Textual Amendments
F1Pt. 9C inserted (1.7.2021) by Financial Services Act 2021 (c. 22), s. 49(5), Sch. 2 para. 1; S.I. 2021/671, reg. 4(b)
(1)This section makes provision about a requirement imposed on a non-authorised parent undertaking of an FCA investment firm (“N”) under section 143K—
(a)prohibiting the disposal of, or other dealing with, any of N's assets (whether in the United Kingdom or elsewhere) or restricting such disposals or dealings, or
(b)requiring that some or all of N's assets, or some or all assets belonging to consumers (as defined in section 1G) but held by N or to N's order, must be transferred to and held by a trustee approved by the FCA.
(2)If the FCA—
(a)imposes a requirement described in subsection (1)(a), and
(b)gives notice of the requirement to an institution with whom N keeps an account,
the notice has the effects set out in subsection (3).
(3)Those effects are that—
(a)the institution does not act in breach of a contract with N if, having been instructed by N (or on N's behalf) to transfer a sum or otherwise make a payment out of N's account, it refuses to do so in the reasonably held belief that complying with the instruction would be incompatible with the requirement, and
(b)if the institution complies with such an instruction, it is liable to pay to the FCA an amount equal to the amount transferred from, or otherwise paid out of, N's account in contravention of the requirement.
(4)If the FCA imposes a requirement described in subsection (1)(b), no assets held by a person as trustee in accordance with the requirement may, while the requirement is in force, be released or dealt with except with the consent of the FCA.
(5)If, while a requirement described in subsection (1)(b) is in force, N creates a charge over any assets of N held in accordance with the requirement, the charge is (to the extent that it confers security over the assets) void against the liquidator and N's creditors.
(6)Assets held by a person as trustee are to be taken to be held by the trustee in accordance with a requirement mentioned in subsection (1)(b) only if—
(a)N has given the trustee a written notice that those assets are to be held by the trustee in accordance with the requirement, or
(b)they are assets into which assets to which paragraph (a) applies have been transposed by the trustee on the instruction of N.
(7)A person who contravenes subsection (4) commits an offence and is liable—
(a)on summary conviction in England and Wales, to a fine;
(b)on summary conviction in Scotland or Northern Ireland, to a fine not exceeding level 5 on the standard scale.
(8)In this section, references to imposing a requirement (however expressed) include imposing a requirement by varying an existing requirement.
(9)In this paragraph, “charge” includes a mortgage (or, in Scotland, a security over property).
(10)Subsections (4) and (6) do not affect any equitable interest or remedy in favour of a person who is a beneficiary of a trust as a result of a requirement described in subsection (1)(b).]