2018 No. 1149

Exiting The European Union
Financial Services And Markets

The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018

Made

Coming into force in accordance with regulation 1(2) and (3)

The Treasury make the following Regulations in exercise of the powers conferred by section 8(1) of, paragraph 1 of Schedule 4 to, and paragraph 21 of Schedule 7 to, the European Union (Withdrawal) Act 20181.

In accordance with paragraphs 1(1) and (2) and 12(1) of Schedule 7 to that Act, a draft of this instrument has been laid before, and approved by a resolution of, each House of Parliament.

PART 1General provision

Citation, commencement and interpretation1

1

These Regulations may be cited as the EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018.

2

These Regulations come into force on the day after the day on which they are made, subject to paragraph (3).

3

Regulations 2 to 4 and 24 come into force on exit day.

4

In these Regulations, “the 2000 Act” means the Financial Services and Markets Act 20002.

PART 2Repeal of passport rights, etc., under Part 3 of the Financial Services and Markets Act 2000

Repeal of passport rights, etc.2

1

Part 3 of the 2000 Act (authorisation and exemption) is amended as follows.

2

Omit section 31(1)(b) (authorised persons: EEA firms).

3

Omit section 31(1)(c) (authorised persons: Treaty firms).

4

Omit section 37 (exercise of EEA rights by UK firms).

5

In Schedule 3 (EEA passport rights), omit—

a

Part 2 (exercise of passport rights by EEA firms);

b

Part 3 (exercise of passport rights by UK firms).

6

Omit Schedule 4 (Treaty rights).

Consequential amendments3

The Schedule makes consequential amendments—

a

in Part 1, to the 2000 Act;

b

in Parts 2 and 3, to other enactments.

Saving provision: tax4

For the purposes of an enactment relating to taxation—

a

the provision made by these Regulations is to be treated as not having been made, and

b

where, by virtue of these Regulations, a person ceases to be a person of a particular description, the person is to be treated as continuing to be a person of that description.

PART 3Transitional and saving provision: applications for permission to carry on a regulated activity

CHAPTER 1Modifications of Part 4A of the Financial Services and Markets Act 2000

Persons to whom the modifications of Part 4A of the Financial Services and Markets Act 2000 apply5

1

The modifications of Part 4A of the 2000 Act (permission to carry on regulated activities) specified in regulation 6 apply—

a

before exit day, in respect of a person who is authorised to carry on a regulated activity in the United Kingdom by virtue of section 31(1)(b) or (c) of the 2000 Act;

b

on and after exit day, in respect of a person to whom regulation 8 or 11 applies.

2

Paragraph (1)(a) only applies in respect of a person if—

a

an application for permission, or for the variation of a permission, under Part 4A of the 2000 Act—

i

is made by the person on or after the day on which this regulation comes into force, or

ii

is made by the person before the day on which this regulation comes into force and has not, immediately before that day, been determined by a regulator in accordance with section 55V of that Act, and

b

the application is in respect of carrying on a regulated activity, on or after exit day, that the person is authorised to carry on by virtue of section 31(1)(b) or (c) of that Act.

Modifications of Part 4A of the Financial Services and Markets Act 20006

1

Part 4A of the 2000 Act3 (permission to carry on regulated activities) is modified as follows.

2

Section 55A (application for permission) has effect as if—

a

in subsection (2), after “subsection (2B)” there were inserted “and to a direction of the PRA or the FCA given with the consent of the other”;

b

in subsection (3), after “is in force” there were inserted “, other than a person who is treated as having such a permission by virtue of regulation 8 of the 2018 Regulations,”.

3

Section 55H (variation by FCA at request of authorised person) has effect as if, after subsection (7), there were inserted—

8

Where a person makes an application to vary the permission that the person is treated as having by virtue of regulation 8 of the 2018 Regulations, the FCA may, if it considers it appropriate to do so, treat the application as an application for permission under section 55A.

4

Section 55I (variation by PRA at request of authorised person) has effect as if, after subsection (8), there were inserted—

9

Where a person makes an application to vary the permission that the person is treated as having by virtue of regulation 8 of the 2018 Regulations, the PRA may, if it considers it appropriate to do so, treat the application as an application for permission under section 55A.

5

Section 55J (variation or cancellation on initiative of regulator) has effect as if, after subsection (1) there were inserted—

1A

Either regulator may exercise its power under this section in relation to—

a

a person to whom regulation 8 of the 2018 Regulations applies, if the person has not made an application for permission under this Part before the end of the period during which, in accordance with section 55U(4)(c), such an application must be made;

b

a person to whom regulation 11 of those Regulations applies, if the person has not made an application to vary a permission under this Part before the end of the period during which, in accordance with section 55U(4)(c), such an application must be made.

6

Section 55U (applications under Part 4A) has effect as if—

a

in subsection (4), after paragraph (b), there were inserted—

and

c

be made—

i

during such period, ending no later than two years beginning with the day on which exit day occurs, as the regulator to which it is to be made may direct, or

ii

if the regulator to which it is to be made does not direct such a period, before the end of two years beginning with the day on which exit day occurs.

b

after subsection (4), there were inserted—

4A

The power to give a direction under subsection (4)(c) includes the power—

a

to give different directions in relation to different persons or categories of person;

b

to vary or revoke a previous direction.

7

Section 55V (determination of applications) has effect as if—

a

in subsection (1), for the words from “6 months” to the end there were substituted “three years beginning with the day on which exit day occurs.”;

b

in subsection (2), for the words from “12 months” to the end there were substituted “three years beginning with the day on which exit day occurs.”;

c

after subsection (6) there were inserted—

6A

For the purposes of subsection (6), in the case of a person to whom regulation 8 or 11 of the 2018 Regulations applies, the date stated must be a date that falls before the end of the period of three years beginning with the day on which exit day occurs.

8

Section 55X (determination of applications: warning notices and decision notices) has effect as if, after subsection (4), there were inserted—

4A

If a regulator decides to refuse an application under this Part, the decision notice must, where applicable, state the day on which regulation 8 or 11 of the 2018 Regulations ceases to apply.

4B

For the purposes of subsection (4A), the day stated must be a day that falls before the end of the period of three years beginning with the day on which exit day occurs.

9

Section 55Z (cancellation of Part 4A permission: procedure) has effect as if, after subsection (2), there were inserted—

3

If a regulator gives a decision notice under subsection (2) in circumstances where a person to whom regulation 8 or 11 of the 2018 Regulations applies—

a

has not made an application in accordance with section 55U(4)—

i

in the case of a person to whom regulation 8 of those Regulations applies, for permission under this Part, or

ii

in the case of a person to whom regulation 11 of those Regulations applies, to vary a permission under this Part, or

b

has made such an application but has withdrawn it without submitting another,

the notice must state the day on which regulation 8 or 11 ceases to apply.

