Related provisions for PERG 5.6.23

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PERG 2.7.6BGRP
[deleted]331126
PERG 2.7.6DGRP
11(1) [deleted]3326(2) [deleted]3326(3) [deleted]3326(4) [deleted]3326(5) An emission allowance is a security. This means that any person wishing to carry out any activity in relation to it will need to consider whether any of the regulated activities relating to securities apply (subject to (8)). 26(6) A derivative on an emission allowance is potentially a contractually based investment and a relevant investment. Therefore any person wishing to carry out any activity in relation
PERG 2.7.7AGRP
There are ten93 arranging activities that are regulated activities under the Regulated Activities Order. These are:39(1) arranging (bringing about) deals in investments which are securities, relevant investments, structured deposits26 or the underwriting capacity of a Lloyd's syndicate or membership of a Lloyd's syndicate (article 25(1));(2) making arrangements with a view to transactions in investments which are securities, relevant investments, structured deposits26 or the underwriting
PERG 2.7.7BDGRP
(1) 8The scope of article 25(2) of the Regulated Activities Order (the subject of PERG 2.7.7B G) was considered by the High Court in the case of Watersheds Limited v. David Da Costa and Paul Gentlemen. The judgement suggests that the activity of introducing does not itself constitute a regulated activity for the purposes of article 25(2) of the Regulated Activities Order. The FCA has considered whether the judgement necessitates any change to the views expressed in PERG 2.7.7B
PERG 2.7.8DGRP
(1) 15Taking steps to procure the payment of a debt due under a credit agreement or a consumer hire agreement is a regulated activity.(2) Taking steps to procure the payment of a debt due under an article 36H agreement (see PERG 2.7.7HG (3)) which has been entered into with the facilitation of an operator of an electronic system in relation to lending is also a regulated activity.(3) The activity is not a regulated activity in so far as the activity is operating an electronic
PERG 2.7.8EGRP
(1) 15Taking steps to perform duties or to exercise or to enforce rights under a credit agreement or a consumer hire agreement on behalf of the lender or owner is a regulated activity.(2) Taking steps to perform duties or to exercise or to enforce rights under an article 36H agreement (see PERG 2.7.7HG (3)) which has been entered into with the facilitation of an operator of an electronic system in relation to lending is also a regulated activity.(3) In so far as the activity is
PERG 2.7.14CGRP
25There are two regulated activities which constitute advising on investments in article 53 of the Regulated Activities Order. These are:(1) advising on investments (except P2P agreements) (in article 53(1) of the Regulated Activities Order); and(2) advising on P2P agreements (in article 53(2) of the Regulated Activities Order).
PERG 2.7.15GRP
The regulated activity of advising on investments (except P2P agreements)25 under article 53(1)25 of the Regulated Activities Order applies to advice on securities, structured deposits26 or relevant investments. It does not, for example, include giving advice about deposits (except structured deposits)26, or about things that are not specified investments for the purposes of the Regulated Activities Order. 19 Giving advice on certain other specified investments is, however, regulated
PERG 2.7.16AAGRP
25The regulated activity of advising on P2P agreements under article 53(2) of the Regulated Activities Order applies to advice given to a person in their capacity as a lender or potential lender under a relevant article 36H agreement (defined in article 53(4) of the Regulated Activities Order), or as an agent for a lender or potential lender under such an agreement, where that advice is on the merits of their doing any of the following (whether as principal or agent):(1) entering
PERG 2.7.16BGRP
Under article 53A of the Regulated Activities Order, giving advice to a person in his capacity as borrower or potential borrower is a regulated activity if it is advice on the merits of the person:(1) entering into a particular regulated mortgage contract; or(2) varying the terms of a regulated mortgage contract.Advice on varying terms as referred to in (2) comes within article 53A only where the borrower entered into the regulated mortgage contract on or after 31 October 2004,
PERG 2.7.16CGRP
3Under article 53B of the Regulated Activities Order, giving advice to a person in his capacity as reversion occupier or reversion provider is a regulated activity if it is advice on the merits of the person:(1) entering into a particular home reversion plan; or(2) varying the terms of a home reversion plan.Advice on varying terms as referred to in (2) only comes within article 53B where the plan was entered into by the person on or after 6 April 2007 and the variation varies
PERG 2.7.16DGRP
3Under article 53C of the Regulated Activities Order, giving advice to a person in his capacity as home purchaser is a regulated activity if it is advice on the merits of the person:(1) entering into a particular home purchase plan; or(2) varying the terms of a home purchase plan.Advice on varying terms as referred to in (2) only comes within article 53C where the plan is entered into by the person on or after 6 April 2007 and the variation varies the person's obligations under
PERG 2.7.16EGRP
9Under article 53D of the Regulated Activities Order giving advice to a person in his capacity as an SRB agreement seller or an SRB agreement provider is a regulated activity if it is advice on the merits of the person:(1) entering into a particular regulated sale and rent back agreement; or(2) varying the terms of a regulated sale and rent back agreement. Advice on varying terms as referred to in (2) only comes within article 53D where the agreement is entered into by the person
PERG 2.7.16FGRP
18Under article 53DA of the Regulated Activities Order, advising a person (“P”) is a regulated activity if:19(1) the advice is given to P in P’s capacity as a recipient of credit, or potential recipient of credit, under a regulated credit agreement;(2) P intends to use the credit to acquire or retain property rights in land or in an existing or projected building; and(3) the advice consists of the provision of personal recommendations to P in respect of one or more transactions
PERG 2.7.16GGRP
