Banking Coordination (Second Council Directive) Regulations 1992

JurisdictionUK Non-devolved
CitationSI 1992/3218

1992 No. 3218

BANKING

The Banking Coordination (Second Council Directive) Regulations 1992

Made 16th December 1992

Coming into force 1st January 1993

Whereas the Treasury are a government department designated1for the purposes of section 2(2) of the European Communities Act 19722in relation to measures relating to credit and financial institutions and to the taking of deposits or other repayable funds from the public;

And whereas a draft of these Regulations has been approved by a resolution of each House of Parliament pursuant to section 2(2) of and paragraph 2(2) of Schedule 2 to that Act;

Now, therefore, the Treasury in exercise of the powers conferred on them by section 2(2) of that Act and of all other powers enabling them in that behalf hereby make the following Regulations:—

1 GENERAL

PART I

GENERAL

Citation and commencement
S-1 Citation and commencement

Citation and commencement

1.—(1) These Regulations may be cited as the Banking Coordination (Second Council Directive) Regulations 1992.

(2) These Regulations shall come into force on 1st January 1993.

Interpretation: general
S-2 Interpretation: general

Interpretation: general

2.—(1) In these Regulations—

“the Banking Act” means the Banking Act 19873;

“the Building Societies Act” means the Building Societies Act 19864;

“the Consumer Credit Act” means the Consumer Credit Act 19745;

“the Financial Services Act” means the Financial Services Act 19866;

“the Insurance Companies Act” means the Insurance Companies Act 19827;

“another member State” means a member State other than the United Kingdom;

“appointed representative” has the same meaning as in the Financial Services Act;

“authorised or permitted”, in relation to the carrying on of a listed activity, shall be construed in accordance with regulation 4 or, as the case may be, regulation 21 below;

“the Bank” means the Bank of England;

“the Board” means The Securities and Investments Board8;

“branch” means one or more places of business established or proposed to be established in the same member State for the purpose of carrying on home-regulated activities;

“the commencement date” means 1st January 1993;

“the Commission” means the Building Societies Commission;

“connected UK authority”, in relation to a credit or financial institution carrying on or proposing to carry on a listed activity in the United Kingdom, means an authority in the United Kingdom which has regulatory functions in relation to that activity;

“constituent instrument”, in relation to an institution, includes any memorandum or articles of the institution;

“Consumer Credit Act business” means consumer credit business, consumer hire business or ancillary credit business;

“consumer credit business”, “consumer hire business” and “ancillary credit business” have the same meanings as in the Consumer Credit Act;

“credit institution” means a credit institution as defined in article 1 of the First Council Directive, that is to say, an undertaking whose business is to receive deposits or other repayable funds from the public and to grant credits for its own account;

“delegation order” and “designated agency” have the same meanings as in the Financial Services Act;

“deposit” has the same meaning as in the Banking Act;

“the Director” means the Director General of Fair Trading;

“ecu” means the European currency unit as defined in Article 1 of Council Regulation No. 3180/78/EEC9;

“establish”, in relation to a branch, means establish the place of business or, as the case may be, the first place of business which constitutes the branch;

“the European Commission” means the Commission of the Communities;

“European institution”, “European authorised institution” and “European subsidiary” have the meanings given by regulation 3 below;

“financial institution” means a financial institution as defined in article 1 of the Second Council Directive, that is to say, an undertaking other than a credit institution the principal activity of which is to acquire holdings or to carry on one or more of the activities listed in points 2 to 12 in the Annex (the text of which is set out in Schedule 1 to these Regulations);

“the First Council Directive” means the First Council Directive on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions (No. 77/780/EEC)10;

“home-regulated activity” shall be construed in accordance with regulation 3(7) or, as the case may be, regulation 20(6) below;

“home-regulated investment business”, in relation to a European institution or quasi-European authorised institution, means investment business which consists in carrying on one or more listed activities—

(a) in relation to which a supervisory authority in its home State has regulatory functions; and

(b) which, in the case of a European subsidiary, it is carrying on its home State;

“home State”, in relation to an institution incorporated in or formed under the law of another member State, means that State;

