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(b) such provision will be made as a result of an agreement which has
been entered into in relation to the territory.

20Disclosure of information to foreign tax authorities

67 (1) Sub-paragraph (2) applies if the law of a foreign territory makes provision
allowing, in respect of payments of the bank levy, relief from an equivalent
foreign levy payable under that law.

(2) No obligation as to secrecy or other restriction on the disclosure of
25information prevents the Commissioners for Her Majesty’s Revenue and
Customs, or an officer of Revenue and Customs, from disclosing to the
authorised officer of the authorities of the territory such facts as may be
necessary to enable the proper relief to be given under the law of the
territory.

30Consequential amendment to the Constitutional Reform and Governance Act 2010

68 In section 23 of the Constitutional Reform and Governance Act 2010 (which
excepts certain treaties from the requirements imposed by section 20 of that
Act as to the laying of treaties before Parliament), after subsection (2)
insert—

(2A) 35Section 20 does not apply to a treaty in relation to which an order
may be made under paragraph 65 of Schedule 19 to the Finance Act
2011 (bank levy: arrangements affording double taxation relief).

Part 8 Definitions

40General

69 (1) In this Schedule—

(2) In this Schedule the following terms have the meaning given in the FSA
35Handbook—

Finance (No. 3) BillPage 351

(3) A entity which would be a BIPRU 730k firm and a full scope BIPRU
investment firm by virtue of activities carried on in the United Kingdom but
for the fact that its registered office (or, if it does not have a registered office,
its head office) is not in the United Kingdom is to be treated as being one.

(4) 5The definition of “high quality liquid assets” has effect, in relation to a
particular entity or group of entities, subject to any direction made in
relation to that entity or group under section 148 of FISMA 2000
(modification or waiver of rules).

(5) If, in any proceedings, any question arises whether a person is an
10international organisation for the purposes of the definition of “entity” in
sub-paragraph (1), a certificate issued by or under the authority of the
Secretary of State stating any fact relevant to that question is conclusive
evidence of that fact.

“Asset management activities”

70 (1) 15“Asset management activities” means activities which consist (or, if they
were carried on in the United Kingdom, would consist) of any or all of the
following—

(a) acting as the operator of a collective investment scheme (within the
meaning of Part 17 of FISMA 2000: see sections 235 and 237 of that
20Act),

(b) acting as a discretionary investment manager for clients none of
which is a linked entity, and

(c) acting as an authorised corporate director.

(2) In sub-paragraph (1), “linked entity”, in relation to an entity (“E”), means—

(a) 25a member of the same group as E,

(b) a company in which a company which is a member of the same
group as E has a major interest (within the meaning of Part 5 of CTA
2009: see section 473 of that Act), or

(c) a partnership the members of which include an entity—

(i) 30which is a member of the same group as E, and

(ii) whose share of the profits or losses of a trade carried on by
the partnership for an accounting period of the partnership
any part of which falls within the chargeable period is at least
a 40% share (see Part 17 of CTA 2009 for provisions about
35shares of partnership profits and losses).

(3) In sub-paragraph (2) “group” means a group for the purposes of—

(a) the provisions mentioned in paragraph 4(3), or

(b) the provisions of US GAAP mentioned in paragraph 4(6)(a)(iii).

“Capital resources condition”

71 (1) 40“The capital resources condition” is that the entity has a capital resources
requirement of at least £100,000,000.

(2) But if the entity is a member of a group, “the capital resources condition” is
that the entity and—

(a) any other entities which—

(i) 45are members of the group,

(ii) meet either of the conditions in sub-paragraph (3),

Finance (No. 3) BillPage 352

(iii) are not excluded entities, and

(iv) are not members of any partnership within paragraph (b),
and

(b) any partnership—

(i) 5the members of which are or include one or more entities
which are members of the group and not excluded entities,
and

(ii) which meets either of the conditions in sub-paragraph (3),

have (in aggregate) capital resources requirements of at least £100,000,000.

(3) 10The conditions referred to in sub-paragraph (2) are that the entity or
partnership—

(a) is both a BIPRU 730k firm and a full scope BIPRU investment firm, or

(b) is an entity or partnership which carries on in the United Kingdom
activities including the relevant regulated activity described in the
15provision mentioned in paragraph 78(a).

(4) In determining whether the entity is a UK resident bank or a relevant foreign
bank by virtue of paragraph 77(2) or 79(2), the references in sub-paragraph
(1) to the entity are to the partnership.

(5) If any entity whose capital resources may be material for the purposes of
20sub-paragraph (1) or (2) prepares its accounts in a currency other than
sterling, the amount of its capital resources at the end of the chargeable
period is to be translated into its sterling equivalent by reference to the spot
rate of exchange on the last day of the chargeable period.

