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)
146(1)This paragraph applies where an instrument under paragraph 145 recognises any third-country resolution action (or a part of it).
(2)The third-country resolution action (or part) produces the same legal effects in any part of the United Kingdom as it would have produced had it been made (with due authority) under the law of that part of the United Kingdom.
(3)For the purposes of supporting, or giving full effect to, the third-county resolution action (or the part), the Bank may exercise, in relation to a third-country central counterparty, one or more of the stabilisation options, or one or more of the stabilisation powers, available to the Bank in relation to a similar entity in the United Kingdom.
(4)But, for the purposes of exercising a power by virtue of sub-paragraph (3), provision which could otherwise be made under this Schedule in a share transfer instrument, property transfer instrument or resolution instrument may instead be made in—
(a)the instrument made under paragraph 145 recognising the third-country resolution action (or part), or
(b)a further instrument made by the Bank under this paragraph.
An instrument under paragraph (b) is a “third-country instrument” (as is an instrument under paragraph 145(2)(a), (b) or (c)).
(5)This Schedule (other than this paragraph) applies in relation to the exercise of any power by virtue of sub-paragraph (3), subject to sub-paragraphs (6) and (7) and any other necessary modifications.
(6)Paragraph 15 (special resolution objectives) has effect as if after sub-paragraph (7) there were inserted—
“(7A)Objective 6 is to support third-country resolution action with a view to promoting objectives which, in relation to the country or territory concerned, correspond to Objectives 1 to 5 in relation to the United Kingdom.”
(7)Paragraphs 17 to 19 do not apply.
(8)Paragraph 145(6) applies for the purposes of this paragraph.
Commencement Information
I2Sch. 11 para. 146 not in force at Royal Assent, see s. 86(3)
147(1)Paragraph 47 (incidental provision) applies to a third-country instrument as it applies to a share transfer instrument.
(2)Paragraph 48 (procedure: instruments) applies to a third-country instrument as it applies to a share transfer instrument, except that references in that paragraph to the CCP are to be read as references to the third-country central counterparty to which the third-country instrument relates.
(3)Paragraph 109 (international obligation notice: general) applies in relation to the making of a third-country instrument under paragraph 145 or 146 as it applies in relation to the exercise of a stabilisation power, except that—
(a)for the purposes of paragraph 109(3), paragraph 15 is to be read subject to the modification in paragraph 146(6), and
(b)in sub-paragraph (4), the reference to a CCP is to be read as a reference to a third-country central counterparty in respect of which a third-country instrument is made.
(4)Paragraph 110 (international obligation notice: bridge central counterparty) applies where the Bank has, by virtue of paragraph 146, transferred all or part of the business of a third-country central counterparty to a bridge central counterparty as it applies where the Bank has transferred all or part of the business of a CCP to a bridge central counterparty.
(5)Paragraph 145(6) applies for the purposes of this paragraph.
Commencement Information
I3Sch. 11 para. 147 not in force at Royal Assent, see s. 86(3)