“initial capital” means capital as defined in points 1 and 2 of article 2(1) of the Council Directive on the own funds of credit institutions (No. 89/299/EEC)11;

“investment business” has the same meaning as in the Financial Services Act;

“listed activity” means an activity listed in the Annex to the Second Council Directive (list of activities subject to mutual recognition), the text of which is set out in Schedule 1 to these Regulations;

“member” and “rules”, in relation to a recognised self-regulating organisation, have the same meanings as in the Financial Services Act;

“own funds” means own funds as defined in the Council Directive on the own funds of credit institutions (No. 89/299/EEC);

“principal”, in relation to an appointed representative, has the same meaning as in the Financial Services Act;

“quasi-European institution”, “quasi-European authorised institution” and “quasiEuropean subsidiary” have the meanings given by regulation 3(4) below;

“recognised self-regulating organisation” has the same meaning as in the Financial Services Act;

“the relevant supervisory authority”, in relation to another member State, means the authority in that State which has regulatory functions in relation to the acceptance of deposits from the public, whether or not it also has such functions in relation to one or more other listed activities;

“requisite details”, in relation to a branch in the United Kingdom or another member State (whether established or proposed to be established), means—

(a) particulars of the programme of operations of the business to be carried on from the branch, including a description of the particular home-regulated activities to be carried on and of the structural organisation of the branch;

(b) the name under which the business is to be carried on and the address in the member State from which information about the business may be obtained; and

(c) the names of the managers of the business;

“the Second Council Directive” means the Second Council Directive on the coordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of credit institutions and amending the First Council Directive (No. 89/646/EEC)12;

“the Solvency Ratio Directive” means the Council Directive on a solvency ratio for credit institutions (No. 89/647/EEC)13;

“supervisory authority”, in relation to another member State, means an authority in that State which has regulatory functions in relation to one or more listed activities;

“the UK authority”, “UK institution”, “UK authorised institution” and “UK subsidiary” have the meanings given by regulation 20 below;

“voting rights”, in relation to an undertaking, shall be construed in accordance with paragraph 2 of Schedule 10A to the Companies Act 198514or paragraph 2 of Schedule 10A to the Companies (Northern Ireland) Order 198615.

(2) In these Regulations “parent undertaking”, “share”, “subsidiary undertaking” and “undertaking” have the same meanings as in Part VII of the Companies Act 198516or Part VIII the Companies (Northern Ireland) Order 198617except that—

(a)

(a) “subsidiary undertaking” also includes, in relation to an institution incorpor ated in or formed under the law of another member State, any undertaking which is a subsidiary undertaking within the meaning of any rule of law in force in that State for purposes connected with the implementation of the Seventh Company Law Directive based on article 54(3)(g) of the Treaty on consolidated accounts (No. 83/349/EEC)18; and

(b)

(b) “parent undertaking” shall be construed accordingly.

(3) For the purposes of these Regulations a subsidiary undertaking of an institution is a 90 per cent. subsidiary undertaking of the institution if the institution holds 90 per cent. or more of the voting rights in the subsidiary undertaking.

(4) Any reference in these Regulations to the carrying on of home-regulated investment business in the United Kingdom—

(a)

(a) is a reference to the carrying on of such business in reliance on regulation 5(1)(b) below; and

(b)

(b) shall be construed in accordance with section 1(3) of the Financial Services Act.

2 RECOGNITION OF EUROPEAN INSTITUTIONS

PART II

RECOGNITION OF EUROPEAN INSTITUTIONS

Preliminary

Preliminary

S-3 European institutions

European institutions

3.—(1) In these Regulations “European institution” means a European authorised institution or a European subsidiary.

(2) A credit institution is a European authorised institution for the purposes of these Regulations if—

(a)

(a) it is incorporated in or formed under the law of another member State;

(b)

(b) its principal place of business is in that State;

(c)

(c) it is for the time being authorised to act as a credit institution by the relevant supervisory authority in that State; and

(d)

(d) the requirements of paragraph 1 of Schedule 2 to these Regulations have been complied with in relation to its carrying on of an...

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