BKM207650 - Bank compensation restriction: definition of banking company: excluded companies - asset management activities
CTA09/S133F(3),(5)&(6)
The list of excluded companies include companies carrying on asset management activities. These activities comprise (or would comprise, if carried on in the UK) the following activities:
Acting as the operator of a collective investment scheme
A company will be an operator of a collective investment scheme where it satisfies the regulatory definition in force at the date of the relevant conduct. The relevant definition is:
- sections 235 and 237 of FSMA 2000 from 25 February 2001 onwards
- in the Financial Services Act 1986 for periods before 25 February
Acting as an authorised corporate director
An authorised corporate director is defined in the FCA handbook. For periods after 1 April 2013 the company should refer to the definition at the date of the relevant conduct. For earlier periods it is the definition in force on 1 April 2013.
Acting as a discretionary investment manager for clients other than linked entities
Discretionary investment manager is not defined in the legislation. The FCA Handbook defines this as ‘a person who, acting only on behalf of a client, manages designated investments in an account or portfolio on a discretionary basis under the terms of a discretionary management agreement’.
For the purpose of determining if a company carries out asset management activities, linked entities means any of the following:
- a member of the same group
- a company in which a member of the same group holds a major interest (see CTA09/S473)
- a partnership the members of which include a member of the same group which has at least a 40% share of the profits and losses (see Part 17 of CTA 2009)
In each case the conditions are to be tested for the accounting period in question.
See BKM207900 for the definition of a group used for determining if a company is an excluded company.