Financial Services and Markets Bill - continued        House of Lords
PART XVIII, RECOGNISED INVESTMENT EXCHANGES AND CLEARING HOUSES - continued
Applications for recognition - continued

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Recognition orders.     283. - (1) If it appears to the Authority that the applicant satisfies the recognition requirements applicable in its case, the Authority may make a recognition order declaring the applicant to be-
 
 
    (a) a recognised investment exchange, if the application is made under section 280;
 
    (b) a recognised clearing house, if it is made under section 281.
      (2) But if the application contains a request under 280(2) or 281(2) in respect of a person, the Authority may make the recognition order only if appears to it that the recognition requirements will be satisfied if that person is the recognised nominee of the applicant.
 
      (3) A recognition order made in accordance with subsection (2) must name the recognised nominee and specify the arrangements in respect of which recognition is granted.
 
      (4) The Treasury's approval of the making of a recognition order is required under section 296.
 
      (5) In considering an application, the Authority may have regard to any information which it considers is relevant to the application.
 
      (6) A recognition order must specify a date on which it is to take effect.
 
      (7) Section 292 has effect in relation to a decision to refuse to make a recognition order-
 
 
    (a) as it has effect in relation to a decision to revoke such an order; and
 
    (b) as if references to a recognised body were references to the applicant.
      (8) Subsection (7) does not apply in a case in which the Treasury have failed to give their approval under section 296.
 
Liability in relation to recognised body's regulatory functions.     284. - (1) A recognised body, its recognised nominee and the officers and staff of either of them are not to be liable in damages for anything done or omitted in the discharge of the recognised body's regulatory functions unless it is shown that the act or omission was in bad faith.
 
      (2) But subsection (1) does not prevent an award of damages made in respect of an act or omission on the ground that the act or omission was unlawful as a result of section 6(1) of the Human Rights Act 1998.
 
      (3) "Regulatory functions" means the functions of the recognised body so far as relating to, or to matters arising out of, the obligations to which the body is subject under or by virtue of this Act.
 
Overseas investment exchanges and clearing houses.     285. - (1) An application under section 280 or 281 by an overseas applicant must contain the address of a place in the United Kingdom for the service on the applicant of notices or other documents required or authorised to be served on it under this Act.
 
      (2) If it appears to the Authority that an overseas applicant satisfies the requirements of subsection (3) it may make a recognition order declaring the applicant to be-
 
 
    (a) a recognised investment exchange;
 
    (b) a recognised clearing house.
      (3) The requirements are that-
 
 
    (a) investors are afforded protection equivalent to that which they would be afforded if the body concerned were required to comply with recognition requirements;
 
    (b) 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 investment exchange or clearing house;
 
    (c) the applicant is able and willing to co-operate with the Authority by the sharing of information and in other ways;
 
    (d) adequate arrangements exist for co-operation between the Authority and those responsible for the supervision of the applicant in the country or territory in which the applicant's head office is situated.
      (4) In considering whether it is satisfied as to the requirements mentioned in subsection (3)(a) and (b), the Authority is to have regard to-
 
 
    (a) the relevant law and practice of the country or territory in which the applicant's head office is situated;
 
    (b) the rules and practices of the applicant.
      (5) In relation to an overseas applicant and a body or association declared to be a recognised investment exchange or recognised clearing house by a recognition order made by virtue of subsection (2)-
 
 
    (a) the reference in section 306(2) to recognition requirements is to be read as a reference to matters corresponding to the matters in respect of which provision is made in the recognition requirements;
 
    (b) sections 289(1) and 291(2) have effect as if the requirements mentioned in section 289(1)(a) and section 291(2)(a) were those of subsection (3)(a), (b), and (c) of this section;
 
    (c) section 291(2) has effect as if the grounds on which a recognition order may be revoked under that provision included the ground that in the opinion of the Authority arrangements of the kind mentioned in subsection (3)(d) no longer exist.
 
Supervision
Notification requirements.     286. - (1) The Authority may make rules requiring a recognised body to give it-
 
 
    (a) notice of such events relating to the body or its recognised nominee (if any) as may be specified; and
 
    (b) such information in respect of those events as may be specified.
      (2) The rules may also require a recognised body to give the Authority, at such times or in respect of such periods as may be specified, such information relating to the body or its recognised nominee (if any) as may be specified.
 
      (3) An obligation imposed by the rules extends only to a notice or information which the Authority may reasonably require for the exercise of its functions under this Act.
 
      (4) The rules may require information to be given in a specified form and to be verified in a specified manner.
 
      (5) If a recognised body-
 
 
    (a) alters or revokes any of its rules or guidance, or
 
    (b) makes new rules or issues new guidance,
  it must give written notice to the Authority without delay.
 
      (6) If a recognised investment exchange makes a change-
 
 
    (a) in the arrangements it makes for the provision of clearing services in respect of transactions effected on the exchange, or
 
    (b) in the criteria which it applies when determining to whom it will provide clearing services,
  it must give written notice to the Authority without delay.
 
      (7) If a recognised clearing house makes a change-
 
 
    (a) in the recognised investment exchanges for whom it provides clearing services, or
 
    (b) in the criteria which it applies when determining to whom (other than recognised investment exchanges) it will provide clearing services,
  it must give written notice to the Authority without delay.
 
      (8) A notice under subsection (5) must include a statement as to whether the alteration, revocation or addition is likely to have any effect on competition.
 
      (9) Subsections (5) to (8) do not apply to an overseas investment exchange or an overseas clearing house.
 
      (10) "Specified" means specified in the Authority's rules.
 
 
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