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184 | Page 182, line 27, at end insert— |
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| “(3A) | Neither section 1A(6)(d) nor the definition of “functions” in |
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| paragraph 1 applies for the purposes of sub-paragraph (2).” |
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185 | Page 183, line 16, leave out from “as,” to end of line 18 and insert “a member, officer |
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| or member of staff of the FCA;” |
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186 | Page 183, line 21, at end insert— |
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| “(1A) | Anything done or omitted by a person mentioned in sub-paragraph |
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| (1)(a) or (b) while acting, or purporting to act, as a result of an |
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| appointment under any of sections 166 to 169 is to be taken for the |
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| purposes of sub-paragraph (1) to have been done or omitted in the |
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| discharge, or as the case may be purported discharge, of the FCA’s |
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| |
187 | Page 183, line 33, leave out “or a member of its governing body” |
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188 | Page 184, line 39, after “by” insert “the court of directors of” |
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189 | Page 185, line 1, after “by” insert “the court of directors of” |
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190 | Page 185, line 3, leave out “Bank” and insert “court of directors” |
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191 | Page 185, line 10, leave out “Bank” and insert “court of directors” |
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192 | Page 185, line 12, leave out “Bank” and insert “court of directors” |
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193 | Page 185, line 34, after first “The” insert “court of directors of the ” |
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194 | Page 185, line 43, after “by” insert “the Oversight Committee of” |
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195 | Page 185, line 45, leave out “the Bank” and insert “that Committee” |
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196 | Page 186, leave out lines 1 to 4 |
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197 | Page 186, line 9, after “functions” insert “or its functions under section 2DA |
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| |
198 | Page 186, line 25, at end insert— |
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| |
| 17A(1) | The PRA must, for each of its financial years, adopt an annual |
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| budget which has been approved by the Bank. |
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| (2) | The budget must be adopted before the start of the financial |
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| year to which it relates, except that the first budget must be |
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| adopted as soon as reasonably practicable after the coming |
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| into force of this paragraph. |
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| (3) | The PRA may, with the approval of the Bank, vary the budget |
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| for a financial year at any time after its adoption. |
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| (4) | The PRA must publish each budget, and each variation of a |
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| budget, in such manner as the PRA thinks fit.” |
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199 | Page 186, leave out line 32 |
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200 | Page 186, line 33, at end insert “and of the matter mentioned in section 2G(1)(b)” |
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201 | Page 186, line 35, after “3I” insert “or 3IA” |
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| |
| | |
202 | Page 187, line 20, at end insert “and the matter mentioned in section 2G(1)(b)” |
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203 | Page 189, leave out lines 1 to 4 and insert— |
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| “26A (1) | The PRA must in respect of each of its financial years pay to the Treasury |
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| its penalty receipts after deducting its enforcement costs. |
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| (2) | The PRA’s “penalty receipts” in respect of a financial year are any |
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| amounts received by it during the year by way of penalties imposed |
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| |
| (3) | The PRA’s “enforcement costs” in respect of a financial year are the |
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| expenses incurred by it during the year in connection with— |
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| (a) | the exercise, or consideration of the possible exercise, of any of its |
|
| enforcement powers in particular cases, or |
