S.I. No. 60/2007 - European Communities (Markets in Financial Instruments) Regulations 2007

• (b) the provision of information to the Bank or such other person as may be specified by the Bank.

Directions by the Bank

147. (1) Without prejudice to the power of the Bank to impose conditions or requirements or both under these Regulations, where the Bank considers it necessary for the proper and orderly regulation and supervision of investment firms or market operators of regulated markets or for the protection of investors, the Bank may give directions to all or any of the following:

• (a) investment firms or market operators of regulated markets;

• (b) proposed investment firms or proposed market operators of regulated markets;

• (c) investment firms or market operators of regulated markets;

• (d) former investment firms or former market operators of regulated markets;

• (e) directors and those responsible for the management of investment firms or market operators of regulated markets, former investment firms or market operators of regulated markets, proposed investment firms or market operators of regulated markets or investment firms or market operators of regulated markets;

• (f) persons purporting to act or whom the Bank reasonably believes are acting as or on behalf of any investment firms or any market operator of a regulated market;

• (g) persons who are -

• (i) directors of an investment firm or of the market operator of a regulated market, or

• (ii) responsible for the management of an investment firm or of the market operator of a regulated market,

who have failed to co-operate with an authorised officer appointed under Regulation 164 or an inspector appointed under Regulation 166 in relation to any matter related to -

• (I) the operation of the firm or operator,

• (II) an acquiring transaction within the meaning of Part 14, or

• (III) directing the cessation by any person of any practice that, in the opinion of the Bank, is contrary to Irish investment services law.

• (2) A direction given by the Bank under this Regulation has effect from the date specified by the Bank.

Further to Regulation 147

148. (1) Without prejudice to the Bank's powers referred to in Regulation 147, where the Bank is of the opinion that it is necessary -

• (a) in the interests of the proper and orderly regulation and supervision of investment firms or market operators of regulated markets,

• (b) for the protection of investors or both, or

• (c) in the circumstances set out in subparagraph (2),

the Bank may give a direction in writing to the investment firm or regulated market concerned to suspend for such period not exceeding 12 months, as shall be specified in the direction, any or all of the following:

• (i) the provision of any investment service;

• (ii) the making of payments to which subparagraph (i) of this paragraph does not relate;

• (iii) the acquisition or disposal of any assets or liabilities;

• (iv) entering into transactions or agreements of any specified kind or entering into them except in specified circumstances or to a specified extent;

• (v) soliciting business from persons of a specified kind or otherwise than from such persons or in a specified country;

• (vi) carrying on business in a specified manner or otherwise than in a specified manner;

• (vii) if unauthorised by the Bank, trading in any financial instrument;

• (viii) if unauthorised by the Bank, the admission to trading, listing marketing or otherwise facilitating the trading of a financial instrument on or in any market.

• (2) The circumstances referred to in paragraph (1)(c) are that the investment firm or the market operator -

• (a) has become or is, in the opinion of the Bank, likely to become unable to meet its obligations to its creditors or its clients or both,

• (b) is not maintaining or is, in the opinion of the Bank, unlikely to be in a position to maintain adequate capital resources having regard to the volume and nature of its business, or no longer complies with capital or other financial requirements specified by the Bank from time to time, or both,

• (c) has failed to comply with any condition or requirement imposed under these Regulations, and the circumstances are such that the Bank is of the opinion that the stability or soundness of an investment firm or regulated market is materially affected by this failure,

• (d) is conducting business in such a manner as to jeopardise or prejudice monies or investment instruments held by or controlled by it on behalf of clients, or the rights and interests of those clients, or

• (e) has failed to provide to the Bank within such reasonable period as may be specified by the Bank such information as the Bank may reasonably request for the purpose of the Bank's functions under these Regulations.

• (3) A direction under Regulation 147 or paragraph (1) of this Regulation may be given -

• (a) to a particular person,

• (b) generally to all persons to whom those paragraphs apply,

• (c) to a particular class of person,

• (d) during a specified period of time or times, or

• (e) by reference to any other matter which the Bank considers appropriate.

• (4) A direction given by the Bank under this Regulation has effect from the date specified by the Bank.

Bank may apply to Court for orders confirming directions

149 (1) In this Regulation:

“termination process”, in relation to an authorised investment firm (including a natural person where appropriate) or to the market operator of a regulated market, or to an associated or related undertaking of such a firm or operator, means any -

• (a) proceedings relating to the winding-up, dissolution or termination of the firm or operator,

• (b) receivership or bankruptcy proceedings of which the firm or operator is the subject, or

• (c) any other such proceedings under law under which an assignee or other person becomes responsible for the firm's or operator's affairs pending the firm or operator ceasing to carry on business.

• (2) The Bank may apply to the Court in a summary manner for an order confirming a direction given by the Bank under Regulation 147 or 148.

• (3) Notwithstanding paragraph (2), if the Bank is of the opinion that a direction given by the Bank under Regulation 147 or 148 is not being complied with, the Bank shall apply to the Court in a summary manner for an order confirming the direction.

• (4) On an application made under paragraph (2) or (3), the Court may -

• (a) hear evidence from creditors, and

• (b) may make any interim or interlocutory order as the Court considers appropriate.

• (5) While a direction under this Regulation is in force in respect of an investment firm, market operator of an organised market or an associated or related undertaking of such a firm or operator, no termination process may be commenced or continued and no assets of the firm, operator or undertaking shall be attached, sequestered or otherwise distrained except with the prior sanction of the Court.

• (6) The Court may hear proceedings or part of proceedings under this Regulation otherwise than in public.

• (7) A creditor who is affected by a direction under Regulation 147 or 148 may apply to the Court to vary or set aside the direction if the direction affects the interests of the creditor to a material degree.

Winding-up on application to Court

150. (1) In this Regulation:

“committee of inspection” means a committee of inspection appointed under section 23 of the Companies Act 1963;

“investment firm” includes a former investment firm;

“market operator” includes a former market operator.

• (2) Notwithstanding Regulation 215 of the Companies Act, 1963, the Bank, by presenting a petition, may apply to the Court to have an investment firm or the market operator of a regulated market wound up on any of the following grounds:

• (a) the investment firm or market operator is unable or, in the opinion of the Bank, may be unable to meet its obligations to its clients or creditors;

• (b) the authorisation of the investment firm or market operator has been withdrawn or revoked and the firm or operator has ceased to carry on business as an investment firm or to operate a regulated market;

• (c) the Bank considers that it is in the interest of the proper and orderly regulation and supervision of investment firms or regulated markets or is necessary for the protection of investors that the investment firm or the market operator of the regulated market be wound up;

• (d) the investment firm or market operator has failed to comply with any direction given by the Bank under these Regulations.

