Proceeds of Crime Act 2002

Part 1 Regulated sector

Business in the regulated sector

1 (1) A business is in the regulated sector to the extent that it engages in any of the following activities—

(a) accepting deposits by a person with permission under Part 4 of the Financial Services and Markets Act 2000 (c. 8) to accept deposits (including, in the case of a building society, the raising of money from members of the society by the issue of shares);

(b) the business of the National Savings Bank;

(c) business carried on by a credit union;

(d) any home-regulated activity carried on by a European institution in respect of which the establishment conditions in paragraph 13 of Schedule 3 to the Financial Services and Markets Act 2000, or the service conditions in paragraph 14 of that Schedule, are satisfied;

(e) any activity carried on for the purpose of raising money authorised to be raised under the National Loans Act 1968 (c. 13) under the auspices of the Director of Savings;

(f) the activity of operating a bureau de change, transmitting money (or any representation of monetary value) by any means or cashing cheques which are made payable to customers;

(g) any activity falling within sub-paragraph (2);

(h) any of the activities in points 1 to 12 or 14 of Annex 1 to the Banking Consolidation Directive, ignoring an activity described in any of sub-paragraphs (a) to (g) above;

(i) business which consists of effecting or carrying out contracts of long term insurance by a person who has received official authorisation pursuant to Article 6 or 27 of the First Life Directive.

(2) An activity falls within this sub-paragraph if it constitutes any of the following kinds of regulated activity in the United Kingdom—

(a) dealing in investments as principal or as agent;

(b) arranging deals in investments;

(c) managing investments;

(d) safeguarding and administering investments;

(e) sending dematerialised instructions;

(f) establishing (and taking other steps in relation to) collective investment schemes;

(g) advising on investments.

(3) Paragraphs (a) and (i) of sub-paragraph (1) and sub-paragraph (2) must be read with section 22 of the Financial Services and Markets Act 2000, any relevant order under that section and Schedule 2 to that Act.

2 (1) This paragraph has effect for the purposes of paragraph 1.

(2) “Building society” has the meaning given by the Building Societies Act 1986 (c. 53).

(3) “Credit union” has the meaning given by the Credit Unions Act 1979 (c. 34) or the Credit Unions (Northern Ireland) Order 1985 (S.I. 1985/1205 (N.I. 12)).

(4) “European institution” means an EEA firm of the kind mentioned in paragraph 5(b) or (c) of Schedule 3 to the Financial Services and Markets Act 2000 (c. 8) which qualifies for authorisation for the purposes of that Act under paragraph 12 of that Schedule.

(5) “Home-regulated activity” in relation to a European institution, means an activity—

(a) which is specified in Annex 1 to the Banking Consolidation Directive and in respect of which a supervisory authority in the home State of the institution has regulatory functions, and

(b) if the institution is an EEA firm of the kind mentioned in paragraph 5(c) of Schedule 3 to the Financial Services and Markets Act 2000, which the institution carries on in its home State.

(6) “Home State”, in relation to a person incorporated in or formed under the law of another member State, means that State.

(7) The Banking Consolidation Directive is the Directive of the European Parliament and Council relating to the taking up and pursuit of the business of credit institutions (No. 2000/12 EC).

(8) The First Life Directive is the First Council Directive on the co-ordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of direct life assurance (No. 79/267/EEC).

Excluded activities

3 A business is not in the regulated sector to the extent that it engages in any of the following activities—

(a) the issue of withdrawable share capital within the limit set by section 6 of the Industrial and Provident Societies Act 1965 (c. 12) by a society registered under that Act;

(b) the acceptance of deposits from the public within the limit set by section 7(3) of that Act by such a society;

(c) the issue of withdrawable share capital within the limit set by section 6 of the Industrial and Provident Societies Act (Northern Ireland) 1969 by a society registered under that Act;

(d) the acceptance of deposits from the public within the limit set by section 7(3) of that Act by such a society;

(e) activities carried on by the Bank of England;

(f) any activity in respect of which an exemption order under section 38 of the Financial Services and Markets Act 2000 has effect if it is carried on by a person who is for the time being specified in the order or falls within a class of persons so specified.