(1) and (2)—

(a) arrangements made by a company for the purposes of issuing its own shares or share warrants; and

(b) arrangements made by any person for the purposes of issuing his own debentures or debenture warrants;

and for the purposes of article 25(1) and (2), a company is not, by reason of issuing its own shares or share warrants, and a person is not, by reason of issuing his own debentures or debenture warrants, to be treated as selling them.

(2) In paragraph (1), “company", “shares", “debentures", “share warrants" and “debenture warrants" have the meanings given by article 18(2).

[F228 (3) This article is subject to article 4(4).]

Textual Amendments

F228 Art. 34(3) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 12(6)

International securities self-regulating organisations U.K.

35.—(1) There are excluded from article 25(1) and (2) any arrangements made for the purposes of carrying out the functions of a body or association which is approved under this article as an international securities self-regulating organisation, whether the arrangements are made by the organisation itself or by a person acting on its behalf.

(2) The Treasury may approve as an international securities self-regulating organisation any body corporate or unincorporated association with respect to which the conditions mentioned in paragraph (3) appear to them to be met if, having regard to such matters affecting international trade, overseas earnings and the balance of payments or otherwise as they consider relevant, it appears to them that to do so would be desirable and not result in any undue risk to investors.

(3) The conditions are that—

(a) the body or association does not have its head office in the United Kingdom;

(b) the body or association is not eligible for recognition under section 287 or 288 of the Act (applications by investment exchanges and clearing houses) on the ground that (whether or not it has applied, and whether or not it would be eligible on other grounds) it is unable to satisfy the requirements of one or both of paragraphs (a) and (b) of section 292(3) of the Act (requirements for overseas investment exchanges and overseas clearing houses);

[F229 (ba) the body or association is also not eligible to become an EEA central counterparty (as defined in section 285(1)(c) of the Act) or a third country central counterparty (as defined in section 285(1)(d) of the Act);]

[F230 (bb) the body or association is also not eligible to become an EEA CSD (as defined in section 285(1)(f) of the Act) or a third country CSD (as defined in section 285(1)(g) of the Act);]

(c) the body or association is able and willing to co-operate with [F231 the FCA and the PRA] by the sharing of information and in other ways;

(d) adequate arrangements exist for co-operation between [F231 the FCA and the PRA] and those responsible for the supervision of the body or association in the country or territory in which its head office is situated;

(e) the body or association has a membership composed of persons falling within any of the following categories, that is to say, authorised persons, exempt persons, and persons whose head offices are outside the United Kingdom and whose ordinary business involves them in engaging in activities which are activities of a kind specified by this Order (or would be apart from any exclusion made by this Part); and

(f) the body or association facilitates and regulates the activity of its members in the conduct of international securities business.

(4) In paragraph (3)(f), “international securities business" means the business of buying, selling, subscribing for or underwriting investments (or agreeing to do so), either as principal or agent, where—

(a) the investments are securities or [F232 relevant investments] and are of a kind which, by their nature, and the manner in which the business is conducted, may be expected normally to be bought or dealt in by persons sufficiently expert to understand the risks involved; and

(b) either the transaction is international or each of the parties may be expected to be indifferent to the location of the other;

and, for the purposes of this definition, it is irrelevant that the investments may ultimately be bought otherwise than in the course of such business by persons not so expert.

(5) Any approval under this article is to be given by notice in writing; and the Treasury may by a further notice in writing withdraw any such approval if for any reason it appears to them that it is not appropriate to it to continue in force.

Textual Amendments

F229 Art. 35(3)(ba) inserted (1.4.2013) by The Financial Services and Markets Act 2000 (Over the Counter Derivatives, Central Counterparties and Trade Repositories) Regulations 2013 (S.I. 2013/504), regs. 1(2), 33(3) (with regs. 52-58)

F230 Art. 35(3)(bb) inserted (28.11.2017) by The Central Securities Depositories Regulations 2017 (S.I. 2017/1064), reg. 1, Sch. para. 23(2) (with regs. 7(4), 9(1))

F231 Words in art. 35(3)(c)(d) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(g)

F232 Words in art. 35(4)(a) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(6)

Modifications etc. (not altering text)

C16 Art. 35 extended (1.12.2001) by The Financial Services and Markets Act 2000 (Transitional Provisions) (Authorised Persons etc.) Order 2001 (S.I. 2001/2636), arts. 1(2)(b), 2(1), 80; S.I. 2001/3538, art. 2(1)

[F233 Trade repositories U.K.

35A.   A trade repository does not carry on an activity of the kind specified by article 25(2) by carrying on its functions of centrally collecting and maintaining records of—

[F234 (a)] derivatives under Regulation (EU) 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC derivatives, central counterparties and trade repositories[F235 ; or

(b) securities financing transactions under the SFT regulation].]

Textual Amendments

F233 Art. 35A inserted (1.4.2013) by The Financial Services and Markets Act 2000 (Over the Counter Derivatives, Central Counterparties and Trade Repositories) Regulations 2013 (S.I. 2013/504), regs. 1(2), 33(4) (with regs. 52-58)

F234 Art. 35A(a) formed from art. 35A (13.7.2016) by virtue of The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016 (S.I. 2016/715), reg. 1(2), Sch. 2 para. 1(3)(a)

F235 Art. 35A(b) and preceding word inserted (13.7.2016) by The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016 (S.I. 2016/715), reg. 1(2), Sch. 2 para. 1(3)(b)

[F236 Providing pensions guidance under Part 20A of the Act U.K.

35B.— (1) A person does not carry on an activity of the kind specified in article 25(1) or (2) by reason of providing pensions guidance under arrangements made with the Treasury pursuant to section 333B of the Act.

(2) For the purposes of paragraph (1), pensions guidance given by a designated guidance provider is given under arrangements made with the Treasury.]

Textual Amendments

F236 Art. 35B inserted (26.3.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (Pensions Guidance Exclusions) Order 2015 (S.I. 2015/489), arts. 1, 2(3)

Other exclusions U.K.

36.— [F237 (1)] Article 25 is also subject to the exclusions in articles 66 (trustees etc.), 67 (profession or non-investment business), 68 (sale of goods and supply of services), 69 (groups and joint enterprises), 70 (sale of body corporate), 71 (employee share schemes)[F238 , 72 (overseas persons)[F239 , 72A (information society services), 72B (activities carried on by a provider of relevant goods or services), 72C (provision of information about contracts of insurance on an incidental basis)[F240 , 72AA (managers of UCITS and AIFs)[F241 , 72D (large risks contracts where risk situated outside the EEA), 72G (local authorities) and 72H (insolvency practitioners)]]]].

[F242 (2) [F243 Articles 25A, 25B[F244 , 25C and 25E] are] also subject to the exclusions in articles 66 (trustees etc.), 67 (profession or non-investment business), 72 (overseas persons)[F245 , 72A (information society services)[F246 , 72AA (managers of UCITS and AIFs) and 72G (local authorities)]].]

[F247 (2A) Article 25A is also subject to the exclusion in article 72I (registered consumer buy-to-let mortgage firms).]

[F248 (3) Article 25D is also subject to [F249 the exclusions in articles 72 (overseas persons)[F250 , 72AA (managers of UCITS and AIFs) and 72H (insolvency practitioners)]].]

Textual Amendments

F237 Art. 36(1): art. 36 renumbered as art. 36(1) (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 12(a)

F238 Words in art. 36 substituted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(6)

F239 Words in art. 36(1) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 5(7)

F240 Words in art. 36(1) substituted (22.7.2013) by virtue of The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(7)

F241 Words in art. 36(1) 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), art. 1(3)(4), 2(6)(a)

F242 Art. 36(2) inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 12(b)

F243 Words in art. 36(2) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 12

F244 Words in art. 36(2) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 12

F245 Words in art. 36(2) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(6)

F246 Words in art. 36(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), art. 1(3)(4), 2(6)(b)

F247 Art. 36(2A) 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. 4(6) (with Pt. 4)

F248 Art. 36(3) inserted (1.4.2007 for specified purposes) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 16

F249 Words in art. 36(3) substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(8)

F250 Words in art. 36(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), art. 1(3)(4), 2(6)(c)

[F251 Chapter 6A U.K. Credit Broking

Textual Amendments

F251 Pt. II Ch. 6A, 6B 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), 4

The activity U.K.

Credit broking U.K.

36A.— (1) Each of the following is a specified kind of activity—

(a) effecting an introduction of an individual or relevant recipient of credit who wishes to enter into a credit agreement to a person (“P”) with a view to P entering into by way of business as lender a regulated credit agreement (or an agreement which would be a regulated credit agreement but for any of the relevant provisions);

(b) effecting an introduction of an individual or relevant recipient of credit who wishes to enter into a consumer hire agreement to a person (“P”) with a view to P entering into by way of business as owner a regulated consumer hire agreement or an agreement which would be a regulated consumer hire agreement but for article 60O (exempt agreements: exemptions relating to the nature of the agreement) or 60Q (exempt agreements: exemptions relating to the nature of the hirer);

(c) effecting an introduction of an individual or relevant recipient of credit who wishes to enter into a credit agreement or consumer hire agreement (as the case may be) to a person who carries on an activity of the kind specified in sub-paragraph (a) or (b) by way of business;

(d) presenting or offering an agreement which would (if entered into) be a regulated credit agreement (or an agreement which would be a regulated credit agreement but for any of the relevant provisions);

(e) assisting an individual or relevant recipient of credit by undertaking preparatory work with a view to that person entering into a regulated credit agreement (or an agreement which would be a regulated credit agreement but for any of the relevant provisions);

(f) entering into a regulated credit agreement (or an agreement which would be a regulated credit agreement but for any of the relevant provisions) on behalf of a lender.

(2) Paragraph (1) does not apply in so far as the activity is an activity of the kind specified by article 36H (operating an electronic system in relation to lending).

