7.—[F1(1)] Advising a person is a controlled activity if the advice is—
(a)given to the person in his capacity as an investor or potential investor, or in his capacity as agent for an investor or a potential investor; and
(b)advice on the merits of his doing any of the following (whether as principal or agent)—
(i)buying, selling, subscribing for or underwriting a particular investment which is a security[F2, structured deposit] or a contractually based investment; or
(ii)exercising any right conferred by such an investment to buy, sell, subscribe for or underwrite such an investment.
[F3(2) Advising a person is a controlled activity if the advice is—
(a)given to the person in that person’s capacity as a lender or potential lender under a relevant paragraph 4C agreement, or in that person’s capacity as an agent for a lender or potential lender under such an agreement; and
(b)advice on the merits of the person doing any of the following (whether as principal or agent)—
(i)entering into a relevant paragraph 4C agreement as a lender or assuming the rights of a lender under such an agreement,
(ii)providing instructions to an operator with a view to entering into a relevant paragraph 4C agreement as a lender or to assuming the rights of a lender under such an agreement by assignment or operation of law, where the instructions involve—
(aa)accepting particular parameters for the terms of the agreement presented by an operator,
(bb)choosing between options governing the parameters of the terms of the agreement presented by an operator, or
(cc)specifying the parameters of the terms of the agreement by other means,
(iii)enforcing or exercising the lender’s rights under a relevant paragraph 4C agreement, or
(iv)assigning rights under a relevant paragraph 4C agreement.
(3) In sub-paragraph (2)—
“operator” means a person carrying on a controlled activity of the kind specified by paragraph 4C(1) or (2D), and
“relevant paragraph 4C agreement” means a paragraph 4C agreement (within the meaning of that paragraph) which has been, or is to be, entered into with the facilitation of a person carrying on a controlled activity of the kind specified by paragraph 4C(1) or (2D) not in contravention of the general prohibition.
(4) For the purposes of the application of section 21(9) and (10) of the Act (restrictions on financial promotion) to an activity of a kind specified by sub-paragraph (2), paragraph 26D of this Schedule (relevant credit agreements), and article 4 (definition of controlled activities and controlled investments) in so far as it relates to that paragraph, have effect as if the reference to a relevant credit agreement in paragraph 26D includes a reference to a paragraph 4C agreement.]
Textual Amendments
F1Sch. 1 para. 7 renumbered as Sch. 1 para. 7(1) (17.3.2016 for specified purposes, 6.4.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), arts. 1(2)(3)(d), 6(3)(a) (with Pt. 5)
F2Words in Sch. 1 para. 7(1)(b)(i) inserted (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), art. 1(2), Sch. para. 9(10)(e)
F3Sch. 1 para. 7(2)-(4) inserted (17.3.2016 for specified purposes, 6.4.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), arts. 1(2)(3)(d), 6(3)(b) (with Pt. 5)