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Status: You are viewing the version of the handbook as on 2019-01-31.

COBS 18.6A Insurance Special Purpose Vehicles (ISPVs)

Application

COBS 18.6A.1R

1This section applies to UK ISPVs.

COBS rules that apply to insurance risk transformation and activities directly arising from insurance risk transformation

COBS 18.6A.2R

1COBS 3 applies (subject to COBS 18.6A.3R) when a firm is carrying on insurance risk transformation and/or activities directly arising from insurance risk transformation.

Definitions and modifications

COBS 18.6A.3R

1When a firm is carrying on insurance risk transformation and/or activities directly arising from insurance risk transformation:

  1. (1)

    The general definition of client in COBS 3.2.1R is modified as set out in COBS 18.6A.3R(2) below.

  2. (2)

    Any reference to the term client is to be taken to include:

    1. (a)

      a person to whom the firm provides, intends to provide or has provided a service in the course of carrying on activities directly arising from insurance risk transformation (including the offer of investments issued by the firm); or

    2. (b)

      (in DISP only) a person who is holding or has held an investment issued by the firm.

  3. (3)

    COBS 3.6.1R(2) does not apply. A client can be an eligible counterparty in relation to insurance risk transformation and activities directly arising from insurance risk transformation.

COBS 18.6A.4G

1For the avoidance of doubt, the remainder of COBS 3.2 and COBS 3.6 applies.

Communications with clients

COBS 18.6A.5R

1Before an investment issued by an ISPV is sold to a client (that is not an eligible counterparty), the ISPV must ensure that the client is informed that compensation will not be available from the FSCS if the ISPV cannot meet its liabilities.

COBS 18.6A.6R

1A statement that compensation will not be available from the FSCS must be included in any brochure or other written communication by which an ISPV offers investments to clients.

COBS 18.6A.7G

1For the avoidance of doubt, COBS 18.6A.5R and COBS 18.6A.6R do not exhaust or restrict the scope of Principle 7.