# The Financial Markets and Insolvency Regulations 1991, Regulation 10: Extent to which charge granted in favour of recognised investment exchange to be treated as market charge

Extent: E+W+S

(1) A charge granted in favour of a recognised investment exchange other than The Stock Exchange shall be treated as a market charge only to the extent that—
(a) it is a charge over property provided as margin in respect of market contracts entered into by the exchange for the purposes of or in connection with the provision of clearing services or over property provided as a default fund contribution to the exchange;
(b) in the case of a recognised UK investment exchange, it secures the obligation to pay to the exchange any sum due to the exchange from a member or designated non-member of the exchange or from a recognised clearing house or from a recognised CSD or from another recognised investment exchange in respect of unsettled market contracts to which the member, designated non-member or recognised body is a party under the rules referred to in paragraph 12 of the Schedule to the Recognition Requirements Regulations; and
(c) in the case of a recognised overseas investment exchange, it secures the obligation to reimburse the cost (other than fees and other incidental expenses) incurred by the exchange in settling unsettled market contracts in respect of which the charged property is provided as margin.
(2) A charge granted in favour of The Stock Exchange shall be treated as a market charge only to the extent that—
(a) it is a charge of the kind described in paragraph (1); or
(b) it is a Talisman charge and secures an obligation of either or both of the kinds mentioned in paragraph (3).
(3) The obligations mentioned in this paragraph are—
(a) the obligation of the chargor to reimburse The Stock Exchange for payments (including stamp duty and taxes but excluding Stock Exchange fees and incidental expenses arising from the operation by The Stock Exchange of settlement arrangements) made by The Stock Exchange in settling, through Talisman, market contracts entered into by the chargor; and
(b) the obligation of the chargor to reimburse The Stock Exchange the amount of any payment it has made pursuant to a short term certificate.
(4) In paragraph (3), “short term certificate” means an instrument issued by The Stock Exchange undertaking to procure the transfer of property of a value and description specified in the instrument to or to the order of the person to whom the instrument is issued or his endorsee or to a person acting on behalf of either of them and also undertaking to make appropriate payments in cash, in the event that the obligation to procure the transfer of property cannot be discharged in whole or in part.

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Source: https://www.legislation.gov.uk/uksi/1991/880/regulation/10 (the official version)
Page: https://openlegislation.uk/financial-markets-and-insolvency-regulations-1991/regulation-10
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.