4

For the purposes of subsection (3), the day stated must be a day that falls before the end of the period of three years beginning with the day on which exit day occurs.

10

Section 55Z4 (interpretation of Part 4A) has effect as if, at the appropriate place, there were inserted—

  • “the 2018 Regulations” means the EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018;

Persons who cease to be authorised to carry on a regulated activity before exit day7

1

The modification of Part 4A of the 2000 Act specified in paragraph (2) applies in respect of a person to whom, before exit day, regulation 5(1)(a) ceases to apply.

2

Section 55V (determination of applications) has effect as if, in subsections (1) and (2), for the words from “it received” to the end there were substituted “regulation 5(1)(a) of the EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 ceased to apply to the applicant.”

CHAPTER 2Temporary permission to carry on a regulated activity

Deemed permission under Part 4A of the Financial Services and Markets Act 20008

1

A person to whom this regulation applies shall be treated as if the person has permission to carry on a regulated activity in the United Kingdom under Part 4A of the 2000 Act.

2

The regulated activity a person is permitted to carry on by virtue of this regulation is one which, immediately before exit day, the person is authorised to carry on in the United Kingdom by virtue of section 31(1)(b) or (c) of the 2000 Act.

3

Reference in an enactment to a person with permission under Part 4A of the 2000 Act (however expressed) is to be read, unless the contrary intention appears, as including a person treated as having permission to carry on a regulated activity under that Part by virtue of this regulation.

4

Accordingly, a power of a regulator under the 2000 Act is exercisable in respect of such a person, and a regulated activity the person is permitted to carry on by virtue of this regulation, as it is in respect of a person with permission under Part 4A of that Act, and a regulated activity the person is permitted to carry on by virtue of Part 4A of that Act.

5

Such a power is exercisable in relation to, in particular—

a

the variation or cancellation of a permission to carry on a regulated activity, or

b

the imposition of requirements, prohibitions or restrictions on a person who has such a permission.

Application of regulation 89

1

Regulation 8 applies to a person who—

a

satisfies the conditions in regulation 10, and

b

has taken one of the steps set out in regulation 14.

2

Regulation 8 applies to such a person for the period determined in accordance with regulation 17.

Conditions to be satisfied for regulation 8 to apply10

The conditions are that, immediately before exit day, the person—

a

is authorised to carry on a regulated activity in the United Kingdom by virtue of section 31(1)(b) or (c) of the 2000 Act, and

b

is not authorised to carry on a regulated activity by virtue of section 31(1)(a) of that Act.

CHAPTER 3Temporary variation to carry on additional regulated activity

Deemed variation under Part 4A of the Financial Services and Markets Act 200011

1

A person to whom this regulation applies shall be treated as if the person’s permission to carry on a regulated activity in the United Kingdom under Part 4A of the 2000 Act were varied.

2

The variation is that the regulated activity the person is permitted to carry on includes one which, immediately before exit day, the person is authorised to carry on in the United Kingdom by virtue of section 31(1)(b) or (c) of the 2000 Act.

3

Reference in an enactment to a person’s permission under Part 4A of the 2000 Act (however expressed) is to be read, unless the contrary intention appears, as including a regulated activity which is included in the person’s permission by virtue of this regulation.

4

Accordingly, a power of a regulator under the 2000 Act is exercisable in respect of such a person, and a regulated activity the person is permitted to carry on by virtue of this regulation, as it is in respect of the person, and a regulated activity the person is, immediately before exit day, permitted to carry on by virtue of Part 4A of that Act.

5

Such a power is exercisable in relation to, in particular—

a

the variation or cancellation of a permission to carry on a regulated activity, or

b

the imposition of requirements, prohibitions or restrictions on a person who has such a permission.

Application of regulation 1112

1

Regulation 11 applies to a person who—

a

satisfies the conditions in regulation 13, and

b

has taken one of the steps set out in regulation 14.

2

Regulation 11 applies to such a person for the period determined in accordance with regulation 17.

Conditions to be satisfied for regulation 11 to apply13

The conditions are that, immediately before exit day, the person—

a

is authorised to carry on a regulated activity in the United Kingdom by virtue of section 31(1)(b) or (c) of the 2000 Act, and

b

is also authorised to carry on a regulated activity by virtue of section 31(1)(a) of that Act.

CHAPTER 4Temporary permission and variation: procedure, etc.

Steps to be taken before exit day: application or notification14

1

For the purposes of regulations 9(1)(b) and 12(1)(b), the steps are that the person has, before exit day—

a

made an application—

i

in the case of a person who satisfies the conditions in regulation 10, for permission under Part 4A of that Act, or

ii

in the case of a person who satisfies the conditions in regulation 13, for a variation of such a permission,

which has, immediately before exit day, not been withdrawn by the person or determined by a regulator in accordance with section 55V of that Act, or

b

notified the relevant regulator that the person wishes to be treated in accordance with regulation 8 or 11.

2

For the purposes of paragraph (1)(b), the notification must—

a

be made in such manner, and during such period, and

b

contain, or be accompanied by, such information,

as the relevant regulator may direct.

Regulator’s response15

1

In the case of an application referred to in regulation 14(1)(a), the relevant regulator must—

a

if it considers that—

i

the requirements of section 55U of the 2000 Act (applications under Part 4A: procedure) are satisfied, or

ii

the requirements of that section are satisfied with the exception of those provided by subsection (4), and it would not be practicable for the applicant to comply with the requirements of that subsection before exit day,

confirm in writing to the person making the application that regulation 8 or 11 is to apply;

b

if it considers otherwise, confirm in writing to the person making the application that regulation 8 or 11 is not to apply, giving details of the requirements that are not satisfied.

2

In the case of a notification referred to in regulation 14(1)(b)—

a

if the relevant regulator has not made a direction under regulation 14(2), the relevant regulator must confirm in writing to the person submitting the notification that regulation 8 or 11 is to apply;

b

if the relevant regulator has made a direction under regulation 14(2), paragraph (3) applies.

3

Where this paragraph applies, the relevant regulator must—

a

if it considers that—

i

the notification is made in accordance with the direction, or

ii

the notification is not made in accordance with the direction, and it would not be practicable for the applicant to comply with the direction before exit day,

confirm in writing to the person submitting the notification that regulation 8 or 11 is to apply;

b

if it considers otherwise, confirm in writing to the person submitting the notification that regulation 8 or 11 is not to apply, giving details of the direction that has not been complied with.

Further information to be supplied by a person to whom regulation 8 or 11 applies16

1

A person to whom regulation 8 or 11 applies must notify the relevant regulator if—

a

any information contained in or accompanying a notification submitted in accordance with regulation 14(1)(b) changes, or

b

an authorisation by a home state regulator is cancelled or varied.