19Under article 53E of the Regulated Activities Order giving advice to a person (“P”) who has subsisting rights in respect of any safeguarded benefits in their capacity as: (1) a member of a pension scheme; or(2) a survivor of a member of a pension scheme;is a regulated activity if the advice is on the merits of P requiring the trustee or manager of the pension scheme to carry out any of the transactions listed in 29PERG 2.7.16HG.29
PERG 2.7.17GRP
Certain activities carried on in connection with business at Lloyds will be regulated. In addition to those already mentioned (arranging deals in the underwriting capacity of a Lloyd's syndicate or membership of a Lloyd'ssyndicate), there are three other regulated activities as follows.(1) Managing the underwriting capacity of a Lloyd's syndicate as a managing agent at Lloyd's is a regulated activity. 'Managing agent' is defined in article 3(1) of the Regulated Activities Order.(2)
PERG 2.7.19BGRP
(1) A credit agreement entered into before 1 April 2014 is a regulated credit agreement for the purposes of PERG 2.7.19AG if it was a ‘regulated agreement’ within the meaning of the CCA when it was entered into, or became such a ‘regulated agreement’ by virtue of being varied or supplemented by another agreement before 1 April 2014. But a credit agreement is not a regulated credit agreement for the purposes of PERG 2.7.19AG if was entered into before 1 April 2014 and, if it had
PERG 2.7.19CGRP
15A credit agreement is an exempt agreement17 in the following cases:(1) if:36(a) by entering into the agreement as lender, a person is or was carrying on the regulated activity of entering into regulated mortgage contracts; or36(b) by entering into the agreement as home purchase provider, a person is or was carrying on a regulated activity of the kind specified by article 63F(1) of the Regulated Activities Order (entering into regulated home purchase plans); or36(c) by administering
PERG 2.7.19FBGRP
(1) 36In PERG 2.7.19FG(3), ‘housing authority’ has the same meaning as in article 60E(7) of the Regulated Activities Order. The definition of ‘housing authority’ in article 60E includes housing associations registered under the relevant housing legislation. (2) The effect of the definition of ‘regulated credit agreement’ in the Regulated Activities Order is that credit agreements entered into by housing associations and other housing authorities before 1 April 2014 that were
PERG 2.7.20GRP
Entering into as lender, and administering, a regulated mortgage contract are regulated activities under article 61 of the Regulated Activities Order (Regulated mortgage contracts). Guidance on these regulated activities is in PERG 4.7 (Entering into a regulated mortgage contract) and PERG 4.8 (Administering a regulated mortgage contract).
PERG 2.7.20AGRP
3Entering into a home reversion plan and administering a home reversion plan are regulated activities under article 63B of the Regulated Activities Order (Regulated home reversion plans). Guidance on these regulated activities is in PERG 14.3 (Guidance on home reversion and home purchase activities).
PERG 2.7.20BGRP
3Entering into a home purchase plan and administering a home purchase plan are regulated activities under article 63F of the Regulated Activities Order (Regulated home purchase plans). Guidance on these regulated activities is in PERG 14.4 (Guidance on home reversion and home purchase activities).
PERG 2.7.20BAGRP
9Entering into a regulated sale and rent back agreement as an agreement provider and administering a regulated sale and rent back agreement are regulated activities under Article 63J of the Regulated Activities Order (Regulated sale and rent back agreements). Guidance on these regulated activities is in PERG 14.4A (Activities relating to regulated sale and rent back agreements).
PERG 4.10A.2GRP
Article 4(4B) of the Regulated Activities Order says that where:(1) a person is: (a) a mortgage creditor (see PERG 4.10A.6 G); or(b) a credit intermediary (see PERG 4.10A.12 G); or (c) a person providing advisory services (see PERG 4.10A.20 G);under the MCD; and(2) that person is (ignoring the exclusions in (3)) carrying on one of the following regulated activities:(a) article 25A (arranging (bringing about) regulated mortgage contracts and making arrangements with a view to regulated
PERG 4.10A.6GRP
To work out the effect of article 4(4B) of the Regulated Activities Order (see PERG 4.10A.2 G) on the regulated activity of entering into a regulated mortgage contract as lender, it is necessary to look at what a mortgage creditor means.
PERG 4.10A.9GRP
Article 4(4B) of the Regulated Activities Order (see PERG 4.10A.2 G) does not affect the regulated activity of making arrangements with a view to regulated mortgage contracts. This is because, in the FCA's view, the activities covered by this regulated activity are not covered by the MCD.
PERG 4.10A.10GRP
Article 4(4B) of the Regulated Activities Order disapplies the Regulated Activities Order exclusions in PERG 4.10A.2G (3) for the regulated activity of arranging (bringing about) regulated mortgage contracts, but only in relation to the credit intermediary activities described in PERG 4.10A.12 G.
PERG 4.10A.11GRP
To work out the effect of article 4(4B) of the Regulated Activities Order on the regulated activity of arranging (bringing about) regulated mortgage contracts, it is necessary to look at what a credit intermediary (as referred to in PERG 4.10A.2G (1)(b)) means.
PERG 4.10A.16GRP
Except as described in PERG 4.10A.15 G, the Regulated Activities Order exclusions in PERG 4.10A.2G (3) do not apply to the regulated activity of arranging (bringing about) regulated mortgage contracts.
PERG 4.10A.20GRP
To work out the effect of article 4(4B) of the Regulated Activities Order (see PERG 4.10A.2 G) on the regulated activity of advising on regulated mortgage contracts, it is necessary to look at what advisory services as referred to in PERG 4.10A.2G (1)(c) means.
PERG 4.10A.26GRP
Article 4(4B) does not apply to advising or arranging activities if: (1) they are carried out on an incidental basis in the course of professional activity;(2) that professional activity is regulated; and(3) the rules governing that professional activity do not prohibit the carrying out, on an incidental basis, of credit intermediation activities.
PERG 2.8.1GRP
Most regulated activities are subject to exclusions that are set out in the Regulated Activities Order directly following each activity.
PERG 2.8.4GRP