(3) For the purposes of paragraph (1) it is immaterial whether the credit agreement or consumer hire agreement is subject to the law of a country outside the United Kingdom.

(4) For the purposes of this article, the “relevant provisions” are the following provisions—

(a) article 60C (exempt agreements: exemptions relating to the nature of the agreement);

(b) article 60D (exempt agreements: exemptions relating to the purchase of land for non-residential purposes);

(c) article 60E (exempt agreements: exemptions relating to the nature of the lender)[F252 , except for paragraph (5) of that article];

(d) article 60G (exempt agreements: exemptions relating to the total charge for credit);

(e) article 60H (exempt agreements: exemptions relating to the nature of the borrower).

Textual Amendments

F252 Words in art. 36A(4)(c) inserted (27.6.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2014 (S.I. 2014/1448), arts. 1(2), 2

Exclusions U.K.

Introducing by individuals in the course of canvassing off trade premises U.K.

36B.— (1) There are excluded from article 36A activities carried on by an individual by canvassing off trade premises—

(a) a restricted-use credit agreement used to finance a transaction between the lender or a member of the lender’s group and the borrower whether forming part of that agreement or not, or

(b) a regulated consumer hire agreement.

(2) But paragraph (1) does not apply if A carries on any other activity of a kind specified by article 36A(1)(a) to (c).

(3) A canvasses a restricted-use credit agreement or a regulated consumer hire agreement off trade premises for the purposes of this article if—

(a) A solicits the entry of an individual or relevant recipient of credit (“B”) into such an agreement by making oral representations to B during a visit by A to any place (not excluded by paragraph (4)) where B is, and

(b) that visit is made by A for the purpose of making such oral representations.

(4) A place is excluded from paragraph (3) if it is a place where a business is carried on (whether on a permanent or temporary basis) by—

(a) the lender or owner,

(b) the supplier under the restricted-use credit agreement,

(c) A,

(d) a person who employs A or has appointed A as an agent, or

(e) B.

Activities for which no fee is paid U.K.

36C.— (1) There are excluded from sub-paragraphs (d), (e) and (f) of article 36A(1) activities carried on by a person for which that person does not receive a fee.

(2) For the purposes of this article, “fee” includes pecuniary consideration or any other form of financial consideration.

Transaction to which the broker is a party U.K.

36D.   There are excluded from article 36A activities in relation to a regulated credit agreement (or an agreement which would be a regulated credit agreement but for the exclusions in articles 60C to 60H) or a regulated consumer hire agreement (or an agreement which would be a regulated consumer hire agreement but for the exclusions in articles 60O to 60Q) into which the person carrying on the activity enters or is to enter as lender or owner.

[F253 Activities in relation to certain agreements relating to land U.K.

36E.— (1) There are excluded from article 36A activities carried on with a view to an individual or a relevant recipient of credit entering into an investment property loan, as defined in article 61A(6) (mortgage contracts which are not regulated mortgage contracts).

(2) There are excluded from article 36A activities of a kind specified by article 25A (arranging regulated mortgage contracts) or 25C (arranging regulated home purchase plans).

(3) There are excluded from article 36A other activities not excluded by paragraph (1) or (2) which consist of effecting an introduction with a view to an individual or relevant recipient of credit entering into a relevant agreement, if the person to whom the introduction is made is an authorised person who has permission to—

(a) enter into such an agreement as lender or home purchase provider (as the case may be), or

(b) make an introduction to an authorised person who has permission to enter into such an agreement as lender or home purchase provider (as the case may be).

(4) In paragraph (3) “relevant agreement” means a regulated mortgage contract or a regulated home purchase plan.]

Textual Amendments

F253 Art. 36E substituted (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. 4(7) (with Pt. 4)

[F254 Activities carried on by members of the legal profession etc U.K.

36F.— (1) There are excluded from article 36A (credit broking) activities carried on by—

(a) a barrister or advocate acting in that capacity;

(b) a solicitor (within the meaning of the Solicitors Act 1974) in the course of providing advocacy services or litigation services;

(c) a solicitor (within the meaning of the Solicitors (Scotland) Act 1980) in the course of providing advocacy services or litigation services;

(d) a solicitor (within the meaning of the Solicitors (Northern Ireland) Order 1976) in the course of providing advocacy services or litigation services;

(e) a relevant person (other than a person falling within sub-paragraph (a) to (d)) in the course of providing advocacy services or litigation services.

(2) In paragraph (1)—

“advocacy services” means any services which it would be reasonable to expect a person who is exercising, or contemplating exercising, a right of audience in relation to any proceedings, or contemplated proceedings, to provide for the purpose of those proceedings or contemplated proceedings;

“litigation services” means any services which it would be reasonable to expect a person who is exercising, or contemplating exercising, a right to conduct litigation in relation to any proceedings, or contemplated proceedings, to provide for the purpose of those proceedings or contemplated proceedings;

“relevant person” means a person who, for the purposes of the Legal Services Act 2007, is an authorised person in relation to an activity which constitutes the exercise of a right of audience or the conduct of litigation (within the meaning of that Act).]

Textual Amendments

F254 Art. 36F substituted (24.3.2015) by The Financial Services and Markets Act 2000 (Miscellaneous Provisions) Order 2015 (S.I. 2015/853), arts. 1(2), 3(2)

[F255 Other exclusions] U.K.

36G.   Article 36A is also subject to [F256 the exclusions in articles 72A (information society services), 72G (local authorities) and 72I (registered consumer buy-to-let mortgage firms)].

Textual Amendments

F255 Art. 36G heading 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), art. 1(3)(4), 2(7)

F256 Words in art. 36G substituted (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. 4(8) (with Pt. 4)

Chapter 6B U.K. Operating an Electronic System in Relation to Lending

The activity U.K.

Operating an electronic system in relation to lending U.K.

36H.— (1) Where the [F257 conditions in paragraphs (2), (2A) and (2C) are] satisfied, operating an electronic system which enables the operator (“A”) to facilitate persons (“B” and “C”) becoming the lender and borrower under an article 36H agreement is a specified kind of activity.

(2) The condition [F258 in this paragraph] is that the system operated by A is capable of determining which agreements should be made available to each of B and C (whether in accordance with general instructions provided to A by B or C or otherwise).

[F259 (2A) The condition in this paragraph is that A, or another person (“X”) acting under an arrangement with A or at A’s direction, undertakes to—

(a) receive payments in respect of [F260 either interest or capital or both] due under the article 36H agreement from C, and

(b) make payments in respect of [F261 either interest or capital or both] due under the article 36H agreement to B.

(2B) For the purposes of paragraph (2A)—

(a) an agreement by A to appoint X to perform the activities in that paragraph is to be treated as an undertaking by A within the meaning of that paragraph;

(b) it is immaterial that—

(i) payments may be subject to conditions;

(ii) A, or X, may be entitled to retain a portion or the entirety of any payment received from C.

(2C) The condition in this paragraph is that A, or another person (“X”) acting under an arrangement with A or at A’s direction, undertakes to perform, or A undertakes to appoint or direct another person to perform either or both of the following activities—

(a) taking steps to procure the payment of a debt under the article 36H agreement;

(b) exercising or enforcing rights under the article 36H agreement on behalf of B.]

[F262 (2D) Where A carries on an activity of the kind specified in paragraph (1), it is a specified kind of activity for A to operate an electronic system where—

(a) that system enables A to facilitate a person (“B”) assuming the rights of the lender under an article 36H agreement by assignment or operation of law, and

(b) the conditions in paragraphs (2), (2A) and (2C) are satisfied where C is the borrower under the agreement in sub-paragraph (a).]

(3) The following are specified kinds of activities if carried on by A in the course of, or in connection with, the carrying on by A of the activity specified by paragraph (1) [F263 or (2D)]—

(a) presenting or offering article 36H agreements to [F264 either B or C] with a view to B becoming the lender under the article 36H agreement [F265 or] C becoming the borrower under the article 36H agreement,

(b) furnishing information relevant to the financial standing of a person (“Y”) with a view to assisting in the determination as to whether another person should—

(i) enter into, as the lender, an article 36H agreement with Y, or

(ii) assume the rights of the lender under an article 36H agreement under which Y is the borrower,

(c) taking steps to procure the payment of a debt due under an article 36H agreement,

(d) [F266 taking steps to perform duties, or exercise or enforce] rights under an article 36H agreement on behalf of the lender,

(e) [F267 taking steps with a view to] ascertaining whether a credit information agency (within the meaning given by article 89A(6)) holds information relevant to the financial standing of an individual or relevant person,

(f) [F268 taking steps with a view to] ascertaining the contents of such information,

(g) [F269 taking steps with a view to] securing the correction of, the omission of anything from, or the making of any other kind of modification of, such information, F270 ...

(h) [F271 taking steps with a view to] securing that a credit information agency which holds such information—

(i) stops holding the information, or

(ii) does not provide it to any other person [F272 , or

(i) giving advice in relation to the taking of any of the steps in sub-paragraphs (e) to (h)].

[F273 (4) An “article 36H agreement” is an agreement by which one person provides another person with credit and in relation to which—

(a) the condition in paragraph (4A) is satisfied, and

(b) the condition in either paragraph (5) or (6) is satisfied, or was satisfied at the time the agreement was entered into.

(4A) The condition in this paragraph is that A does not provide credit, assume the rights (by assignment or operation of law) of a person who provided credit, or receive credit under the agreement.]

(5) The condition in this paragraph is that the lender is an individual or relevant person.

(6) The condition in this paragraph is that the borrower is an individual or relevant person and—

(a) the lender provides the borrower with credit less than or equal to £25,000, or

(b) the agreement is not entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower.

(7) Paragraphs (5) and (6) of article 60C (exempt agreements: exemptions relating to the nature of the agreement) apply for the purposes of paragraph (6)(b).