2

For the purposes of paragraph (1), the notification must—

a

be made in such manner, and during such period, and

b

contain, or be accompanied by, such information,

as the relevant regulator may direct.

CHAPTER 5Temporary permission and variation: duration

Period during which regulation 8 or 11 is to apply17

1

For the purposes of regulations 9(2) and 12(2), the period is one that begins with exit day and ends—

a

after three years beginning with the day on which exit day occurs, or

b

if earlier, with a day determined in accordance with paragraph (3), (5) or (7).

2

Paragraph (3) applies where a regulator makes a determination under section 55V in respect of an application—

a

in the case of a person to whom regulation 8 applies, for a permission or cancellation of a permission under Part 4A of the 2000 Act, or

b

in the case of a person to whom regulation 11 applies, for a variation or cancellation of such a permission.

3

Where this paragraph applies—

a

if the application is granted, the day referred to in paragraph (1)(b) is the day before the date stated in the written notice (issued in accordance with section 55V(5) of the 2000 Act) as that from which permission, variation or cancellation has effect;

b

if the application for a permission or variation is refused, the day referred to in paragraph (1)(b) is the day before the day stated in the decision notice (issued in accordance with section 55X(4A) of the 2000 Act) as that on which regulation 8 or 11 ceases to apply.

4

Paragraph (5) applies where a regulator exercises its power to cancel the Part 4A permission of a person to whom regulation 8 or 11 applies under section 55J of the 2000 Act.

5

Where this paragraph applies, the day referred to in paragraph (1)(b) is the day before the day stated in the decision notice (issued in accordance with section 55Z(3) of the 2000 Act) as that on which regulation 8 or 11 ceases to apply.

6

Paragraph (7) applies where—

a

a regulator exercises its power to vary the Part 4A permission of a person to whom regulation 11 applies under section 55J of the 2000 Act, and

b

as a result of the variation, there are no longer any regulated activities for which the person is treated as having permission by virtue of regulation 11.

7

Where this paragraph applies, the day referred to in paragraph (1)(b) is the day before the day stated in the written notice (issued in accordance with section 55Y(4) of the 2000 Act) as that on which a variation takes effect.

8

For the purposes of this regulation, a reference to an application for permission includes a reference to an application for a variation that is treated as an application for permission by virtue of section 55H(8) or 55I(9) of the 2000 Act.

CHAPTER 6Savings

Requirements imposed by a domestic regulator18

1

A requirement imposed by a regulator in accordance with section 196 of the 2000 Act (power of intervention) and which has effect immediately before exit day continues to have effect on and after exit day in respect of a person to whom regulation 8 or 11 applies as if it were imposed by the regulator under—

a

section 55L (imposition of requirements by FCA) of that Act, or

b

section 55M (imposition of requirements by PRA) of that Act.

2

In respect of a person to whom regulation 8 or 11 applies—

a

the FCA may exercise its power under section 55L(3) of the 2000 Act, and

b

the PRA may exercise its power under section 55M(3) of that Act,

if it appears that, immediately before exit day, the circumstances set out in section 194(1)(a) or (b) of that Act are satisfied in respect of the person.

3

Paragraph (2) is without prejudice to section 55L(2) or 55M(2) of the 2000 Act.

Requirements imposed by a home state regulator19

1

A requirement imposed by a home state regulator and which has effect immediately before exit day continues to have effect on and after that day in respect of a person to whom regulation 8 or 11 applies as if it were imposed by a regulator under—

a

section 55L (imposition of requirements by FCA) of the 2000 Act, or

b

section 55M (imposition of requirements by PRA) of that Act.

2

The requirement only has effect in so far as it could have been imposed by a regulator under those sections.

CHAPTER 7General provision

Directions20

The power to give directions under this Part includes the power—

a

to give different directions in relation to different persons or categories of person;

b

to vary or revoke a previous direction.

Interpretation21

1

In this Part—

  • “the FCA” means the Financial Conduct Authority;

  • “home state regulator” means the competent authority of an EEA state in relation to the person concerned; and “competent authority” is construed in accordance with the EU instrument by virtue of which, immediately before exit day, the person derived authorisation to carry on a regulated activity in the United Kingdom;

  • “the PRA” means the Prudential Regulation Authority;

  • “regulated activity” has the same meaning as in section 22 of the 2000 Act4.

2

A reference to the relevant regulator is, subject to a direction of the PRA or the FCA given with the consent of the other, a reference to—

a

the PRA, in a case where the regulated activities to which an application or notification under regulation 14 relates consist of or include a PRA-regulated activity (within the meaning of section 22A of the 2000 Act5);

b

the FCA, in any other case.

PART 4Transitional provision: miscellaneous

Persons to whom the modifications in regulations 23 to 25 apply22

1

The modifications specified in regulations 23 to 25 apply—

a

before exit day, in respect of a person who is authorised to carry on a regulated activity in the United Kingdom by virtue of section 31(1)(b) or (c) of the 2000 Act;

b

on and after exit day, in respect of a person to whom regulation 8 or 11 applies.

2

Paragraph (1)(a) only applies in respect of a person if—

a

an application for permission, or for the variation of a permission, under Part 4A of the 2000 Act—

i

is made by the person on or after the day on which this regulation comes into force, or

ii

is made by the person before the day on which this regulation comes into force and has not, immediately before that day, been determined by a regulator in accordance with section 55V of that Act, and

b

the application is in respect of carrying on a regulated activity, on or after exit day, that the person is authorised to carry on by virtue of section 31(1)(b) or (c) of that Act.

Performance of regulated activities - modifications of Part 5 of the Financial Services and Markets Act 200023

1

Part 5 of the Financial Services and Markets Act 2000 (performance of regulated activities) is modified as follows.

2

That Part has effect as if, after section 59 (approval for particular arrangements), there were inserted—

59ZZADeemed approval for particular arrangements

1

The appropriate regulator may by notice given to an authorised person treat as approved under section 59 a person who is the subject of an application under section 60.

2

The period during which a person may be so treated begins at such time on or after exit day as the notice may specify and ends—

a

after three years beginning with the day on which exit day occurs, or

b

if earlier—

i

if the application is granted, with the day before the day stated in the written notice (given in accordance with section 62(1)) or decision notice (given in accordance with section 62(3)) as that from which approval has effect;

ii

if the application is refused, with the day before the day stated in the decision notice (given in accordance with section 62(3)) as that on which the person is to cease to be treated as approved.

3

The period in subsection (2) is subject to—

a

the withdrawal of an approval under section 63;

b

the expiry of an approval under section 66(3)(ac).