The regulated activity of dealing in investments as principal applies to specified transactions relating to any security or to any contractually based investment (apart from rights under funeral plan contracts or rights to or interests in such contracts). The activity is cut back by exclusions as follows.(1) Of particular significance is the exclusion in article 15 of the Regulated Activities Order (Absence of holding out etc). This applies where dealing in investments as principal
PERG 2.8.5GRP
The regulated activity of dealing in investments as agent applies to specified transactions relating to any security or to any relevant investment (apart from rights under funeral plan contracts or rights to or interests in such rights). In addition, the activity is cut back by exclusions as follows.(1) An exclusion applies to certain transactions entered into by an agent who is not an authorised person which depend on him dealing with (or through) an authorised person. It does
PERG 2.8.6GRP
The various activities that involve arranging fall into two general types. These are:33(1) those relating to arranging a particular transaction or a contract, agreement5 or plan variation (articles 25(1), 25A(1), 25A(2A).12 25B(1),5 25C(1) , and 25E(1) 5of the Regulated Activities Order); and53(2) those relating to making arrangements with a view to persons entering into certain transactions (articles 25(2), 25A(2), 25B(2),5 25C(2) , and 25E(2) 5of the Regulated Activities Order).53The
PERG 2.8.6AGRP
3The exclusions in the Regulated Activities Order that relate to the various arranging activities are as follows.(-1) [deleted]228(1) Under article 26, arrangements that do not or would not bring about the transaction to which they relate are excluded from the arranging activities that relate to a particular transaction (see PERG 2.8.6G (1)) only. A person will bring about a transaction or a contract or plan variation only if his involvement in the chain of events leading to a
PERG 2.8.7GRP
The activities of persons appointed under a power of attorney are excluded under article 38 of the Regulated Activities Order, from the regulated activity of managing investments, if specified conditions are satisfied. The exclusion only applies where a person is not carrying on insurance distribution or reinsurance distribution20 and is subject to further limitations discussed below2. In addition, the following exclusions (outlined in PERG 2.9) apply in specified circumstances
PERG 2.8.8GRP
The exclusions from the regulated activity of safeguarding and administering investments are as follows.(1) Safeguarding and administration activities carried on by one person are excluded if a specified third party undertakes a responsibility for the assets which is no less onerous than it would have been if he were doing the safeguarding and administration himself. The effect of this is that an authorised person with permission to carry on this regulated activity (or in certain
PERG 2.8.10GRP
10(1) 22The exclusion for business angel-led capital funds (see PERG 2.9.20 G) applies to the activities of managing an AIF, managing a UK UCITS22 and establishing, operating and winding up a collective investment scheme.10There is a third exclusion for insolvency practitioners (see PERG 2.9.25 G).9(2) In addition, there are two further exclusions which apply to the activity of establishing, operating or winding up a collective investment scheme:10(a) the exclusion in PERG 2.9.22
PERG 5.6.1GRP
Article 25 of the Regulated Activities Order (Arranging deals in investments) describes two types of regulated activities concerned with arranging deals in respect of contracts of insurance. These are:(1) arranging (bringing about) deals in investments (article 25(1) (Arranging deals in investments)); and(2) making arrangements with a view to transactions in investments (article 25(2) (Arranging deals in investments)).
PERG 5.6.6GRP
In broad terms, article 72C of the Regulated Activities Order excludes from the activities of arranging and assisting in the administration and performance of a contract of insurance activities that:(1) consist of the provision of information to the policyholder or potential policyholder;(2) are carried on by a person carrying on any profession or business which does not otherwise consist of regulated activities; and(3) amount to the provision of information that may reasonably
PERG 5.6.8GRP
This exclusion applies to a person whose profession or business does not otherwise consist of regulated activities. In the FCA's view, the fact that a person may carry on regulated activities in the course of the carrying on of a profession or business does not, of itself, mean that the profession or business consists of regulated activities. This is provided that the main focus of the profession or business does not involve regulated activities and that the regulated activities
PERG 5.6.12GRP
Article 28 of the Regulated Activities Order (Arranging transactions to which the arranger is a party) excludes from the regulated activities in article 25(1) and 25(2) arrangements made for or with a view to contracts of insurance when:(1) the person (P) making the arrangements is the only policyholder; or(2) P, as a result of the transaction, would become the only policyholder.
PERG 5.6.16GRP
The restriction in the scope of article 28 raises an issue where there is a trust with co-trustees, where each trustee will be a policyholder with equal rights and obligations. If the activities of one of the trustees include arranging in respect of contracts of insurance, that trustee could be viewed as arranging on behalf of his co-trustees who will also be policyholders. Similar issues also arise in respect of trustees assisting in the administration and performance of a contract
PERG 5.6.17GRP
Article 33 of the Regulated Activities Order (Introducing) excludes arrangements which would otherwise fall under article 25(2) where:(1) they are arrangements under which persons will be introduced to another person;(2) the person to whom introductions are to be made is:(a) an authorised person; or(b) an exempt person acting in the course of business comprising a regulated activity in relation to which they are1 exempt; or(c) a person who is not unlawfully carrying on regulated
PERG 2.6.9GRP
Shares are defined in the Regulated Activities Order as shares or stock in a wide range of entities; that is, any body corporate wherever incorporated and unincorporated bodies formed under the law of a country other than the United Kingdom. They include deferred shares issued by building societies as well as transferable shares in industrial and provident societies, credit unions and equivalent EEA bodies. These shares are transferable and negotiable in a way similar to other
