The Investment Services Regulations 1995

Construction of Part VII

46.—(1) In this Part of these Regulations—

(a) a “minority controller” means a controller not falling within sub-paragraph (a) or (b) of paragraph (2) below;

(b) a “10 per cent. controller” means a controller in whose case the percentage referred to in the relevant paragraph is 10 or more but less than 20;

(c) a “20 per cent. controller” means a controller in whose case the percentage referred to in the relevant paragraph is 20 or more but less than 33;

(d) a “33 per cent. controller” means a controller in whose case the percentage referred to in the relevant paragraph is 33 or more but less than 50; and

(e) a “50 per cent. controller” means a controller in whose case the percentage referred to in the relevant paragraph is 50 or more,

and for these purposes “controller” has the meaning given in paragraph (2) below and “the relevant paragraph”, in relation to a controller, means whichever one of sub-paragraph (a) or (b) of paragraph (2) below gives the greater percentage of his case.

(2) A “controller”, in relation to an investment firm, means a person who, either alone or with any associate or associates—

(a) holds 10 per cent. or more of the shares in the firm or another person of whom the firm is a subsidiary undertaking;

(b) is entitled to exercise, or control the exercise of, 10 per cent. or more of the voting power at any general meeting of the firm or another person of whom the firm is such an undertaking; or

(c) is able to exercise a significant influence over the management of the firm or another person of whom the firm is such an undertaking by virtue of—

(i) a holding of shares in; or

(ii) an entitlement to exercise, or control the exercise of, the voting power at any general meeting of,

the firm or, as the case may be, the other person concerned.

(3) In this Part of these Regulations “associate”, in relation to a person entitled to exercise or control the exercise of voting power in relation to, or holding shares in, an undertaking, means—

(a) the wife or husband or son or daughter of that person;

(b) the trustees of any settlement under which that person has a life interest in possession or, in Scotland, a life interest;

(c) any company of which that person is a director;

(d) any person who is an employee or partner of that person;

(e) if that person is a company—

(i) any director of that company;

(ii) any subsidiary undertaking of that company;

(iii) any director or employee of any such subsidiary undertaking; and

(f) if that person has with any other person an agreement or arrangement with respect to the acquisition, holding or disposal of shares or other interests in that undertaking or body corporate or under which they undertake to act together in exercising their voting power in relation to it, that other person.

(4) For the purposes of paragraph (3) above—

• “son” includes stepson and “daughter” includes stepdaughter; and

• “settlement” includes any disposition or arrangement under which property is held on trust.

(5) References in this Part of these Regulations to a “relevant regulator”, in relation to an investment firm, are references to—

(a) any recognised self-regulating organisation to whose rules the firm is subject in providing core investment services;

(b) the Board, in a case in which the firm in question is subject, in providing core services, to rules made by the Board; and

(c) the Bank, in a case in which the firm in question is not an authorised person and is an exempted person by virtue of being admitted to the list maintained for the purposes of section 43 of the Financial Services Act.

(6) References in this Part of these Regulations to “voting rights”, in relation to an undertaking, shall be construed in accordance with paragraph 2 of Schedule 10A to the Companies Act 1985(1) or paragraph 2 of Schedule 10A to the Companies (Northern Ireland) Order 1986(2).

(7) Nothing in this Part of these Regulations shall require a person to give notice of his intention to become or to cease to be a controller of any description pursuant to an agreement entered into before the commencement date to acquire or dispose of a holding of shares or an entitlement to exercise or control the exercise of voting power.

(1)

1985 c. 6; Schedule 10A was inserted by the Companies Act 1989 (c. 40), section 21(2).

(2)

S.I. 1986/1032 (N.I.6); Schedule 10A was inserted by the Companies (Northern Ireland) Order 1990 (S.I. 1990/593 (N.I.5)), Article 23(2).