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REC 6.3 Recognition requirements

REC 6.3.1GRP

Before making a recognition order, the FCA3 will need to be satisfied that the recognition requirements in section 292(3) of the Act (Overseas investment exchanges) have been met. These requirements are the only recognition requirements applicable to ROIEs3.


Sections 292(3) and 292(4) state:

2Section 292(3)

The requirements are that-


investors are afforded protection equivalent to that which they would be afforded if the body concerned were required to comply with -4


4(i) recognition requirements, other than any such requirements which are expressed in regulations under section 286 not to apply for the purposes of this paragraph; and

4(ii) requirements contained in any directly applicable Community regulation made under the markets in financial instruments directive or markets in financial instruments regulation;


there are adequate procedures for dealing with a person who is unable, or likely to become unable, to meet his obligations in respect of one or more market contracts connected with the [ROIE]



the applicant is able and willing to co-operate with the[FCA]3 by the sharing of information and in other ways; and



adequate arrangements exist for co-operation between the[FCA]3 and those responsible for the supervision of the applicant in the country or territory in which the applicant's head office is situated.


Section 292(4)

In considering whether it is satisfied as to the requirements mentioned in subsections (3)(a) and (b), the[FCA]3 is to have regard to-



the relevant law and practice of the country or territory in which the applicant's head office is situated;


the rules and practices of the applicant.

REC 6.3.3GRP

The reference to recognition requirements in section 292(3)(a) of the Act is a reference to the requirements applicable to UK RIEs in the Recognition Requirements Regulations. These requirements are set out, together with guidance, in REC 2.