PERG 2.6.19CGRP
213(1) Rights under stakeholder pension schemes and personal pension schemes are specified investments for the purposes of the entire Regulated Activities Order.13(2) Rights or interests under a pension scheme which provides safeguarded benefits as defined by section 48(8) of the Pension Schemes Act 2015 are only specified investments for the purposes of article 53E (Advising on conversion or transfer of pension benefits) and not in relation to any other regulated activity.13(3)
PERG 4.5.1GRP
Article 25A of the Regulated Activities Order describes two types of regulated activities concerned with arrangingregulated mortgage contracts. These are:(1) making arrangements:2(a) for another person to2 enter into a regulated mortgage contract as borrower; or(b) to enter into a regulated mortgage contract with a borrower on behalf of a lender; or22(c) for another person to vary the terms of a regulated mortgage contract entered into by that person3 as borrower on or after 31
PERG 4.5.2GRP
The first activity (article 25A(1) and (2A)2) is referred to in this guidance as arranging (bringing about) regulated mortgage contracts. Various points arise:(1) It is not necessary for the potential borrower himself to be involved in making the arrangements.(2) This activity is carried on only if the arrangements bring about, or would bring about a regulated mortgage contract. This is because of the exclusion in article 26 (see PERG 4.5.4 G). As explained in PERG 4.5.4A G, this
PERG 4.5.10GRP
Article 33A of the Regulated Activities Order (Introducing to authorised persons) excludes from article 25A(2) arrangements under which a borrower is introduced to certain persons. Introducing is only a regulated activity under article 25A(2) as it does not of itself bring about regulated mortgage contracts (see PERG 4.5.2 G).
PERG 4.5.11GRP
The exclusion applies for introductions to:(1) an authorised person who has permission to carry on a regulated activity specified in article 25A (Arranging regulated mortgage contracts) or article 53A (Advising on regulated mortgage contracts) or article 61(1) (Entering into a regulated mortgage contract as lender); introducers can check the status of an authorised person and its permission by visiting the Financial Services Register1 at http://www.fsa.gov.uk/register/;11(2) an
PERG 4.5.18GRP
In addition to the exclusion in article 33A, introducers may be able to take advantage of the exclusion in article 33 of the Regulated Activities Order (Introducing). This excludes arrangements where:(1) they are arrangements under which persons will be introduced to another person;(2) the person to whom the introduction is to be made is:(a) an authorised person; or(b) an exempt person acting in the course of business comprising a regulated activity in relation to which he is
PERG 4.5.19GRP
The Regulated Activities Order contains a number of other exclusions which have the effect of preventing certain activities from amounting to regulated activities within article 25. These are referred to in PERG 4.10 (Exclusions applying to more than one regulated activity). There is also an exclusion where both the arranger and borrower are overseas, which is referred to in PERG 4.11 (Link between activities and the United Kingdom).
PERG 2.9.1GRP
The various exclusions outlined below deal with a range of different circumstances.(1) Each set of circumstances described in PERG 2.9.3 G to PERG 2.9.17 G has some application to several regulated activities relating to securities, structured deposits,18relevant investments orhome finance transactions.4 They have no effect in relation to the separate regulated activities of accepting deposits, issuing electronic money,9effecting or carrying out contracts of insurance, 20advising
PERG 2.9.2GRP
The exclusions grouped together in the Regulated Activities Order are described below in this chapter in general terms. The exact terms of each exclusion will need to be considered by any person who is considering whether they need authorisation. Each description is accompanied by an indication of which regulated activities are affected.
PERG 2.9.3GRP
This group of exclusions applies, in specified circumstances, to the regulated activities of:(1) dealing in investments as principal;(2) arranging (bringing about) dealsininvestments and4making arrangements with a view to transactions in investments;44(2A) arranging a home finance transaction;4(3) managing investments;(4) assisting in the administration and performance of a contract of insurance;(5) safeguarding and administering investments;(6) sending dematerialised instructions;(7)
PERG 2.9.5GRP
This group of exclusions applies, in specified circumstances, to the regulated activities of:(1) dealing in investments as agent;(2) arranging (bringing about) deals in investments, and4making arrangements with a view to transactions in investments;44(2A) arranging a home finance transaction;4(3) assisting in the administration and performance of a contract of insurance;(4) safeguarding and administering investments; and(5) advising on investments,15advising on regulated credit
PERG 2.9.18GRP
[deleted]20
PERG 2.9.24GRP
(1) 12Subject to (2), (3) and (4),15 the exclusions apply, in relation to any activity carried on by a local authority.15(2) The exclusion relating to the regulated activities of:(a) dealing in investments as agents;(b) arranging (bringing about) deals in investments;(c) making arrangements with a view to transactions in investments;(d) assisting in the administration and performance of a contract of insurance; and(e) advising on investments;applies to any activity carried on
PERG 4.11.6GRP
The exclusions in article 72(5A) to (5F) of the Regulated Activities Order (Overseas persons) provide that an overseas person does not carry on the regulated activities of:(1) arranging (bringing about) or making arrangements with view to a regulated mortgage contract;(2) entering into a regulated mortgage contract; or(3) administering a regulated mortgage contract;of the borrower (and each of them, if more than one) is an individual and is normally resident outside the United
PERG 4.11.11GRP
There may also be situations where a lender, who does not maintain an establishment in the United Kingdom, provides services in the United Kingdom. For instance, a lender might attend a property exhibition in the United Kingdom at which he sets up a loan with a borrower. A lender might also attend the offices of its UK-based lawyers, or appoint them as its agent, to enter into a contract with a borrower. In these cases, the overseas lender would only be carrying on a regulated