• (3) Where the petition for the winding-up of an investment firm or the operator of a regulated market is presented by a person other than the Bank, a copy of the petition shall be served on the Bank and the Bank is entitled to be heard on the petition.

• (4) Where an investment firm or the operator of a regulated market is being wound up voluntarily and the Bank has reason to believe that any of the grounds set out in paragraph (1) are applicable, then, the Bank may apply to the Court to have that investment firm or market operator wound up by the Court.

• (5) Where -

• (a) an investment firm or the market operator of a regulated market or a former investment firm or the former market operator of a regulated market is being wound up, and

• (b) the Bank is not a creditor,

any notice or document, by whatever name called, which is required to be sent to a creditor of the firm or operator shall be sent also to the Bank.

• (6) The Bank, in writing, may authorise an officer or employee of the Bank or some other suitably qualified person to attend a meeting of creditors of an investment firm the market operator of a regulated market or a former investment firm or former market operator of a regulated market.

• (7) The Bank, in writing, may appoint an officer or employee of the Bank or some other suitably qualified person to be a member of a committee of inspection appointed in relation to an authorised investment firm, the market operator of a regulated market or a former authorised investment firm or market operator of a regulated market.

• (8) A person appointed under paragraph (6) -

• (a) is not to be counted in computing the maximum or minimum number of members of a committee of inspection prescribed by the Companies Acts, and

• (b) may not be removed from membership of the committee without the consent of the Bank.

• (9) The rules of Court relating to the winding-up of companies shall, pending the making of rules of Court for the purposes of this Regulation, apply for such purposes with such adaptations as may be necessary.

• (10) In the case of an unincorporated body of persons that is an authorised investment firm or is the market operator of a regulated market, the Bank may apply by petition to the Court for a decree of dissolution and, for that purpose, section 35 of the Partnership Act, 1890, shall extend to the Bank and shall apply as if the grounds specified in paragraph (2) (a) to (d) were incorporated in that section.

• (11) In the case of an individual that is an authorised investment firm or is the market operator of a regulated market, the Bank may apply by petition to the Court for an adjudication of bankruptcy within the meaning of the Bankruptcy Act, 1988, and the Bankruptcy Act, 1988 shall apply as if the grounds specified in paragraph (2) (a) to (d) were acts of bankruptcy (within the meaning of the Bankruptcy Act, 1988).

Definitions for Regulations 151 and 152

151 In this Regulation and Regulation 152:

“investment research” means research or other information recommending or suggesting an investment strategy, explicitly or implicitly, concerning one or several financial instruments or the issuers of financial instruments, including any opinion as to the present or future value or price of such instruments, intended for distribution channels or for the public, and in relation to which the following conditions are met:

• (a) it is labelled or described as investment research or in similar terms, or is otherwise presented as an objective or independent explanation of the matters contained in the recommendation;

• (b) if the recommendation in question were made by an investment firm to a client, it would not constitute the provision of investment advice for the purposes of Directive 2004/39/EC;

“related financial instrument” means a financial instrument the price of which is closely affected by price movements in another financial instrument which is the subject of investment research, and includes a derivative on that other financial instrument;

“specified” means specified in a direction under Regulation 152.

Restrictions on advertising

152. (1) A person shall not -

• (a) cause to be advertised, supply, or offer to supply, investment or ancillary services,

• (b) make any other solicitation in respect of investment or ancillary services, or

• (c) represent that the person is a provider of such services,

if the provision of the services would be in breach of Regulation 7.

• (2) Without prejudice to the generality of any provision of these Regulations empowering the Bank to impose conditions, requirements or both, the Bank may impose such conditions, requirements or both, on an investment firm or the operator of a regulated market in respect of advertising by that firm or operator as the Bank considers necessary, in the interests of -

• (a) the orderly and proper regulation and supervision of investment firm or regulated markets, or

• (b) the protection of investors.

• (3) The Bank may impose a requirement on—

• (a) a specified authorised investment firm or market operator of a regulated market, or

• (b) all authorised investment firms or market operators of regulated markets,

to display specified information at their premises or to publish specified information.

• (4) If, with respect to an investment firm or the market operator of a regulated market, the Bank considers it expedient, in the interest of—

• (a) the proper and orderly regulation and supervision of investment firms or the market operators of regulated markets, or

• (b) the protection of investors,

the Bank may give the investment firm or market operator a direction -

• (i) as to the content and form of any advertisement or other means of soliciting money, financial instruments or business from potential or existing clients,

• (ii) as to the content and form of any advertisement relating to any service provided or business being undertaken by the firm or operator, or

• (iii) requiring the firm or operator to withdraw an advertisement or to cease advertising.

• (5) Without prejudice to the generality of paragraph (4), a direction under this Regulation may do all or any of the following:

• (a) prohibit the issue by the investment firm or regulated market of advertisements of all descriptions or any specified description;

• (b) require the investment firm or regulated market to modify advertisements of a specified description in a specified manner;

• (c) prohibit the issue by the investment firm or regulated market of any advertisements which are, or are substantially, repetitions of a specified advertisement;

• (d) require the investment firm or regulated market to withdraw any specified advertisement or any advertisement of a specified description;

• (e) require the investment firm or regulated market to include specified information in any advertisement to be published by it or on its behalf or in any statement to the public to be made by it or on its behalf.

Consequences of advertising contrary to Regulations

153 (1) If, in contravention of Regulation 152(1) or of a direction under Regulation 152, a person (in this paragraph called the “first person”) issues, or causes to be issued, an advertisement -

• (a) inviting other persons to enter or offer to enter into an investment agreement, or

• (b) containing information calculated to lead directly or indirectly to other persons entering into or offering to enter into an investment agreement,

then, subject to paragraph (4),

• (i) the first person is not entitled to enforce any agreement to which the advertisement related and which was entered into after the issue of the advertisement, and

• (ii) the other persons are entitled to recover any money, other property or financial instruments paid or transferred by them under the agreement together with compensation for any loss sustained by them as a result of having paid money or transferred property or financial instruments under the agreement.

• (2) If, in contravention of Regulation 152(1) or of a direction under Regulation 152, a person (in this paragraph called the “first person” issues, or causes to be issued, an advertisement -

• (a) inviting other persons to exercise any rights conferred by a financial instrument, or

• (b) containing information calculated to lead directly or indirectly to other persons exercising any rights conferred by a financial instrument,

then, subject to paragraph (3),

• (i) the first person is not entitled to enforce any obligation to which the other persons are subject as a result of any exercise by the first person after the issue of the advertisement of any rights to which the advertisement related, and

• (ii) the other persons are entitled to recover any money or other property or financial instruments paid or transferred by them under any such obligation, together with compensation for any loss sustained by them.

