The Electronic Money Regulations 2011

1. Introductory Text

2. PART 1 INTRODUCTORY PROVISIONS

   1. 1. Citation and commencement

   2. 2. Interpretation

   3. 3. Electronic money: exclusions

   4. 3A. Notification of use of limited network exclusion

   5. 3B. Notification of use of electronic communications exclusion

3. PART 2 REGISTRATION

   1. The register

      1. 4. The register of certain electronic money issuers

   2. Authorisation

      1. 5. Application to become an authorised electronic money institution or variation of an existing authorisation

      2. 6. Conditions for authorisation

      3. 7. Imposition of requirements

      4. 8. Variation etc at request of an authorised electronic money institution

      5. 9. Determination of application for authorisation or variation of authorisation

      6. 10. Cancellation of authorisation

      7. 11. Variation of authorisation on Authority's own initiative

   3. Registration as a small electronic money institution

      1. 12. Application for registration as a small electronic money institution or variation of an existing registration

      2. 13. Conditions for registration

      3. 14. Average outstanding electronic money

      4. 15. Supplementary provisions

      5. 16. Application for authorisation if requirements cease to be met

   4. Common provisions

      1. 17. Duty to notify changes

      2. 18. Electronic money institutions acting without permission

4. PART 3 PRUDENTIAL SUPERVISION ...

   1. Capital requirements

      1. 19. Capital requirements

   2. Safeguarding

      1. 20. Safeguarding requirements

      2. 21. Safeguarding option 1

      3. 22. Safeguarding option 2

      4. 23. Power of the Authority to exclude assets

      5. 24. Insolvency events (except electronic money institution special administration)

      6. 24A. Insolvency Regulations

      7. 25. Accounting and statutory audit

      8. 26. Outsourcing

      9. 27. Record keeping

   3. Exercise of passport rights

      1. 28. Notice of intention

      2. 29. Decision following notice of intention

      3. 29A. Notice of intention from an EEA authorised payment institution

      4. 30. Supervision of firms exercising passport rights

      5. 31. Carrying on of Consumer Credit Act business by an EEA authorised electronic money institution

5. PART 4 ADDITIONAL ACTIVITIES AND USE OF DISTRIBUTORS AND AGENTS

   1. 31A. Record keeping

   2. 32. Additional activities

   3. 33. Use of distributors and agents

   4. 34. Requirement for agents to be registered

   5. 35. Removal of agents from the register

   6. 36. Reliance

   7. 37. Duty to notify change in circumstance

6. PART 5 ISSUANCE AND REDEEMABILITY OF ELECTRONIC MONEY

   1. 38. Application of Part 5

   2. 39. Issuance and redeemability

   3. 40. Conditions of redemption

   4. 41. Fees for redemption

   5. 42. Amount of redemption

   6. 43. Requests for redemption

   7. 44. Redemption rights of persons other than consumers

   8. 45. Prohibition of interest

   9. 46. Termination of a contract

7. PART 6 THE AUTHORITY

   1. The functions of the Authority

      1. 47. Functions of the Authority

   2. Supervision and enforcement

      1. 48. Monitoring and enforcement

      2. 49. Reporting requirements

      3. 50. Public censure

      4. 51. Financial penalties

      5. 52. Suspending authorisation etc

      6. 53. Proposal to take disciplinary measures

      7. 54. Injunctions

      8. 55. Power of Authority to require restitution

      9. 56. Proposal to require restitution

      10. 57. Restitution orders

      11. 58. Complaints

   3. Miscellaneous

      1. 59. Costs of supervision

      2. 59A. Credit agreements

      3. 60. Guidance

      4. 61. Authority's exemption from liability in damages

      5. 62. Application and modification of primary and secondary legislation

8. PART 7 GENERAL

   1. Offences

      1. 63. Prohibition on issuing electronic money by persons other than electronic money issuers

