[Exemption from prohibitionU.K.
This section has no associated Explanatory Memorandum
12L.—[(1) A person to whom this paragraph applies is, subject to sub-paragraph (6), exempt from the prohibitions in regulation 138(1) of the Payment Services Regulations 2017 and in regulation 63(1) of EMR 2011 for a period of five years beginning with the exit day, but only to the extent that it is necessary for the person to provide payment services or electronic money services in the United Kingdom to perform a pre-existing contract or to redeem outstanding electronic money.]
(2) This paragraph applies to an EEA authorised electronic money institution exercising its passport rights in the United Kingdom immediately before exit day other than through a branch in the United Kingdom or a UK-based agent.
(3) The FCA may cancel the exemption of a person to whom this paragraph applies, or direct that paragraph 12B is to apply to the person, if it considers that doing so is necessary—
(a)for the prevention, detection, investigation or prosecution of a criminal offence;
(b)for the protection of electronic money holders or payment service users; or
(c)for the protection of trust in, or the stability of, a payment system.
(4) In exercising the power in paragraph (3), the FCA must take into account—
(a)the person’s conduct,
(b)the practicality of supervision by the FCA,
(c)the size of the person’s undertaking, and
(d)the nature of the services the person provides.
(5) Paragraph 3 of Schedule 3 to EMR 2011 has effect in relation to the FCA’s exercise of its powers under this paragraph.
[(6) A person to whom paragraph applies is exempt from the prohibition in regulation 138(1) of the Payment Services Regulations 2017 only to the extent that it was providing the payment service in the United Kingdom immediately before exit day in accordance with the exercise of an EEA passport right under Title 5 of Directive (EU) 2015/2366 as in force immediately before exit day.]]