Authorised Unit Trust Scheme (Investment and Borrowing Powers) Regulations 1988
| Jurisdiction | UK Non-devolved |
| Citation | SI 1988/284 |
| Year | 1988 |
1988 No. 284
FINANCIAL SERVICES
The Authorised Unit Trust Scheme (Investment and Borrowing Powers) Regulations 1988
Made 22th February 1988
Laid before Parliament 22th February 1988
Coming into force 14th March 1988
The Secretary of State, in exercise of the powers conferred on him by section 81 of the Financial Services Act 19861, and all other powers enabling him in that behalf, hereby makes the following Regulations:—
PART I
GENERAL
Citation and commencement
1. These Regulations may be cited as the Authorised Unit Trust Scheme (Investment and Borrowing Powers) Regulations 1988 and shall come into force on 14th March 1988.
Interpretation
2.—(1) In these Regulations, unless the context otherwise requires—
“the Act” means the Financial Services Act 1986;
“approved market” means the Official List of any member State and includes the principal or only market established under the rules of an investment exchange specified in Part I of Schedule 1 to these Regulations and also any market specified in Part II of that Schedule;
“approved options and futures market” means a market specified in Schedule 2 to these Regulations;
“approved securities” means—
(a) transferable securities which are traded on or under the rules of an approved market otherwise than by virtue of the specific permission of the market authority; and
(b) recently issued transferable securities,
but does not include any investment falling within paragraph 1 or 2 of Schedule 1 to the Act which can be transferred only with the consent of the body corporate which issued the investment or with the consent of any members or debenture holders of that body corporate;
“authorised institution” means an authorised institution within the meaning of the Banking Act 19872and also includes any person who is authorised under the law of another member State to carry on a business which is a deposit-taking business for the purposes of that Act;
“authorised securities scheme” means a scheme the sole object of which is to enable participants to participate in or receive profits or income arising from the acquisition, holding, management or disposal of transferable securities and which is not a feeder fund or a fund of funds;
“base currency”, except in the case of a scheme which is treated as an authorised unit trust scheme by virtue of paragraph 9 of Schedule 15 to the Act and, subject to paragraph (2), means the currency specified in the trust deed as the base currency of the scheme and, in the case of a scheme which is treated as an authorised unit trust scheme by virtue of that paragraph for which there is no base currency, means the currency in which accounts relating to the scheme are prepared;
“business day”, in relation to anything done or to be done in any part of the United Kingdom, means any day other than a Saturday, a Sunday or a bank holiday in that part of the United Kingdom and, in relation to anything done or to be done by reference to a market outside the United Kingdom, means any day on which that market is normally open for business;
“cash” includes foreign currency;
“close out”, in relation to a transaction entered into for the scheme, means the entry, by the trustee, into a further transaction under which the obligation to deliver or receive which arises or may, at the option of the other party to the transaction, arise under the original transaction is offset by an equivalent and opposite obligation or right to receive or deliver;
“contract for differences” means a contract rights under which constitute an investment falling within paragraph 9 of Schedule 1 to the Act;
“feeder fund” means a scheme the sole object of which is to enable participants to participate in or receive profits or income arising from the acquisition, holding, management or disposal of units in a single scheme or recognised scheme;
“fund of funds” means a scheme the sole object of which is to enable participants to participate in or receive profits or income arising from the acquisition, holding, management or disposal of units in schemes or recognised schemes;
“future” means a contract rights under which constitute an investment falling within paragraph 8 of Schedule 1 to the Act;
“Government and other public securities” means investments falling within paragraph 3 of Schedule 1 to the Act which are—
(a) issued by or on behalf of the Government of the United Kingdom, of Northern Ireland or of a member State other than the United Kingdom or by or on behalf of a local authority in the United Kingdom or any other member State; or
(b) issued by or on behalf of the Government of any country or territory specified in Schedule 3 to these Regulations; or
(c) issued by or on behalf of an international organisation the members of which include the United Kingdom or another member State,
and includes investments which would fall within paragraph 3 of Schedule 1 to the Act if that paragraph extended to investments guaranteed by a local authority in any member State or by the Government of the United Kingdom, the Government of any other member State or of Northern Ireland or by the Government of any country or territory specified in Schedule 3 to these Regulations;
“Government and other public securities fund” means an authorised securities scheme the sole object of which is to enable participants to participate in or receive profits or income arising from the acquisition, holding, management or disposal of either Government and other public securities or Government and other public securities and units in other collective investment schemes which are, or, if authorised, would be, Government and other public securities funds;
“hedging transaction” means a transaction of the kind described in regulation 8(2);
“initial margin” means cash or other property deposited in accordance with the rules of an approved options and futures market on entering into a margined contract;
“manager”, in relation to a scheme, means the manager of the scheme;
“margin” means cash or other property paid, transferred or deposited under the terms of a margined contract;
“margined contract” means a contract rights under which constitute an investment falling within paragraph 7, 8 or 9 of Schedule 1 to the Act being a contract the terms of which are such that property of the scheme will or may be required to be paid, transferred or deposited as security for the performance of an obligation to deliver or receive property which will or may arise under the contract whether at the option of the trustee or of the other party to the contract or otherwise and includes an option purchased for the scheme under which the total amount of premium which may be payable for the option is not payable on purchase but may be demanded before expiry of the option;
“market dealing bid price”, in relation to property of any description and a particular time, means the amount which would be received in consideration for the sale of the property on the assumption that—
(a) it was sold on the best terms available at that time on an approved market on which it is traded for transactions in property of that description in what, in the reasonable opinion of the manager, is a standard size; and
(b) there had been deducted from the consideration an amount equal to an estimated amount of such fiscal charges, commission and other sales charges as would be payable by the seller in connection with such a sale, calculated on the basis that the commission and charges payable were the least that could reasonably be expected to be paid in connection with a transaction of the kind in question;
“money market fund” means a scheme the sole object of which is to enable participants to participate in or receive profits or income arising from the acquisition, holding, management or disposal of any one or more of the following, or of any one or more of the following and transferable securities—
(a) deposits;
(b) loans; and
(c) instruments creating or evidencing indebtedness which are not transferable securities;
“near cash” means money in a current account with an authorised institution or money in a deposit account with, or on short term loan to, such an institution which can be withdrawn immediately and without payment of a penalty exceeding more than seven days' interest calculated at ordinary commercial rates and also includes investments of a kind described in paragraphs 1 and 2 of Part II of the First Schedule to the Trustee Investments Act 19613and equivalent investments issued or guaranteed by the Government of another member State or of a country or territory specified in Schedule 3 to these Regulations;
“option” means a right exercisable within a specified period of time, at the option of the holder of the right, to dispose of or acquire any property at a specified price;
“premium”, in relation to an option, means the total amount which the purchaser of the option is, or may be, required to pay in consideration for the right to exercise the option;
“purchase”, in relation to an option, means acquiring the right to exercise the option;
“recently issued transferable securities” means transferable securities—
(a) which were issued on terms that an application would be made to an exchange or market which, if accepted, would result in the securities becoming approved securities by virtue of paragraph (a) of the definition of “approved securities”;
(b) with respect to which no application of the kind described in paragraph (a) of this definition has been refused; and
(c) with respect to which not more than twelve months has passed since the date of their issue;
“relevant pension scheme” means a scheme which is either—
(a) an appropriate scheme for the purposes of section 1(8) of the Social Security Act 19864; or
(b) an exempt approved scheme within the meaning of section 592(1) of the Income and Corporation Taxes Act 19885to which the employer is not a...
To continue reading
Request your trial