Part VIIU.K. Financial Markets and Insolvency

Modifications etc. (not altering text)

C1Pt. VII (ss. 154-191): functions of the Secretary of State transferred (7.6.1992) to the Treasury by S.I. 1992/1315, art. 2(1)(c) (with art. 6)

Pt. VII (ss. 154-191) applied (E.W.S.) (15.8.1995) by S.I. 1995/2049, reg.3; and applied (with modifications) (E.W.S.) (15.8.1995) by S.I. 1995/2049, regs.3,4,5,19, 26; and applied (with modifications) (15.7.1996) by S.I. 1996/1469, regs.3, 4, 5

C2Pt. VII: power to apply conferred (1.12.2001) by 2000 c. 8, s. 301(1)(a); S.I. 2001/3538, art. 2(1)

Market propertyE+W+S

177 Application of margin [F1or default fund contribution] not affected by certain other interests.E+W+S

(1)The following provisions have effect with respect to the application by [F2a recognised body] of property (other than land) held by [F3the recognised body] as margin in relation to a market contract [F4or as default fund contribution].

(2)So far as necessary to enable the property to be applied in accordance with the rules of [F5the recognised body] , it may be so applied notwithstanding any prior equitable interest or right, or any right or remedy arising from a breach of fiduciary duty, unless [F5the recognised body] had notice of the interest, right or breach of duty at the time the property was provided as margin [F6or as default fund contribution].

(3)No right or remedy arising subsequently to the property being provided as margin [F7or as default fund contribution] may be enforced so as to prevent or interfere with the application of the property by [F8the recognised body] in accordance with its rules.

(4)Where [F9a recognised body] has power by virtue of the above provisions to apply property notwithstanding an interest, right or remedy, a person to whom [F10the recognised body] disposes of the property in accordance with its rules takes free from that interest, right or remedy.

Textual Amendments

Modifications etc. (not altering text)

C3S. 177 applied (15.8.1995) by S.I. 1995/2049, reg. 25(1)

Commencement Information

I1S. 177 wholly in force at 25.4.1991 see s. 215 and S.I. 1991/878, art. 2, Sch. (subject to certain savings in art. 3(5))

Prospective

178 Priority of floating market charge over subsequent charges.E+W+S

(1)The Secretary of State may by regulations provide that a market charge which is a floating charge has priority over a charge subsequently created or arising, including a fixed charge.

(2)The regulations may make different provision for cases defined, as regards the market charge or the subsequent charge, by reference to the description of charge, its terms, the circumstances in which it is created or arises, the nature of the charge, the person in favour of whom it is granted or arises or any other relevant factor.

179 Priority of market charge over unpaid vendor’s lien.E+W+S

Where property subject to an unpaid vendor’s lien becomes subject to a market charge, the charge has priority over the lien unless the chargee had actual notice of the lien at the time the property became subject to the charge.

Modifications etc. (not altering text)

C4S. 179 applied (15.8.1995) by S.I. 1995/2049, reg. 25(2)

Commencement Information

I2S. 179 wholly in force at 25.4.1991 see s. 215 and S.I. 1991/878, art. 2, Sch. (subject to certain savings in art. 3(6))

180 Proceedings against market property by unsecured creditors.E+W+S

(1)Where property (other than land) is held by [F11a recognised body] as margin in relation to market contracts [F12or as default fund contribution,] or is subject to a market charge, no execution or other legal process for the enforcement of a judgment or order may be commenced or continued, and no distress may be levied, [F13and no power to use the procedure in Schedule 12 to the Tribunals, Courts and Enforcement Act 2007 (taking control of goods) may be exercised,] against the property by a person not seeking to enforce any interest in or security over the property, except with the consent of—

(a)in the case of property provided as cover for margin [F14or as default fund contribution], [F15the recognised body] in question, or

(b)in the case of property subject to a market charge, the person in whose favour the charge was granted.

(2)Where consent is given the proceedings may be commenced or continued notwithstanding any provision of the M1Insolvency Act 1986 or the M2Bankruptcy (Scotland) Act [F162016].

(3)Where by virtue of this section a person would not be entitled to enforce a judgment or order against any property, any injunction or other remedy granted with a view to facilitating the enforcement of any such judgment or order shall not extend to that property.

(4)In the application of this section to Scotland, the reference to execution being commenced or continued includes a reference to diligence being carried out or continued, and the reference to distress being levied shall be omitted.

Textual Amendments

Modifications etc. (not altering text)

C5S. 180 applied (15.8.1995) by S.I. 1995/2049, reg. 25(3)

Commencement Information

I3S. 180 wholly in force at 25.4.1991 see s. 215 and S.I. 1991/878, art. 2, Sch. (subject to certain savings in art. 3(7)).

Marginal Citations

181 Power to apply provisions to other cases.E+W+S

(1)[F17A power to which this subsection applies includes the] power to apply sections 177 to 180 to any description of property provided as cover for margin in relation to contracts in relation to which the power is exercised or, as the case may be, property subject to charges in relation to which the power is exercised.

(2)The regulations may provide that those sections apply with such exceptions, additions and adaptations as may be specified in the regulations.

[F18(3)Subsection (1) applies to the powers of the Secretary of State and the Treasury to act jointly under—

(a)sections 170, 172 and 176 of this Act; and

(b)section 301 of the Financial Services and Markets Act 2000 (supervision of certain contracts).]

Textual Amendments

F17Words in s. 181(1) substituted (1.12.2001) by S.I. 2001/3649, arts. 1, 86(2)

F18S. 181(3) inserted (1.12.2001) by S.I. 2001/3649, arts. 1, 86(3)

Modifications etc. (not altering text)

C6S. 181: certain functions made exercisable (7.6.1992) jointly by the Secretary of State and the Treasury by S.I. 1992/1315, art. 4, Sch. 2 para. 7 (with art. 6).

Commencement Information

I4S. 181 wholly in force: s. 181 not in force at Royal Assent see s. 215(1)(2); s. 181 in force for certain purposes at 25.3.1991 by S.I. 1991/488, art. 2(2); s. 181 wholly in force at 4.7.1995 by S.I. 1995/1591, art. 2