4

Reference in an enactment to an approval given by the appropriate regulator under section 59 (however expressed) is to be read, unless the contrary intention appears, as including an approval a person is treated as having by virtue of this section.

3

Section 61 (controlled functions: determination of applications) has effect as if, for subsection (3A)(a), there were substituted—

a

in any case where the application under section 60 is made by a person applying for permission, or for the variation of a permission, under Part 4A, means the period within which the application must be determined under section 55V(1) or (2), and

4

Section 62 (applications for approval: procedure and right to refer to Tribunal) has effect as if—

a

after subsection (1), there were inserted—

1A

The notice must state the day from which the approval has effect.

b

after subsection (3), there were inserted—

3A

The notice must state—

a

where the decision is to refuse the application, the day on which the person who is the subject of an application is to cease to be treated as approved in accordance with section 59ZZA;

b

where the decision is to grant the application subject to conditions or for a limited period (or both), the day from which the approval has effect.

5

Section 63 (withdrawal of approval) has effect as if, after subsection (4), there were inserted—

4A

If a regulator decides to withdraw an approval that a person is treated as having by virtue of section 59ZZA, the decision notice must state the day on which that approval is to cease to have effect.

4B

For the purposes of subsection (4A), the day stated must be a day that falls before the end of the period of three years beginning with the day on which exit day occurs.

Financial Services Compensation Scheme - modifications of Part 15 of the Financial Services and Markets Act 200024

1

Part 15 of the Financial Services and Markets Act 2000 (Financial Services Compensation Scheme) is modified as follows.

2

Section 213 (the compensation scheme) has effect as if—

a

after subsection (4), there were inserted—

4A

The compensation scheme may not provide for the scheme manager to have the power to impose levies on a person who is not to be regarded as a relevant person by virtue of subsection (9A).

b

after subsection (9), there were inserted—

9A

But a person to whom subsection (9B) applies and who, at that time—

a

has not established a branch in the United Kingdom, and

b

is treated as if—

i

the person has permission to carry on a regulated activity by virtue of regulation 8 of the EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018, or

ii

the person’s permission to carry on a regulated activity were varied in accordance with regulation 11 of those Regulations,

is not to be regarded as a relevant person in relation to a regulated activity which the person has permission to carry on by virtue of regulation 8 or 11 of those Regulations.

9B

This subsection applies to a person who is, immediately before exit day—

a

a credit institution,

b

an insurance intermediary,

c

an investment firm,

d

a mortgage intermediary,

e

a management company, or

f

an AIFM in relation to all activities authorised by its home state regulator other than—

i

any services specified by Annex I to the alternative investment fund managers directive in respect of an authorised unit trust scheme, an authorised contractual scheme or an authorised open-ended investment company, or

ii

any activities undertaken as an authorised manager of an ELTIF, as permitted by the ELTIF Regulation.

9C

For the purposes of subsection (9B)—

  • “AIFM” means an AIFM as defined in Article 4.1(b) of the alternative investment fund managers directive which—

    1. a

      is, immediately before exit day, authorised in accordance with Article 6.1 of that directive by its home state regulator to provide services specified by Annex I to that directive, and

    2. b

      provides those services, or services specified by Article 6.4 of that directive (discretionary portfolio management and non-core services), in the United Kingdom;

  • “an authorised contractual scheme” has the meaning given by section 237(3);

  • “an authorised open-ended investment company” has the meaning given by section 237(3);

  • “an authorised unit trust scheme” has the meaning given by section 237(3);

  • “collective portfolio management services” means those services set out in Annex II to the UCITS directive which a management company is providing to a UCITS in the United Kingdom;

  • “credit institution” means a credit institution as defined in Article 4.1(1) of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26th June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 which is, immediately before exit day, authorised (within the meaning of Article 8 of Directive 2013/36/EU of the European Parliament and of the Council of 26th June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC) by its home state regulator;

  • “ELTIF” means a UK AIF that is, immediately before exit day, authorised by the FCA as a European long-term investment fund under Article 6 of the ELTIF Regulation;

  • “ELTIF Regulation” means Regulation (EU) No 2015/760 of the European Parliament and of the Council of 29th April 2015 on European Long-term Investment Funds;

  • “insurance intermediary” means an insurance intermediary or an ancillary insurance intermediary as defined in Article 2.1(3) and (4) of Directive 2016/97/EC of the European Parliament and of the Council of 20th January 2016 on insurance distribution (recast) which is, immediately before exit day, registered (under Article 3 of that Directive) by its home state regulator;

  • “investment firm” means an investment firm as defined in Article 4.1(1) of Directive 2014/65/EU of the European Parliament and of the Council of 15th May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU which is, immediately before exit, authorised (within the meaning of Article 5 of that Directive) by its home state regulator;

  • “management company” means a management company as defined in Article 2.1(b) of the UCITS directive which—

    1. a

      is, immediately before exit day, authorised (within the meaning of Article 6 of that Directive) by its home state regulator to provide services of the kind specified by Article 6.3 of the UCITS directive (management of portfolios of investments) except collective portfolio management services, and

    2. b

      is providing those services in the United Kingdom;

  • “mortgage intermediary” means—

    1. a

      a credit intermediary as defined in Article 4(5) of Directive 2014/17/EU of the European Parliament and of the Council of 4th February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010, or

    2. b

      a person providing advisory services as defined in Article 4(21) of that Directive,

    which is, immediately before exit day, admitted (in accordance with Article 29.1 of that Directive) by its home state regulator;

  • UCITS” means an undertaking for collective investment in transferable securities which is, immediately before exit day, authorised in accordance with Article 5 of the UCITS directive;

  • UK AIF” has the meaning given in regulation 2 of the Alternative Investment Fund Managers Regulations 2013.

3

Section 224 (scheme manager’s power to inspect documents held by Official Receiver, etc.) has effect as if, after subsection (3), there were inserted—

3A

But a person who is not to be regarded as a relevant person for the purposes of section 213, by virtue of subsection (9A) of that section, is not to be regarded as a relevant person for the purposes of this section.

Insurance and reinsurance - modification of Part 4 of the Solvency 2 Regulations 201525

1

The Solvency 2 Regulations 20156 (approvals) are modified as follows.

2

Regulation 48 (models) has effect as if, in paragraph (4), for the words from “six months” to the end there were substituted “three years beginning with the day on which exit day occurs.”

3

Part 4 has effect as if, after Chapter 2, there were inserted—

CHAPTER 2ADeemed approval

54A

1

A person to whom regulation 8 or 11 of the EEA Passport Rights (Amendment etc., and Transitional Provisions) Regulations 2018 applies is to be treated as if the PRA has granted to the person an approval, determined in accordance with paragraphs (2) and (3), with respect to the person carrying on business in the UK through a branch.