• (3) The compensation recoverable under paragraph (1) or (2) of this Regulation shall be such as the parties may agree or as the Court, on the application of either party, may determine.

• (4) The Court may allow any such agreement or obligation as is mentioned in paragraph (1) or (2) of this Regulation to be enforced or money, other property or financial instruments paid or transferred under it to be retained, if the Court is satisfied that -

• (a) the person against whom enforcement is sought or who is seeking to recover the money, property or financial instruments was not influenced, or not influenced to any material extent, by the advertisements in making the decision to enter into the agreement or as to the exercise of the rights in question, or

• (b) the advertisement was not misleading as to the nature of the investment, the terms of the agreement or, as the case may be, the consequences of exercising the rights in question and fairly stated any risks involved in those matters.

• (5) Where a person elects not to perform an agreement or an obligation which by virtue of paragraph (1) or (2) of this Regulation is unenforceable against the person or by virtue of either of those paragraphs recovers money paid or other property or financial instruments transferred by the person under an agreement or obligation, he shall repay any money and return any other property or financial instruments received by the person under the agreement or, as the case may be, as a result of exercising the rights in question.

• (6) Where any property or financial instruments transferred under an agreement or obligation to which paragraph (1) or (2) of this Regulation applies has passed to a third party the references to that property or financial instruments in this Regulation shall be construed as references to its value at the time of its transfer under the agreement or obligation.

• (7) If an advertisement or other solicitation to which this Regulation relates is published and it does not include the name and address of the person who arranged with the publisher for the advertisement or solicitation,

• (a) the Bank, at any time within 12 months after any publication of the advertisement or solicitation, may request the publisher to supply the name and address of that person to the Bank, and

• (b) the publisher shall without delay comply with that request.

Miscellaneous requirements respecting advertising

154. (1) The Bank may -

• (a) direct a person to arrange the publication of a correction of a misleading advertisement concerning services of investment firms or regulated markets,

• (b) direct a person to arrange the publication of a correction of an advertisement which contravenes the provisions of this Regulation,

• (c) direct a person to arrange the publication of the fact that an offence under this Regulation has taken place and that a fine or administrative sanction, if any, has been imposed, or

• (d) arrange the publication of an advertisement correcting any misleading aspects of advertisements, published by an investment firm or regulated market,

in a manner specified by the Bank.

• (2) A recommendation of the type covered by Article 1(3) of Directive 2003/125/EC, but relating to financial instruments as defined in these Regulations, that does not meet the conditions set out in the definition of “investment research” in Regulation 151 shall be treated as a marketing communication for the purposes of these Regulations and any investment firm that produces or disseminates the recommendation shall ensure that the recommendation is clearly identified as a marketing communication.

• (3) Additionally, an investment firm shall ensure that a recommendation referred to in paragraph (2) contains a clear and prominent statement that (or, in the case of an oral recommendation, to the effect that) it -

• (a) has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and

• (b) is not subject to any prohibition on dealing ahead of the dissemination of investment research.

Requirements respecting investment research by investment firms

155. (1) Investment firms which produce, or arrange for the production of, investment research that is intended or likely to be subsequently disseminated to clients of the firm or to the public, under their own responsibility or that of a member of their group, shall ensure the implementation of all the measures set out in paragraph (2) in relation to the financial analysts involved in the production of the investment research and other relevant persons whose responsibilities or business interests may conflict with the interests of the persons to whom the investment research is disseminated.

• (2) Investment firms referred to in paragraph (1) shall have in place arrangements designed to ensure that the following conditions are satisfied:

• (a) financial analysts and other relevant persons must not -

• (i) undertake personal transactions, or

• (ii) trade, other than as market makers acting in good faith and in the ordinary course of market making or in the execution of an unsolicited client order, on behalf of any other person including the investment firm,

in financial instruments to which investment research relates, or in any related financial instruments, with knowledge of the likely timing or content of that investment research which is not -

• (I) publicly available, or

• (II) available to clients

and cannot readily be inferred from information that is so available until the recipients of the investment research have had a reasonable opportunity to act on it;

• (b) in circumstances not covered by subparagraph (a), financial analysts and any other relevant persons involved in the production of investment research must not undertake personal transactions -

• (i) in financial instruments to which the investment research relates, or

• (ii) in any related financial instruments,

contrary to current recommendations, except in exceptional circumstances and with the prior approval of a member of the firm's legal or compliance function;

• (c) the investment firms themselves, financial analysts, and other relevant persons involved in the production of the investment research must not accept inducements from those with a material interest in the subject-matter of the investment research;

• (d) the investment firms themselves, financial analysts, and other relevant persons involved in the production of the investment research must not promise issuers favourable research coverage;

• (e) issuers, relevant persons other than financial analysts, and any other persons must not before the dissemination of investment research be permitted to review a draft of the investment research -

• (i) for the purpose of verifying the accuracy of factual statements made in that research, or

• (ii) for any other purpose other than verifying compliance with the firm's legal obligations, if the draft includes a recommendation or a target price.

• (3) Investment firms which disseminate investment research produced by another person to the public or to clients are exempt from complying with Regulation 152(1) if the following criteria are met:

• (a) the person that produces the investment research is not a member of the group to which the investment firm belongs;

• (b) the investment firm does not substantially alter the recommendations within the investment research;

• (c) the investment firm does not present the investment research as having been produced by it;

• (d) the investment firm verifies that the producer of the research is subject to requirements equivalent to the requirements under these Regulations in relation to the production of that research, or has established a policy setting such requirements.

Exemption from restrictions on advertising

156. (1) Regulation 152 does not apply to a class of advertisement specified from time to time by the Bank for the purpose of exempting from that Regulation -

• (a) advertisements appearing to the Bank to have a private character whether by reason of a connection between the person issuing them and those to whom they are issued or otherwise,

• (b) advertisements appearing to the Bank to deal with investment or ancillary services only incidentally, or

• (c) advertisements issued to persons appearing to the Bank to be sufficiently expert to understand any risks involved.

• (2) An exemption under paragraph (1) of this Regulation is subject to such conditions as may be specified by the Bank when granting the exemption.