(8) It is immaterial for the purposes of this article whether the lender is carrying on a regulated activity.

[F274 (9) In this article—

“assignment”, in relation to Scotland, means assignation;

“borrower” means a person who receives credit under an article 36H agreement or a person to whom the rights and duties of a borrower under such an agreement have passed by assignment or operation of law;

“credit” has the meaning given by article 60L;

“lender” means—

(a)

a person providing credit under an article 36H agreement, or

(b)

a person who by assignment or operation of law has assumed the rights of a person who provided credit under such an agreement;

“relevant person” means—

(a)

a partnership consisting of two or three persons not all of whom are bodies corporate, or

(b)

an unincorporated body of persons which does not consist entirely of bodies corporate and is not a partnership.]

[F275 (10) For the purposes of the application of section 22(1) of the Act (regulated activities) to an activity of a kind specified by this article, article 88D (credit agreement), and article 73 (investments: general) in so far as it relates to that article, [F276 have] effect as if the reference to a credit agreement in article 88D includes a reference to an article 36H agreement.]

Textual Amendments

F257 Words in art. 36H(1) 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), art. 1(3)(4), 2(9)(a)

F258 Words in art. 36H(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), art. 1(3)(4), 2(9)(b)

F259 Arts. 36H(2A)-(2C) 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), art. 1(3)(4), 2(9)(c)

F260 Words in art. 36H(2A)(a) substituted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(a) (with Pt. 5)

F261 Words in art. 36H(2A)(b) substituted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(a) (with Pt. 5)

F262 Art. 36H(2D) inserted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(b) (with Pt. 5)

F263 Words in art. 36H(3) inserted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(i) (with Pt. 5)

F264 Words in art. 36H(3)(a) substituted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(ii)(aa) (with Pt. 5)

F265 Word in art. 36H(3)(a) substituted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(ii)(bb) (with Pt. 5)

F266 Words in art. 36H(3)(d) substituted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(iii) (with Pt. 5)

F267 Words in art. 36H(3)(e) inserted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(iv) (with Pt. 5)

F268 Words in art. 36H(3)(f) inserted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(iv) (with Pt. 5)

F269 Words in art. 36H(3)(g) inserted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(iv) (with Pt. 5)

F270 Word in art. 36H(3)(g) revoked (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(v) (with Pt. 5)

F271 Words in art. 36H(3)(h) inserted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(iv) (with Pt. 5)

F272 Art. 36H(3)(i) and word inserted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(c)(vi) (with Pt. 5)

F273 Art. 36H(4)(4A) substituted for art. 36H(4) (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(a), 2(5)(d) (with Pt. 5)

F274 Art. 36H(9) substituted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(d), 2(5)(e) (with Pt. 5)

F275 Art. 36H(10) 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), art. 1(3)(4), 2(9)(d)

F276 Word in art. 36H(10) substituted (17.3.2016) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(d), 2(5)(f) (with Pt. 5)

Exclusion U.K.

Information society services U.K.

36I.   Article 36H is subject to the exclusion in article 72A (information society services).

[F277 Activities in relation to debentures and bonds U.K.

36IA.   There is excluded from article 36H (operating an electronic system in relation to lending) any activity of a kind specified by article 14 (dealing in investments as principal), 25 (arranging deals in investments), 37 (managing investments) or 53 (advising on investments).]

Textual Amendments

F277 Art. 36IA 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), art. 1(3)(4), 2(10)

Supplemental U.K.

Meaning of “consumer” U.K.

36J.— (1) For the purposes of sections 1G, 404E and 425A of the Act (meaning of “consumer”), a person (“C”) is only to be regarded as a person who uses, may use, has, may have used or has or may have contemplated using, services provided by authorised persons in carrying on a regulated activity of the kind specified by article 36H or article 64 in so far as relevant to that activity if—

(a) C is, may be, has been or may have been the lender under a relevant agreement and is an individual or relevant person, or

(b) C is, may be, has been or may have been the borrower under a relevant agreement, C is an individual or relevant person and one of the conditions in paragraph (2) is satisfied, or

(c) C meets the following conditions—

(i) C is, was or would be the lender under a relevant agreement, and

(ii) C is not, was not or would not be, as a result, carrying on a regulated activity.

(2) The conditions in this paragraph are that—

(a) the lender provides, provided or would provide the borrower with credit (within the meaning given by article 60L) less than or equal to £25,000, or

(b) the agreement is not, was not or would not be entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower.

(3) Paragraphs (5) and (6) of article 60C (exempt agreements: exemptions relating to the nature of the agreement) apply for the purposes of paragraph (2)(b).

(4) In paragraph (1)—

“relevant agreement” means an agreement between one person (“the borrower”) and another person (“the lender”) by which the lender provides the borrower with credit (within the meaning given by article 60L);

“relevant person” has the meaning given in article 36H.]

Chapter VII U.K. Managing Investments

The activity U.K.

Managing investments U.K.

37.  Managing assets belonging to another person, in circumstances involving the exercise of discretion, is a specified kind of activity if—

(a) the assets consist of or include any investment which is a security[F278 , structured deposit] or a contractually based investment; or

(b) the arrangements for their management are such that the assets may consist of or include such investments, and either the assets have at any time since 29th April 1988 done so, or the arrangements have at any time (whether before or after that date) been held out as arrangements under which the assets would do so.

Textual Amendments

F278 Words in art. 37(a) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 4(3)

Exclusions U.K.

Attorneys U.K.

38.— [F279 (1)] A person does not carry on an activity of the kind specified by article 37 if—

(a) he is a person appointed to manage the assets in question under a power of attorney; and

(b) all routine or day-to-day decisions, so far as relating to investments of a kind mentioned in article 37(a), are taken on behalf of that person by—

(i) an authorised person with permission to carry on activities of the kind specified by article 37; F280 ...

(ii) a person who is an exempt person in relation to activities of that kind [F281 ; or

(iii) an overseas person.]

[F282 (2)  This article is subject to article 4(4).]

Textual Amendments

F279 Art. 38(1): art. 38 renumbered as art. 38(1) (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 17(a)

F280 Word in art. 38(b) omitted (1.12.2001) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2001 (S.I. 2001/3544), arts. 1(a), 6(a)

F281 Art. 38(b)(iii) and word inserted (1.12.2001) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2001 (S.I. 2001/3544), arts. 1(a), 6(b)

F282 Art. 38(2) inserted (1.4.2007 for specified purposes, 1.11.2007 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment No. 3) Order 2006 (S.I. 2006/3384), arts. 1(2), 17(b)

Other exclusions U.K.

39.  Article 37 is also subject to the exclusions in articles 66 (trustees etc.), 68 (sale of goods and supply of services) [F283 , 69 (groups and joint enterprises)][F284 , 72A (information society services)[F285 , 72AA (managers of UCITS and AIFs)[F286 , 72C (provision of information about contracts of insurance on an incidental basis) and 72H (insolvency practitioners)]]].

Textual Amendments

F283 Words in art. 39 substituted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(7)

F284 Words in art. 39 substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 6

F285 Words in art. 39 substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(9)

F286 Words in art. 39 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), art. 1(3)(4), 2(11)

[F287 CHAPTER VIIA U.K. Assisting in the Administration and Performance of a Contract of Insurance

Textual Amendments

F287 Pt. 2 Ch. 7A inserted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 7

The activity U.K.

Assisting in the administration and performance of a contract of insurance U.K.

39A.   Assisting in the administration and performance of a contract of insurance is a specified kind of activity.

Exclusions U.K.

Claims management on behalf of an insurer etc. U.K.

39B.— (1) A person does not carry on an activity of the kind specified by article 39A if he acts in the course of carrying on the activity of—

(a) expert appraisal;

(b) loss adjusting on behalf of a relevant insurer; or

(c) managing claims on behalf of a relevant insurer,

and that activity is carried on in the course of carrying on any profession or business.

(2) In this article—

(a) “relevant insurer” means—

(i) a person who has Part IV permission to carry on an activity of the kind specified by article 10;

(ii) a person to whom the general prohibition does not apply by virtue of section 316(1)(a) of the Act (members of the Society of Lloyd's);

(iii) an EEA firm falling within paragraph 5(d) of Schedule 3 to the Act (insurance undertaking); or

(iv) a relevant reinsurer;

(b) “relevant reinsurer” means a person whose main business consists of accepting risks ceded by—

(i) a person falling within sub-paragraph (i), (ii) or (iii) of the definition of “relevant insurer”; F288 ...

[F289 (ii) an EEA firm falling within paragraph 5(da) of Schedule 3 to the Act (reinsurance undertaking); or

(iii) a person established outside the United Kingdom and not falling within paragraph (ii) who carries on an activity of the kind specified by article 10 by way of business.]

Textual Amendments

F288 Word in art. 39B(2)(b)(i) omitted (10.12.2007) by The Financial Services and Markets Act 2000 (Reinsurance Directive) Order 2007 (S.I. 2007/3254), arts. 1, 2(2)(a)

F289 Art. 39B(2)(b)(ii)(iii) substituted for art. 39B(2)(b)(ii) (10.12.2007) by The Financial Services and Markets Act 2000 (Reinsurance Directive) Order 2007 (S.I. 2007/3254), arts. 1, 2(2)(b)

Other exclusions U.K.

39C.   Article 39A is also subject to the exclusions in articles 66 (trustees etc.), 67 (profession or non-investment business), 72A (information society services), 72B (activities carried on by a provider of relevant goods or services), 72C (provision of information about contracts of insurance on an incidental basis) [F290 , 72AA (managers of UCITS and AIFs)[F291 , 72D (large risks contracts where risk situated outside the EEA), 72G (local authorities) and 72H (insolvency practitioners)])].]

Textual Amendments

F290 Words in art. 39C substituted (22.7.2013) by virtue of The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(7)

F291 Words in art. 39C 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), art. 1(3)(4), 2(12)

[F292 Chapter 7B U.K. Activities in Relation to Debt

Textual Amendments

F292 Pt. II Ch. 7B 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), 5

The activities U.K.

