The Child Trust Funds Regulations 2004

General requirements for accounts U.K.

8.  —An account must satisfy the requirements that—

(a) it is the account for a single child (“the named child”);

(b) the named child is or has been an eligible child;

(c) no child may hold more than one account;

F1 (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(e) the account must at all times be managed in accordance with these Regulations by an account provider and, subject to regulation 6(2), under terms agreed and recorded in a management agreement made between the account provider and the registered contact (on behalf of the named child where appropriate); and

(f) the management agreement must include instructions to the provider as to the manner in which Inland Revenue contributions and any subscriptions made are to be invested under the account.

(2) Apart from other requirements of these Regulations the terms so agreed shall include the conditions that—

(a) the account investments shall be in the beneficial ownership of the named child;

(b) the title to all account investments, except those falling within regulation 12(2)(k), (l) or (m), shall be vested in the account provider or his nominee, subject to sub-paragraph (f);

(c) where a share certificate or other document evidencing title to an account investment is issued, it shall be held by the account provider or as he may direct, subject to sub-paragraph (f);

(d) in relation to qualifying investments falling within regulation 12(2)(a), (b) and (f) to (j), the account provider shall, if the registered contact so elects (and subject to any charge for the arrangement), arrange for the registered contact to receive a copy of the annual report and accounts issued to investors by every company, unit trust, open-ended investment company or other entity in which account investments are held;

(e) in relation to qualifying investments falling within regulation 12(2)(a), (b) and (f) to (j), the account provider shall, if the registered contact so elects (subject to any charge for the arrangement, and to any provisions made under any enactment), be under an obligation to arrange for the registered contact to be able—

(i) to attend any meetings of investors in companies, unit trusts, open-ended investment companies and other entities in which account investments are held,

(ii) to vote, and

(iii) to receive, in addition to the documents referred to in sub-paragraph (d), any other information issued to investors in such companies, unit trusts, open-ended investment companies and other entities;

(f) if and so long as a person falling within regulation 14(2)(d)(iv) acts as account provider of an account, and the account investments include a policy of life insurance—

(i) the title to all such policies shall be vested in the registered contact, and

(ii) where a policy document or other document evidencing title to such policies of life insurance is issued, it shall be held by the registered contact;

(g) the account provider shall satisfy himself that any person to whom he delegates any of his functions or responsibilities under the management agreement is competent to carry out those functions or responsibilities;

(h) on the instructions of the registered contact (“the transfer instructions”) and within such time as is stipulated by the registered contact in the transfer instructions, the whole of an account, with all rights and obligations of the parties to it, shall be transferred free of expense (except any incidental expenses) to another account provider subject to and in accordance with regulation 21;

[F2 (ha) where the account is or has been transferred to the account provider by a transfer under regulation 21, that no charges or expenses are due in respect of that transfer, except in accordance with sub-paragraph (h);]

[F3 (hb) any transfer under regulation 20A shall be free of expense (except any incidental expenses);]

(i) where the account provider offers accounts of another description or type, on the instructions of the registered contact (“the internal transfer instructions”) and within such time as is stipulated by the registered contact in the internal transfer instructions, the account shall become (free of expense, except any incidental expenses) an account of that other description or type (any necessary change in the investments being made accordingly); and

(j) the account provider shall notify the registered contact if by reason of any failure to satisfy the provisions of these Regulations an account is or will become no longer exempt from tax by virtue of regulation 24.

(3) Where the transfer instructions or internal transfer instructions, or any new management agreement entered into by the registered contact with the account provider (or a new account provider) under regulation 8(1)(e), is a distance contract, the transfer or internal transfer shall only take effect once those contracts satisfy Condition 4 in regulation 5(1).

(4) The time stipulated in transfer instructions or internal transfer instructions shall be subject to any reasonable business period (not exceeding 30 days) of the account provider required for the practical implementation of the instructions.

(5) In this regulation, “incidental expenses” means stamp duty and other dealing costs of disposing of or acquiring investments.

Textual Amendments

F1 Reg. 8(1)(d) omitted (1.7.2015) by virtue of The Child Trust Funds (Amendment No. 3) Regulations 2015 (S.I. 2015/1371), regs. 1, 5

F2 Reg. 8(2)(ha) inserted (6.4.2005) by The Child Trust Funds (Amendment) Regulations 2004 (S.I. 2004/2676), regs. 1, 6

F3 Reg. 8(2)(hb) inserted (6.4.2015) by The Child Trust Funds (Amendment No. 2) Regulations 2015 (S.I. 2015/876), regs. 1, 4