2

In respect of a person—

a

who, immediately before exit day, is approved by a supervisory authority of an EEA State—

i

in respect of the matter mentioned in the first column of the following table and

ii

under the provision of the Solvency 2 Directive mentioned in the corresponding entry in the second column of the table, and

b

whose approval is applicable to the person’s permanent presence in the UK,

the approval a person is treated as having is the approval mentioned in the corresponding entry in the third column of the table.

Solvency 2 approval

Approval granted by supervisory authority of an EEA State

Deemed approval granted by the PRA

Matching adjustment to the relevant risk-free interest rate term structure

Article 77b of the Solvency 2 Directive

Regulation 42

Volatility adjustment to the relevant risk-free interest rate term structure

Article 77d of the Solvency 2 Directive

Regulation 43

Ancillary own funds

Article 90 of the Solvency 2 Directive

Regulation 44

Classification of own funds

Article 95 of the Solvency 2 Directive

Regulation 46

Full and partial internal model

Article 112 and 113 of the Solvency 2 Directive

Regulation 48(1)(a)

Group internal model to calculate the solvency capital requirement of an insurance or reinsurance undertaking

Article 231 or 233(5) of the Solvency 2 Directive

Regulation 48(1)(a)

Policy for changing a full and partial internal model

Article 115 of the Solvency 2 Directive

Regulation 48(1)(c)

Transitional measure on risk-free interest rates

Article 308c of the Solvency 2 Directive

Regulation 53

Transitional measure on technical provisions

Article 308d of the Solvency 2 Directive

Regulation 54

Design of the basic solvency capital requirement

Article 104(7) of the Solvency 2 Directive

Regulation 47

3

In respect of a person—

a

who, immediately before exit day, is applying a volatility adjustment to the relevant risk-free interest rate term structure in order to calculate the best estimate referred to in Article 77(2) of the Solvency 2 Directive on a date specified by the PRA, and

b

whose approval by a supervisory authority of an EEA State is not required,

the approval a person is treated as having is an approval under regulation 43.

4

Regulation 55 (decisions: written notices) has effect as if, after paragraph (2), there were inserted—

2A

If the PRA revokes an approval, the written notice must, where applicable, state the day on which regulation 54A ceases to apply.

2B

For the purposes of paragraph (2A), the day stated must be a day that falls before the end of the period of three years beginning with the day on which exit day occurs.

Persons who cease to be authorised to carry on a regulated activity before exit day26

1

The modifications specified in paragraphs (2) and (3) apply in respect of a person to whom, before exit day, regulation 22(1)(a) ceases to apply.

2

Section 61 of the 2000 Act (determination of applications) has effect as if, for subsection (3A)(a), there were substituted—

a

in any case where the application under section 60 is made by a person applying for permission, or for the variation of a permission, under Part 4A, means the period within which the application must be determined under section 55V(1) or (2), and

3

Regulation 48 of the Solvency 2 Regulations 2015 (models) has effect as if, in paragraph (4), for the words from “its receipt” to the end there were substituted “the day on which regulation 22(1)(a) ceased to apply in respect of the applicant.”

PART 5Power to amend time limits

Power to amend time limits imposed by modifications under these Regulations27

1

The Treasury may by regulations made by statutory instrument amend—

a

regulation 6(7)(a) and (b) to extend the period during which an application under section 55V of the 2000 Act must be determined,

b

regulation 17(1)(a) to extend the period during which regulation 8 or 11 applies, and

c

regulation 25(2) to extend the period during which an application under regulation 48 of the Solvency 2 Regulations 2015 must be determined,

if the Treasury considers it necessary to do so.

2

The Treasury may only make regulations under paragraph (1) if, no later than six months before the end of the period to be extended, the Financial Conduct Authority and the Prudential Regulation Authority have submitted to the Treasury a joint assessment as to the effect of extending, and not extending, the period on—

a

persons (in general) to whom regulation 8 or 11 applies,

b

the UK financial system (within the meaning of section 1I of the 2000 Act7), and

c

the ability of the Financial Conduct Authority and Prudential Regulation Authority to discharge their functions in a way that advances their objectives under Part 1A of the 2000 Act8.

3

Regulations under paragraph (1) may not extend the period for the time being by more than 12 months.

4

Regulations under paragraph (1) may make consequential amendments to regulation 6(7)(c), (8) and (9), regulation 23(2) and regulation 25(4).

5

A statutory instrument which contains regulations under paragraph (1) is subject to annulment in pursuance of a resolution of either House of Parliament.

Mike FreerRebecca HarrisTwo of the Lords Commissioners of Her Majesty’s Treasury

SCHEDULEConsequential amendments

Regulation 3

PART 1The Financial Services and Markets Act 2000 (c. 8)

1

The Financial Services and Markets Act 20009 is amended as follows.

2

In section 3E (memorandum of understanding)10, omit subsection (2)(f) and (k).

3

Omit section 34 (EEA firms)11.

4

Omit section 35 (Treaty firms)12.

5

In section 55A (application for permission)13, omit subsection (4).

6

In section 55Q (exercise of power in support of overseas regulator)14, omit subsection (2).

7

In section 55R (persons connected with an applicant)15, omit subsections (2) to (3B).

8

1

Section 55X (determination of applications: warning notices and decision notices)16 is amended as follows.

2

In subsection (2), omit “(unless subsection (3) applies)”.

3

Omit subsection (3).

9

In section 137A (the FCA’s general rules)17, omit subsection (5).

10

In section 137G (the PRA’s general rules)18, omit subsection (5).

11

In section 168 (appointment of persons to carry out investigations in particular cases)19, in subsection (1)(b), omit “or under Schedule 4”.

12

Omit Part 13 (incoming firms: intervention by FCA or PRA), except for, in section 195 (exercise of power in support of overseas regulator), subsections (3) and (4).

13

Omit Part 13A (enhanced supervision of firms exercising rights under the Insurance Distribution Directive)20.

14

In section 213 (the compensation scheme)21, omit subsections (10) and (11).

15

In section 214 (provisions of the scheme: general), omit subsection (5).

16

In section 224 (scheme manager’s power to inspect documents held by Official Receiver etc.), omit subsection (4).

17

In section 234K (duty to consider exercise of powers under Competition Act 1998)22, in subsection (3), omit paragraph (f).

18

In section 313D (interpretation of Part 18A)23, in subsection (1), in the definition of “institution”, omit from “but does not include” to the end.

19

Omit section 368 (winding-up petitions: EEA and Treaty firms)24.

20

1

Section 425 (expressions relating to authorisation elsewhere in the single market)25 is amended as follows.

2

Omit subsection (2).

3

In the heading, omit “elsewhere”.

21

In Schedule 1ZA (the Financial Conduct Authority)26, in Part 3 (penalties and fees), omit paragraph 24(a) (together with the final “or”).

