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

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Point in time view as at 28/01/2021.

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The Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, Cross Heading: The activity is up to date with all changes known to be in force on or before 23 November 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.

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[F1The activityU.K.

Textual Amendments

F1Pt. 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

Operating an electronic system in relation to lendingU.K.

36H.—(1) Where the [F2conditions 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 [F3in 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).

[F4(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 [F5either interest or capital or both] due under the article 36H agreement from C, and

(b)make payments in respect of [F6either 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.]

[F7(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) [F8or (2D)]—

(a)presenting or offering article 36H agreements to [F9either B or C] with a view to B becoming the lender under the article 36H agreement [F10or] 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)[F11taking steps to perform duties, or exercise or enforce] rights under an article 36H agreement on behalf of the lender,

(e)[F12taking 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)[F13taking steps with a view to] ascertaining the contents of such information,

(g)[F14taking 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, F15...

(h)[F16taking 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 [F17, or

(i)giving advice in relation to the taking of any of the steps in sub-paragraphs (e) to (h)].

[F18(4) [F19Subject to article 60C(4C),] 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.

[F20(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.]

[F21(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, [F22have] effect as if the reference to a credit agreement in article 88D includes a reference to an article 36H agreement.]]