Debt adjusting U.K.

39D.— (1) When carried on in relation to debts due under a credit agreement—

(a) negotiating with the lender, on behalf of the borrower, terms for the discharge of a debt,

(b) taking over, in return for payments by the borrower, that person’s obligation to discharge a debt, or

(c) any similar activity concerned with the liquidation of a debt,

is a specified kind of activity.

(2) When carried on in relation to debts due under a consumer hire agreement—

(a) negotiating with the owner, on behalf of the hirer, terms for the discharge of a debt,

(b) taking over, in return for payments by the hirer, that person’s obligation to discharge a debt, or

(c) any similar activity concerned with the liquidation of a debt,

is a specified kind of activity.

Debt-counselling U.K.

39E.— (1) Giving advice to a borrower about the liquidation of a debt due under a credit agreement is a specified kind of activity.

(2) Giving advice to a hirer about the liquidation of a debt due under a consumer hire agreement is a specified kind of activity.

Debt-collecting U.K.

39F.— (1) Taking steps to procure the payment of a debt due under a credit agreement or a relevant article 36H agreement is a specified kind of activity.

(2) Taking steps to procure the payment of a debt due under a consumer hire agreement is a specified kind of activity.

(3) Paragraph (1) does not apply in so far as the activity is an activity of the kind specified by article 36H (operating an electronic system in relation to lending).

(4) In this article, “relevant article 36H agreement” means an article 36H agreement (within the meaning of article 36H) which has been entered into with the facilitation of an authorised person with permission to carry on a regulated activity of the kind specified by that article.

Debt administration U.K.

39G.— (1) Subject to paragraph (3), taking steps—

(a) to perform duties under a credit agreement or relevant article 36H agreement on behalf of the lender, or

(b) to exercise or enforce rights under such an agreement on behalf of the lender,

is a specified kind of activity

(2) Subject to paragraph (3), taking steps—

(a) to perform duties under a consumer hire agreement on behalf of the owner, or

(b) to exercise or enforce rights under such an agreement on behalf of the owner,

is a specified kind of activity.

(3) Paragraphs (1) and (2) do not apply in so far as the activity is an activity of the kind specified by article 36H (operating an electronic system in relation to lending) or article 39F (debt-collecting).

(4) In this article, “relevant article 36H agreement” means an article 36H agreement (within the meaning of article 36H) which has been entered into with the facilitation of an authorised person with permission to carry on a regulated activity of the kind specified by that article.

Exclusions U.K.

Activities where person has a connection to the agreement U.K.

39H.— (1) There are excluded from articles 39D(1), 39E(1) and 39F(1) activities carried on by a person who is—

(a) the lender under the agreement,

(b) the supplier in relation to that agreement,

(c) a person carrying on an activity of the kind specified by article 36A by way of business and who has acquired the business of the person who was the supplier in relation to the agreement, or

(d) a person who would be carrying on an activity of the kind specified by article 36A by way of business but for the exclusion in article 36B where the agreement was made in consequence of an introduction (by that person or another person) to which article 36B applies.

(2) There are excluded from articles 39D(2), 39E(2) and 39F(2) activities carried on by a person who is—

(a) the owner under the consumer hire agreement, or

(b) a person who would be carrying on an activity of the kind specified by article 36A by way of business but for the exclusion in article 36B where the agreement was made in consequence of an introduction (by that person or another person) to which article 36B applies.

(3) There is excluded from article 39G(1) steps taken under or in relation to an agreement [F293 by] a person who is, in relation to that agreement, a person falling within paragraph (1)(a) to (d).

(4) There is excluded from article 39G(2) steps taken under or in relation to a consumer hire agreement [F294 by] a person who is, in relation to that agreement, a person falling within paragraph (2)(a) or (b).

(5) In paragraph (1), “supplier”, in relation to an agreement, means—

(a) a person, other than the lender, whose transaction with the borrower is, or is to be, financed by the agreement, or

(b) a person to whom the rights and duties of a person falling within sub-paragraph (a) have been passed by assignment or operation of law.

Textual Amendments

F293 Word in art. 39H(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), art. 1(3)(4), 2(13)

F294 Word in art. 39H(4) 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), art. 1(3)(4), 2(13)

Activities carried on by certain energy suppliers U.K.

39I.— (1) There are excluded from articles 39D, 39E, 39F and 39G activities carried on by a relevant energy supplier acting in that capacity in relation to debts due under a green deal plan associated with the supplier.

(2) A green deal plan is associated with a supplier if the payments under the plan are to be made to the supplier.

(3) In this article—

(a) [F295 “green deal plan” has the meaning given by section 1 of the Energy Act 2011;]

(b) “relevant energy supplier” has the meaning given in regulations made for the purpose of section 2(9) of [F296 that Act] [F296 the Energy Act 2011].

Textual Amendments

F295 Art. 39I(3)(a) omitted (E.W.S.) (15.7.2014) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 4(a) (with art. 1(3))

F296 Words in art. 39I(3)(b) substituted (E.W.S.) (15.7.2014) by The Financial Services and Markets Act 2000 (Regulated Activities) (Green Deal) (Amendment) Order 2014 (S.I. 2014/1850), arts. 1(2), 4(b) (with art. 1(3))

Activities carried on in relation to a relevant agreement in relation to land U.K.

39J.   There [F297 is] excluded from articles 39D, 39E, 39F and 39G [F298 any activity that relates] to a regulated mortgage contract or a regulated home purchase plan [F299 to the extent that the activity constitutes an activity of the kind specified by a provision of Part 2 of this Order other than articles 39D, 39E, 39F and 39G, where entering into that contract as lender constitutes an activity of the kind specified by article 61 or entering into that plan as home purchase provider constitutes an activity of the kind under article 63F].

Textual Amendments

F297 Word in art. 39J 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), art. 1(3)(4), 2(14)(a)

F298 Words in art. 39J 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), art. 1(3)(4), 2(14)(b)

F299 Words in art. 39J 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), art. 1(3)(4), 2(14)(c)

[F300 Activities carried on by members of the legal profession etc U.K.

39K.— (1) There are excluded from articles 39D, 39E, 39F and 39G activities carried on by—

(a) a barrister or advocate acting in that capacity;

(b) a solicitor (within the meaning of the Solicitors Act 1974) in the course of providing advocacy services or litigation services;

(c) a solicitor (within the meaning of the Solicitors (Scotland) Act 1980) in the course of providing advocacy services or litigation services;

(d) a solicitor (within the meaning of the Solicitors (Northern Ireland) Order 1976) in the course of providing advocacy services or litigation services;

(e) a relevant person (other than a person falling within sub-paragraph (a) to (d)) in the course of providing advocacy services or litigation services.

(2) In paragraph (1)—

“advocacy services” means any services which it would be reasonable to expect a person who is exercising, or contemplating exercising, a right of audience in relation to any proceedings, or contemplated proceedings, to provide for the purpose of those proceedings or contemplated proceedings;

“litigation services” means any services which it would be reasonable to expect a person who is exercising, or contemplating exercising, a right to conduct litigation in relation to any proceedings, or contemplated proceedings, to provide for the purpose of those proceedings or contemplated proceedings;

“relevant person” means a person who, for the purposes of the Legal Services Act 2007, is an authorised person in relation to an activity which constitutes the exercise of a right of audience or the conduct of litigation (within the meaning of that Act).]

Textual Amendments

F300 Art. 39K substituted (24.3.2015) by The Financial Services and Markets Act 2000 (Miscellaneous Provisions) Order 2015 (S.I. 2015/853), arts. 1(2), 3(3)

[F301 Activities carried on by reason of providing pensions guidance under Part 20A of the Act U.K.

39KA.— (1) There are excluded from article 39E activities carried on by reason of providing pensions guidance under arrangements made with the Treasury pursuant to section 333B of the Act.

(2) For the purposes of paragraph (1), pensions guidance given by a designated guidance provider is given under arrangements made with the Treasury.]

Textual Amendments

F301 Art. 39KA inserted (26.3.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (Pensions Guidance Exclusions) Order 2015 (S.I. 2015/489), arts. 1, 2(4)

[F302 Other exclusions] U.K.

39L.   Articles 39D, 39E, 39F and 39G are also subject to the [F303 exclusions] in article 72A (information society services)[F304 , article 72G (local authorities) and article 72H (insolvency practitioners)].

Textual Amendments

F302 Art. 39L heading 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), art. 1(3)(4), 2(15)

F303 Word in art. 39L 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), art. 1(3)(4), 2(16)(a)

F304 Words in art. 39L 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), art. 1(3)(4), 2(16)(b)

Supplemental U.K.

Meaning of “consumer” etc. U.K.

39M.— (1) For the purposes of sections 1G, 404E and 425A of the Act (meaning of “consumer”), in so far as those provisions relate to a person (“A”) carrying on a regulated activity of the kind specified by article 39F (debt-collecting) or 39G (debt administration), or article 64 (agreeing to carry on specified kinds of activity) so far as relevant to that activity the following are to be treated as a “consumer”—

(a) the borrower under the agreement or the hirer under the consumer hire agreement;

(b) someone who has been the borrower or hirer under that agreement;

(c) a person who is treated by A as a person falling within sub-paragraph (a) or (b).

(2) For the purposes of section 328(8) of the Act (meaning of “clients”) in so far as that provision relates to a person (“A”) carrying on a regulated activity of the kind specified by article 39F or 39G, the following are to be treated as a “client”—

(a) the borrower under the agreement or the hirer under the consumer hire agreement;

(b) someone who has been the borrower or hirer under that agreement;

(c) a person who is treated by A as a person falling within sub-paragraph (a) or (b).

