Valid from 31/12/2023
145(1)This paragraph applies where the Bank is notified of third-country resolution action in respect of a third-country central counterparty.
(2)The Bank must make an instrument which—
(a)recognises the action,
(b)refuses to recognise the action, or
(c)recognises part of the action and refuses to recognise the remainder.
An instrument within paragraph (a), (b) or (c) is a “third-country instrument” (as is an instrument under paragraph 146).
(3)The Bank may only make a decision under sub-paragraph (2) with the approval of the Treasury.
(4)Recognition of the action (or a part of it) may be refused only if the Bank and the Treasury are satisfied that one or more of the following conditions are satisfied—
(a)recognition would have an adverse effect on financial stability in the United Kingdom;
(b)under the third-country resolution action creditors (including in particular clearing members) located or payable in the United Kingdom would not, by reason of being located or payable in the United Kingdom, receive the same treatment as creditors who are located or payable in the country concerned and have similar legal rights;
(c)recognition of, and taking action in support of, the third-country resolution action (or the part) would have material fiscal implications for the United Kingdom;
(d)recognition would be unlawful under section 6 of the Human Rights Act 1998 (public authority not to act contrary to Human Rights Convention).
(5)The recognition of a third-country resolution action (or any part of it) is without prejudice to any normal insolvency proceedings.
(6)In this paragraph—
“third-country central counterparty” has the meaning given by section 285 of FSMA 2000;
“third-country resolution action” means action under the law of a country or territory outside the United Kingdom to manage the failure or likely failure of a third-country central counterparty—
the anticipated results of which are, in relation to a third-country central counterparty, broadly comparable to results which could have been anticipated from the exercise of a stabilisation option in relation to an entity in the United Kingdom corresponding to the third-country central counterparty, and
the objectives of which are broadly comparable, in relation to the country or territory concerned, to the special resolution objectives in paragraph 15 as they apply in relation to the United Kingdom.
Commencement Information
I1Sch. 11 para. 145 not in force at Royal Assent, see s. 86(3)