347.—(1) Schedule 9 to the Value Added Tax Act 1994 (exempt supplies)(1) is amended as follows.
(2) For Item 1 of Group 2 substitute—
“1 The provision of insurance or reinsurance in the course of insurance business by—
(a)a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to effect or carry out contracts of insurance;
(b)a person who is exempt in respect of effecting or carrying out contracts of insurance by reason of an order under section 38 of that Act (and accordingly may effect or carry out contracts of insurance without contravening the general prohibition);
(c)a person who carries on an insurance market activity;
(d)a person (not falling within paragraph (a)) who would require permission to effect or carry out—
(i)a contract of insurance under which the benefits provided by that person are exclusively or primarily benefits in kind in the event of accident to or breakdown of a vehicle, or
(ii)a contract in the course of a Community co-insurance operation,
but for the identity of the person carrying on that activity.”.
(3) For Item 2 substitute—
“2 The provision by an insurer or reinsurer who belongs outside the United Kingdom of—
(a)insurance against any of the risks or other things described in the Annex to the first non-life insurance directive or in the Annex to the first life insurance directive, or
(b)reinsurance relating to any of those risks or other things.”.
(4) In Item 4, in paragraph (a) for “a contract of insurance or reinsurance” substitute “a contract of insurance”.
(5) Before Note (1) to Group 2, insert—
“(A1) For the purposes of Item 1—
“Community co-insurance operation” has the same meaning as in the Council Directive of 30 May 1978 on the co-ordination of laws, regulations and administrative provisions relating to Community co-insurance (No. 78/473/EEC);
“insurance business” means business which consists of effecting and carrying out contracts of insurance;
“insurance market activity” has the meaning given in section 316(3) of the Financial Services and Markets Act 2000.
(B1) References—
(a)in Items 1 and 4 to contracts of insurance, and
(b)in Item 1 and Note (AI) to the effecting and carrying out of contracts of insurance,
must be read with section 22 of the Financial Services and Markets Act 2000, any relevant order under that section, and Schedule 2 to that Act.
(C1) In Item 2—
(a)“first non-life insurance directive” means the Council Directive of 24 July 1973 on the co-ordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of direct insurance other than life assurance (No. 73/239/EEC);
(b)“first life insurance directive” means the Council Directive of 5 March 1979 on the co-ordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of direct life assurance (No.79/267/EEC).”.
348.—(1) In Schedule 9 to the Value Added Tax Act 1994 (exempt supplies), Group 5 (Finance) is amended as follows.
(2) For Note (6), substitute—
“(6) In item 9—
“authorised unit trust scheme” has the meaning given in section 237(3) of the Financial Services and Markets Act 2000;
“operator” has the meaning given in section 237(2) of that Act; and
“trust based scheme” means a scheme the purpose or effect of which is to enable persons taking part in the scheme, by becoming beneficiaries under a trust, to participate in or receive profits or income arising from the acquisition, holding, management or disposal of property of a kind described in section 239(3)(a) of the Financial Services and Markets Act 2000 or sums paid out of such profits or income.”
(3) For Note (10), substitute—
“(10) For the purposes of this Group—
“collective investment scheme” has the meaning given in section 235 of the Financial Services and Markets Act 2000; and
“open-ended investment company” has the meaning given in section 236 of that Act.”.
Relevant amendments made by the Finance Act 1997 (c. 16), section 38.