3(1)A direction under this Schedule may be given to—U.K.
(a)a particular person operating in the financial sector,
(b)any description of persons operating in that sector, or
(c)all persons operating in that sector.
(2)In this Schedule “relevant person”, in relation to a direction, means any of the persons to whom the direction is given.
(3)A direction may make different provision in relation to different descriptions of relevant person.
4(1)Any reference in this Schedule to a person operating in the financial sector is to a credit or financial institution that—U.K.
(a)is a United Kingdom person, or
(b)is acting in the course of a business carried on by it in the United Kingdom.
(2)This is subject to the exceptions in paragraph 6.
5[F1(1)Credit institution” means a credit institution, as defined in [F2Article 4(1)(1) of the capital requirements regulation], when it accepts deposits or other repayable funds from the public or grants credits for its own account (within the meaning of that directive).]U.K.
(2)“Financial institution” means—
(a)an undertaking, including a money service business, when it carries out one or more of the activities listed in points 2 to 12 [F3, 14 and 15] of [F4Schedule 2 to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017], other than—
(i)a credit institution;
(ii)an undertaking whose only listed activity is trading for own account in one or more of the products listed in point 7 of [F4Schedule 2 to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017] where the undertaking does not have a customer,
and for this purpose “customer” means a person who is not a member of the same group as the undertaking;
(b)an insurance company duly authorised in accordance with the life assurance consolidation directive, when it carries out activities covered by that directive;
[F5(ba)a person equivalent to an insurance company within paragraph (b) whose head office is located in a non-EEA state, when carrying out activities of the kind mentioned in paragraph (b);]
(c)a person whose regular occupation or business is the provision to other persons of an investment service or the performance of an investment activity on a professional basis, when providing or performing investment services or activities (within the meaning of the markets in financial instruments directive), other than a person falling within Article 2 of that directive;
(d)a collective investment undertaking, when marketing or otherwise offering its units or shares;
(e)an insurance intermediary as defined in Article 2(5) of Directive 2002/92/EC of the European Parliament and of the Council of 9th December 2002 on insurance mediation (other than a tied insurance intermediary as mentioned in Article 2(7) of that Directive), when it acts in respect of contracts of long-term insurance within the meaning given by article 3(1) of, and Part II of Schedule 1 to, the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544);
F6(f). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(g)an insurance company (as defined by section 1165(3) of the Companies Act 2006 (c. 46));
(h)the National Savings Bank;
(i)the Director of Savings, when money is raised under the auspices of the Director under the National Loans Act 1968 (c. 13).
[F7(3)The fact that an institution's head office is located in a non-EEA state does not prevent it from being a credit institution or a financial institution for the purposes of this Schedule.]
Textual Amendments
F1Sch. 7 para. 5(1) substituted (17.12.2010) by Terrorist Asset-Freezing etc. Act 2010 (c. 38), ss. 48(1)(a), 55(1)
F2Words in Sch. 7 para. 5(1) substituted (1.1.2014) by The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 44(2)(a)
F3Words in Sch. 7 para. 5(2)(a) substituted (9.2.2011 for specified purposes, 30.4.2011 in so far as not already in force) by The Electronic Money Regulations 2011 (S.I. 2011/99), reg. 1(2), Sch. 4 para. 6(b)
F4Words in Sch. 7 para. 5(2)(a) substituted (17.8.2022) by The Financial Services Act 2021 (Prudential Regulation of Credit Institutions and Investment Firms) (Consequential Amendments and Miscellaneous Provisions) Regulations 2022 (S.I. 2022/838), regs. 1(2), 6(2) (with regs. 24-26)
F5Sch. 7 para. 5(2)(ba) inserted (17.12.2010) by Terrorist Asset-Freezing etc. Act 2010 (c. 38), ss. 48(1)(b), 55(1)
F6Sch. 7 para. 5(2)(f) repealed (17.12.2010) by Terrorist Asset-Freezing etc. Act 2010 (c. 38), ss. 48(1)(c), 55(1), Sch. 2 Pt. 2
F7Sch. 7 para. 5(3) inserted (17.12.2010) by Terrorist Asset-Freezing etc. Act 2010 (c. 38), ss. 48(1)(d), 55(1)
6(1)For the purposes of this Schedule the following are not regarded as persons operating in the financial sector when carrying out any of the following activities—U.K.