22

In Schedule 1ZB (the Prudential Regulation Authority)27, in Part 3 (penalties and fees), omit paragraph 32(a) (together with the final “or”).

23

1

Schedule 6 (threshold conditions) is amended as follows.

2

Omit Part 1F (authorisation under Schedule 3)28.

3

Omit Part 1G (authorisation under Schedule 4)29.

PART 2Other primary legislation

Agricultural Credits Act 1928 (c. 43)24

In section 5 of the Agricultural Credits Act 192830 (agricultural charges on farming stock and assets), in the definition of “Bank” in subsection (7), omit paragraph (c).

Solicitors Act 1974 (c. 47)25

In section 87 of the Solicitors Act 197431 (interpretation)—

a

in the definition of “bank” in subsection (1)—

i

for “, a person” substitute “or a person”;

ii

omit from “or an EEA firm” to the end;

b

in subsection (1A), omit paragraphs (c) (together with the final “or”) and (d).

Judicial Pensions Act 1981 (c. 20)26

In section 33A of the Judicial Pensions Act 198132 (voluntary contributions)—

a

in subsection (9)—

i

in the definition of “authorised provider”, omit paragraphs (b) (together with the final “or”) and (c);

ii

in the definition of “insurer”, omit paragraph (b);

b

omit subsections (9B) to (9E).

Administration of Justice Act 1985 (c. 61)27

In section 21 of the Administration of Justice Act 198533 (professional indemnity and compensation), in subsection (5), omit paragraphs (b) (together with the final “or”) and (c).

Housing Act 1985 (c. 68)28

In section 622 of the Housing Act 198534 (minor definitions: general), in subsection (1)—

a

in the definition of “authorised deposit taker”, omit paragraph (b) and the “or” before it;

b

in the definition of “authorised insurer”, omit paragraph (b) and the “or” before it;

c

in the definition of “authorised mortgage lender”, omit paragraphs (b) (together with the final “or”) and (c).

Building Societies Act 1986 (c. 53)29

1

The Building Societies Act 198635 is amended as follows.

2

In section 9A (restrictions on certain transactions), in subsection (5), omit paragraph (b) and the “or” before it.

3

In section 98 (transfers of business: supplementary provisions), in subsection (3), omit paragraph (c)(ii) and the “or” before it.

Access to Medical Reports Act 1988 (c. 28)30

In section 2 of the Access to Medical Reports Act 198836 (interpretation), in the definition of “insurer” in subsection (1), omit paragraph (b).

Road Traffic Act 1988 (c. 52)31

In section 95 of the Road Traffic Act 198837 (notification of refusal of insurance on grounds of health), in subsection (3), omit paragraph (b) and the “or” before it.

Social Security Administration Act 1992 (c. 5)32

In section 109B of the Social Security Administration Act 199238 (power to require information), in subsection (7)—

a

in the definition of “bank”, omit paragraph (b) (but not the final “or”);

b

in the definition of “insurer”, omit paragraph (b) and the “or” before it.

Judicial Pensions and Retirement Act 1993 (c. 8)33

1

The Judicial Pensions and Retirement Act 199339 is amended as follows.

2

In section 10 (additional benefits from voluntary contributions)—

a

in subsection (8)—

i

in the definition of “authorised provider”, omit paragraphs (b) (together with the final “or”) and (c);

ii

in the definition of “insurer”, omit paragraph (b);

b

omit subsections (8B) to (8E).

3

In Schedule 2 (transfer of accrued benefits), in the definition of “authorised insurer” in paragraph 1(1), omit paragraph (ii) and the “or” before it.

Social Security (Recovery of Benefits) Act 1997 (c. 27)34

In Schedule 1 to the Social Security (Recovery of Benefits) Act 199740 (compensation payments), in paragraph 5, omit sub-paragraph (2)(b) at the “or” before it.

Bank of England Act 1998 (c. 11)35

1

The Bank of England Act 199841 is amended as follows.

2

In section 17 (power to obtain information), in subsection (7), omit paragraph (b) and the “or” before it.

3

In Schedule 2 (cash ratio deposits), in paragraph 1, omit sub-paragraph (1A)(d) and the “or” before it.

Trustee Act 2000 (c. 29)36

In section 29 of the Trustee Act 200042 (remuneration of certain trustees), in subsection (3A), omit paragraph (b) and the “or” before it.

Anti-terrorism, Crime and Security Act 2001 (c. 24)37

In Schedule 1 to the Anti-terrorism, Crime and Security Act 200143 (forfeiture of terrorist property), in paragraph 10R (meaning of “bank”), omit sub-paragraph (2)(c).

Health and Social Care (Community Health and Standards) Act 2003 (c. 43)38

In Schedule 10 to the Health and Social Care (Community Health and Standards) Act 200344 (recovery of NHS charges: exempted payments), in paragraph 4, omit sub-paragraph (b) and the “or” before it.

Legal Services Act 2007 (c. 29)39

In section 64 of the Legal Services Act 200745 (modification of the Board’s functions under section 62(1)(b)), in the definition of “authorised insurer” in subsection (5), omit paragraphs (b) and (c).

Dormant Bank and Building Society Accounts Act 2008 (c. 31)40

In section 7 of the Dormant Bank and Building Society Accounts Act 200846 (definition of “bank”)—

a

in subsection (2), omit paragraph (b);

b

in subsection (3), omit “or firm”, wherever occurring.

Terrorist Asset-Freezing etc. Act 2010 (c. 38)41

In section 41 of the Terrorist Asset-Freezing etc. Act 201047 (meaning of “relevant institution”), in subsection (1), omit paragraph (b) (but not the final “or”).

Charities Act 2011 (c. 25)42

In section 109 of the Charities Act 201148 (dormant bank accounts: supplementary), in subsection (3), omit paragraph (c) (but not the final “or”).

Health and Social Care Act 2012 (c. 7)43

In section 145 of the Health and Social Care Act 201249 (borrowing), in subsection (3), omit paragraph (b) and the “or” before it.

Welfare Reform and Work Act 2016 (c. 7)44

In section 19 of the Welfare Reform and Work Act 201650 (section 18: further provision), in subsection (8)—

a

in the definition of “deposit taker”, omit paragraph (b) and the “or” before it;

b

in the definition of “insurer”, omit paragraph (b) and the “or” before it.

PART 3Secondary legislation

Social Security (Payments on account, Overpayments and Recovery) Regulations 198845

In regulation 10 of the Social Security (Payments on account, Overpayments and Recovery) Regulations 198851 (conversion of payments made in a foreign currency), in paragraph (2), omit sub-paragraph (b) and the “or” before it.

