Article 14 Use of certain funds

(1)

The scheme manager must, so far as practicable, ensure that—

(a)

funds held by it which originate from the payment of contributions levied under sections 53 to 55 of the Banking Act or section 26 of the Building Societies Act^f1 are used only to meet relevant liabilities attributable to deposit-taking;

(b)

funds held by it which originate from the payment of general business levies under the Policyholders Protection Act are used only to meet relevant liabilities attributable to general insurance business;

(c)

funds held by it which originate from the payment of long term business levies or levies on intermediaries under the Policyholders Protection Act are used only to meet relevant liabilities attributable to long-term insurance business.

(2)

In this article—

“deposit-taking” means—
1. (a)
  
  deposit-taking business within the meaning of section 6 of the Banking Act;
2. (b)
  
  deposit-taking, or the issue of shares to members, carried out by a building society within the meaning of the Building Societies Act; or
3. (c)
  
  accepting deposits within the meaning of the Regulated Activities Order;
“general insurance business” means—
1. (a)
  
  general business within the meaning of section 1 of the Insurance Companies Act; or
2. (b)
  
  effecting and carrying out contracts of general insurance within the meaning of the Regulated Activities Order;
“long-term insurance business” means—
1. (a)
  
  long term business within the meaning of section 1 of the Insurance Companies Act; or
2. (b)
  
  effecting and carrying out contracts of long-term insurance within the meaning of the Regulated Activities Order;
“relevant liabilities” means liabilities of the scheme manager to pay compensation in respect of article 9 defaults or applications for compensation under the new scheme.

Annotations

Footnotes

f1: Repealed in part and amended by S.I. 1995/1442.