(1)The Secretary of State may by order made by statutory instrument designate an eligible person to be a counterparty for contracts for difference.
(2)A person designated under this section is referred to in this Chapter as a “CFD counterparty”.
(3)A person is eligible if the person is—
(a)a company formed and registered under the Companies Act 2006, or
(b)a public authority, including any person any of whose functions are of a public nature.
(4)A designation may be made only with the consent of the person designated.
(5)The Secretary of State may exercise the power to designate so that more than one designation has effect under this section, but only if the Secretary of State considers it necessary for the purposes of ensuring that—
(a)liabilities under a CFD are met,
(b)arrangements entered into for purposes connected to a CFD continue to operate, or
(c)directions given to a CFD counterparty continue to have effect.
(6)A designation ceases to have effect if—
(a)the Secretary of State by order made by statutory instrument revokes the designation, or
(b)the person withdraws consent to the designation by giving not less than 3 months' notice in writing to the Secretary of State.
(7)At any time after the first designation has effect, the Secretary of State must, so far as reasonably practicable, exercise the power to designate so as to ensure that at least one designation has effect under this section.
(8)Schedule 1 (which makes provision about schemes to transfer property, rights and liabilities from a person who has ceased to be a CFD counterparty to a person who is a CFD counterparty) has effect.
(9)As soon as reasonably practicable after a designation ceases to have effect the Secretary of State must make a transfer scheme under Schedule 1 to ensure the transfer of all rights and liabilities under any CFD to which the person who has ceased to be a CFD counterparty was a party.
(10)Regulations may include provision about the period of time for which, and the circumstances in which, a person who has ceased to be a CFD counterparty is to continue to be treated as a CFD counterparty for the purposes of the regulations.