Social Landlords (Additional Purposes or Objects) Order 199946

In article 3 of the Social Landlords (Additional Purposes or Objects) Order 199952 (priority of mortgages), in the definition of “qualifying lending institution” in paragraph (3) (other than as that definition applies to bodies eligible for registration as social landlords by the Housing Corporation in England), omit paragraph (c) and the “or” before it.

National Health Service Pension Scheme (Additional Voluntary Contributions) Regulations 200047

In regulation 2 of the National Health Service Pension Scheme (Additional Voluntary Contributions) Regulations 200053 (interpretation), in the definition of “insurer” in paragraph (1), omit paragraph (b) and the “or” before it.

Pig Industry Restructuring (Capital Grant) Scheme 200148

In paragraph 2 of the Pig Industry Restructuring (Capital Grant) Scheme 200154 (interpretation), in the definition of “bank” in sub-paragraph (1), omit paragraph (ii).

Financial Services and Markets Act 2000 (Regulated Activities) Order 200149

1

The Financial Services and Markets Act 2000 (Regulated Activities) Order 200155 is amended as follows.

2

In article 6 (sums paid by certain persons), in paragraph (1), omit sub-paragraph (a)(iii).

3

Omit article 11 (Community co-insurers).

4

In article 39B (claims management on behalf of an insurer etc.), in paragraph (2)—

a

omit sub-paragraph (a)(iii) (but not the final “or”);

b

omit sub-paragraph (b)(ii) (but not the final “or”);

c

in sub-paragraph (b)(iii), omit “and not falling within paragraph (ii)”.

Financial Services and Markets Act 2000 (Stakeholder Products) Regulations 200450

In regulation 2 of the Financial Services and Markets Act 2000 (Stakeholder Products) Regulations 200456 (interpretation), in paragraph (1)—

a

in the definition of “relevant contract of insurance”, omit paragraph (b)(ii) and the “or” before it;

b

in the definition of “deposit-taker”, omit paragraph (b) and the “or” before it;

c

in the definition of “insurer”, omit paragraph (b) and the “or” before it.

North Korea (United Nations Measures) Order 200651

In article 2 of the North Korea (United Nations Measures) Order 200657 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) and the “and” before it.

Iran (Financial Sanctions) Order 200752

In article 2 of the Iran (Financial Sanctions) Order 200758 (interpretation), in the definition of “relevant institution” in paragraph (1), omit from “and an EEA firm” to the end.

Lasting Powers of Attorney, Enduring Powers of Attorney and Public Guardian Regulations 200753

In regulation 34 of the Lasting Powers of Attorney, Enduring Powers of Attorney and Public Guardian Regulations 200759 (security given under regulation 33(2)(a): requirement for endorsement), in paragraph (5)—

a

in the definition of “authorised insurance company”, omit paragraph (b);

b

in the definition of “authorised deposit-taker”, omit paragraph (b).

Companies (Authorised Minimum) Regulations 200854

In regulation 4 of the Companies (Authorised Minimum) Regulations 200860 (the appropriate spot rate of exchange), in paragraph (3), omit sub-paragraph (b) and the “or” before it.

Zimbabwe (Financial Sanctions) Regulations 200955

In regulation 2 of the Zimbabwe (Financial Sanctions) Regulations 200961 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) and the “and” before it.

Companies (Authorised Minimum) Regulations 200956

In regulation 4 of the Companies (Authorised Minimum) Regulations 200962 (the appropriate spot rate of exchange), in paragraph (3), omit sub-paragraph (b) and the “or” before it.

Somalia (Asset-Freezing) Regulations 201057

In regulation 2 of the Somalia (Asset-Freezing) Regulations 201063 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Libya (Financial Sanctions) Order 201158

In article 2 of the Libya (Financial Sanctions) Order 201164 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Egypt (Asset-Freezing) Regulations 201159

In regulation 2 of the Egypt (Asset-Freezing) Regulations 201165 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Tunisia (Asset-Freezing) Regulations 201160

In regulation 2 of the Tunisia (Asset-Freezing) Regulations 201166 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Iran (Asset-Freezing) Regulations 201161

In regulation 2 of the Iran (Asset-Freezing) Regulations 201167 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Afghanistan (Asset-Freezing) Regulations 201162

In regulation 2 of the Afghanistan (Asset-Freezing) Regulations 201168 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Legal Services Act 2007 (Designation as a Licensing Authority) Order 201163

In the Schedule to the Legal Services Act 2007 (Designation as a Licensing Authority) Order 201169, in paragraph 2, omit sub-paragraph (4)(a)(iii) (but not the final “and”).

ISIL (Da’esh) and Al-Qaida (Asset-Freezing) Regulations 201164

In regulation 2 of the ISIL (Da’esh) and Al-Qaida (Asset-Freezing) Regulations 201170 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Legal Services Act 2007 (Designation as a Licensing Authority) (No. 2) Order 201165

In article 4 of the Legal Services Act 2007 (Designation as a Licensing Authority) (No. 2) Order 201171 (bank accounts of licensed bodies), in paragraph (4), omit sub-paragraph (a)(iii) (but not the final “and”).

Syria (European Union Financial Sanctions) Regulations 201266

In regulation 2 of the Syria (European Union Financial Sanctions) Regulations 201272 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Guinea-Bissau (Asset-Freezing) Regulations 201267

In regulation 2 of the Guinea-Bissau (Asset-Freezing) Regulations 201273 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Iraq (Asset-Freezing) Regulations 201268

In regulation 2 of the Iraq (Asset-Freezing) Regulations 201274 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Republic of Guinea (Asset-Freezing) Regulations 201269

In regulation 2 of the Republic of Guinea (Asset-Freezing) Regulations 201275 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Democratic Republic of the Congo (Asset-Freezing) Regulations 201270

In regulation 2 of the Democratic Republic of the Congo (Asset-Freezing) Regulations 201276 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Eritrea (Asset-Freezing) Regulations 201271

In regulation 2 of the Eritrea (Asset-Freezing) Regulations 201277 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Lebanon and Syria (Asset-Freezing) Regulations 201272

In regulation 2 of the Lebanon and Syria (Asset-Freezing) Regulations 201278 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Belarus (Asset-Freezing) Regulations 201373

In regulation 2 of the Belarus (Asset-Freezing) Regulations 201379 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Council Tax Reduction Schemes (Detection of Fraud and Enforcement) (England) Regulations 201374

In regulation 4 of the Council Tax Reduction Schemes (Detection of Fraud and Enforcement) (England) Regulations 201380 (power to require information), in paragraph (10)—

a

in the definition of “bank”, omit paragraph (b) (but not the final “or”);

b

in the definition of “insurer”, omit paragraph (e) and the “or” before it.

