# The Income Tax (Stock Lending) Regulations 1989, Regulation 6: Conditions relating to the transfer of other United Kingdom securities


(1) The conditions specified in this regulation in relation to an arrangement mentioned in subsection (1) are–
(a) that, subject to paragraph (2) below, the person referred to as A in the principal section is an approved borrower;
(b) that the person referred to as B in the principal section is an approved moneybroker;
(c) that the arrangement takes a form approved by the Board;
(d) that, where A is an approved borrower by virtue of sub-paragraph (a) of the definition in paragraph (4) below, the contract of sale mentioned in the subsection was entered into by him in the ordinary course of his business;
(e) that, where A is an approved borrower by virtue of sub-paragraph (b) of the definition in paragraph (4) below, the contract of sale mentioned in the subsection was entered into by him in the ordinary course of his business as a market maker in relation to options to buy or sell securities of the kind sold under the contract of sale;
(f) that, where A is an approved borrower by virtue of sub-paragraph (c) of the definition in paragraph (4) below–
(i) the contract of sale mentioned in the subsection was entered into by him in the ordinary course of his business as a market maker in relation to securities carrying rights of subscription for, or conversion into, securities of the kind sold under the contract of sale, and
(ii) he will, by the time that the arrangement is to take effect, have irrevocably exercised rights of subscription for, or conversion into, a quantity of securities of the same kind as those to be transferred by B which is not less than that to be so transferred.
(2) Where the securities to which an arrangement mentioned in subsection (1) relates–
(a) have been issued or guaranteed by the government of any of the countries or territories which, at the time when the arrangement is made, is mentioned in Schedule 3 or Schedule 6 to the British Nationality Act 1981, the Channel Islands, the Isle of Man or the Republic of Ireland or by a public or local authority in the United Kingdom, any such country or territory, the Channel Islands, the Isle of Man or the Republic of Ireland, or
(b) are denominated in sterling and have been issued by the government of, or a public or local authority in, any other country or territory,
the condition contained in paragraph (1)(a) above has effect as if the reference to A being an approved borrower was a reference to A being an approved borrower by virtue of sub-paragraph (a) of the definition in paragraph (4) below.
(3) The conditions specified in this regulation in relation to an arrangement mentioned in subsection (2) are–
(a) that B is an approved moneybroker;
(b) that the person referred to as C in the principal section, and any person for whom C is acting in connection with the arrangement as a nominee, is an approved lender;
(c) that the arrangement takes a form approved by the Board.
(4) In this regulation–
“approved borrower” means a person who, at the time when the arrangement is made–
(a) is a market maker in relation to securities of the kind which are the subject of the arrangement or similar securities, or
(b) is a market maker in relation to options to buy or sell securities of the kind which are the subject of the arrangement, or
(c) is a market maker in relation to securities which carry rights of subscription for, or conversion into, securities of the kind which are the subject of the arrangement,
and for the purposes of this definition securities shall be deemed to be similar if they would be so deemed for the purposes of sections 731 to 734 of the Taxes Act 1988;
“approved lender” and “approved moneybroker” have the same meanings as in regulation 5.

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Source: https://www.legislation.gov.uk/uksi/1989/1299/regulation/6 (the official version)
Page: https://openlegislation.uk/income-tax-stock-lending-regulations-1989/regulation-6
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.