PERG 4.11.12GRP
If a service provider is overseas, the question of whether that person is carrying on a regulated activity in the United Kingdom will depend upon:(1) the type of regulated activity being carried on;(2) section 418 of the Act;(3) the residence and location of the borrower;(4) the application of the overseas persons exclusion in article 72(5A) to (5F) of the Regulated Activities Order; and(5) whether the service provider is carrying on an electronic commerce activity.The factors
PERG 4.11.13GRP
When a person is arranging (bringing about) regulated mortgage contracts or making arrangements with a view to regulated mortgage contracts from overseas, the question of whether he will be carrying on regulated activities in the United Kingdom will depend on the relevant circumstances. In the FCA's view, factors to consider include:(1) the territorial limitation in the definition of regulated mortgage contract so that regulation only applies if the land is in the United Kingdom5;44(2)
PERG 4.11.16GRP
The effect of article 72(5D) of the Regulated Activities Order is that an overseasperson does not carry on the regulated activity of entering into a regulated mortgage contract if the borrower is resident overseas at the time the contract is entered into.
PERG 4.11.18GRP
The effect of article 72(5E) and (5F) of the Regulated Activities Order is that an overseas person who administers a regulated mortgage contract, where the borrower was resident overseas at the time that the contract was entered into, does not carry on the regulated activity of administering a regulated mortgage contract.
PERG 5.11.6GRP
(1) The5 exclusion for groups and joint enterprises in article 69 of the Regulated Activities Order (Groups and joint enterprises) does not apply to transactions relating to contracts of insurance. This will affect5 a company providing services for:(a) other members of its group; or(b) other participants in a joint enterprise of which it is a participant.(2) Such companies might typically provide risk or treasury management or administration services which may include regulated
PERG 5.11.9GRP
Article 67 excludes from the activities of dealing as agent, arranging (bringing about) deals in investments, making arrangements with a view to transactions in investments, assisting in the administration and performance of a contract of insurance and advising on investments, any activity which:(1) is carried on in the course of carrying on any profession or business which does not otherwise consist of the carrying on of regulated activities in the United Kingdom; and(2) may
PERG 5.11.10GRP
Although the article 67 exclusion is disapplied (by article 4(4A) of the Regulated Activities Order (Specified investments: general)) when a person takes up or pursues insurance distribution or reinsurance distribution5 as defined by articles 2.1(1), 2.1(2) and 2.2 of the IDD5, there may be cases where a person is not carrying on activities that amount to insurance distribution5. For example, where a person's activities amount simply to the provision of information on an incidental
PERG 5.11.13GRP
Article 72B (see also PERG 5.3.7 G (Connected contracts of insurance)) may be of relevance to persons who supply non-motor goods or services5 or provide services related to travel in the course of carrying on a profession or business which does not otherwise consist of carrying on regulated activities. In the FCA's view, the fact that a person may carry on regulated activities in the course of the carrying on of a profession or business does not, of itself, mean that the profession
PERG 7.3.2GRP
Articles 53,1 53A, 53B,3 53C1, 53D 53DA4 and 53E 5of the Regulated Activities Order contain a number of elements, all of which must be present before a person will require authorisation. For guidance on whether a person is carrying on these regulated activities, see PERG 8 (Financial promotion and related activities),1PERG 4 (Guidance on regulated activities connected with mortgages), PERG 12.6 (Advising on conversion or transfer of pension benefits), 5, 3PERG 14.3, 3PERG 14.4
PERG 7.3.7GRP
But even if advice is given in the United Kingdom, the general prohibition will not be contravened if the giving of advice does not amount to the carrying on, in the United Kingdom, of the business of advising on investments, advising on regulated credit agreements for the acquisition of land4,9 or advising on conversion or transfer of pension benefits advising on a home finance transaction . Also, the general prohibition will not be contravened if the exclusion for overseas persons
PERG 7.3.8GRP
If a person is carrying on the business of advising on investments, advising on regulated credit agreements for the acquisition of land,9 advising on a home finance transaction or advising on conversion or transfer of pension benefits9 in the United Kingdom, he will not require authorisation if:41(1) he is able to rely on an exclusion; in addition to the exclusions already mentioned (in articles 54 and 72 of the Regulated Activities Order), other exclusions that may be relevant
PERG 4.6.1GRP
Article 53A of the Regulated Activities Order (Advising on regulated mortgage contracts) makes advising on regulated mortgage contracts a regulated activity. This covers advice which is both:(1) given to a person in his capacity as borrower or potential borrower; and(2) advice on the merits of the borrower:(a) entering into a particular regulated mortgage contract (whether or not the entering into is done by way of business); or(b) varying the terms of a regulated mortgage contract
PERG 4.6.5GRP
Advice will come within the regulated activity in article 53A of the Regulated Activities Order only if it relates to a particular regulated mortgage contract (or several different regulated mortgage contracts). Generic or general advice is not covered: examples of generic advice are shown in PERG 4.6.7G (but see PERG 4.6.7AG as well). Generic or general advice may, however, be a financial promotion (see PERG 8.4 (Invitation or inducement)).
SUP App 3.10.1GRP
The guidance in Table 3 describes in broad outline the relationship between:4(1) the insurance-related regulated activities specified in the Regulated Activities Order; and(2) the activities within the scope of the Solvency II Directive77
SUP App 3.10.2GRP