Civil Legal Aid (Statutory Charge) Regulations 201375

In regulation 19 of the Civil Legal Aid (Statutory Charge) Regulations 201381 (interest on damages), in paragraph (4)—

a

in sub-paragraph (b), omit “either”;

b

omit sub-paragraph (b)(ii) (but not the final “and”) and the “or” before it.

Local Government Pension Scheme Regulations 201376

In Part 3 of Schedule 2 to the Local Government Pension Scheme Regulations 201382 (scheme employers), in paragraph 7, omit sub-paragraph (b) (but not the final “or”).

Ukraine (European Union Financial Sanctions) Regulations 201477

In regulation 2 of the Ukraine (European Union Financial Sanctions) Regulations 201483 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Central African Republic (European Union Financial Sanctions) Regulations 201478

In regulation 2 of the Central African Republic (European Union Financial Sanctions) Regulations 201484 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Ukraine (European Union Financial Sanctions) (No. 2) Regulations 201479

In regulation 2 of the Ukraine (European Union Financial Sanctions) (No. 2) Regulations 201485 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Prevention of Social Housing Fraud (Power to Require Information) (England) Regulations 201480

In regulation 4 of the Prevention of Social Housing Fraud (Power to Require Information) (England) Regulations 201486 (power to require information), in the definition of “bank” in paragraph (11), omit paragraph (b) (but not the final “or”).

Sudan (European Union Financial Sanctions) Regulations 201481

In regulation 2 of the Sudan (European Union Financial Sanctions) Regulations 201487 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Ukraine (European Union Financial Sanctions) (No. 3) Regulations 201482

In regulation 2 of the Ukraine (European Union Financial Sanctions) (No. 3) Regulations 201488 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Yemen (European Union Financial Sanctions) Regulations 201483

In regulation 2 of the Yemen (European Union Financial Sanctions) Regulations 201489 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

South Sudan (European Union Financial Sanctions) (No. 2) Regulations 201584

In regulation 2 of the South Sudan (European Union Financial Sanctions) (No. 2) Regulations 201590 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Burundi (European Union Financial Sanctions) Regulations 201585

In regulation 2 of the Burundi (European Union Financial Sanctions) Regulations 201591 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Iran (European Union Financial Sanctions) Regulations 201686

In regulation 2 of the Iran (European Union Financial Sanctions) Regulations 201692 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Libya (European Union Financial Sanctions) Regulations 201687

In regulation 2 of the Libya (European Union Financial Sanctions) Regulations 201693 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Local Government Pension Scheme (Management and Investment of Funds) Regulations 201688

In regulation 6 of the Local Government Pension Scheme (Management and Investment of Funds) Regulations 201694 (separate bank account), in paragraph (2), omit sub-paragraph (b).

Democratic People’s Republic of Korea (European Union Financial Sanctions) Regulations 201789

In regulation 2 of the Democratic People’s Republic of Korea (European Union Financial Sanctions) Regulations 201795 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Judicial Pensions (Fee-Paid Judges) Regulations 201790

In regulation 70 of the Judicial Pensions (Fee-Paid Judges) Regulations 201796 (interpretation), in the definition of “authorised insurer” in paragraph (1), omit paragraph (b) and the “or” before it.

Republic of Mali (European Union Financial Sanctions) Regulations 201791

In regulation 2 of the Republic of Mali (European Union Financial Sanctions) Regulations 201797 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Venezuela (European Union Financial Sanctions) Regulations 201792

In regulation 2 of the Venezuela (European Union Financial Sanctions) Regulations 201798 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

Andrey Lugovoy and Dmitri Kovtun Freezing Order 201893

In article 2 of the Andrey Lugovoy and Dmitri Kovtun Freezing Order 201899 (interpretation), in paragraph (2)—

a

before ““relevant institution”” insert “In this Order,”;

b

omit sub-paragraph (b) and the “and” before it.

Burma (European Union Financial Sanctions) Regulations 201894

In regulation 2 of the Burma (European Union Financial Sanctions) Regulations 2018100 (interpretation), in the definition of “relevant institution” in paragraph (1), omit paragraph (b) (but not the final “or”).

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations repeal EEA Passport Rights under Schedule 3 to the Financial Services and Markets Act 2000 (c. 8) (“the 2000 Act”) and Treaty Rights under Schedule 4 to that Act. A person with an EEA Passport Right or a Treaty Right is one who is authorised in the person’s home EEA state to carry on a regulated activity and, as a result, may become authorised to carry on a regulated activity (see section 22 of the 2000 Act) in the United Kingdom. Reciprocal arrangements are provided by European Union member states.

These reciprocal arrangements will cease when the United Kingdom ceases to be a member of the European Union, and it is not considered appropriate that a person should thereafter carry on a regulated activity in the United Kingdom unless the person is authorised by a domestic financial services regulator. Accordingly, these arrangements represent a deficiency in retained EU law (see section 8(2)(c) of the European Union (Withdrawal) Act 2018 (c. 16)).

These Regulations also make transitional provision so that a person who ceases to be authorised to carry on a regulated activity in the United Kingdom by virtue of an EEA Passport Right or a Treaty Right may continue, for a limited time, to carry on such an activity.

In these Regulations:

  • Part 1 makes general provision as to citation, commencement and interpretation;

  • Part 2 amends Part 3 of the 2000 Act (authorisation and exemption) to repeal provision dealing with the authorisation to carry on regulated activities, within the meaning of Part 2 of that Act, granted to EEA firms (Schedule 3 to that Act) and Treaty firms (Schedule 4 to that Act);

    the Schedule to these Regulations makes amendments consequential upon these repeals;

  • in Part 3:

    • Chapter 1 provides modifications to Part 4A of the 2000 Act for the purposes of the transitional provisions that follow;

    • Chapters 2 and 3 provide for a person authorised to carry on regulated activities before exit day by virtue of the legislation repealed by Part 2 to continue to do so, by treating the person as having the requisite permission under Part 4A of the 2000 Act, pending the determination of an application for permission, or variation of a permission, under that Part;

    • Chapter 4 provides the procedure by which a person may be so treated;

    • Chapter 5 provides the period during which a person may be so treated;

    • Chapter 6 provides saving provision;

    • Chapter 7 provides general and interpretative provision;

  • Part 4 provides miscellaneous transitional provision in respect of other areas of financial services legislation which have a bearing on the provisions in Part 3;

  • Part 5 provides a power for the Treasury to amend certain time limits set by the modifications made by these Regulations.

An impact assessment of the effect that this instrument, and certain other instruments made by HM Treasury under the European Union (Withdrawal) Act 2018, will have on the costs of business, the voluntary sector and the public sector is available from HM Treasury, 1 Horse Guards Road, London SW1A 2HQ and is published alongside this instrument at www.legislation.gov.uk.