Liquidators receivers, administrators, examiners, official assignees or creditors

157. (1) No liquidator, receiver, administrator, examiner, official assignee or creditor of an investment firm shall have or obtain any recourse or right against client money or client financial instruments or documents of title relating to such financial instruments received held or paid on behalf of a client by an investment firm, until all proper claims of clients or of their heirs, successors or assigns against client money and client financial instruments or documents of title relating to such financial instruments have been satisfied in full.

• (2) Notwithstanding paragraph (1), a liquidator, receiver, administrator, examiner or official assignee may have recourse or right against client money or client financial instruments or documents of title relating to such financial instruments received, held or paid on behalf of a client by an investment firm in respect of such reasonable expenses as are incurred -

• (a) in the carrying out of their functions under these Regulations or under the Investor Compensation Act 1998, or

• (b) in the distribution of client money and financial instruments to clients of the investment firm where the assets of the investment firm have been exhausted.

Application to the Court

158. (1) A liquidator, receiver, administrator, examiner or official assignee shall apply to the Court before seeking recourse or right against client money or client financial instruments or documents of title relating to such financial instruments received, held or paid on behalf of a client by an investment firm under Regulation 157(2) and the Court shall determine the matter and make such order as the Court sees fit.

• (2) A person with whom an account is kept in pursuance of client money requirements or rules under Regulation 157 and this Regulation does not incur any liability as constructive trustee where money is wrongfully paid from the account, unless -

• (a) the person permits the payment with knowledge that the payment is wrongful, or

• (b) having deliberately failed to make inquiries in circumstances in which a reasonable and honest person would have done so.

Prohibition against misappropriation

159. (1) A person who is a director, officer or employee of an investment firm shall not misappropriate fraudulently any money or financial instruments held, controlled or paid on behalf of a client by that investment firm.

Safeguarding clients’ rights relative to financial instruments

160 (1) In this Regulation, “qualifying money market fund” means a collective investment undertaking -

• (a) authorised under Directive 85/611/EEC [UCITS], or

• (b) which is subject to supervision

and, if applicable, authorised by an authority under the national law of a Member State, and which satisfies the following conditions:

• (i) its primary investment objective must be to maintain the net asset value of the undertaking either constant at par (net of earnings), or at the value of the investors’ initial capital plus earnings;

• (ii) it must, with a view to achieving that primary investment objective invest exclusively in either of the following, whether alone or in combination with the other:

• (I) cash;

• (II) high quality money market instruments with a maturity or residual maturity that is no greater than one year, or with yield adjustments which are made regularly, and at least annually;

• (iii) it must provide liquidity through same day or next day settlement.

• (2) For the purposes of safeguarding clients’ rights in relation to financial instruments and funds belonging to them, investment firms shall comply with the following requirements:

• (a) they must keep such records and accounts as are necessary to enable them at any time and without delay to distinguish assets held for one client from assets held for any other client, and from their own assets;

• (b) they must maintain their records and accounts in a way that ensures their accuracy, and in particular their correspondence to the financial instruments and funds held for clients;

• (c) they must conduct, on a regular basis, reconciliations between their internal accounts and records and those of any third parties by whom those assets are held;

• (d) they must take the necessary steps to ensure that any client financial instruments deposited with a third party, in accordance with Regulation 161 (1) to (3), are identifiable separately from the financial instruments belonging to the investment firm, by means of -

• (i) differently titled accounts on the books of the third party, or

• (ii) other equivalent measures that achieve the same level of protection;

• (e) they must take the necessary steps to ensure that client funds deposited in accordance with Regulation 161, in a central bank, a credit institution or a bank authorised in a third country or a qualifying money market fund are held in an account or accounts identified separately from any accounts used to hold funds belonging to the investment firm;

• (f) they must introduce adequate organisational arrangements to minimise the risk of the loss or diminution of client assets, or of rights in connection with those assets, as a result of misuse of the assets, fraud poor administration, inadequate record-keeping or negligence.

• (3) If, for reasons of the applicable law, including in particular the law relating to property or insolvency, the arrangements made by investment firms in compliance with paragraph (1) to safeguard clients’ rights are not sufficient to satisfy the requirements of Regulations 33(1)(h) and (i), the Bank shall prescribe the measures that investment firms must take in order to comply with those requirements.

Deposit of financial instruments and funds by investment firms

161 (1) Investment firms may deposit financial instruments held by them on behalf of their clients into an account or accounts opened with a third party provided that the firms -

• (a) exercise all due skill, care and diligence in the selection, appointment and periodic review of the third party and of the arrangements for the holding and safekeeping of those financial instruments, and

• (b) take into account the expertise and market reputation of the third party as well as any legal requirements or market practices related to the holding of those financial instruments that could adversely affect clients’ rights.

• (2) If the safekeeping of financial instruments for the account of another person is subject to specific regulation and supervision in a jurisdiction where an investment firm proposes to deposit client financial instruments with a third party, the firm shall not deposit those financial instruments in that jurisdiction with a third party which is not subject to such regulation and supervision.

(3). An investment firms shall not deposit financial instruments held on behalf of clients with a third party in a third country that does not regulate the holding and safekeeping of financial instruments for the account of another person unless one of the following conditions is met:

• (a) the nature of the financial instruments or of the investment services connected with those instruments requires them to be deposited with a third party in that third country;

• (b) where the financial instruments are held on behalf of a professional client, that client requests the firm in writing to deposit them with a third party in that third country.

• (4) An investment firms, on receiving any client funds, shall without delay deposit those funds into one or more accounts opened with any of the following:

• (a) a central bank;

• (b) a credit institution authorised in accordance with Directive 2006/48/EC;

• (c) a bank authorised in a third country;

• (d) a qualifying money market fund.

• (5) Paragraph (1) does not apply to a credit institution authorised under Directive 2006/48/EC in relation to deposits within the meaning of that Directive held by that institution.

• (6) Where investment firms do not deposit client funds with a central bank, the firms shall exercise all due skill, care and diligence in the -

• (a) selection, appointment and periodic review of the credit institution bank or money market fund in which the funds are deposited, and

• (b) the arrangements for the holding of those funds,

taking into account the expertise and market reputation of the credit institution, bank or money market fund, with a view to ensuring the protection of clients’ rights, as well as any

• (i) legal or regulatory requirements, or

• (ii) market practices

related to the holding of client funds that could adversely affect clients’ rights.

Securities financing transactions of investment firms

162. (1) An investment firm shall not enter into arrangements for securities financing transactions in respect of financial instruments held by the firm on behalf of a client, or otherwise use such financial instruments for their own account or the account of another client of the firm, unless the following conditions are met:

• (a) the client must have given prior express consent to the use of the instruments on specified terms, as evidenced, in the case of a retail client, by the client's signature;

• (b) the use of the client's financial instruments must be restricted to the specified terms to which the client consents.