This is a guide only and should not be used as a substitute for legal advice

in individual cases.

Table 3: Solvency II Directive activities7

7

Part II RAO Activities

Part III RAO Investments

1. Non-life insurance activities

1.

Taking up and carrying on direct non-life insurance business

Article 10

Article 75

2.

Classes 1 to 18 of non-life insurance business in Point A of Annex I to the Solvency II7 Directive

77

Corresponding paragraphs 1 to 18 of Schedule 1, Part I

2. Life insurance activities7

7

1.

Taking up and carrying on direct life insurance business

Article 10

Article 75

2.

Classes I to IX of direct life insurance business in Annex II to the Solvency II Directive7

7

Corresponding paragraphs I to IX of Schedule 1, Part II

SUP App 3.10.7GRP
Most of the exclusions under the Directives, however, are not excluded from being regulated activities. For example, the activities of "non-directive friendly societies"7 are regulated under the Act, on a "lighter basis" than the activities of other insurers.7
SUP App 3.10.9GRP
So, the effect of App 3.12.1 is that an insurer may be carrying on insurance business in the United Kingdom which is to be treated as a regulated activity under article 10 to the Regulated Activities Order (Effecting and carrying out contracts of insurance) in circumstances where the risks covered are treated as located in another EEA State. In that event, the insurer is required by Schedule 3 to the Act to passport into the State concerned and may be subject to conduct of business
PERG 5.8.1GRP
Article 53(1)2 of the Regulated Activities Order (Advising on Investments (except P2P agreements)2) makes advising on contracts of insurance a regulated activity. This covers advice which is both:(1) given to a person in his capacity as an insured or potential insured, or as agent for an insured or a potential insured; and(2) advice on the merits of the insured or his agent:(a) buying, selling, subscribing for or underwriting a particular contract of insurance; or(b) exercising
PERG 5.8.4GRP
Advice about contracts of insurance will come within the regulated activity in article 53(1)2 of the Regulated Activities Order only if it relates to a particular contract of insurance. So, generic or general advice will not fall under article 53(1)2. In particular:(1) advice would come within article 53(1)2 if it took the form of a recommendation that a person should buy the ABC Insurers motor insurance;(2) advice would not relate to a particular contract if it consists of a
PERG 5.8.13GRP
The requirements imposed by the IDD3 (see PERG 5.2.5 G (Approach to implementation of the IMD)) and the text of article 2.3 IDD3 articles 2.1(1), 2.1(2) and 2. 2 in PERG 5.16.1 G3are narrower than the scope of the Regulated Activities Order (see PERG 5.2.7 G (Approach to implementation of the IDD)). Unlike3 the Regulated Activities Order, they do not relate to the assignment of contracts of insurance. This is of relevance to, amongst others, persons involved in the 'second-hand'
SUP App 3.9.5GRP

3Table 2: MiFIDinvestment services and activities

Part II RAO Activities13

Part III RAO Investments

A MiFIDinvestment services and activities

1.

Reception and transmission of orders in relation to one or more financial instruments

Article 252

Article 76-81, 82B,12 83-85, 89

2.

Execution of orders on behalf of clients

Article 14, 21

A Article 76-81,82B,12 83-85, 89

3.

Dealing on own account

Article 14

Article 76-81, 82B,12 83-85, 89

4.

Portfolio management

Article 37 (14, 21, 25 - see Note 1) 2

Article 76-81, 82B,12 83-85, 89

5.

Investment advice

Article 53(1)10

Article 76-81, 82B,12 83-85, 89

6.

Underwriting of financial instruments and/or placing of financial instruments on a firm commitment basis

Article 14, 21

Article 76-81, 82B,12 83-85, 89

7.

Placing of financial instruments without a firm commitment basis

Article 21, 25

Article 76-81, 82B,12 83-85, 89

8.

Operation of Multilateral Trading Facilities

Article 25D5 (see Note 2)

5

Article 76-81, 82B,12 83-85, 89

12 9.

Operation of an OTF

Article 25DA (see Note 3)

Article 77, 77A, 78, 79, 80, 81, 82B, 83-85, 89

Ancillary services

Part II RAO Activities

Part III RAO Investments

1.

