For subsections (1) to (3) substitute—

“(1)

Section 87 above shall not apply as regards an agreement to transfer securities of a particular kind to B or B's nominee if—

(a)

B is a member of a regulated market on which securities of that kind are regularly traded; and

(b)

B is an intermediary and is recognised as such by the market in accordance with arrangements approved by the Commissioners for Her Majesty's Revenue and Customs (“the Commissioners”).

(1A)

Section 87 above shall not apply as regards an agreement to transfer securities of a particular kind to B or B's nominee if—

(a)

B is a member of a multilateral trading facility, or a recognised foreign exchange, on which securities of that kind are regularly traded;

(b)

B is an intermediary and is recognised as such by the facility or exchange in accordance with arrangements approved by the Commissioners; and

(c)

the agreement is effected on the facility or exchange.

(1B)

Section 87 above shall not apply as regards an agreement to transfer securities of a particular kind to B or B's nominee if—

(a)

B is an intermediary who is approved for the purposes of this section by the Commissioners; and

(b)

securities of that kind are regularly traded on a regulated market.

(1C)

Section 87 above shall not apply as regards an agreement to transfer securities of a particular kind to B or B's nominee if—

(a)

B is an intermediary who is approved for the purposes of this section by the Commissioners;

(b)

securities of that kind are regularly traded on a multilateral trading facility or a recognised foreign exchange; and

(c)

the agreement is effected on the facility or exchange.

(2)

Section 87 above shall not apply as regards an agreement to transfer securities of a particular kind to B or B's nominee if—

(a)

B is a member of a regulated market, a multilateral trading facility or a recognised foreign options exchange;

(b)

options to buy or sell securities of that kind are regularly traded on, and are listed by or quoted on, that market, facility or exchange;

(c)

B is an options intermediary and is recognised as such by that market, facility or exchange in accordance with arrangements approved by the Commissioners; and

(d)

securities of that kind are regularly traded on a regulated market.

(2A)

Section 87 above shall not apply as regards an agreement to transfer securities of a particular kind to B or B's nominee if—

(a)

B is a member of a regulated market, a multilateral trading facility or a recognised foreign options exchange;

(b)

options to buy or sell securities of that kind are regularly traded on, and are listed by or quoted on, that market, facility or exchange;

(c)

B is an options intermediary and is recognised as such by that market, facility or exchange in accordance with arrangements approved by the Commissioners; and

(d)

the agreement is effected on a relevant qualifying exchange on which securities of that kind are regularly traded or is effected on a relevant qualifying exchange pursuant to the exercise of a relevant option and options to buy or sell securities of that kind are regularly traded on, and are listed by or quoted on, that exchange;

and in paragraph (d) “relevant qualifying exchange” means a multilateral trading facility, a recognised foreign options exchange or a recognised foreign exchange.

(2B)

Section 87 above shall not apply as regards an agreement to transfer securities of a particular kind to B or B's nominee if—

(a)

B is an options intermediary who is approved for the purposes of this section by the Commissioners;

(b)

options to buy or sell securities of that kind are regularly traded on, and are listed by or quoted on, a regulated market, a multilateral trading facility or a recognised foreign options exchange; and

(c)

securities of that kind are regularly traded on a regulated market.

(2C)

Section 87 above shall not apply as regards an agreement to transfer securities of a particular kind to B or B's nominee if—

(a)

B is an options intermediary who is approved for the purposes of this section by the Commissioners;

(b)

options to buy or sell securities of that kind are regularly traded on, and are listed by or quoted on, a regulated market, a multilateral trading facility or a recognised foreign options exchange; and

(c)

the agreement is effected on a relevant qualifying exchange on which securities of that kind are regularly traded or is effected on a relevant qualifying exchange pursuant to the exercise of a relevant option and options to buy or sell securities of that kind are regularly traded on, and are listed by or quoted on, that exchange;

and in paragraph (c) “relevant qualifying exchange” means a multilateral trading facility, a recognised foreign options exchange or a recognised foreign exchange.”

After that subsection insert—

“(6A)

The Commissioners may approve a person for the purposes of this section only if the person is authorised under the law of an EEA State to provide any of the investment services or activities listed in Section A 2 or 3 of Annex I to the Directive (execution of orders on behalf of clients and dealing on own account), whether or not the person is authorised under the Directive.”