Financial Services and Markets Bill - continued        House of Lords

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  PART II
  REGULATED AND PROHIBITED ACTIVITIES
 
The general prohibition
The general prohibition.     17. - (1) No person may carry on a regulated activity in the United Kingdom, or purport to do so, unless he is-
 
 
    (a) an authorised person; or
 
    (b) an exempt person.
      (2) The prohibition is referred to in this Act as the general prohibition.
 
 
Requirement for permission
Authorised persons acting without permission.     18. - (1) If an authorised person carries on a regulated activity in the United Kingdom, or purports to do so, otherwise than in accordance with permission-
 
 
    (a) given to him by the Authority under Part IV, or
 
    (b) resulting from any other provision of this Act,
  he is to be taken to have contravened a requirement imposed on him by the Authority under this Act.
 
      (2) But no provision made by or under this Act is to be read as causing such a contravention to affect the rights or obligations of any party to a transaction which constitutes, or is part of, a regulated activity.
 
 
Financial promotion
Restrictions on financial promotion.     19. - (1) A person ("A") must not, in the course of business, communicate an invitation or inducement to engage in investment activity.
 
      (2) But subsection (1) does not apply if-
 
 
    (a) A is an authorised person; or
 
    (b) the content of the communication is approved for the purposes of this section by an authorised person.
      (3) In the case of a communication originating outside the United Kingdom, subsection (1) applies only if the communication is capable of having an effect in the United Kingdom.
 
      (4) The Treasury may by order specify circumstances in which a person is to be regarded for the purposes of subsection (1) as-
 
 
    (a) acting in the course of business;
 
    (b) not acting in the course of business.
      (5) The Treasury may by order specify circumstances (which may include compliance with financial promotion rules) in which subsection (1) does not apply.
 
      (6) "Engaging in investment activity" means-
 
 
    (a) entering or offering to enter into an agreement the making or performance of which by either party constitutes a controlled activity; or
 
    (b) exercising any rights conferred by an investment to acquire, dispose of, underwrite or convert an investment.
      (7) An activity is a controlled activity if-
 
 
    (a) it is an activity of a specified kind or one which falls within a specified class of activity; and
 
    (b) it relates to an investment of a specified kind, or to one which falls within a specified class of investment.
      (8) Schedule 2 applies for the purposes of subsection (7), with references to section 20 being read as references to that subsection.
 
      (9) Nothing in Schedule 2, as applied by subsection (8), limits the powers conferred by subsection (7).
 
      (10) "Communicate" includes causing a communication to be made.
 
      (11) "Investment" includes any asset, right or interest.
 
      (12) "Specified" means specified in an order made by the Treasury.
 
 
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Prepared 11 February 2000