PART IIE+W+S CONDITIONS APPLYING TO STAKEHOLDER PENSION SCHEMES

Requirement applying to all stakeholder pension schemes as regards investmentsE+W+S

8.—(1) For the purposes of section 1(1)(b), it shall be a condition of a scheme being a stakeholder pension scheme that the requirements of this regulation are complied with.

(2) Except where monies are held temporarily on deposit in the course of dealing in assets for the purposes of the scheme, the trustees or manager must ensure that there is derived, from any part of the funds of the scheme that are held on deposit, a return accruing on a daily basis that is, net of any fees or charges, not less than the base rate minus 2 per cent. per annum.

(3) Where the base rate is increased, paragraph (2) shall apply as if the reference to the base rate in that paragraph were—

(a)within one calendar month of the date of the increase, a reference to the base rate immediately before the increase; and

(b)after that calendar month has elapsed, a reference to the base rate as increased.

(4) The trustees or manager shall not [F1directly hold, for the purposes of the scheme,] units or shares in a collective investment scheme (within the meaning of [F2section 235 of the Financial Services and Markets Act 2000] (interpretation: definition of 'collective investment scheme’)) unless it is a requirement of the collective investment scheme that the purchase and sale price of those units or shares shall, at any given time, not differ from each other.

(5) The trustees or manager shall not [F1directly hold, for the purposes of the scheme,] rights under a contract of insurance which are expressed as units or shares in funds held by the [F3insurer] unless it is a requirement of the contract of insurance that the purchase and sale price of those units or shares shall, at any given time, not differ from each other.

(6) In this regulation—

  • “base rate" means the rate for the time being quoted by the reference banks as applicable to sterling deposits or, where there is for the time being more than one such base rate, the rate which, when the base rate quoted by each bank is ranked in a descending sequence of seven, is fourth in the sequence;

  • [F4“contract of insurance” means a contract—

    (a)

    which, or any part of which, is of one or more of the following kinds—

    (i)

    life and annuity,

    (ii)

    linked long term,

    (iii)

    pension fund management, and

    (iv)

    which is carried out by an insurer who has permission, as the case may be, under—

    (v)

    Part 4 of the Financial Services and Markets Act 2000, or

    (ii)

    paragraph 15 of Schedule 3 to that Act,

    to effect or carry out contracts of insurance of that kind;]

  • F5...

  • [F6“reference banks” means the seven largest persons for the time being who—

    (a)

    have permission under Part 4 of the Financial Services and Markets Act 2000 to accept deposits,

    (b)

    are incorporated in the United Kingdom and carrying on there a regulated activity of accepting deposits; and

    (c)

    quote a base rate applicable to sterling deposits,

    and for the purpose of this definition the size of a person at any time is to be determined by reference to the gross assets denominated in sterling of that person, together with any subsidiary (as defined in section 736 of the Companies Act 1985) M1, as shown in the audited end of year accounts last published before that time.]

[F7(7) References to a “deposit” in this regulation, together with the definitions of “contract of insurance” and “reference banks” in paragraph (6) must be read with—

(a)section 22 of the Financial Services and Markets Act 2000;

(b)any relevant order under that section; and

(c)Schedule 2 to that Act.]

Textual Amendments

Marginal Citations

M11985 c. 6. Section 736 was substituted by section 144(1) of the Companies Act 1989 (c. 40).