(6) If any entity whose capital resources may be material for the purposes of
25sub-paragraph (1) or (2) carries on a trade in the United Kingdom through a
permanent establishment in the United Kingdom, its capital resources are to
be determined as they would be for corporation tax purposes (see Chapter 4
of Part 2 of CTA 2009).

(7) In sub-paragraph (2) “group” means a group for the purposes of—

(a) 30the provisions mentioned in paragraph 4(3), or

(b) the provisions of US GAAP mentioned in paragraph 4(6)(a)(iii).

“Excluded entity”

72 (1) “Excluded entity” means an entity which is—

(a) an insurance company or an insurance special purpose vehicle,

(b) 35an entity which is a member of a group and does not carry on any
relevant regulated activities otherwise than on behalf of an insurance
company or insurance special purpose vehicle which is a member of
the group,

(c) an entity which does not carry on any relevant regulated activities
40otherwise than as the manager of a pension scheme,

(d) an investment trust (within the meaning given by section 1158 of
CTA 2010),

(e) an entity which does not carry on any relevant regulated activities
other than asset management activities,

(f) 45an exempt BIPRU commodities firm,

Finance (No. 3) BillPage 353

(g) an entity which does not carry on any relevant regulated activities
otherwise than for the purpose of trading in commodities or
commodity derivatives,

(h) an entity which does not carry on any relevant regulated activities
5otherwise than for the purpose of dealing in contracts for
differences—

(i) as principal with persons all or all but an insignificant
proportion of whom are retail clients, or

(ii) with another person to enable the entity or other person to
10deal in contracts for differences as principal with persons all
or all but an insignificant proportion of whom are retail
clients,

(i) a society incorporated under the Friendly Societies Act 1992,

(j) a society registered as a credit union under the Industrial and
15Provident Societies Act 1965 or the Credit Unions (Northern Ireland)
Order 1985 (S.I. 1985/1205 (N.I. 12)S.I. 1985/1205 (N.I. 12)), or

(k) a building society.

(2) In sub-paragraph (1)(a) and (b) “insurance company” and “insurance special
purpose vehicle” have the meaning given by section 431(2) of ICTA.

(3) 20In sub-paragraph (1)(b) “group” means a group for the purposes of—

(a) the provisions mentioned in paragraph 4(3), or

(b) the provisions of US GAAP mentioned in paragraph 4(6)(a)(iii).

“Long term” equity and liabilities

73 All equity is “long term”.

74 (1) 25Liabilities are “long term” to the extent that—

(a) as at the end of the chargeable period, the liabilities are not required,
and cannot be required, to be repaid or otherwise met during the 12
month period starting with the last day of the chargeable period, and

(b) in the case of liabilities of one member of the relevant group to
30another member of the relevant group, an officer of Revenue and
Customs is satisfied that the following condition is also met in
relation to the liabilities.

(2) The condition is that, as at the end of the chargeable period, the liabilities are
funded by the relevant group through—

(a) 35equity,

(b) excluded liabilities to persons who are not members of the relevant
group, or

(c) liabilities to such persons which are not required, and cannot be
required, to be repaid or otherwise met during the 12 month period
40starting with the last day of the chargeable period.

75 (1) Liabilities are also “long term” so far as they consist of non-protected
deposits.

(2) But sub-paragraph (1) does not apply to a deposit if the depositor is—

(a) an authorised person for the purposes of FISMA 2000 (see section 31
45of that Act), or

Finance (No. 3) BillPage 354

(b) an entity which if it were a UK resident entity which carried on its
activities in the United Kingdom would be required to be an
authorised person.

(3) A deposit is “non-protected” so far as it is not a protected deposit for the
5purposes of paragraph 29.

(4) For the purposes of this paragraph—

(a) “deposit” has the meaning given by article 5(2) of the Financial
Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I.
2001/544), and

(b) 10in relation to a deposit held in a territory outside the United
Kingdom, the exclusions in articles 6 to 9AB of that Order apply with
whatever modifications are appropriate to achieve the following
purpose.

(5) The purpose is that the exclusions are to cover, essentially, the same matters
15in relation to the territory concerned as they cover in relation to the United
Kingdom.

76 Paragraphs 73 to 75 are subject to Step 6 in paragraph 24(1).

“Relevant foreign bank”

77 (1) “Relevant foreign bank” means an entity which—

(a) 20is a non-UK resident entity,

(b) is an authorised person for the purposes of FISMA 2000 (see section
31 of that Act),

(c) is an entity which carries on a trade in the United Kingdom through
a permanent establishment in the United Kingdom and—

(i) 25whose activities include the relevant regulated activity
described in the provision mentioned in paragraph 78(a), or

(ii) which is both a BIPRU 730k firm and a full scope BIPRU
investment firm, whose activities consist wholly or mainly of
any of the relevant regulated activities described in the
30provisions mentioned in paragraph 78(b) to (f),

(d) carries on that relevant regulated activity, or those relevant
regulated activities, wholly or mainly in the course of that trade,

(e) meets the capital resources condition, and

(f) is not an excluded entity.