• (2) Investment firms shall not -

• (a) enter into arrangements for securities financing transactions in respect of financial instruments which are held on behalf of a client in an omnibus account, or

• (b) otherwise use financial instruments held in such an account for their own account or for the account of another client,

unless, in addition to the conditions set out in paragraph (1), at least one of the following conditions is met:

• (i) each client whose financial instruments are held together in an omnibus account must have given prior express consent in accordance with paragraph(1)(a);

• (ii) the investment firm must have in place systems and controls which ensure that only financial instruments belonging to clients who have given prior express consent in accordance with paragraph (1)(a) are so used.

• (3) The investment firm shall ensure that the records of the firm include -

• (a) details of the client on whose instructions the use of the financial instruments has been effected, and

• (b) the number of financial instruments used belonging to each client who has given consent, so as to enable the correct allocation of any loss.

Warning notices

163. (1) The Bank may arrange for the publication of warning notices in any of the newspapers circulating in the State or elsewhere or in the Iris Oifigiúil where the Bank reasonably believes that a company registered in the State or any other person operating in the State, without an authorisation as required by these Regulations, is -

• (a) providing investment services,

• (b) operating a regulated market, or

• (c) claiming, or holding itself, himself or herself out, to be—

• (i) providing investment services, or

• (ii) operating a regulated market.

• (2) The Bank shall endeavour to provide the company or person referred to in paragraph (1) with 7 days notice of the Bank's intention to publish a warning notice.

PART 13 — ENFORCEMENT

Authorised Officers

164. (1) The Bank, in writing, may appoint persons to be authorised officers for the purposes of these Regulations.

• (2) The Bank shall provide any authorised officer with a certificate of authority.

• (3) Whenever an authorised officer is requested to do so by a person in relation to whom the officer is exercising a power under these Regulations, the officer shall produce the officer's certificate of authority together with some form of personal identification.

Powers of authorised officers

165. (1) In this Regulation:

“agent”, in relation to a person to whom this Regulation applies or to any associated or related undertaking, includes past as well as present agents, as the case may be, and includes its bankers, accountants, solicitors, auditors and its financial and other advisors, whether or not those persons are officers or persons to whom this Regulation applies;

“persons to whom this Regulation applies” means the persons described in paragraph (2);

“specified” means specified under this Regulation.

• (2) The powers conferred by this Regulation may be exercised in respect of all or any of the following persons:

• (a) an investment firm, a regulated market or the market operator of a regulated market;

• (b) a proposed investment firm, regulated market or market operator of a regulated market;

• (c) a person whom the Bank has reasonable grounds to believe has provided or is providing investment or ancillary services;

• (d) an associated or related undertaking of any of them.

• (3) An authorised officer, for the purpose of obtaining any information which the Bank may require to enable the Bank to exercise any of its functions under these Regulations may do any one or more of the following:

• (a) at all reasonable times enter any premises if there are reasonable grounds to believe that, in those premises -

• (i) there are being carried on, or have been carried on, any investment services, ancillary services or activities, in connection with an investment firm or the market operator of a regulated market, or

• (ii) there are kept any books, records or other documents, relating to such services or activities,

and search and inspect the premises and any books, records or other documents on the premises;

• (b) secure for later inspection any premises or any part of a premises in which books, records or other documents are kept or there are reasonable grounds for believing that such books, records or other documents are kept;

• (c) inspect and take copies of or extracts from, or, subject to a warrant being issued for that purpose by a judge of the District Court, remove for a reasonable period for further examination, any books, records or other documents which the officer finds in the course of inspection;

• (d) require any person who -

• (i) carries on such investment or ancillary services or any activity in connection with an investment firm or with the market operator of a regulated market, and

• (ii) who is employed in connection therewith to give to the authorised officer such information as the officer may reasonably require in relation to any entries in the books records or other documents referred to in subparagraph (c);

• (e) require any such person to give to the officer any information which the authorised officer may require in regard to the investment or ancillary services or any activity in connection with an investment firm or regulated market or in regard to the persons carrying on services or activities or employed in connection therewith;

• (f) require any such person to give to the authorised officer any other information which the authorised officer may reasonably require in regard to such investment or ancillary services or any activity in connection with an investment firm or regulated market;

• (g) require any person by whom or on whose behalf data equipment is or has been used or any person having charge of, or otherwise concerned with the operation of, the data equipment or any associated apparatus or material, to afford the authorised officer reasonable assistance in relation thereto;

• (h) summon, at any reasonable time, any other person employed in connection with the investment or ancillary services or the activity in connection with an investment firm or regulated market -

• (i) to give to the authorised officer any information which the officer may reasonably require in regard to such activity, and

• (ii) to produce to the authorised officer any books, records or other documents which are in that person's power or control;

• (i) require any person employed in the premises -

• (I) to prepare a report on specified aspects of the business of the persons to whom this Regulation applies, or

• (II) to explain entries in any documents or other materials furnished;

• (j) communicate with any client of an investment firm or the market operator of a regulated market, for the purpose of confirming the investment or ancillary services which were provided to the client or the activity that was carried on.

• (4) A person who has in the person's power, possession or procurement any books, records or other documents aforesaid shall -

• (a) produce them at the request of an authorised officer and permit him or her to inspect and take copies of, or extracts from, them,

• (b) at the request of an authorised officer, give any information which may be reasonably required with regard to them, and

• (c) give such other assistance and information to an authorised officer as is reasonable in the circumstances.

• (5) Where any person from whom production of a book, record or other document is required under this Regulation claims a lien thereon, the production of the book, record or document shall be without prejudice to the lien.

• (6) Nothing in this Regulation shall compel the production by a barrister or solicitor of a book, record or other document containing a privileged communication made by or to the solicitor or barrister in that capacity or the furnishing of information contained in a privileged communication so made.

• (7) At such times as the Bank may specify from time to time an investment firm or the market operator of a regulated market and any person carrying on the business of an associated or related undertaking to which this Regulation relates shall each furnish to the Bank such information and returns -

• (a) that relate to the business of the associated undertaking or related undertaking, and

• (b) that Bank considers it necessary to have for the due performance of the Bank's functions under these Regulations,

as the Bank may specify from time to time.

• (8) This Regulation applies to the business of an associated undertaking or related undertaking to the extent only that the information and returns sought by the Bank are, in the opinion of the Bank, materially relevant to the proper appraisal of the business of the investment firm or regulated market to which the associated or related undertaking relates.