(3) In this article, “borrower” includes (in addition to those persons included in the definition in article 60L)—

(a) any person providing a guarantee or indemnity under the agreement, and

(b) a person to whom the rights and duties of a person falling within sub-paragraph (a) have passed by assignment or operation of law.]

Chapter VIII U.K. Safeguarding and Administering Investments

The activity U.K.

Safeguarding and administering investments U.K.

40.—(1) The activity consisting of both—

(a) the safeguarding of assets belonging to another, and

(b) the administration of those assets,

or arranging for one or more other persons to carry on that activity, is a specified kind of activity if the condition in sub-paragraph (a) or (b) of paragraph (2) is met.

(2) The condition is that—

(a) the assets consist of or include any investment which is a security or a contractually based investment; or

(b) the arrangements for their safeguarding and administration are such that the assets may consist of or include such investments, and either the assets have at any time since 1st June 1997 done so, or the arrangements have at any time (whether before or after that date) been held out as ones under which such investments would be safeguarded and administered.

(3) For the purposes of this article—

(a) it is immaterial that title to the assets safeguarded and administered is held in uncertificated form;

(b) it is immaterial that the assets safeguarded and administered may be transferred to another person, subject to a commitment by the person safeguarding and administering them, or arranging for their safeguarding and administration, that they will be replaced by equivalent assets at some future date or when so requested by the person to whom they belong.

Exclusions U.K.

Acceptance of responsibility by third party U.K.

41.—(1) There are excluded from article 40 any activities which a person carries on pursuant to arrangements which—

(a) are ones under which a qualifying custodian undertakes to the person to whom the assets belong a responsibility in respect of the assets which is no less onerous than the qualifying custodian would have if the qualifying custodian were safeguarding and administering the assets; and

(b) are operated by the qualifying custodian in the course of carrying on in the United Kingdom an activity of the kind specified by article 40.

(2) In paragraph (1), “qualifying custodian" means a person who is—

(a) an authorised person who has permission to carry on an activity of the kind specified by article 40, or

(b) an exempt person acting in the course of a business comprising a regulated activity in relation to which he is exempt.

Introduction to qualifying custodians U.K.

42.—(1) There are excluded from article 40 any arrangements pursuant to which introductions are made by a person (“P") to a qualifying custodian with a view to the qualifying custodian providing in the United Kingdom a service comprising an activity of the kind specified by article 40, where the qualifying person (or other person who is to safeguard and administer the assets in question) is not connected with P.

(2) For the purposes of paragraph (1)—

(a) “qualifying custodian" has the meaning given by article 41(2); and

(b) a person is connected with P if either he is a member of the same group as P, or P is remunerated by him.

[F305 Depositaries of UCITS and AIFs U.K.

42A.   A person does not carry on an activity of the kind specified by article 40 if the person carries on the activity in relation to—

(a) a UCITS, and the person has a Part 4A permission to carry on the activity specified in article 51ZB in respect of that UCITS; or

(b) an AIF, and the person has a Part 4A permission to carry on the activity specified in article 51ZD in respect of that AIF.]

Textual Amendments

F305 Art. 42A inserted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(10)

Modifications etc. (not altering text)

C17 Art. 42A applied (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), regs. 1, 76(6)

Activities not constituting administration U.K.

43.  The following activities do not constitute the administration of assets for the purposes of article 40—

(a) providing information as to the number of units or the value of any assets safeguarded;

(b) converting currency;

(c) receiving documents relating to an investment solely for the purpose of onward transmission to, from or at the direction of the person to whom the investment belongs.

Other exclusions U.K.

44.  Article 40 is also subject to the exclusions in articles 66 (trustees etc.), 67 (profession or non-investment business), 68 (sale of goods and supply of services), 69 (groups and joint enterprises) [F306 , 71 (employee share schemes)][F307 , 72A (information society services)[F308 , 72AA (managers of UCITS and AIFs)[F309 , 72C (provisions of information about contracts of insurance on an incidental basis) and 72H (insolvency practitioners)]]].

Textual Amendments

F306 Words in art. 44 substituted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(8)

F307 Words in art. 44 substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 8

F308 Words in art. 44 substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(9)

F309 Words in art. 44 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), art. 1(3)(4), 2(17)

Chapter IX U.K. Sending Dematerialised Instructions

The activities U.K.

Sending dematerialised instructions U.K.

45.—(1) Sending, on behalf of another person, dematerialised instructions relating to a security [F310 or a contractually based investment] is a specified kind of activity, where those instructions are sent by means of a relevant system in respect of which an Operator is approved under the [F311 2001] Regulations.

(2) Causing dematerialised instructions relating to a security [F312 or a contractually based investment] to be sent [F313 on behalf of another person] by means of such a system is also a specified kind of activity where the person causing them to be sent is a system-participant.

(3) In this Chapter—

[F314 (a) “the 2001 Regulations” means the Uncertificated Securities Regulations 2001;]

(b) “dematerialised instruction", “Operator", “settlement bank" and “system-participant" have the meaning given by regulation 3 of the [F315 2001] Regulations.

Textual Amendments

F310 Words in art. 45(1) inserted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 13(1)(a)

F311 Word in art. 45(1) substituted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 13(1)(b)

F312 Words in art. 45(2) inserted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 13(2)

F313 Words in art. 45(2) inserted (1.12.2001) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2001 (S.I. 2001/3544), arts. 1(a), 7

F314 Art. 45(3)(a) substituted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 13(3)(a)

F315 Word in art. 45(3)(b) substituted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 13(3)(b)

Exclusions U.K.

Instructions on behalf of participating issuers U.K.

46.  There is excluded from article 45 the act of sending, or causing to be sent, a dematerialised instruction where the person on whose behalf the instruction is sent or caused to be sent is a participating issuer within the meaning of the [F316 2001] Regulations.

Textual Amendments

F316 Word in art. 46 substituted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 13(4)

Instructions on behalf of settlement banks U.K.

47.  There is excluded from article 45 the act of sending, or causing to be sent, a dematerialised instruction where the person on whose behalf the instruction is sent or caused to be sent is a settlement bank in its capacity as such.

Instructions in connection with takeover offers U.K.

48.—(1) There is excluded from article 45 of the act of sending, or causing to be sent, a dematerialised instruction where the person on whose behalf the instruction is sent or caused to be sent is an offeror making a takeover offer.

(2) In this article—

(a) “offeror" means, in the case of a takeover offer made by two or more persons jointly, the joint offers or any of them;

(b) “takeover offer" means—

(i) an offer to acquire shares (which in this sub-paragraph has the same meaning as in [F317 section 974 of the Companies Act 2006]) in a body corporate incorporated in the United Kingdom which is a takeover offer within the meaning of [F318 Chapter 3 of Part 28] of that Act (or would be such an offer if that Part of that Act applied in relation to any body corporate);

(ii) an offer to acquire all or substantially all the shares, or all the shares of a particular class, in a body corporate incorporated outside the United Kingdom; or

(iii) an offer made to all the holders of shares, or shares of a particular class, in a body corporate to acquire a specified proportion of those shares;

but in determining whether an offer falls within paragraph (ii) there are to be disregarded any shares which the offeror or any associate of his (within the meaning of [F319 section 988 of the Companies Act 2006]) holds or has contracted to acquire; and in determining whether an offer falls within paragraph (iii) the offeror, any such associate and any person whose shares the offeror or any such associate has contracted to acquire is not to be regarded as a holder of shares.

Textual Amendments

F317 Words in art. 48(2)(b) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 3 para. 8(2)

F318 Words in art. 48(2)(b) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 3 para. 8(3)

F319 Words in art. 48(2)(b) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 3 para. 8(4)

Instructions in the course of providing a network U.K.

49.  There is excluded from article 45 the act of sending, or causing to be sent, a dematerialised instruction as a necessary part of providing a network, the purpose of which is to carry dematerialised instructions which are at all time properly authenticated (within the meaning of the [F320 2001] Regulations).

Textual Amendments

F320 Word in art. 49 substituted (27.4.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2002 (S.I. 2002/682), arts. 1(2)(b), 13(4)

Other exclusions U.K.

50.  Article 45 is also subject to the exclusions in articles 66 (trustees etc.) [F321 , 69 (groups and joint enterprises)[F322 , 72A (information society services)[F323 , 72AA (managers of UCITS and AIFs) and 72H (insolvency practitioners)]]].

Textual Amendments

F321 Words in art. 50 substituted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(9)

F322 Words in art. 50 substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(6)

F323 Words in art. 50 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), art. 1(3)(4), 2(18)

Chapter X U.K. F324 Collective Investment ...

Textual Amendments

F324 Word in Pt. 2 Ch. 10 heading omitted (22.7.2013) by virtue of The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(11)

The activities U.K.

Establishing etc. a collective investment scheme U.K.

F325 51.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F325 Arts. 51ZA-51ZG substituted for arts. 51 and cross-heading (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(12)

[F325 Managing a UCITS U.K.

51ZA.— (1) Managing a UCITS is a specified kind of activity.

(2) A person manages a UCITS when the person carries on collective portfolio management of the UCITS within the meaning of the UCITS directive, which includes the functions referred to in Annex 2 to that directive (the text of which is set out in Schedule 6) in relation to a UCITS.

(3) If a person manages a UCITS and also carries on other activities in connection with or for the purposes of the management of that UCITS, such other activities are also included in the activity specified in paragraph (1).

Textual Amendments

F325 Arts. 51ZA-51ZG substituted for arts. 51 and cross-heading (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(12)

Acting as trustee or depositary of a UCITS U.K.

51ZB.— (1) Acting as—

(a) the trustee of an authorised unit trust scheme, or

(b) the depositary of an open-ended investment company or authorised contractual scheme,

where the scheme or company is a UCITS, is a specified kind of activity.

(2) In paragraph (1), “authorised contractual scheme”, “authorised unit trust scheme”, “trustee” and “depositary” have the meanings given by section 237 of the Act (other definitions).

