7.—(1) Schedule 3 to the Electronic Money, Payment Services and Payment Systems (Amendment and Transitional Provisions) (EU Exit) Regulations 2018(1) (transitional provisions) is amended as follows.
(2) At the end of paragraph 12A, insert “and “PSR 2017” means the Payment Services Regulations 2017(2)”.
(3) In paragraph 12L(3), after sub-paragraph (5) insert—
“(6) Where a person (“A”) to whom this paragraph applies issues electronic money to a person (“B”) in pursuance of a pre-existing contract in reliance on the exemption in sub-paragraph (1), A must, as soon as it is reasonably practicable to do so, notify B—
(a)that A is exempt from the prohibition in regulation 63(1) of EMR 2011 by virtue of sub-paragraph (1) and is not authorised by the FCA under EMR 2011;
(b)that, as a result of the United Kingdom’s withdrawal from the European Union—
(i)it is possible that B’s assets held by A in relation to the performance of the pre-existing contract no longer attract the same protection afforded to them immediately before exit day;
(ii)it is possible that recourse to an alternative dispute resolution procedure or compensation scheme that was available to B under the pre-existing contract immediately before exit day is no longer available;
(c)in so far as it is practicable to do so, of any changes arising as a result of the United Kingdom’s withdrawal from the European Union to—
(i)the protection afforded to B’s assets held by A in relation to the performance of the pre-existing contract; or
(ii)the availability to B of an alternative dispute resolution procedure or compensation scheme under the pre-existing contract.
(7) If at any time after A has provided B with any information under sub-paragraph (6)—
(a)there is, or is likely to be, a material change affecting that information; or
(b)it becomes apparent to the applicant that the information is incomplete or contains a material inaccuracy,
A must provide B with details of the change, the complete information or a correction of the inaccuracy (as the case may be) as soon as it is reasonably practicable to do so.
(8) The FCA may issue guidance in respect of compliance with an obligation under sub-paragraph (6) or (7).”.
(4) After paragraph 20(1)(j) insert—
“(ja)in the case of a person carrying on account information services, the person does not hold professional indemnity insurance, or a comparable guarantee, of the kind mentioned in regulation 6(7)(f) of PSR 2017,”.
(5) In paragraph 36(4), after sub-paragraph (5) insert—
“(6) Where a person (“A”) to whom this paragraph applies provides payment services to a person (“B”) in pursuance of a pre-existing contract in reliance on the exemption in sub-paragraph (1), A must, as soon as it is reasonably practicable to do so, notify B—
(a)that A is exempt from the prohibition in regulation 138(1) of PSR 2017 by virtue of sub-paragraph (1) and is not authorised by the FCA under PSR 2017;
(b)that, as a result of the United Kingdom’s withdrawal from the European Union—
(i)it is possible that B’s assets held by A in relation to the performance of the pre-existing contract no longer attract the same protection afforded to them immediately before exit day;
(ii)it is possible that recourse to an alternative dispute resolution procedure or compensation scheme that was available to B under the pre-existing contract immediately before exit day is no longer available;
(c)in so far as it is practicable to do so, of any changes arising as a result of the United Kingdom’s withdrawal from the European Union to—
(i)the protection afforded to B’s assets held by A in relation to the performance of the pre-existing contract; or
(ii)the availability to B of an alternative dispute resolution procedure or compensation scheme under the pre-existing contract.
(7) If at any time after A has provided B with any information under sub-paragraph (6)—
(a)there is, or is likely to be, a material change affecting that information; or
(b)it becomes apparent to the applicant that the information is incomplete or contains a material inaccuracy,
A must provide B with details of the change, the complete information or a correction of the inaccuracy (as the case may be) as soon as it is reasonably practicable to do so.
(8) The FCA may issue guidance in respect of compliance with an obligation under sub-paragraph (6) or (7).”.
Paragraph 12L was inserted, together with the rest of Part 1A (comprising paragraphs 12A to 12M), by regulation 10 of S.I. 2019/405.
Paragraph 36 was inserted, together with the rest of Part 3 (comprising paragraphs 25 to 37), by regulation 10 of S.I. 2019/405.