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| (b) | the recovery of penalties imposed under this Act. |
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| (4) | For this purpose the PRA’s enforcement powers are— |
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| (a) | its powers under any of the provisions mentioned in section |
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| |
| (b) | its powers under section 56 (prohibition orders), |
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| (c) | its powers under Part 25 of this Act (injunctions and restitution), |
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| (d) | its powers under any other enactment specified by the Treasury |
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| |
| (e) | its powers in relation to the investigation of relevant offences, |
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| |
| (f) | its powers in England and Wales or Northern Ireland in relation |
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| to the prosecution of relevant offences. |
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| (5) | “Relevant offences” are— |
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| (a) | offences under FSMA 2000, |
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| (b) | offences under subordinate legislation made under that Act, and |
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| (c) | any other offences specified by the Treasury by order. |
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| (6) | The Treasury may give directions to the PRA as to how the PRA is to |
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| comply with its duty under sub-paragraph (1). |
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| (7) | The directions may in particular— |
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| (a) | specify descriptions of expenditure that are, or are not, to be |
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| regarded as incurred in connection with either of the matters |
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| mentioned in sub-paragraph (3), |
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| (b) | relate to the calculation and timing of the deduction in respect of |
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| the PRA’s enforcement costs, and |
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| (c) | specify the time when any payment is required to be made to the |
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| |
| (8) | The directions may also require the PRA to provide the Treasury at |
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| specified times with information relating to— |
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| (a) | penalties that the PRA has imposed under FSMA 2000, or |
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| (b) | the PRA’s enforcement costs. |
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| (9) | The Treasury must pay into the Consolidated Fund any sums received |
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| by them under this paragraph. |
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| 26B | The PRA must prepare and operate a scheme (“the financial penalty |
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| scheme”) for ensuring that the amounts that, as a result of the deduction |
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| for which paragraph 26A(1) provides, are retained by the PRA in respect |
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|
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| |
| | |
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| of amounts paid to it by way of penalties imposed under this Act are |
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| applied for the benefit of PRA-authorised persons.” |
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204 | Page 189, line 6, leave out “authorised” and insert “PRA-authorised” |
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205 | Page 189, line 6, at end insert— |
|
| “( ) | The financial penalty scheme must ensure that those who have become |
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| liable to pay a penalty to the PRA in any financial year of the PRA do not |
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| receive any benefit under the scheme in the following financial year.” |
|
206 | Page 190, line 6, after “Act” insert “or any of the other Acts mentioned in section |
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| |
207 | Page 190, line 22, at end insert— |
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| “(3A) | Neither section 2A(6)(d) nor the definition of “functions” in |
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| paragraph 1 applies for the purposes of sub-paragraph (2).” |
|
208 | Page 191, line 8, leave out from “as,” to end of line 10 and insert “a member, officer |
|
| or member of staff of the PRA;” |
|
209 | Page 191, line 13, at end insert— |
|
| “(1A) | Anything done or omitted by a person mentioned in sub-paragraph |
|
| (1)(a) or (b) while acting, or purporting to act, as a result of an |
|
| appointment under any of sections 97, 166 to 169 and 284 is to be taken |
|
| for the purposes of sub-paragraph (1) to have been done or omitted in |
|