Textual Amendments

F325 Arts. 51ZA-51ZG substituted for arts. 51 and cross-heading (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(12)

Managing an AIF U.K.

51ZC.— (1) Managing an AIF is a specified kind of activity.

(2) A person manages an AIF when the person performs at least risk management or portfolio management for the AIF.

(3) A person does not manage an AIF if the functions they perform for the AIF have been delegated to it by another person, provided that such other person is not an AIFM that has delegated such functions to the extent that it is a letter-box entity.

(4) Paragraph (5) applies if a person manages an AIF, and also carries on—

(a) one or more of the additional activities listed in paragraph 2 of Annex 1 to the alternative investment fund managers directive (the text of which is set out in Schedule 7) for that AIF; or

(b) one or more other activities in connection with or for the purposes of the management of that AIF.

(5) The additional or other activities are included in the activity specified in paragraph (1).

(6) Any expression used in this article which is not defined in this Order and is used in the alternative investment fund managers directive has the same meaning as in that directive.

Textual Amendments

F325 Arts. 51ZA-51ZG substituted for arts. 51 and cross-heading (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(12)

Acting as trustee or depositary of an AIF U.K.

51ZD.— (1) Acting as—

(a) the depositary of an AIF falling within paragraph (2),

(b) the trustee of an authorised unit trust scheme which is an AIF that does not fall within paragraph (2), or

(c) the depositary of an open-ended investment company or authorised contractual scheme which is an AIF that does not fall within paragraph (2),

is a specified kind of activity.

(2) An AIF falls within this paragraph if it is—

(a) an AIF managed by a full-scope UK AIFM; or

(b) a UK AIF managed by an EEA AIFM.

(3) In paragraph (1)(a) “depositary” means—

(a) a person appointed in compliance with the requirement for the AIFM to appoint a depositary at Article 21.1 of the alternative investment fund managers directive; or

(b) an Article 36 custodian as defined in regulation 57(5)(a) of the Alternative Investment Fund Managers Regulations 2013.

(4) In paragraph (1)(b) “authorised unit trust scheme” and “trustee” have the meanings given by section 237 of the Act.

(5) In paragraph (1)(c) “authorised contractual scheme” and “depositary” have the meanings given by section 237 of the Act.

(6) Until 22nd July 2017, an AIF also falls within paragraph (2) if the FCA or an authority in another EEA State has permitted a person with its registered office or a branch in the United Kingdom to be appointed as a depositary of the AIF in accordance with Article 61.5 of the alternative investment fund managers directive.

Textual Amendments

F325 Arts. 51ZA-51ZG substituted for arts. 51 and cross-heading (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(12)

Establishing etc. a collective investment scheme U.K.

51ZE.   Establishing, operating or winding up a collective investment scheme is a specified kind of activity.

Textual Amendments

F325 Arts. 51ZA-51ZG substituted for arts. 51 and cross-heading (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(12)

Exclusions U.K.

Persons excluded from managing an AIF U.K.

51ZF.   There is excluded from article 51ZC the activity of managing an AIF if the person carrying on the activity is listed or described in Schedule 8.

Operating a collective investment scheme in relation to a UCITS or an AIF U.K.

51ZG.— (1) A person does not carry on an activity of the kind specified by article 51ZE if the person carries on the activity—

(a) in relation to a UCITS, and—

(i) at the time the person carries on the activity, the UCITS is managed by a person with a Part 4A permission to carry on the activity specified by article 51ZA in respect of that UCITS; or

(ii) no more than the permitted period has passed since the UCITS was managed by a person with such a Part 4A permission; or

(b) in relation to an AIF, and—

(i) at the time the person carries on the activity, the AIF is managed by—

(aa) a person with a Part 4A permission to carry on the activity specified by article 51ZC in respect of that AIF; or

(bb) a person registered as a small registered UK AIFM because the conditions in regulation 10(4) of the Alternative Investment Fund Managers Regulations 2013 are met in respect of that AIF; or

(ii) no more than the permitted period has passed since the AIF was managed by a person with such a Part 4A permission or registration.

(2) In this article “the permitted period” means a period calculated as follows—

(a) subject to sub-paragraphs (b) and (c), the period is 30 days;

(b) if, before the end of the period, the FCA receives notice of the action being taken to appoint a person with a Part 4A permission or registration to manage the UCITS or AIF, the period is extended by a further 30 days, and may be so extended a second time;

(c) if, before the end of the period calculated in accordance with sub-paragraphs (a) and (b), the FCA receives notice of a proposal in respect of the UCITS or AIF for a new manager under section 251(3) of the Act, a new operator under section 261Q(5) of the Act or a new director under regulation 21(1)(e) of the Open-Ended Investment Company Regulations 2001, the period is further extended until the earlier of—

(i) the date on which the FCA gives written notice of its approval to the proposal;

(ii) the date on which the FCA gives a decision notice refusing the proposal; or

(iii) one month after the date on which notice of the proposal was given.]

F325 ... U.K.

[F326 [F327 Other exclusions] U.K.

51A.   [F328 Articles 51ZA, 51ZB, 51ZC, 51ZD, and 51ZE are also] subject to the [F329 exclusions] in article 72A (information society services)[F330 , 72AA (managers of UCITS and AIFs) and 72H (insolvency practitioners)].]

Textual Amendments

F326 Art. 51A and cross-heading inserted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(10)

F327 Art. 51A heading 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), art. 1(3)(4), 2(19)

F328 Words in art. 51A substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(13)

F329 Word in art. 51A substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(4)(b)

F330 Words in art. 51A substituted (14.2.2014 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) Order 2014 (S.I. 2014/366), art. 1(3)(4), 2(20)

Chapter XI U.K. F331 ... Pension Schemes

Textual Amendments

F331 Word in Pt. 2 Ch. 11 title omitted (1.10.2006 for specified purposes, 6.4.2007 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2006 (S.I. 2006/1969), arts. 1(2), 2(3)

The activities U.K.

[F332 Establishing etc. a pension scheme U.K.

52.   The following are specified kinds of activity—

(a) establishing, operating or winding up a stakeholder pension scheme;

(b) establishing, operating or winding up a personal pension scheme.]

Textual Amendments

F332 Art. 52 substituted (1.10.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2006 (S.I. 2006/1969), arts. 1(2), 2(4)

[F333 Exclusion U.K.

Textual Amendments

F333 Art. 52A and cross-heading inserted (21.8.2002) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776), arts. 1, 3(11)

[F334 Other exclusions] U.K.

52A.   Article 52 is subject to the [F335 exclusions] in article 72A (information society services)[F336 , 72AA (managers of UCITS and AIFs) and 72H (insolvency practitioners)].]

Textual Amendments

F334 Art. 52A heading 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), art. 1(3)(4), 2(21)

F335 Word in art. 52A substituted (22.7.2013) by The Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773), reg. 1, Sch. 2 para. 1(4)(b)

F336 Words in art. 52A substituted (14.2.2014 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) Order 2014 (S.I. 2014/366), art. 1(3)(4), 2(22)

[F337 CHAPTER XIA U.K. Providing Basic Advice On Stakeholder Products

Textual Amendments

F337 Pt. 2 Ch. 11A inserted (6.4.2005) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2004 (S.I. 2004/2737), arts. 1(1), 3

The activity U.K.

Providing basic advice on stakeholder products U.K.

52B.— (1) Providing basic advice to a retail consumer on a stakeholder product is a specified kind of activity.

(2) For the purposes of paragraph (1), a person (“P”) provides basic advice when—

(a) he asks a retail consumer questions to enable him to assess whether a stakeholder product is appropriate for that consumer; and

(b) relying on the information provided by the retail consumer P assesses that a stakeholder product is appropriate for the retail consumer and—

(i) describes that product to that consumer;

(ii) gives a recommendation of that product to that consumer; and

(c) the retail consumer has indicated to P that he has understood the description and the recommendation in sub-paragraph (b).

(3) In this article—

“retail consumer” means any person who is advised by P on the merits of opening or buying a stakeholder product in the course of a business carried on by P and who does not receive the advice in the course of a business carried on by him;

“stakeholder product” means—

(a)

an account which qualifies as a stakeholder child trust fund within the meaning given by the Child Trust Funds Regulations 2004;

(b)

[F338 rights under a stakeholder pension scheme;]

“relevant stakeholder pension scheme” means a stakeholder pension scheme within the meaning given by section 1 of the Welfare Reform and Pensions Act 1999 and which is subject to lifestyling, and

“lifestyling” means the process, applied from a date at least five years before the member’s retirement date, or, in the case of a member who joins the scheme less than five years before his retirement date, immediately after he becomes a member, and continuing until the member’s retirement date, by which an investment strategy is adopted by the trustees or manager which aims progressively to minimise the variation or potential variation in the value of the member’s rights caused by market conditions from time to time, and the words “member” and “scheme” have the same meaning as they have in the Welfare Reform and Pensions Act 1999;

(c)

an investment of a kind specified in regulations made by the Treasury.]

Textual Amendments

F338 Words in art. 52B(3) substituted (6.4.2005) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2005 (S.I. 2005/593), arts. 1, 2(3)

[F339 Exclusion U.K.

Textual Amendments

F339 Art. 52C and cross-heading inserted (26.3.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (Pensions Guidance Exclusions) Order 2015 (S.I. 2015/489), arts. 1, 2(5)

Providing pensions guidance under Part 20A of the Act U.K.

52C.— (1) A person does not carry on an activity of the kind specified in article 52B by reason of providing pensions guidance under arrangements made with the Treasury pursuant to section 333B of the Act.

(2) For the purposes of paragraph (1), pensions guidance given by a designated guidance provider is given under arrangements made with the Treasury.]

Chapter XII U.K. Advising on Investments

The activity U.K.

Advising on investments U.K.

