Financial Services and Markets Act 2000

[F1 PART 9 U.K. Transition on withdrawal of approval of regulated activity etc

Textual Amendments

F1 Sch. 2A inserted (1.9.2023 for specified purposes) by Financial Services Act 2021 (c. 22), s. 49(5), Sch. 6 (as amended (1.1.2024) by The Retained EU Law (Revocation and Reform) Act 2023 (Consequential Amendment) Regulations 2023 (S.I. 2023/1424), reg. 1(2), Sch. para. 100(3)(b)); S.I. 2023/934, reg. 2(a)

Transition on withdrawal of approval of regulated activity U.K.

58 (1) Sub-paragraph (2) applies where— U.K.

(a) the Treasury withdraw their approval of a regulated activity for the purposes of this Schedule (by revoking or amending regulations under paragraph 5), and

(b) immediately before approval is withdrawn, a person had a Schedule 2A permission to carry on the activity.

(2) The regulated activity is to be treated as approved under this Schedule but—

(a) only so far as carried on by the person,

(b) subject to the time limit in sub-paragraph (3), and

(c) subject to any restriction under paragraph 60.

(3) The regulated activity ceases to be treated as approved under this Schedule by virtue of sub-paragraph (2)—

(a) at the end of the period specified by the Treasury by regulations, or

(b) if earlier, when an event listed in sub-paragraph (4) first occurs.

(4) Those events are—

(a) the person ceases to carry on the regulated activity in the United Kingdom;

(b) the person ceases to have permission from the Gibraltar regulator to carry on the corresponding activity in Gibraltar;

(c) the person ceases to have a Schedule 2A permission in respect of the activity;

(d) the person is given permission under Part 4A of this Act in respect of the activity;

(e) the Treasury approve the activity for the purposes of this Schedule (by making regulations under paragraph 5).

(5) Where the approval of the regulated activity referred to in sub-paragraph (1)(a) is subject to limitations, references in this Part of this Schedule to that activity are to that activity subject to those limitations.

(6) Where the withdrawal of the approval of the regulated activity referred to in sub-paragraph (1)(a) is subject to limitations, references in this Part of this Schedule to that activity are to that activity subject to those limitations.

(7) For the purposes of sub-paragraph (4)(b) and (c), a person does not cease to have permission in respect of an activity while it has permission to carry on the activity by virtue of, and subject to the restrictions in, Part 10 of this Schedule.

Transition on Gibraltar activity ceasing to be corresponding activity U.K.

59 (1) Sub-paragraph (2) applies where— U.K.

(a) the Treasury provide that an activity which the Gibraltar regulator has authorised, or may authorise, a person to carry on in Gibraltar (a “Gibraltar activity”) does not correspond to an approved activity (by revoking or amending regulations under paragraph 6), and

(b) immediately before they do so, a person had a Schedule 2A permission to carry on the approved activity by virtue of having permission from the Gibraltar regulator to carry the Gibraltar activity.

(2) For the purposes of this Schedule, the Gibraltar activity is to be treated as corresponding to the approved activity but—

(a) only so far as the approved activity is carried on by the person in the United Kingdom,

(b) subject to the time limit in sub-paragraph (3), and

(c) subject to any restriction under paragraph 60.

(3) The Gibraltar activity ceases to be treated as corresponding to the approved activity by virtue of sub-paragraph (2)—

(a) at the end of the period specified by the Treasury by regulations, or

(b) if earlier, when an event listed in sub-paragraph (4) first occurs.

(4) Those events are—

(a) the person ceases to carry on the approved activity in the United Kingdom;

(b) the person ceases to have permission from the Gibraltar regulator to carry on the Gibraltar activity;

(c) the person ceases to have a Schedule 2A permission in respect of the approved activity;

(d) the person is given permission under Part 4A of this Act in respect of the approved activity;

(e) the Treasury provide that the Gibraltar activity corresponds to the approved activity (by making regulations under paragraph 6).

(5) Where the provision made about the Gibraltar activity in regulations under paragraph 6 immediately before the Treasury make the provision described in sub-paragraph (1)(a) is subject to limitations, references in this Part of this Schedule to the Gibraltar activity are to that activity subject to those limitations.

(6) Where the provision made about the Gibraltar activity in the regulations under paragraph 6 referred to in sub-paragraph (1)(a) is subject to limitations, references in this Part of this Schedule to the Gibraltar activity are to that activity subject to those limitations.

(7) For the purposes of sub-paragraph (4)(b) and (c), a person does not cease to have permission in respect of an activity while it has permission to carry on the activity by virtue of, and subject to the restrictions in, Part 10 of this Schedule.

