PART 1Regulatory framework
CHAPTER 2New regulatory powers
Financial market infrastructure: piloting powers
I1I213Testing of FMI technologies or practices
1
The Treasury may by regulations make provision for the purposes of—
a
testing, for a limited period, the efficiency or effectiveness of the carrying on of FMI activities in a particular way, and
b
assessing whether or how relevant enactments should apply in relation to FMI activities carried on in that way.
2
The reference in subsection (1)(a) to FMI activities being carried on in a particular way includes a reference to—
a
the use of developing technology in the carrying on of FMI activities;
b
the adoption of new or different practices in the carrying on of FMI activities.
3
Provision made in regulations under subsection (1) is referred to in this group of sections as an FMI sandbox.
4
An FMI sandbox must specify or otherwise provide for—
a
the FMI activities to which the FMI sandbox arrangements relate;
b
the description—
i
of FMI entities eligible to participate in the FMI sandbox arrangements, and
ii
of any other persons (including in particular the users of services provided by FMI entities) eligible to so participate;
c
the limited period for which the FMI sandbox arrangements apply.
5
An FMI sandbox may confer functions on the appropriate regulator in connection with the implementation and operation of the FMI sandbox arrangements.
6
An FMI sandbox may—
a
provide for a relevant enactment not to apply for the purposes of the FMI sandbox arrangements;
b
provide for modifications in the application of a relevant enactment for those purposes;
c
provide for the application of a relevant enactment (with or without modifications) for those purposes;
but provision under this subsection may not amend, repeal or revoke a relevant enactment.
7
In the case of a relevant enactment that is a rule or another instrument made by an appropriate regulator, provision under subsection (6) may provide for the powers under that subsection to be exercisable by that regulator.
8
Schedule 4 contains further examples of types of provision that an FMI sandbox may make.
9
An FMI sandbox—
a
may be replaced by another FMI sandbox of the same or similar effect;
b
may have effect at the same time as one or more other FMI sandboxes.
10
Regulations under this section are subject to the negative procedure.
11
For the purposes of this group of sections—
a
“FMI entity” means—
i
a recognised investment exchange that is not an overseas investment exchange;
ii
a recognised CSD;
iii
the operator of a multilateral trading facility;
iv
the operator of an organised trading facility;
v
such other persons as may be specified in regulations under this section as eligible to participate in the FMI sandbox arrangements concerned;
b
“FMI activities” are any activities carried on as part of the business of an FMI entity;
c
“FMI sandbox arrangements” means any arrangements implemented as part of an FMI sandbox.