53.— [F340 (1)]  Advising a person is a specified kind of activity if the advice is—

(a) given to the person in his capacity as an investor or potential investor, or in his capacity as agent for an investor or a potential investor; and

(b) advice on the merits of his doing any of the following (whether as principal or agent)—

(i) buying, selling, subscribing for[F341 , exchanging, redeeming, holding] or underwriting a particular investment which is a security[F342 , structured deposit] or a [F343 relevant investment], or

(ii) exercising [F344 or not exercising] any right conferred by such an investment to buy, sell, subscribe for[F345 , exchange or redeem] such an investment.

[F346 (1A) Paragraph (1) does not apply to a person who is appropriately authorised except to the extent that they are providing a personal recommendation.

(1B) A person is appropriately authorised when they are authorised for the purposes of the Act to carry on an activity of a kind specified by a provision of this Order which is not the activity specified by paragraph (1) and is not the activity of agreeing to carry on the activity specified by paragraph (1).

(1C) Subject to paragraph (1D), a personal recommendation is a recommendation–

(a) made to a person in their capacity as an investor or potential investor, or in their capacity as agent for an investor or a potential investor;

(b) which constitutes a recommendation to them to do any of the following (whether as principal or agent)–

(i) buy, sell, subscribe for, exchange, redeem, hold or underwrite a particular investment which is a security[F347 , structured deposit] or a relevant investment; or

(ii) exercise or not exercise any right conferred by such an investment to buy, sell, subscribe for, exchange or redeem such an investment; and

(c) that is–

(i) presented as suitable for the person to whom it is made; or

(ii) based on a consideration of the circumstances of that person.

(1D) A recommendation is not a personal recommendation if it is issued exclusively to the public.]

[F348 (2) Advising a person is a specified kind of activity if the advice is—

(a) given to the person in that person’s capacity as a lender or potential lender under a relevant article 36H agreement, or in that person’s capacity as an agent for a lender or potential lender under such an agreement; and

(b) advice on the merits of that person doing any of the following (whether as principal or agent)—

(i) entering into a relevant article 36H agreement as a lender or assuming the rights of a lender under such an agreement by assignment or operation of law,

(ii) providing instructions to an operator with a view to entering into a relevant article 36H agreement as a lender or assuming the rights of a lender under such an agreement by assignment or operation of law, where the instructions involve—

(aa) accepting particular parameters for the terms of the agreement presented by an operator,

(bb) choosing between options governing the parameters of the terms of the agreement presented by an operator, or

(cc) specifying the parameters of the terms of the agreement by other means,

(iii) enforcing or exercising the lender’s rights under a relevant article 36H agreement, or

(iv) assigning rights under a relevant article 36H agreement.

(3) Paragraph (2) does not apply in so far as—

(a) the advice is given in relation to a relevant article 36H agreement which has been facilitated by the person giving the advice, in the course of carrying on an activity of a kind specified by article 36H and is given by—

(i) an authorised person with permission to carry on a regulated activity of the kind specified by article 36H(1) (operating an electronic system in relation to lending),

(ii) an appointed representative in relation to that activity,

(iii) an exempt person in relation to that activity, or

(iv) a person to whom, as a result of Part 20 of the Act, the general prohibition does not apply in relation to that activity;

(b) the advice is given in the course of carrying on an activity of a kind specified by article 39F (debt-collecting) by a person carrying on that activity not in contravention of the general prohibition; or

(c) the advice is given in the course of carrying on an activity of a kind specified by article 39G (debt administration) by a person carrying on that activity not in contravention of the general prohibition.

(4) In this article—

“operator” means a person carrying on an activity of the kind specified by article 36H(1) or (2D), and

“relevant article 36H agreement” means an article 36H agreement (within the meaning of article 36H (operating an electronic system in relation to lending)) which has been, or may be, entered into with the facilitation of a person carrying on an activity of the kind specified by article 36H(1) or (2D).

(5) For the purposes of the application of section 22(1) of the Act (regulated activities) to an activity of a kind specified by paragraph (2) of this article, article 88D (credit agreement), and article 73 (investments: general) in so far as it relates to that article, have effect as if the reference to a credit agreement in article 88D includes a reference to a relevant article 36H agreement.]

Textual Amendments

F340 Art. 53(1): art. 53 renumbered as art. 53(1) (17.3.2016 for specified purposes, 6.4.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(d), 2(6)(a) (with Pt. 5)

F341 Words in art. 53(1)(b)(i) inserted (3.1.2018) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2017 (S.I. 2017/500), arts. 1(1), 2(2)

F342 Words in art. 53(1)(b)(i) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 4(4)

F343 Words in art. 53(b)(i) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 9(1)

F344 Words in art. 53(1)(b)(ii) inserted (3.1.2018) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2017 (S.I. 2017/500), arts. 1(1), 2(3)(a)

F345 Words in art. 53(1)(b)(ii) substituted (3.1.2018) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2017 (S.I. 2017/500), arts. 1(1), 2(3)(b)

F346 Art. 53(1A)-(1D) inserted (3.1.2018) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2017 (S.I. 2017/500), arts. 1(1), 2(4)

F347 Words in art. 53(1C)(b)(i) inserted (3.1.2018) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(6), Sch. 3 para. 2 (with reg. 7)

F348 Art. 53(2)-(5) inserted (17.3.2016 for specified purposes, 6.4.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(d), 2(6)(b) (with Pt. 5)

[F349 Advising on regulated mortgage contracts U.K.

53A.— (1) Advising a person is a specified kind of activity if the advice—

(a) is given to the person in his capacity as a borrower or potential borrower; and

(b) is advice on the merits of his doing any of the following—

(i) entering into a particular regulated mortgage contract, or

(ii) varying the terms of a regulated mortgage contract [F350 falling within paragraph (1A)] entered into by him F351 ... in such a way as to vary his obligations under that contract.

[F352 (1A) A regulated mortgage contract falls within this paragraph if—

(a) the contract was entered into on or after 31st October 2004; or

(b) the contract—

(i) was entered into before 31st October 2004; and

(ii) was a regulated credit agreement immediately before 21st March 2016.]

(2) In this article, “borrower” has the meaning given by article 61(3)(a)(i).]

Textual Amendments

F349 Art. 53A inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 13

F350 Words in art. 53A(1)(b)(ii) inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 2(7)(a)(i) (with Pt. 5)

F351 Words in art. 53A(1)(b)(ii) omitted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 2(7)(a)(ii) (with Pt. 5)

F352 Art. 53A(1A) inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 2(7)(b) (with Pt. 5)

[F353 Advising on regulated home reversion plans U.K.

53B.   Advising a person is a specified kind of activity if the advice—

(a) is given to the person in his capacity as—

(i) a reversion seller or potential reversion seller, or

(ii) a plan provider or potential plan provider; and

(b) is advice on the merits of his doing either of the following—

(i) entering into a particular regulated home reversion plan, or

(ii) varying the terms of a regulated home reversion plan, entered into on or after 6th April 2007 by him, in such a way as to vary his obligations under that plan.]

Textual Amendments

F353 Arts. 53B, 53C inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 13

[F353 Advising on regulated home purchase plans U.K.

53C.   Advising a person is a specified kind of activity if the advice—

(a) is given to the person in his capacity as a home purchaser or potential home purchaser; and

(b) is advice on the merits of his doing either of the following—

(i) entering into a particular regulated home purchase plan, or

(ii) varying the terms of a regulated home purchase plan, entered into on or after 6th April 2007 by him, in such a way as to vary his obligations under that plan.]

Textual Amendments

F353 Arts. 53B, 53C inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 13

[F354 Advising on regulated sale and rent back agreements U.K.

53D.   Advising a person is a specified kind of activity if the advice—

(a) is given to the person (“A”) in A’s capacity as—

(i) an agreement seller or potential agreement seller, or

(ii) an agreement provider or potential agreement provider; and

(b) is advice on the merits of A doing either of the following—

(i) entering into a particular regulated sale and rent back agreement; or

(ii) varying the terms of a regulated sale and rent back agreement entered into on or after 1st July 2009 by A as agreement seller or agreement provider, in such a way so as to vary A’s obligations under that agreement.]

Textual Amendments

F354 Art. 53D inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 13

[F355 Advising on regulated credit agreements for the acquisition of land U.K.

53DA.— (1) Advising a person (“P”) is a specified kind of activity if—

(a) the advice is given to P in P's capacity as a recipient of credit, or potential recipient of credit, under a regulated credit agreement;

(b) P intends to use the credit to acquire or retain property rights in land or in an existing or projected building; and

(c) the advice consists of the provision of personal recommendations to P in respect of one or more transactions relating to regulated credit agreements [F356 entered into, or to be entered into, on or after 21st March 2016].

(2) In this article “regulated credit agreement” has the meaning given by article 60B(3).]

Textual Amendments

F355 Art. 53DA 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. 4(9) (with Pt. 4)

F356 Words in art. 53DA(1)(c) inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 2(8) (with Pt. 5)

[F357 Advising on conversion or transfer of pension benefits U.K.

53E.— (1) Advising a person (“P”) is a specified kind of activity if—

(a) the advice is given to P in P’s capacity as—

(i) a member of a pension scheme; or

(ii) a survivor of a member of a pension scheme;

(b) P has subsisting rights in respect of any safeguarded benefits; and

(c) the advice is advice on the merits of P requiring the trustee or manager of the pension scheme to—

(i) convert any of the safeguarded benefits into different benefits that are flexible benefits under the scheme;

(ii) make a transfer payment in respect of any of the safeguarded benefits with a view to acquiring a right or entitlement to flexible benefits for P under another pension scheme; or

(iii) pay a lump sum that would be an uncrystallised funds pension lump sum in respect of any of the safeguarded benefits.