(2) 35“Relevant foreign bank” also includes an entity which—

(a) meets the conditions in sub-paragraph (1)(a) and (f), and

(b) is a member of a partnership which meets the conditions in
paragraph 79(1)(b) to (e).

“Relevant regulated activity”

78 40“Relevant regulated activity” means an activity which is a regulated activity
for the purposes of FISMA 2000 by virtue of any of the following provisions
of the Financial Services and Markets Act 2000 (Regulated Activities) Order
2001 (S.I. 2001/544S.I. 2001/544)—

(a) article 5 (accepting deposits),

(b) 45article 14 (dealing in investments as principal),

Finance (No. 3) BillPage 355

(c) article 21 (dealing in investments as agent),

(d) article 25 (arranging deals in investments),

(e) article 40 (safeguarding and administering investments), and

(f) article 61 (entering into regulated mortgage contracts).

5UK resident bank”

79 (1) UK resident bank” means an entity which—

(a) is a UK resident entity,

(b) is an authorised person for the purposes of FISMA 2000 (see section
31 of that Act),

(c) 10is an entity—

(i) whose activities include the relevant regulated activity
described in the provision mentioned in paragraph 78(a), or

(ii) which is both a BIPRU 730k firm and a full scope BIPRU
investment firm, whose activities consist wholly or mainly of
15any of the relevant regulated activities described in the
provisions mentioned in paragraph 78(b) to (f),

(d) carries on that relevant regulated activity, or those relevant
regulated activities, wholly or mainly in the course of trade,

(e) meets the capital resources condition, and

(f) 20is not an excluded entity.

(2) UK resident bank” also includes an entity which—

(a) meets the conditions in sub-paragraph (1)(a) and (f), and

(b) is a member of a partnership which meets the conditions in sub-
paragraph (1)(b) to (e).

25Part 9 Power to make consequential changes

80 (1) The Treasury may, by order made by statutory instrument, make such
amendments of this Schedule as they consider appropriate in consequence
of—

(a) 30any change made to or replacement of the Financial Services and
Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544S.I. 2001/544)
(or any replacement),

(b) any change made to the FSA Handbook, or

(c) any change in international accounting standards, UK GAAP or US
35GAAP.

(2) An order under this paragraph may have retrospective effect in relation to—

(a) any chargeable period in which the order is made, or

(b) in the case of an order made on or before 31 December 2011, any
chargeable period ending on or after 1 January 2011.

(3) 40A statutory instrument containing an order under this paragraph is subject
to annulment in pursuance of a resolution of the House of Commons.

Finance (No. 3) BillPage 356

Section 78

SCHEDULE 20 Supplies of commodities to be used in producing electricity

1 Schedule 6 to FA 2000 (climate change levy) is amended as follows.

2 In paragraph 6 (supplies of gas), after sub-paragraph (1) insert—

(1A) 5In relation to a supply which is within sub-paragraph (1B) but not
sub-paragraph (1C)—

(a) in sub-paragraph (1)(a) the reference to a gas utility is to be
read as including a reference to an unregulated gas
supplier (within the meaning of paragraph 151), and

(b) 10in relation to a supply made by an unregulated gas
supplier—

(i) sub-paragraph (1) has effect as if paragraph (b)(ii)
were omitted, and

(ii) in paragraph 40(2)(b) the reference to a utility is to
15be read as including a reference to an unregulated
gas supplier.

(1B) A supply is within this sub-paragraph if it is a supply of any gas
to a person to be used by that person in producing electricity.

(1C) A supply is within this sub-paragraph if it is a supply of any gas
20to a person who intends to cause the gas to be used in—

(a) a fully exempt combined heat and power station, or

(b) a partly exempt combined heat and power station,

in producing any outputs of the station.

3 (1) Paragraph 14 (exemption: supplies (other than self-supplies) to electricity
25producers) is amended as follows.

(2) In sub-paragraph (1), for “a taxable commodity” substitute “electricity”.

(3) In sub-paragraphs (1)(a), (2)(b) and (3)(b), for “commodity” substitute
“electricity”.

4 In paragraph 21 (regulations to avoid double charges to levy), after sub-
30paragraph (2) insert—

(2A) In sub-paragraph (2)(b) “taxable supply” does not include a
taxable supply subject to the carbon price support rates (see
paragraph 42A).

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