BIPRU TP 25 Exclusions from consolidation

1Application

25.1

R

This section applies to a firm to which BIPRU 8 (Group risk - consolidation) applies.

Duration of transitional

25.2

R

This section applies until 1 January 2008. However BIPRU TP 25.8R continues in force until it is revoked.

Transitional rule

25.3

R

A firm may exclude a member of its UK consolidation group or non-EEA sub-group that would otherwise have been included under BIPRU 8.5 (Basis of consolidation) if, as at 31 December 2006, that member was excluded from the firm's UK consolidation group in accordance with any of the following:

(1)

bullet points one or three of paragraph 6 of section 4 of Chapter CS of IPRU(BANK) (exclusion from consolidation where inclusion would be inappropriate or misleading or where there are legal impediments to the transfer of information); or

(2)

section 1.13 of Chapter 1 of Volume 1 of IPRU(BSOC) (exclusion of subsidiary undertakings where inclusion in the consolidation would be misleading or inappropriate); or

(3)

IPRU(INV) 14.2.5R(2) (exclusion from consolidation where inclusion would be inappropriate or misleading); or

(4)

any waiver from the consolidation provisions of Chapter 14 of IPRU(INV) or (in the case of IPRU(BSOC)) a written consent or approval by the FSA on the ground set out in indent one of Article 52(3) of the Directive 2000/12 (the previous version of the Banking Consolidation Directive) (exclusion from consolidation where there are legal impediments to the transfer of information).

25.4

R

A firm may only apply BIPRU TP 25.3R to a member of its UK consolidation group or non-EEA sub-group if the firm or another member of its UK consolidation group notifies the FSA in writing that it intends to apply that rule to that member and the notice complies with the following requirements:

(1)

the FSA was notified on or after 1 November 2006 and on or before 29 December 2006;

(2)

the notice must give the name of the member concerned and say where it is incorporated and has its head office; and

(3)

the notice must say whether that member is a body corporate and state the legal form of that member.

Limitations

25.5

R

Any condition, limitation or requirement to which the treatment in BIPRU TP 25.3R is subject continues to apply to the extent that it is compatible with BIPRU.

Obligation to meet other qualifying conditions

25.6

R

A firm may only apply the treatment in BIPRU TP 25.3R if the conditions in whichever is applicable of Article 73(1)(a) (exclusion from consolidation where there are legal impediments to transfer of information) or Article 73(1)(c) (exclusion from consolidation where inclusion would be inappropriate or misleading) of the Banking Consolidation Directive continue to be satisfied.

Notification of relevance etc of concession

25.7

R

A firm must notify the FSA immediately if it becomes aware of any matter which is material to the relevance or appropriateness of the continuance of the treatment in BIPRU TP 25.3R.

Small balance sheet size exclusion

25.8

R

If a firm excluded a member of its UK consolidation group or non-EEA sub-group from the firm's UK consolidation group in accordance with:

(1)

bullet point two of paragraph 6 of section 4 of Chapter CS of IPRU(BANK) (exclusion from consolidation where combined balance sheet is below certain thresholds);

(2)

IPRU(INV) 14.2.5R(1) (exclusion from consolidation where combined balance sheet is below certain thresholds); or

(3)

a written consent or approval by the FSA under IPRU(BSOC) on the ground set out in indent two of Article 52(3) of the Directive 2000/12 (the previous version of the Banking Consolidation Directive) (exclusion from consolidation where combined balance sheet is below certain thresholds);

the firm need not notify the FSA under BIPRU 8.5.9 R (exclusion from consolidation where combined balance sheet is below certain thresholds) as long as it has notified the FSA of its intention to take advantage of this rule and that notice complies with BIPRU TP 25.4R.