| the discharge, or as the case may be purported discharge, of the PRA’s |
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| |
210 | Page 191, line 25, leave out “or a member of its governing body” |
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|
211 | Page 198, line 39, leave out sub-paragraph (2) and insert— |
|
| “(2) | For “the Authority” or “the Authority’s”, in each place, substitute “the |
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| appropriate regulator” or “the appropriate regulator’s”.” |
|
212 | Page 199, line 1, leave out “(7)” and insert “(8)” |
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213 | Page 199, line 2, leave out “(8)” and insert “(9)” |
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214 | Page 199, line 10, leave out “(9)” and insert “(10)” |
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215 | Page 199, line 13, at end insert— |
|
| “( ) | In the heading, for “Authority” substitute “appropriate regulator”.” |
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216 | Page 199, line 32, leave out sub-paragraph (2) and insert— |
|
| “(2) | For “the Authority” or “the Authority’s”, in each place, substitute “the |
|
| appropriate regulator” or “the appropriate regulator’s”.” |
|
217 | Page 199, line 34, leave out “(11)” and insert “(11A)” |
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218 | Page 199, line 35, leave out “(11A)” and insert “(11B)” |
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219 | Page 200, line 39, leave out sub-paragraph (4) and insert— |
|
| “(4) | In subsections (3) to (11), for “the Authority” substitute “the regulator”.” |
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220 | Page 201, line 1, leave out “(10)” and insert “(11)” |
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|
|
| |
| | |
221 | Page 201, line 2, leave out “(11)” and insert “(12)” |
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|
222 | Page 204, line 5, at end insert— |
|
| “(b) | after subsection (5) insert— |
|
| “(5A) | “The appropriate regulator”— |
|
| (a) | in relation to a controlled function which is of a |
|
| description specified in rules made by the FCA, |
|
| |
| (b) | in relation to a controlled function which is of a |
|
| description specified in rules made by the PRA, |
|
| |
| (c) | in subsection (6), after “Any” insert “other”.” |
|
|
223 | Page 215, leave out lines 44 to 48 and insert— |
|
| “(a) | the general condition in subsection (2) were that the Bank |
|
| considers that it is desirable to give the direction for the purpose |
|
| of the effective regulation of one or more recognised clearing |
|
| houses in the group of the qualifying parent undertaking,” |
|
224 | Page 217, line 42, at end insert— |
|
| |
| 23A(1) | The following provisions of Part 24 of this Act are to apply in relation to |
|
| |
| (a) | section 356 (powers to participate in proceedings: company |
|
| |
| (b) | section 358 (powers to participate in proceedings: trust deeds for |
|
| |
| (c) | section 359 (administration order); |
|
| (d) | section 362 (powers to participate in administration |
|
| |
| (e) | section 362A (consent to appointment of administrator); |
|
| (f) | section 363 (powers to participate in proceedings: receivership); |
|
| (g) | section 365 (powers to participate in proceedings: voluntary |
|
| |
| (h) | section 367 (winding-up petitions); |
|
| (i) | section 371 (powers to participate in proceedings: winding-up). |
|
| (2) | Those provisions are to apply as if any reference to an authorised person |
|
| or recognised UK investment exchange were a reference to a recognised |
|
| |
| 23B | In the case of any regulated activity which is carried on for the purposes |
|
| of, or in connection with, the provision of clearing services, the reference |
|
| to the FCA in section 375(1) is to be read as including a reference to the |
|
| |
225 | Page 219, line 41, at end insert— |
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|
|
| |
| | |
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| |
| Winding up, administration or insolvency of UK clearing houses |
|
| Notice to Bank of England of preliminary steps |
|
| 31A(1) | An application for an administration order in respect of a UK clearing |
|
| house may not be determined unless the conditions below are satisfied. |
|
| (2) | A petition for a winding up order in respect of a UK clearing house may |
|
| not be determined unless the conditions below are satisfied. |
|
| (3) | A resolution for voluntary winding up of a UK clearing house may not |
|
| be made unless the conditions below are satisfied. |
|
| (4) | An administrator of a UK clearing house may not be appointed unless |
|
| the conditions below are satisfied. |
|
| (5) | Condition 1 is that the Bank of England has been notified— |
|
| (a) | by the applicant for an administration order, that the application |
|
| |
| (b) | by the petitioner for a winding up order, that the petition has |
|
| |
| (c) | by the UK clearing house, that a resolution for voluntary |
|
| winding up may be made, or |
|
| (d) | by the person proposing to appoint an administrator, of the |
|
| |
| (6) | Condition 2 is that a copy of the notice complying with Condition 1 has |
|
| been filed (in Scotland, lodged) with the court (and made available for |
|
| public inspection by the court). |
|
| |
| (a) | the period of 2 weeks, beginning with the day on which the |
|