(2) In this article—

“flexible benefit” means—

(a)

a money purchase benefit;

(b)

a cash balance benefit; or

(c)

a benefit, other than a money purchase benefit or cash balance benefit, calculated by reference to an amount available for the provision of benefits to or in respect of the member (whether the amount so available is calculated by reference to payments made by the member or any other person in respect of the member or any other factor);

“pension scheme” has the meaning given by section 1(5) of the Pension Schemes Act 1993 or section 1(5) of the Pension Schemes (Northern Ireland) Act 1993;

“safeguarded benefits” means benefits other than—

(a)

money purchase benefits; and

(b)

cash balance benefits;

“subsisting right”—

(a)

in relation to a member of a pension scheme, means—

(i)

any right which has accrued to or in respect of the member to future benefits under the scheme; or

(ii)

any entitlement to benefits under the scheme; and

(b)

in relation to a survivor of a member of a pension scheme means any right to future benefits, or entitlement to benefits, which the survivor has under the scheme in respect of the member;

“survivor”, in relation to a member of a pension scheme, means a person who has survived the member and has a right to future benefits, or is entitled to benefits, under the scheme in respect of the member;

“trustees or managers” means—

(a)

in relation to a scheme established under a trust, the trustees; and

(b)

in relation to any other scheme, the managers; and

“uncrystallised funds pension lump sum” has the meaning given by paragraph 4A of Schedule 29 to the Finance Act 2004.

(3) Paragraphs (4) to (9) apply for the interpretation of “flexible benefit” and “safeguarded benefits”.

(4) “Cash balance benefit”, in relation to a member of a pension scheme or a survivor of a member, means a benefit calculated by reference to an amount available for the provision of benefits to or in respect of the member (“the available amount”) where there is a promise about that amount.

(5) But a benefit is not a “cash balance benefit” if, under the scheme—

(a) a pension may be provided from the available amount to or in respect of the member; and

(b) there is a promise about the rate of that pension.

(6) The promise mentioned in paragraph (4) includes, in particular, a promise about the change in the value of, or the return from, payments made by the member or any other person in respect of the member.

(7) The promise mentioned in paragraph (5)(b) includes a promise that—

(a) the available amount will be sufficient to provide a pension of a particular rate;

(b) the rate of a pension will represent a particular proportion of the available amount.

(8) A benefit is not excluded from the definition of “cash balance benefit” by paragraph (5) merely because under the scheme there is a promise that—

(a) the rate or amount of the benefit payable in respect of a deceased member will be a particular proportion of the rate or amount of the benefit which was (or would have been) payable to the member; or

(b) the amount of a lump sum payable to a member, or in respect of a deceased member, will represent a particular proportion of the available amount.

(9) “Money purchase benefits”—

(a) in relation to a pension scheme governed by the law of England and Wales or Scotland, has the meaning given by section 181 of the Pension Schemes Act 1993; and

(b) in relation to a pensions scheme governed by the law of Northern Ireland, has the meaning given by section 176 of the Pension Schemes (Northern Ireland) Act 1993.]

Textual Amendments

F357 Art. 53E inserted (6.4.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2015 (S.I. 2015/731), arts. 1, 2(2)

Exclusions U.K.

Advice given in newspapers etc. U.K.

54.—(1) There is excluded from [F358 articles 53, 53A, 53B [F359 , 53C [F360 , 53D [F361 , 53DA] and 53E]]] the giving of advice in writing or other legible form if the advice is contained in a newspaper, journal, magazine, or other periodical publication, or is given by way of a service comprising regularly updated news or information, if the principal purpose of the publication or service, taken as a whole and including any advertisements or other promotional material contained in it, is neither—

(a) that of giving advice of a kind mentioned in article 53 [F362 , 53A, 53B [F363 , 53C [F364 , 53D [F361 , 53DA] or 53E],] as the case may be]; nor

[F365 (b) that of leading or enabling persons—

(i) to buy, sell, subscribe for or underwrite securities [F366 , structured deposits,] or [F367 relevant investments], or (as the case may be),

[F368 (ia) to enter into a relevant article 36H agreement (within the meaning of that article) as a lender, to assume the rights of a lender under such an agreement by assignment or operation of law, or to assign rights under such an agreement,]

(ii) to enter as borrower into regulated mortgage contracts, or vary the terms of regulated mortgage contracts entered into by them as borrower[F369 ;

(iii) to enter as reversion seller or plan provider into regulated home reversion plans, or vary the terms of regulated home reversion plans entered into by them as reversion seller or plan provider,

(iv) to enter as home purchaser into regulated home purchase plans, or vary the terms of regulated home purchase plans entered into by them as home purchaser] [F370 ;

(v) to enter as agreement seller or agreement provider into regulated sale and rent back agreements, or vary the terms of regulated sale and rent back agreements entered into by them as agreement seller or agreement provider];]

[F371 (va) to enter as a recipient of credit into a regulated credit agreement the purpose of which is to acquire or retain property rights in land or in an existing or projected building,]

[F372 (vi) to require the trustee or manager of a pension scheme to take any of the actions referred to in article 53E(1)(c).]

(2) There is also excluded from [F373 articles 53, 53A, 53B [F374 , 53C [F375 , 53D [F361 , 53DA] and 53E]]] the giving of advice in any service consisting of the broadcast or transmission of television or radio programmes, if the principal purpose of the service, taken as a whole and including any advertisements or other promotional material contained in it, is neither of those mentioned in paragraph (1)(a) and (b).

[F376 (2A) Paragraphs (1) and (2) do not apply to advice which is a personal recommendation falling within article 53(1A).]

(3) [F377 The FCA] may, on the application of the proprietor of any such publication or service as is mentioned in paragraph (1) or (2), certify that it is of the nature described in that paragraph, and may revoke any such certificate if it considers that it is no longer justified.

(4) A certificate given under paragraph (3) and not revoked is conclusive evidence of the matters certified.

Textual Amendments

F358 Words in art. 54(1) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 14(a)(i)

F359 Words in art. 54(1) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 14(a)

F360 Words in art. 54(1) substituted (6.4.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2015 (S.I. 2015/731), arts. 1, 2(3)(a)(i)

F361 Word in art. 54 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. 4(10)(a) (with Pt. 4)

F362 Words in art. 54(1)(a) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 14(a)(ii)

F363 Words in art. 54(1)(a) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 14(b)

F364 Words in art. 54(1)(a) substituted (6.4.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2015 (S.I. 2015/731), arts. 1, 2(3)(a)(ii)

F365 Art. 54(1)(b) substituted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 14(4)

F366 Words in art. 54(1)(b)(i) inserted (3.1.2018) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) (No.2) Regulations 2017 (S.I. 2017/1255), regs. 2(b), 4(2)

F367 Words in art. 54(1)(b) substituted (31.10.2004 for specified purposes, 14.1.2005 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(3), 9(2)

F368 Art. 54(1)(b)(ia) inserted (17.3.2016 for specified purposes, 6.4.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(d), 2(9) (with Pt. 5)

F369 Art. 54(1)(b)(iii)(iv) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 14(a)(iii)

F370 Art. 54(1)(b)(v) inserted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 14(c)

F371 Art. 54(1)(b)(va) 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. 4(10)(b) (with Pt. 4)

F372 Art. 54(1)(b)(vi) inserted (6.4.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2015 (S.I. 2015/731), arts. 1, 2(3)(a)(iii)

F373 Words in art. 54(2) substituted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 14(b)

F374 Words in art. 54(2) substituted (1.7.2009 for specified purposes, 30.6.2010 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 14(d)

F375 Words in art. 54(2) substituted (6.4.2015) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2015 (S.I. 2015/731), arts. 1, 2(3)(b)

F376 Art. 54(2A) inserted (3.1.2018) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2017 (S.I. 2017/500), arts. 1(1), 3(2)

F377 Words in art. 54(3) substituted (1.4.2013) by The Financial Services Act 2012 (Consequential Amendments and Transitional Provisions) Order 2013 (S.I. 2013/472), art. 1(1), Sch. 2 para. 35(a)

[F378 Advice given in the course of administration by authorised person U.K.

54A.— [F379 (1)] A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 53A by reason of—

(a) anything done by an authorised person (“B”) in relation to a regulated mortgage contract which B is administering pursuant to arrangements of the kind mentioned in article 62(a); or

(b) anything A does in connection with the administration of a regulated mortgage contract in circumstances falling within article 62(b).

[F380 (2) A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 53B by reason of—

(a) anything done by an authorised person (“B”) in relation to a regulated home reversion plan which B is administering pursuant to arrangements of the kind mentioned in article 63C(a); or

(b) anything A does in connection with the administration of a regulated home reversion plan in circumstances falling within article 63C(b).

(3) A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 53C by reason of—

(a) anything done by an authorised person (“B”) in relation to a regulated home purchase plan which B is administering pursuant to arrangements of the kind mentioned in article 63G(a); or

(b) anything A does in connection with the administration of a regulated home purchase plan in circumstances falling within article 63G(b).]

[F381 (4) A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 53D by reason of

(a) anything done by an authorised person (“B”) in relation to a regulated sale and rent back agreement which B is administering pursuant to arrangements of the kind mentioned in article 63K(a); or

(b) anything A does in connection with the administration of a regulated sale and rent back agreement in circumstances falling within article 63K(b).]

[F382 (5) A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 53DA by reason of—

(a) anything done by an authorised person (“B”) in relation to a regulated credit agreement which B is administering pursuant to arrangements of the kind mentioned in article 60I(a) (arranging administration by authorised person); or

(b) anything A does in connection with the administration of a regulated credit agreement in circumstances falling within article 60I(b).]]

Textual Amendments

F378 Art. 54A inserted (31.10.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(3), 15

F379 Art. 54A(1): art. 54A renumbered as art. 54A(1) (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 15(a)

F380 Art. 54A(2)(3) inserted (6.11.2006 for specified purposes, 6.4.2007 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2006 (S.I. 2006/2383), arts. 1(2), 15(b)