Safekeeping and administration of financial instruments for the account of clients, including custodianship and related services such as cash/collateral management

Article 40, 45, 64

Article 76-81, 82B,12 83-85, 89

2.

Granting credits or loans to an investor to allow him to carry out a transaction in one or more of the relevant instruments where the firm granting the credit or loan is involved

3.

Advice to undertakings on capital structure, industrial strategy and related matters and advice and services relating to mergers and the purchase of undertakings

Article 14, 21, 25, 53(1)10, 64

Article 76-80, 82B,12 83-85, 89

4.

Foreign exchange services where these are connected with the provision of investment services

Article 14, 21, 25, 53(1)10, 64

Article 83-85, 89

5.

Investment research and financial analysis or other forms of general recommendation relating to transactions in financial instruments

Article 53(1)10, 64 (see Note 4)13

Article 76-81, 82B,12 83-85, 89

6.

Services related to underwriting

Article 25, 53(1)10, 64

Article 76-81, 82B,12 83-85, 89

7.

Investment services and activities as well as ancillary services of the type included under Section A or B of Annex I related to the underlying of the derivatives included under Section C 5, 6, 7 and 10-where these are connected to the provision of investment or ancillary services.

Article 14, 21, 25, 25D,5 37, 53(1)10, 64

5

Article 83 and 84

Note 1. A firm may also carry on these other activities when it is managing investments.2

Note 2. A firm operating an MTF under article 25D5 does not need to have a permission covering other regulated activities, unless it performs other regulated activities in addition to operating an MTF.

5

Note 3. A firm operating an OTF under article 25DA does not need to have a permission covering other regulated activities, unless it performs other regulated activities in addition to operating an OTF.12

13Note 4: A firm which provides investment research and financial analysis or other forms of general recommendation relating to transactions in financial instruments does not need permission under article 53(1) of the Regulated Activities Order if it is appropriately authorised (see article 53(1) to (1D) of the Regulated Activities Order).

SUP App 3.9.5AGRP

Table 2ZA: AIFMD activities

Part II RAO Activities

Part III RAO Investments

1.

AIFM management functions.

Article 51ZC

N/A (activity relates to property of any kind)

2.

Management of portfolios of investments, including those owned by pension funds and institutions for occupational retirement in accordance with article 19(1) of Directive 2003/41/EC, in accordance with mandates given by investors on a discretionary client-by-client basis (Note 2).

Articles 14, 21, 25, 37, 40 (arranging only), 64

Articles 76 to 81, 82B,12 83 to 85, 89

3.

Investment advice (Note 2).

Articles 53(1)10, 64

Articles 76 to 81, 82B,12 83 to 85, 89

4.

Safe-keeping and administration in relation to shares or units of collective investment undertakings.

Articles 40, 45, 64

Articles 76 to 81, 82B,12 83 to 85, 89

5.

Reception and transmission or orders in relation to financial instruments.

Articles 25(1), 64

Articles 76 to 81,82B,12 83 to 85, 89

Note 1. See FUND 1.4.2 R to FUND 1.4.4 R for further information in relation to the activities that full-scope UK AIFMs are able to perform.

Note 2. See FUND 1.4.5 G for the position with respect to assets which are not financial instruments.

SUP App 3.9.6GRP

Table 2A: UCITS Directive activities

Part II RAO Activities

Part III RAO Investments

1.

The management of UCITS in the form of unit trusts / common funds or of investment companies; this includes the function mentioned in Annex II of the UCITS Directive (see Note 2).

Article 51ZA8

8

N/A (activity relates to property of any kind) (Note 3)8

88

2.

Managing portfolios of investments, including those owned by pension funds, in accordance with mandates given by investors on a discretionary, client-by-client basis, where such portfolios include one or more of the instruments listed in Section C 3of Annex I 3to MiFID3.

33

Articles 14, 21, 25, 37, 40 (arranging only),8 64

8

Articles 76-81, 82B,12 83-85, 89

3.

Investment advice concerning one or more of the instruments listed in Section C3of Annex I 3to MiFID3.

3

Articles 53(1)10, 64

Articles 76-81, 82B,12 83-85, 89

4.

Safekeeping and administration services in relation to units of collective investment undertakings.

Articles 40, 45, 64

Articles 76-81, 82B,12 83-85, 89

Note 1. A UCITS management company can only be authorised to carry on the non-core services set out in rows (3) and (4) of Table 2A if it is also authorised to carry on the activity set out in row (2) of the table (see COLL 6.9.9 R)8.

338

Note 2. The functions set out in Annex 2 to the UCITS Directive are:

1.

Investment management.

2.

Administration:

a.

legal and fund management accounting services;

b.

customer inquiries;

c.

valuation and pricing (including tax returns);

d.

regulatory compliance monitoring;

e.

maintenance of unit-holder register;

f.

distribution of income;

g.

unit issues and redemptions;

h.

contract settlements (including certificate dispatch);

i.

record keeping.

3.

Marketing.

8Note 3. The regulated activity of managing a UCITS may be carried on for property of any kind (article 4(2) of the regulated activities order). However, the scheme property of a UCITS scheme is limited to certain types of property, in line with COLL 5 (Investment and borrowing powers).

SUP App 3.9.7GRP

Table 2B: Insurance Distribution14Directive2 Activities/Examples14

2

Part II RAO Activities

Part III RAO Investments

1.

