PRIN 1 Annex 1 Non-designated investment business - clients that a firm may treat as an eligible counterparty for the purposes of PRIN
11.1 |
A firm may categorise the following types of client as an eligible counterparty for the purposes of PRIN: |
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(1) |
a properly constituted government (including a quasi-governmental body or a government agency) of any country or territory; |
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(2) |
a central bank or other national monetary authority of any country or territory; |
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(3) |
a supranational whose members are either countries or central banks or national monetary authorities; |
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(4) |
a State investment body, or a body charged with, or intervening in, the management of the public debt; |
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(5) |
another firm, or an overseas financial services institution; |
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(6) |
any associate of a firm (except an OPS firm), or of an overseas financial services institution, if the firm or institution consents; |
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(7) |
a client when he is classified as an eligible counterparty in accordance with 1.2; or |
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(8) |
a recognised investment exchange, designated investment exchange, regulated market or clearing house. |
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1.2 |
A firm may classify a client (other than another firm, regulated collective investment scheme, or an overseas financial services institution) as an eligible counterparty for the purposes of PRIN under 1.1(7) if: |
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(1) |
the client at the time he is classified is one of the following: |
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(a) |
a body corporate (including a limited liability partnership) which has (or any of whose holding companies or subsidiaries has) called up share capital of at least £10 million (or its equivalent in any other currency at the relevant time); |
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(b) |
a body corporate that meets (or any of whose holding companies or subsidiaries meets) two of the following tests: |
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(i) |
a balance sheet total of 12.5 million euros (or its equivalent in any other currency at the relevant time); |
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(ii) |
a net turnover of 25 million euros (or its equivalent in any other currency at the relevant time); |
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(iii) |
an average number of employees during the year of 250; |
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(c) |
a local authority or public authority; |
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(d) |
a partnership or unincorporated association which has net assets of at least £10 million (or its equivalent in any other currency at the relevant time) (and calculated, in the case of a limited partnership, without deducting loans owing to any of the partners); |
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(e) |
a trustee of a trust (other than an occupational pension scheme, SSAS, personal pension scheme or stakeholder pension scheme) with assets of at least £10 million (or its equivalent in any other currency), calculated by aggregating the value of the cash and designated investments forming part of the trust's assets, but before deducting its liabilities; |
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(f) |
a trustee of an occupational pension scheme or SSAS, or a trustee or operator of a personal pension scheme or stakeholder pension scheme where the scheme has (or has had at any time during the previous two years): |
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(i) |
at least 50 members; and |
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(ii) |
assets under management of not less than £10 million (or its equivalent in any other currency at the relevant time); and |
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(2) |
the firm has, before commencing business with the client on an eligible counterparty basis: |
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(a) |
advised the client in writing that he is being categorised as an eligible counterparty for the purposes of PRIN; |
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(b) |
given a written warning to the client that he will lose protections under the regulatory system; |
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(c) |
for a client falling under (1)(a) or (b): |
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(i) |
taken reasonable steps to ensure that the written notices required by (a) and (b) have been delivered to a person authorised to take such a decision for the client; and |
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(ii) |
not been notified by the client that the client objects to being classified as an eligible counterparty; |
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(d) |
for a client falling under (1)(c), (d), (e) or (f): |
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(i) |
taken reasonable steps to ensure that the written notices required by (a) and (b) have been delivered to a person authorised to take such a decision for the client; and |
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(ii) |
obtained the client's written consent or is otherwise able to demonstrate that consent has been given. |