Article 36H Operating an electronic system in relation to lendingF1

Where the F2conditions in paragraphs (2), (2A) and (2C) are satisfied, operating an electronic system which enables the operator (“A”) to facilitate persons (“B” and “C”) becoming the lender and borrower under an article 36H agreement is a specified kind of activity.

The condition F3in this paragraph is that the system operated by A is capable of determining which agreements should be made available to each of B and C (whether in accordance with general instructions provided to A by B or C or otherwise).

The condition in this paragraph is that A, or another person (“X”) acting under an arrangement with A or at A’s direction, undertakes to—

For the purposes of paragraph (2A)—

The condition in this paragraph is that A, or another person (“X”) acting under an arrangement with A or at A’s direction, undertakes to perform, or A undertakes to appoint or direct another person to perform either or both of the following activities—

Where A carries on an activity of the kind specified in paragraph (1), it is a specified kind of activity for A to operate an electronic system where—

The following are specified kinds of activities if carried on by A in the course of, or in connection with, the carrying on by A of the activity specified by paragraph (1) F8or (2D)—

F19Subject to article 60C(4C), an “article 36H agreement” is an agreement by which one person provides another person with credit and in relation to which—

The condition in this paragraph is that A does not provide credit, assume the rights (by assignment or operation of law) of a person who provided credit, or receive credit under the agreement.

The condition in this paragraph is that the lender is an individual or relevant person.

The condition in this paragraph is that the borrower is an individual or relevant person and—

Paragraphs (5) and (6) of article 60C (exempt agreements: exemptions relating to the nature of the agreement) apply for the purposes of paragraph (6)(b).

It is immaterial for the purposes of this article whether the lender is carrying on a regulated activity.

In this article—

• “assignment”, in relation to Scotland, means assignation;

• “borrower” means a person who receives credit under an article 36H agreement or a person to whom the rights and duties of a borrower under such an agreement have passed by assignment or operation of law;

• “credit” has the meaning given by article 60L;

• “lender” means—

  1. (a)

     a person providing credit under an article 36H agreement, or

  2. (b)

     a person who by assignment or operation of law has assumed the rights of a person who provided credit under such an agreement;

• “relevant person” means—

  1. (a)

     a partnership consisting of two or three persons not all of whom are bodies corporate, or

  2. (b)

     an unincorporated body of persons which does not consist entirely of bodies corporate and is not a partnership.

For the purposes of the application of section 22(1) of the Act (regulated activities) to an activity of a kind specified by this article, article 88D (credit agreement), and article 73 (investments: general) in so far as it relates to that article, F22have effect as if the reference to a credit agreement in article 88D includes a reference to an article 36H agreement.