Restricting transitional permission U.K.

60 (1) Sub-paragraph (2) applies where— U.K.

(a) by virtue of paragraph 58(1), a regulated activity is treated as approved under this Schedule so far as carried on by a person, or

(b) by virtue of paragraph 59(1), an activity which the Gibraltar regulator has authorised, or may authorise, a person to carry on in Gibraltar is treated as corresponding to an approved activity so far as the approved activity is carried on by a person.

(2) The appropriate UK regulator may decide that the person may only carry on the regulated activity or approved activity (as appropriate) in the United Kingdom so far as is necessary for one or more of the following purposes—

(a) for the performance of a protected contract;

(b) in order to reduce the financial risk of a party to a protected contract or a third party affected by the performance of a protected contract;

(c) in order to transfer the property, rights or liabilities under a protected contract to a person authorised to carry on a regulated activity by virtue of section 31(1)(a);

(d) in order to comply with a requirement imposed by or under an enactment.

(3) If it proposes to make a decision under sub-paragraph (2), the appropriate UK regulator must give the person a written notice.

(4) The notice must—

(a) give details of the proposed decision, and

(b) inform the person that the person may make representations to the appropriate UK regulator within the period specified in the notice.

(5) The appropriate UK regulator may extend the period allowed under the notice for making representations.

(6) If, having considered any representations made by the person, the appropriate UK regulator decides to restrict the person's activities as described in sub-paragraph (2), it must—

(a) give the person a written notice (“a restriction notice”), and

(b) inform the Gibraltar regulator in writing without delay.

(7) A restriction notice must—

(a) specify the date on which it takes effect,

(b) inform the person of the person's right to refer the matter to the Tribunal (see paragraph 62), and

(c) indicate the procedure on a reference to the Tribunal.

(8) The Treasury may by regulations provide that a restriction notice may not specify a date falling before the end of a period specified or described in the regulations.

(9) In this paragraph—

• “the appropriate UK regulator” means—

  (a)

  in the case of a PRA-authorised person, the PRA, and

  (b)

  in any other case, the FCA;

• “enactment” includes—

  (a)

  assimilated legislation,

  (b)

  an enactment comprised in subordinate legislation,

  (c)

  an enactment comprised in, or in an instrument made under, a Measure or Act of Senedd Cymru,

  (d)

  an enactment comprised in, or in an instrument made under, an Act of the Scottish Parliament, and

  (e)

  an enactment comprised in, or in an instrument made under, Northern Ireland legislation;

• “protected contract” means a contract specified or described in a direction by the appropriate UK regulator under paragraph 61;

• “subordinate legislation” has the same meaning as in the Interpretation Act 1978 (see section 21 of that Act).

(10) In this paragraph, references to the performance of a protected contract include the performance of an obligation under the contract which is contingent or conditional.

Directions about protected contracts U.K.

61 (1) A UK regulator may direct that a contract specified or described in the direction is a protected contract for the purposes of this Part of this Schedule. U.K.

(2) A UK regulator that gives a direction under this paragraph may, by a further direction, vary or revoke the direction.

(3) A direction under this paragraph may make different provision for different purposes, including different provision in connection with—

(a) different activities,

(b) different contracts or descriptions of contract, or

(c) different Gibraltar-based persons or descriptions of Gibraltar-based person.

(4) After giving a direction under this paragraph, a UK regulator must—

(a) publish the direction in the way appearing to the UK regulator to be best calculated to bring it to the attention of persons likely to be affected by it, and

(b) give a copy of the direction to the Treasury and the other UK regulator without delay.

Right to refer matters to the Tribunal U.K.

62 U.K. Where a person in respect of whom a decision under paragraph 60(2) is made is aggrieved by the decision, the person may refer the matter to the Tribunal.

Further powers U.K.

63 (1) The Treasury may by regulations extend the period under section 55V(1) or (2) for determining an application which— U.K.

(a) is for a Part 4A permission or a variation of a Part 4A permission, and

(b) relates only to the carrying on of an activity which the applicant is carrying on in the United Kingdom by virtue of this Part of this Schedule.

(2) The power under sub-paragraph (1) includes power to amend section 55V.

(3) The Treasury may by regulations extend the period for consideration of an application which—

(a) is for approval under section 59 or variation of approval under section 59, and

(b) relates only to performance of a function in relation to the carrying on of an activity which the applicant is carrying on in the United Kingdom by virtue of this Part of this Schedule.

(4) The power under sub-paragraph (3) includes power to amend sections 61 and 63ZA.]