      2. 64. False claims to be an electronic money issuer

      3. 65. Defences

      4. 66. Misleading the authority

      5. 67. Restriction on penalties

      6. 68. Liability of officers of bodies corporate etc

      7. 69. Prosecution

      8. 70. Proceedings against unincorporated bodies

   2. Duties of the Authority and the Commissioners to co-operate

      1. 71. Duty to co-operate and exchange information

   3. Actions for breach of requirements

      1. 72. Right to bring actions

      2. 73. Prohibition on contracting-out

   4. Transitional provisions

      1. 74. Persons with a Part 4 permission

      2. 75. EEA firms

      3. 76. Certified persons

      4. 77. Existing fixed term contracts

      5. 78. Amendments to the banking consolidation directive

      6. 78A. Transitional arrangements for existing electronic money institutions on the implementation of the second payment services directive

   5. Amendments to legislation

      1. 79. Amendments to primary and secondary legislation

   6. Gibraltar

      1. 80. Application to Gibraltar

9. Signature

10. 1. SCHEDULE 1

       Information to be included in or with an application for authorisation

       1. 1. A programme of operations, setting out, in particular, the type...

       2. 2. A business plan including a forecast budget calculation for the...

       3. 3. Evidence that the applicant holds initial capital for the purposes...

       4. 4. A description of the measures taken for safeguarding the electronic...

       5. 5. A description of the applicant's governance arrangements and internal control...

       6. 5A. A description of the applicant's procedure for monitoring, handling and...

       7. 5B. A description of the applicant's process for filing, monitoring, tracking...

       8. 5C. A description of the applicant's business continuity arrangements, including a...

       9. 5D. A description of the principles and definitions used by the...

       10. 5E. A statement of the applicant's security policy, including—

       11. 6. A description of the internal control mechanisms which the applicant...

       12. 7. A description of the applicant's structural organisation, including, where applicable,...

       13. 8. In relation to each person holding, directly or indirectly, a...

       14. 9. (1) The identity of directors and persons who are or...

       15. 10. The identity of the auditors of the applicant, if any....

       16. 11. (1) The legal status of the applicant and, where the...

       17. 12. The address of the head office of the applicant.

       18. 13. For the purposes of paragraphs 4, 5 , 5A and...

       19. 14. In the case of an applicant which proposes to provide...

    2. SCHEDULE 2

       Capital Requirements

       1. PART 1 Initial capital

          1. 1. For the purposes of these Regulations “initial capital” comprises one...

          2. 2. An applicant for authorisation as an electronic money institution must...

          3. 3. (1) Where the business activities of an applicant for registration...

       2. PART 2 Own funds

          1. Qualifying items

             1. 4. For the purposes of these Regulations “own funds” means own...

             2. 5. The items specified in paragraph 4(a) to (d) must be—...

             3. 6. Own funds are not to include guarantees provided by the...

          2. ...

             1. 7. The deductions from own funds are— (a) own shares at...

             2. 8. Where shares in another credit institution, financial institution, insurance undertaking,...

          3. Limits on qualifying items

             1. 9. For the purposes of calculating own funds—

             2. 10. The Authority may in temporary and exceptional circumstances direct that...

             3. 11. An electronic money institution must not include in its own...

             4. 12. An authorised electronic money institution that carries on activities other...

          4. Own funds requirement

             1. 13. An authorised electronic money institution must calculate its own funds...

             2. 14. Where a small electronic money institution is required by regulation...

          5. Adjustment by the Authority

             1. 15. The Authority may direct in respect of an authorised electronic...

             2. 16. The Authority may direct in respect of a small electronic...

             3. 17. A direction made under paragraph 15 or 16 must be...

             4. 18. The Authority may make a reasonable charge for making an...

          6. Provision for start-up electronic money institutions

             1. 19. If an electronic money institution has not completed a full...

          7. Method A

             1. 20. (1) “Method A” means the calculation method set out in...

          8. Method B

             1. 21. (1) “Method B” means the calculation method set out in...

          9. Method C

             1. 22. (1) “Method C” means the calculation method set out in...

             2. 23. (1) “Method D” means the calculation method set out in...