(a)[F8a registered society within the meaning of the Co-operative and Community Benefit Societies Act 2014], when it—
(i)issues withdrawable share capital within the limit set by [F9section 24] of that Act (maximum shareholding in society); or
(ii)accepts deposits from the public within the limit set by [F10section 67(2)] of that Act (carrying on of banking by societies);
(b)a society registered under the Industrial and Provident Societies Act (Northern Ireland) 1969 (c. 24 (N.I.)), when it—
(i)issues withdrawable share capital within the limit set by section 6 of that Act (maximum shareholding in society); or
(ii)accepts deposits from the public within the limit set by section 7(3) of that Act (carrying on of banking by societies);
(c)a person within any of paragraphs 1 to 23 or 25 to 51 of the Schedule to the Financial Services and Markets Act 2000 (Exemption) Order 2001 (S.I. 2001/1201), when carrying out an activity in respect of which the person is exempt;
(d)a person who was an exempted person for the purposes of section 45 of the Financial Services Act 1986 (c. 60) (miscellaneous exemptions) immediately before its repeal, when exercising the functions specified in that section.
(2)A person who falls within the definition of “credit institution” or “financial institution” solely as a result of engaging in financial activity on an occasional or very limited basis is not regarded for the purposes of this Schedule as operating in the financial sector.
(3)For the purposes of sub-paragraph (2) a person is regarded as engaging in a financial activity on an occasional or very limited basis if—
(a)the person's total annual turnover in respect of the financial activity does not exceed £64,000,
(b)the financial activity is limited in relation to any customer to no more than one transaction exceeding 1,000 euro (whether the transaction is carried out in a single operation or a series of operations which appear to be linked),
(c)the financial activity does not exceed 5% of the person's total annual turnover,
(d)the financial activity is ancillary and directly related to the person's main activity,
(e)the financial activity is not the transmission or remittance of money (or any representation of monetary value) by any means,
(f)the person's main activity is not that of a credit or financial institution, and
(g)the financial activity is provided only to customers of the person's main activity.
Textual Amendments
F8Words in Sch. 7 para. 6(1)(a) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 139(2) (with Sch. 5)
F9Words in Sch. 7 para. 6(1)(a)(i) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 139(3) (with Sch. 5)
F10Words in Sch. 7 para. 6(1)(a)(ii) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 139(4) (with Sch. 5)
7U.K.In this Part of this Schedule—
F11...
F12...
[F13“the capital requirements regulation” means Regulation (EU) No. 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms;]
“the life assurance consolidation directive” means Directive 2002/83/EC of the European Parliament and of the Council of 5th November 2002 concerning life assurance;
“the markets in financial instruments directive” means [F14Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014] on markets in financial instruments.
Textual Amendments
F11Words in Sch. 7 para. 7 omitted (1.1.2014) by virtue of The Capital Requirements Regulations 2013 (S.I. 2013/3115), reg. 1(2), Sch. 2 para. 44(3)(a)
F12Words in Sch. 7 para. 7 omitted (17.8.2022) by virtue of The Financial Services Act 2021 (Prudential Regulation of Credit Institutions and Investment Firms) (Consequential Amendments and Miscellaneous Provisions) Regulations 2022 (S.I. 2022/838), regs. 1(2), 6(3) (with regs. 24-26)
F13Words in Sch. 7 para. 7 substituted (1.1.2022) by The Financial Services Act 2021 (Prudential Regulation of Credit Institutions and Investment Firms) (Consequential Amendments and Miscellaneous Provisions) Regulations 2021 (S.I. 2021/1376), regs. 1(3), 8
F14Words in Sch. 7 para. 7 substituted (29.6.2017 for specified purposes, 3.7.2017 for specified purposes, 31.7.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2017 (S.I. 2017/701), reg. 1(2)(3)(4)(6), Sch. 4 para. 11 (with reg. 7)
8(1)The Treasury may by order amend paragraphs 4 to 7.U.K.
(2)Any such order is subject to affirmative resolution procedure.