SCHEDULE 1U.K. 

PART IIU.K.Controlled Investments

FuturesU.K.

22.—(1) Subject to sub-paragraph (2), rights under a contract for the sale of a commodity or property of any other description under which delivery is to be made at a future date and at a price agreed on when the contract is made.

[F1(1A) Subject to sub-paragraph (1D), futures—

(a)to which sub-paragraph (1) does not apply;

(b)which relate to commodities;

(c)which may be settled physically; and

(d)to which paragraph 5 or 6 of Section C of Annex I to the markets in financial instruments directive applies.

(1B) Subject to sub-paragraph (1D), futures and forwards—

(a)to which sub-paragraph (1) does not apply;

(b)which relate to commodities;

(c)which may be settled physically;

(d)which in accordance with Article 38 of the Commission Regulation are to be considered as having the characteristics of other derivative financial instruments and not being for commercial purposes; and

(e)to which paragraph 7 of Section C of Annex I to the markets in financial instruments directive applies.

(1C) Subject to sub-paragraph (1D), futures—

(a)to which sub-paragraph (1) does not apply;

(b)which may be settled physically; and

(c)to which paragraph 10 of Section C of Annex I to the markets in financial instruments directive (read with the Commission Regulation) applies.

(1D) Sub-paragraphs (1A), (1B) and (1C) only apply to futures or forwards in relation to which—

(a)an investment firm or credit institution is providing or performing investment services and activities on a professional basis,

(b)a management company is providing, in accordance with Article 5(3) of the UCITS directive, the investment service specified in paragraph 4 or 5 of Section A, or the ancillary service specified in paragraph 1 of Section B, of Annex I to the markets in financial instruments directive, or

(c)a market operator is providing the investment service specified in paragraph 8 of Section A of Annex I to the markets in financial instruments directive.

(1E) Expressions used in sub-paragraphs (1A) to (1C) and in the markets in financial instruments directive have the same meaning as in that directive.]

(2) There are excluded from sub-paragraph (1) rights under any contract which is made for commercial and not investment purposes.

(3) For the purposes of sub-paragraph (2), in considering whether a contract is to be regarded as made for investment purposes or for commercial purposes, the indicators set out in article 84 of the Regulated Activities Order shall be applied in the same way as they are applied for the purposes of that article.

Textual Amendments