Proposing14 or carrying out other work preparatory to the conclusion of contracts of insurance or reinsurance14.

Articles 25, 53(1)10 and 64

Articles 75, 89 (see Note 1)

141A.

Advising on contracts of insurance or reinsurance

Articles 53(1) and 64

Articles 75, 89

2.

Concluding contracts of insurance or reinsurance14

Articles 21, 25, 53(1)10 and 64

Articles 75, 89

3.

Assisting in the administration and performance of contracts of insurance or reinsurance14, in particular in the event of a claim.

Articles 39A, 64

Articles 75, 89

144

Provision of information concerning one or more insurance contracts in accordance with criteria selected by customers through a website or other media and the compilation of an insurance product ranking list, including price and product comparison, or a discount on the price of an insurance contract, when the customer is able to directly or indirectly conclude an insurance contract using a website or other media.

Articles 21, 25, (where this involves the provision of advice) 53(1), and 64.

Articles 75, 89

Note 1. Rights to or interests in life policies are specified investments under Article 89 of the Regulated Activities Order, but rights to or interests in general insurance contracts are not.

14Note 2. Row 4 in Table 2B includes text that appears in article 2.1(1) of the IDD. These activities are not considered to be separate, discrete activities under the IDD but rather are included by way of an example of what constitutes insurance distribution. They have been included in this table for completeness, together with an indication of the Part II RAO activities and Part III RAO investments that may be relevant. This is to indicate, including for firms considering undertaking passport activities under the IDD, how these examples may relate to regulated activities and specified investments.

SUP App 3.9.8GRP

Table 3: MCD activities

Part II RAO specified activities

Part III RAO Investments

1

Acting as credit intermediary

Articles 25A(1), 25A11(2A), 53A, 36A(1)(d), (e), (f) and 53DA

Articles 88 and 88D

PERG 8.14.19GRP
Article 39 of the Financial Promotion Order exempts a financial promotion that:(1) is communicated by one participator or potential participator in a joint enterprise to another; and(2) is in connection with or for the purposes of that enterprise.A joint enterprise means, in general terms, arrangements entered into by two or more persons for commercial purposes related to a business that they carry on. The business must not involve a controlled activity or a controlled claims
PERG 8.14.34AGRP
11The financial promotion restriction (that is, the restriction in section 21 of the Act) does not apply to a communication which is a non-real time financial promotion or a solicited real time financial promotion by an insolvency practitioner who acts in that capacity (see the definition of “acting as an insolvency practitioner” in article 3 of the Regulated Activities Order). The exemption only applies where the communication is made in the course of carrying on an activity
PERG 8.32.3GRP
In the course of their business, people such as publishers or broadcasters, Internet service providers, website operators or telephone marketing companies may provide services for authorised or exempt persons or other persons (such as overseas persons) who carry on regulated activities. This does not necessarily mean that any arrangements they make with such persons will fall within the scope of article 25(2). For that to be the case, the arrangements must be made with a view
PERG 8.32.7GRP
It would also be an indicator that a publisher or broadcaster might be making arrangements falling within article 25(2) if he receives a commission or other form of reward based on the amount of regulated business done as a result of his carrying the promotion. This would be on the basis that the existence of the financial interest will inevitably have a bearing on the purpose for which the arrangements are viewed as having been made by him. However, the article 27 exclusion will
PERG 2.10.5GRP
With one exception, a5person is exempt if they are7 an appointed representative of an authorised person. In some circumstances, however, a person may be an appointed representative and not be exempt, if the person has a limited permission for certain credit-related regulated activities.5 See SUP 12 (Appointed representatives). But where an appointed representative carries on insurance distribution or reinsurance distribution, that person7 will not be exempt unless they are7 included
PERG 2.10.16GRP
A person carrying on regulated activities under the regime for members of the professions will be subject to rules made by the professional body designated by the Treasury. Such bodies are obliged to make rules governing the carrying on by their members of those regulated activities that they are able to carry on without authorisation under the Act. Where such a person is carrying on insurance distribution or reinsurance distribution, that person7 must also be included on the
PERG 8.12.21GRP
Financial promotions made only to or directed only at certain types of person who are sophisticated enough to understand the risks involved are exempt. These are:(1) authorised persons;(2) exempt persons (where the financial promotion relates to a controlled activity which is a regulated activity for which the person is exempt);(3) governments and local authorities; and(4) persons whose ordinary business involves carrying on a controlled activity of the kind to which the financial
PERG 4.10.5GRP
There are exclusions that apply, in certain circumstances, in relation to each of the regulated mortgage activities if the person carrying on the activity is acting in the capacity of trustee or personal representative. Article 66 of the Regulated Activities Order (Trustees, nominees and personal representatives) sets out the circumstances in which the exclusions apply. The terms of these differ slightly depending on the regulated activity.
PERG 5.2.6GRP
The United Kingdom5implemented the IDD (and the IMD before it)4, in part, through secondary legislation, which applies4 pre-existing regulated activities (slightly amended) in the Regulated Activities Order to the component elements of the insurance distribution and reinsurance distribution definitions in the IDD4 (see PERG 5.2.5 G and the text of IDD articles 2.1(1), 2.1(2) and 2.24 in PERG 5.16.2G4).
PERG 5.2.7GRP
[deleted]4