| notice is received, has ended, or |
|
| (b) | the Bank of England has informed the person who gave the |
|
| |
| (i) | it has no objection to the order, resolution or appointment |
|
| |
| (ii) | it does not intend to exercise a stabilisation power under |
|
| Part 1 of the Banking Act 2009. |
|
| (8) | Arranging for the giving of notice in order to satisfy Condition 1 can be |
|
| a step with a view to minimising the potential loss to a UK clearing |
|
| house’s creditors for the purpose of section 214 of the Insolvency Act |
|
| |
| (9) | In this paragraph “the court” means— |
|
| (a) | in England and Wales, the High Court, |
|
| (b) | in Scotland, the Court of Session, and |
|
| (c) | in Northern Ireland, the High Court. |
|
| Power to give directions to insolvency practitioner |
|
| 31B(1) | This paragraph applies where a person has been appointed to act as an |
|
| insolvency practitioner (within the meaning of section 388 of the |
|
| Insolvency Act 1986 or article 3 of the Insolvency (Northern Ireland) |
|
|
|
| |
| | |
|
| Order 1989) in relation to company which is, or has been, a UK clearing |
|
| |
| (2) | The Bank of England may give directions to the person if satisfied that it |
|
| is desirable to give the directions, having regard to the public interest |
|
| |
| (a) | protecting and enhancing the stability of the UK financial system, |
|
| (b) | protecting and enhancing public confidence in the stability of the |
|
| |
| (c) | maintaining the continuity of central counterparty clearing |
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| |
| (3) | Before giving directions the Bank of England must consult— |
|
| |
| (b) | (if the clearing house is a PRA-authorised person) the PRA, and |
|
| |
| (4) | Directions are enforceable, on an application by the Bank of England, by |
|
| an injunction or, in Scotland, by an order for specific performance under |
|
| section 45 of the Court of Session Act 1988. |
|
| (5) | A person is not liable for damages in respect of action or inaction in |
|
| accordance with directions. |
|
| (6) | The immunity does not extend to action or inaction— |
|
| |
| (b) | in contravention of section 6(1) of the Human Rights Act 1998.” |
|
|
226 | Page 223, line 25, leave out “subsection (5)” and “subsections (5) and (6)” |
|
227 | Page 223, line 26, after “procedure)” insert— |
|
| “(a) | in subsections (1), (6) and (7), after “section 296” insert “or 296A”, |
|
| |
| |
228 | Page 223, line 40, leave out from “provision)” to “substitute” in line 41 and insert |
|
| “for “Authority” (in each place)” |
|
229 | Page 225, line 12, leave out “and (12) (in both places)” and insert “, (12) (in both |
|
| places) and (13) (in the first place)” |
|
230 | Page 225, line 15, leave out “In section 313 (interpretation)” and insert— |
|
| “(1) | Section 313 (interpretation) is amended as follows. |
|
| |
| (a) | after the definition of “applicant” insert— |
|
| ““central counterparty clearing services” has the |
|
| same meaning as in section 155 of the Companies |
|
| Act 1989 (see subsection (3A) of that section);”, |
|
| |
| |
| “UK clearing house” means a clearing house— |
|
| (a) | which has its head office or its registered |
|
| office (or both) in the United Kingdom, |
|
|
|
| |
| | |
|
| (b) | which provides central counterparty |
|
| |
| (c) | in relation to which a recognition order is |
|
| |
| |
|
231 | Page 226, leave out lines 14 and 15 and insert— |
|
| “(4) | For subsection (2) substitute— |
|
| “(2) | A contravention within subsection (1) or (1A)— |
|
| (a) | does not, except as provided by section 23(1A), make a |
|
| person guilty of an offence, |
|
| (b) | does not, except as provided by section 26A, make any |
|
| transaction void or unenforceable, and |
|
| (c) | does not, except as provided by subsection (3), give rise to |
|
| any right of action for breach of statutory duty.”” |
|
232 | Page 226, line 17, at end insert— |
|
| “( ) | After subsection (3) insert— |
|
| “(4) | Subsections (1) and (1A) are subject to section 39(1D). |
|
| (5) | References in this Act to an authorised person acting in |
|
| contravention of this section are references to the person acting |
|
| in a way that results in a contravention within subsection (1) or |
|
| |
233 | Page 226, line 17, at end insert— |
|
| “2A(1) | Section 23 (contravention of the general prohibition) is amended as |
|
| |
| (2) | After subsection (1) insert— |
|
| “(1A) | An authorised person (“A”) is guilty of an offence if A carries on |
|
| a credit-related regulated activity in the United Kingdom, or |
|
| purports to do so, otherwise than in accordance with |
|
| |
| (a) | given to that person under Part 4A, or |
|
| (b) | resulting from any other provision of this Act. |
|
| (1B) | In this Act “credit-related regulated activity” means a regulated |
|
| activity of a kind designated by the Treasury by order. |
|
| (1C) | The Treasury may designate a regulated activity under |
|
| subsection (1B) only if the activity involves a person— |
|
| (a) | entering into or administering an agreement under which |
|
| the person provides another person with credit, |
|
| (b) | exercising or being able to exercise the rights of the lender |
|
| under an agreement under which another person |
|
| provides a third party with credit, or |
|
| (c) | taking steps to procure payment of debts due under an |
|
| agreement under which another person is provided with |
|
| |
|