• (9) A requirement under this Regulation may be imposed on a person outside the State to whom this Regulation applies.

• (10) The duty to produce or provide any information, document, material or explanation extends to a person -

• (a) who is an examiner, liquidator, receiver, official assignee or who is or has been an officer or employee or agent of the persons to whom this Regulation applies, or

• (b) who appears to the Bank or to the authorised officer to have the information, document, material or explanation in the person's possession or under the person's control.

• (11) An authorised officer appointed under these Regulations, where he or she considers it necessary, may be accompanied by a member of the Gardaí Síochána when performing any powers conferred on an authorised officer by these Regulations.

• (12) If any officer, employee, shareholder or agent of a person to whom this Regulation applies refuses -

• (a) to produce to an authorised officer when requested to do so any book or document which it is the person's duty under this Regulation to produce,

• (b) to co-operate with an authorised officer when required to do so, or

• (c) to answer any question put to the person by an authorised officer with respect to the affairs of the person to whom this Regulation applies,

the authorised officer may certify the refusal under his or her hand to the Court.

• (13) When an authorised officer certifies a refusal referred to in paragraph (12) to the Court, the Court may inquire into the case and may make such order or direction as the Court thinks fit, after hearing -

• (a) any witnesses who may be produced against or on behalf of the officer employee, shareholder or agent of the person to whom this Regulation applies, and

• (b) any statement which may be offered in defence.

• (14) Without limiting the generality paragraph (13), an order or direction made by the Court under that paragraph may include an order or direction to the person concerned -

• (a) to attend or re-attend before the authorised officer,

• (b) to produce particular books or documents,

• (c) to answer a particular question put to the person by the authorised officer, or

• (d) that the person need not produce a particular book or document or answer a particular question put to the person by the authorised officer.

• (15) A person shall not obstruct or interfere with an authorised officer in the exercise of the officer's powers under these Regulations.

• (16) A person shall not, without reasonable excuse, refuse or fail to comply with any request or requirement of an authorised officer made in accordance with these Regulations.

• (17) A person shall not give an authorised officer information that the person knows or ought reasonably to know is false or misleading in a material particular.

Appointment of inspector by Court

166. (1) Without prejudice to the powers of the Bank under these Regulations, where the Bank is of the opinion that it is in the interest of -

• (a) the proper and orderly regulation and supervision of investment firms or regulated markets, or

• (b) the protection of investors,

that an investigation should be held into the affairs of an investment firm or the market operator of a regulated market, the Bank may apply to the Court for an order authorising such an investigation.

• (2) On application by the Bank under paragraph (1), the Court, as it thinks proper may appoint one or more inspectors to -

• (a) investigate the affairs of -

• (i) the investment firm or market operator that is the subject of the application, and

• (ii) where necessary, any subsidiary or other associated or related undertaking of the investment firm or market operator, and

• (b) to report the results of the investigation in such manner as the Court directs.

• (3) Before applying to the Court to appoint an inspector under this Regulation, the Bank, if it is of the opinion that it would not be prejudicial to the interests of shareholders or creditors or investors, may notify the investment firm or the market operator concerned in writing of -

• (a) the application, and

• (b) reasons for the application,

and, in that case, the investment firm or the market operator, within such period as the Bank may set out in the notification, shall be entitled to give to the Bank a statement in writing explaining the relevant activities of the investment firm or market operator, as the case may be.

Power of inspector to extend investigation

167. Where an inspector appointed under Regulation 166 to investigate the affairs of an investment firm or the market operator of a regulated market or any subsidiary or other associated or related undertaking thinks it necessary for the purposes of the investigation to investigate the affairs of -

• (a) any other investment firm or market operator of a regulated market or

• (b) any body corporate or any undertaking which body or undertaking is or was at any relevant time a subsidiary, an associated undertaking or a related undertaking of the investment firm or the market operator of the regulated market,

the inspector, with the approval of the Court, shall have power to do so, and shall report on the affairs of -

• (i) the other investment firm or regulated market or

• (ii) the body corporate, undertaking, associated undertaking or related undertaking,

so far as the inspector thinks the results of the investigation are relevant to the investigation of the affairs of the first-mentioned investment firm or market operator.

Direction to inspector by Court

168. Where the Court appoints an inspector under Regulation 166, the Court may from time to time give such directions as it thinks fit, whether to the inspector or otherwise, with a view to ensuring that the investigation is carried out as efficiently and as effectively as is practicable in the circumstances.

Powers of inspection

169. (1) It is the duty -

• (a) of all officers, shareholders, employees and agents of an investment firm or regulated market or other body the affairs of which are being investigated as provided by Regulation 166 or 173, including officers shareholders and agents outside the State, and

• (b) of any other person, including those being investigated under Regulation 167, and including any person outside the State, who the inspector considers is, or may be, in possession of any information concerning the affairs of an investment firm or regulated market,

to do each of the following:

• (i) produce to an inspector appointed under Regulation 166 or 173 all books, accounts, deeds, records or other documents of, or relating to the business of the investment firm, the market operator of the regulated market or the person being investigated under Regulation 167, which are in their control, possession or procurement;

• (ii) attend before the inspector, when required to do so;

• (iii) give to the inspector all assistance in connection with the investigation which they are reasonably able to give.

• (2) The inspector may examine on oath or by written interrogatories on oath the officers, employees, shareholders and agents of the investment firm or the market operator of a regulated market being investigated or other person being investigated by the inspector and any such person as is mentioned in paragraph (1) of this Regulation in relation to its affairs and may -

• (a) administer an oath accordingly, and

• (b) take or cause to be taken the answers of such person in writing and require that person to sign them.

• (3) If an inspector has reasonable grounds for believing that a director or past director or employee or past employee or agent or past agent or shareholder or past shareholder of the investment firm or regulated market or of any other person mentioned in paragraph (1) of this Regulation whose affairs the inspector is investigating, maintains or has maintained, either at that time or at any time in the past, an account of any description in a credit institution or an account with any other financial institution, including holdings of investment instruments, whether alone or jointly with another person and whether in the State or elsewhere, into or out of which there has been paid -

• (a) any money which has resulted from or been used in the financing of any transaction, arrangement or agreement relating to the business of the investment firm or market operator or relating to client money or investment instruments, or

• (b) any money which has been in any way connected with any act or omission, or series of acts or omissions, which on the part of that director or employee or agent constituted misconduct (whether fraudulent or not) towards the investment firm or market operator or the firm's or market operator's shareholders or any client or creditor of the firm or market operator,

the inspector may require the director or past director or officer or past officer or employee or past employee or agent or past agent or shareholder or past shareholder or other person mentioned in paragraph (1) of this Regulation to produce to the inspector all documents in the director's employee's or agent's possession, or under the director's, employee's or agent's control, relating to that account and in this paragraph “credit institution account” includes an account with any person exempt by virtue of section 7(4) of the Central Bank Act, 1971, from the requirement of holding a licence granted under section 9 of that Act.