             3. 24. (1) Where— (a) an electronic money institution provides payment services...

          10. Application of accounting standards

              1. 25. Except where this Schedule provides for a different method of...

    3. SCHEDULE 2ZA

       Application and modification of the Banking Act 2009

       1. 1. Section 93(4) of the Banking Act 2009 (interpretation: other expressions)...

       2. 2. Section 233 of the Banking Act 2009 (insolvency regulations) applies...

       3. 3. Section 234 of the Banking Act 2009 (regulations: details) applies...

       4. 4. Section 235 of the Banking Act 2009 (regulations: procedure) applies...

       5. 5. Section 236 of the Banking Act 2009 (review) applies as...

       6. 6. For the purposes of the modifications in this Schedule— “...

    4. SCHEDULE 2A

       Credit agreements

       1. PART 1 Prohibitions and restrictions

          1. 1. Power to prohibit the entry into credit agreements

          2. 2. Power to restrict the entry into credit agreements

       2. PART 2 Procedure and appeals

          1. 3. Interpretation

          2. 4. Notice of prohibition or restriction

          3. 5. Application to revoke or vary prohibition or restriction

          4. 6. Notice to the home state competent authority

    5. SCHEDULE 3

       Application and modification of legislation

       1. PART 1 Application and modification of the 2000 Act

          1. 1. Disciplinary powers

          2. 2. The Tribunal

          3. 2A. Authority rules

          4. 3. Information gathering and investigations

          5. 4. Control over electronic money institutions

          6. 4A. Incoming firms: interventions by the Authority

          7. 5. Auditors and actuaries

          8. 6. Restriction on disclosure of information

          9. 7. Insolvency

          10. 8. Warning notices and decision notices

          11. 9. Limitation on powers to require documents

       2. PART 2 Application and modification of secondary legislation

          1. 10. The Financial Services and Markets Act 2000 (Service of Notices) Regulations 2001

          2. 11. The Financial Services and Markets Act 2000 (Disclosure of Confidential Information) Regulations 2001

    6. SCHEDULE 4

       Amendments to primary and secondary legislation

       1. PART 1 Amendments to primary legislation

          1. 1. Consumer Credit Act 1974

          2. 2. The 2000 Act

          3. 3. The Terrorism Act 2000

          4. 4. The Proceeds of Crime Act 2002

          5. 5. The Companies Act 2006

          6. 6. The Counter-Terrorism Act 2008

       2. PART 2 Amendments to secondary legislation

          1. 7. The Rehabilitation of Offenders Act 1974 (Exceptions) Order 1975

          2. 8. The Financial Markets and Insolvency (Settlement Finality) Regulations 1999

          3. 9. The Competition Act 1998 (Small Agreements and Conduct of Minor Significance) Regulations 2000

          4. 10. The Competition Act 1998 (Determination of Turnover for Penalties) Order 2000

          5. 11. The Financial Services and Markets Act 2000 (EEA Passport Rights) Regulations 2001

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

          7. 13. The Enterprise Act 2002 (Merger Fees and Determination of Turnover) Order 2003

          8. 14. The Conduct of Employment Agencies and Employment Business Regulations 2003

          9. 15. The Financial Services (Distance Marketing) Regulations 2004

          10. 16. The Credit Institutions (Reorganisation and Winding Up) Regulations 2004

          11. 17. The Building Societies Act 1986 (Modification of the Lending Limit and Funding Limit Calculations) Order 2004

          12. 18. The Pension Protection Fund (Entry Rules) Regulations 2005

          13. 19. The Money Laundering Regulations 2007

          14. 20. Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008

          15. 21. The Payment Services Regulations 2009

    7. SCHEDULE 5

       Gibraltar

       1. 1. Exercise of market access rights by Gibraltar-based firms

       2. 2. Exercise by authorised electronic money institutions of market access rights in Gibraltar

       3. 2A. References to Gibraltar regulator

       4. 3. Modification of legislation

       5. 4. Firms which have taken action before 13th January 2018

11. Explanatory Note