• (4) If any officer, shareholder or agent of the investment firm or the operator of a regulated market or any such person as is mentioned in paragraph (1) refuses -

• (a) to produce to the inspector any book or document which it is the director's, employee's, agent's or person's duty under this Regulation to produce,

• (b) to attend before the inspector when required to do so, or

• (c) to answer any question put to the person by the inspector with respect to the affairs of the investment firm, the market operator or another person mentioned in paragraph (1), as the case may be,

the inspector may certify the refusal under his or her hand to the Court.

• (5) When the inspector certifies a refusal referred to in paragraph (4) to the Court and the Court may inquire into the case may make such order or direction as the Court thinks fit, after hearing -

• (a) any witnesses who may be produced against or on behalf of the officer shareholder or agent of the investment firm, market operator of a regulated market, associated or related undertaking another person mentioned in paragraph (1) as the case may be, and

• (b) any statement which may be offered in defence.

• (6) Without limiting the generality of paragraph (5), an order or direction under that paragraph may include a direction or order to the person concerned -

• (a) to attend or re-attend before the inspector,

• (b) to produce particular books or documents,

• (c) to answer a particular question put to the person by the inspector, or

• (d) that the person need not produce a particular book or document or answer a particular question put to the person by the inspector.

• (7) In this Regulation any reference to officers or agents includes past as well as present officers and agents, as the case may be, and “agents”, in relation to an investment firm or the market operator of a regulated market or other person mentioned in paragraph (1 includes the bankers, accountants, solicitors, auditors and the financial and other advisors of the investment firm, market operator or other person mentioned in paragraph (1), whether those persons are or are not officers of the investment firm or market operator or other body or undertaking.

Expenses of and fees relating to an investigation

170. (1) The expenses of and incidental to an investigation and the fees incurred by an inspector appointed by the Court under Regulation 166 or by the Bank under Regulation 173 shall be defrayed by the Bank, but the Court may direct that any person dealt with in the report shall be liable, to such extent as the Court may direct, on the application of the Bank to repay the Bank any expenses or fees incurred.

• (2) Without prejudice to paragraph (1) of this Regulation, any person who is -

• (a) convicted on indictment of an offence on a prosecution instituted as a result of an investigation,

• (b) ordered to pay damages or restore any property in proceedings brought as a result of an investigation, or

• (c) awarded damages or to whom property is restored in proceedings brought as a result of an investigation,

may be ordered, in the same proceedings, to repay all or part of the expenses and fees referred to in paragraph (1) of this Regulation and interest as appropriate, to the Bank or to any person on whom liability has been imposed by the Court under that paragraph.

• (3) However, in the case of a person to whom paragraph (2)(c) relates, the Court shall not order payment in excess of -

• (a) one-tenth of the amount of the damages awarded, or

• (b) one tenth of the value of the property restored,

and interest as appropriate and any such order shall not be executed until the person concerned has received the person's damages or the property has been restored.

• (4) The report of an inspector may, if he or she thinks fit, and shall, if the Court so directs, include a recommendation as to the directions, if any, which the inspector thinks appropriate, in the light of the inspector's investigation, to be given under paragraph (1) of this Regulation.

Inspectors’ reports and proceedings thereon

171. (1) An inspector appointed under Regulation 166 may, and shall if the Court so requires, make an interim report to the Court and, on conclusion of the investigation, shall make a final report to the Court but may at any time in the course of the investigation without making an interim report, inform the Court of matters coming to the inspector's knowledge as a result of the investigation tending to show that an offence has been committed.

• (2) On a report being presented to it under this Regulation, the Court shall -

• (a) forward a copy of any such report to the Bank,

• (b) if the Court thinks fit, furnish a copy thereof to the investment firm or regulated market concerned and its auditors, and

• (c) if the Court thinks fit -

• (i) furnish a copy thereof, on request and on payment of such fee as it may fix, to any other person who is a shareholder of the investment firm or regulated market concerned or a shareholder of any other body dealt with in the report by virtue of Regulation 166 or whose interests as a creditor or client of the investment firm or regulated market concerned or of any other such body appear to the Court to be affected, and

• (ii) cause any such report to be printed and published.

• (3) Where the Court thinks it to be proper the Court may direct that a particular part of a report made by virtue of this Regulation be omitted from a copy forwarded or furnished under paragraph (2)(b) or (2)(c) (i) or from the report as printed and published under paragraph (2) (c) (ii).

Powers of Court following consideration of reports

172. (1) Having considered a report made under Regulation 171, the Court may make such order as it thinks fit in relation to matters arising from that report including—

• (a) an order of its own motion for the winding-up or dissolution or bankruptcy of an investment firm or the market operator of a regulated market,

• (b) an order for the purpose of remedying any disability suffered by any person whose interests were adversely affected by the conduct of the affairs of the investment firm or market operator provided that, in making any such order, the Court shall have regard to the interests of any other person who may be adversely affected by the order.

• (2) If, in the case of any investment firm or market operator of a regulated market which firm or operator is liable to be wound up or dissolved under these Regulations or is subject to an adjudication of bankruptcy, it appears to the Bank from -

• (a) any report made under Regulation 171 as a result of an application by the Bank under Regulation 166, or

• (b) any report made by inspectors appointed by the Bank under Regulation 173, or

• (c) any information or document obtained by the Bank under these Regulations,

that a petition should be presented for the winding-up or dissolution or bankruptcy of an investment firm or the market operator of a regulated market, the Bank, unless the investment firm or market operator is already being wound up or dissolved or is already subject to an adjudication of bankruptcy, may present a petition for it to be so wound up or dissolved or to be the subject of an adjudication of bankruptcy if the Court thinks it just and equitable for it to be so wound up or dissolved or subject to an adjudication of bankruptcy.

Appointment of inspector by the Bank

173. (1) Without prejudice to its powers under these Regulations, the Bank may subject to paragraph (2), appoint one or more inspectors to investigate and report on any or all of the following:

• (a) the affairs and conduct of the business of an authorised investment firm or regulated market or other undertaking which is, or was at the relevant time, an associated or related undertaking of an authorised investment firm or the market operator of a regulated market, or any particular aspect of such business;

• (b) compliance of the authorised investment firm or regulated market with all or any of the following:

• (i) conditions or requirements or both imposed by the Bank under these Regulations;

• (ii) rules or codes of conduct set out or approved by the Bank under these Regulations;

• (iii) any condition or requirement of these Regulations;

• (iv) rules or requirements set out or approved by the Bank, with respect to clients’ money and investment instruments;

• (v) any other enactment;

• (c) any other matter as the Bank may consider appropriate.

• (2) An appointment under paragraph (1) of this Regulation may be made by the Bank if it is of the opinion that there are circumstances suggesting that it is necessary -

• (a) for the effective administration of the law relating to investment firms or regulated markets, or

• (b) for the effective discharge by the Bank of its statutory functions under these Regulations.

• (3) The terms of appointment of an inspector under this Regulation may define the scope of the inspector's investigation, whether as respects the matters or the period to which it is to extend or otherwise, and in particular may limit the investigation to matters connected with particular circumstances.

• (4) Subject to the terms of appointment of an inspector, the powers conferred on the inspector by this Regulation shall extend to the investigation of any circumstances suggesting the existence of an arrangement or understanding which, though not legally binding, is or was observed or likely to be observed in practice and which is relevant to the purposes of the investigation.

• (5) For the purposes of any investigation under this Regulation, Regulations 167 to 171, except Regulations 168, 169(3) and 170(3), shall apply with the necessary modifications or references to the affairs of the authorised investment firm or the market operator of a regulated market or to the affairs of any other person or any associated or related undertaking, so, however, that -

• (a) the Regulations shall apply in relation to all persons who are or have been officers or employees or agents of the authorised investment firm or market operator or other persons who appear to the inspector to have the information, document, material or explanation in their possession or under their control, and

• (b) for references to the Court except in Regulations 167, 169(4), 170(1 and (2), there shall be substituted references to the Bank.

Search and seizure

174. (1) If a Judge of the District Court is satisfied on the sworn information of an authorised officer or an inspector appointed under Regulation 173 that there are reasonable grounds for suspecting that there are on any premises any books, records or other documents -

• (a) of which production has been required under these Regulations, and

• (b) which have not been produced in compliance with that requirement,

the Judge may issue a warrant authorising any member of the Gardaí Síochána, together with any other persons named in the warrant and any other members of the Gardaí Síochána, at any time or times within one month from the date of the warrant, on production if so requested of the warrant, to enter the premises specified in the information (using such force as is reasonably necessary for the purpose) and to search the premises or other place specified in the warrant and -

• (i) take possession of any books or documents appearing to be such books or documents as aforesaid, or

• (ii) to take, in relation to any books or documents so appearing, any other steps which may appear necessary for preserving them and preventing interference with them.

• (2) Any books or documents of which possession is taken under this Regulation may be retained for a period of 6 months or -

• (a) if within that period there are commenced any such criminal proceedings (being proceedings to which the books or documents are relevant), until the conclusion of those proceedings, or

• (b) if within that period there is commenced an investigation by An Gardaí Síochána into matters relating to Regulation 177(1)(a) (and the books or documents are relevant to the investigation), until the conclusion of the investigation.

• (3) A person shall not -

• (a) obstruct or interfere with a member of the Gardaí Síochána acting under the authority of a warrant issued under this Regulation,

• (b) be present on the premises or at the place specified in the warrant by a member of the Gardaí Síochána acting under the authority of a warrant issued under this Regulation and -

• (i) fail or refuse to give the member the person's name and address when required to do so, or

• (ii) give a name and address that is false or misleading, or

• (c) obstruct the exercise of an authority conferred by a warrant under this Regulation to take possession of any books or documents.

• (4) In this Regulation “premises” includes any building or other land and includes a vessel, aircraft or motor vehicle.

Admissibility in evidence of reports of inspectors

175. A document purporting to be a copy of a report of an inspector appointed under these Regulations shall be admissible in any civil proceedings as evidence -

• (a) of the facts set out the document without further proof, unless the contrary is shown, and

• (b) of the opinion of the inspector in relation to any matter contained in the report.

Privilege

176. (1) Nothing in these Regulations

• (a) compels the disclosure by any person of any information which the person would, in the opinion of the Court, be entitled to refuse to produce on the grounds of legal professional privilege, or

• (b) authorises the taking possession of any document containing such information which is in the person's possession.

• (2) The publication, in pursuance of any provision of this Part, of any report information, book or document relating to inspectors appointed under this Part is privileged.

Consent to publication of information

177. (1) In this Regulation “appropriate authority” includes any or all of the following:

• (a) the Bank;

• (b) a person authorised by the Governor of the Bank;

• (c) an inspector appointed under these Regulations;

• (e) the Minister;

• (f) any court of competent jurisdiction;

• (g) any other competent authority for the purposes of the Directive or of Directive 2006/48/EC relating to the taking up and pursuit of the business of credit institutions

• (2) No information, book or document, relating to a person, which has been obtained under Regulation 174 shall, without the previous consent in writing of that person be published or disclosed, except to an appropriate authority, unless the publication or disclosure is required for all or any of the following:

• (a) with a view to the institution of, or otherwise for the purposes of, any criminal proceedings pursuant to, or arising out of, any enactments under which the relevant Bank exercises statutory functions or any criminal proceedings for an offence entailing misconduct in connection with the management of the affairs of a person or misapplication or wrongful retainer of its property;

• (b) for the purpose of complying with any requirement, or exercising any power, imposed or conferred by these Regulations with respect to reports made by inspectors appointed thereunder by the Court or the Bank;

• (c) with a view to the institution by the Bank of proceedings for the winding-up, dissolution or bankruptcy under these Regulations of the person or otherwise for the purposes of proceedings instituted by the Bank for that purpose;

• (d) for the purposes of proceedings under Regulation 174.

PART 14 — ACQUIRING TRANSACTIONS

Definitions for the purposes of this Part

178. In this Part:

“acquiring transaction” means any direct or indirect acquisition by a person or more than one person acting in concert of shares or other interest in an authorised investment firm or the market operator of a regulated market if, after the proposed acquisition,

• (a) the proportion of voting rights or capital held by the person or persons making the acquiring transaction would reach or exceed a qualifying holding, or

• (b) the proportion of voting rights or capital held by the person or persons making the acquiring transaction would reach or exceed 20 per cent, 33 per cent or 50 per cent, or

• (c) an authorised investment firm or the market operator of a regulated market would become a subsidiary of the acquirer;