Registration and recording of legal title - CASS Provision: Difference between revisions

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(Created page with "To the extent practicable, a {{isdaprov|firm}} must effect appropriate registration or recording of legal title to a safe {{isdaprov|custody asset}} in the name of: :(1) the {...")
 
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To the extent practicable, a {{isdaprov|firm}} must effect appropriate registration or recording of legal title to a safe {{isdaprov|custody asset}} in the name of:
{{fullanat|cass|6.2.3|}}
:(1) the {{isdaprov|client}} (or, where appropriate, the {{isdaprov|trustee firm}}), unless the {{isdaprov|client}} is an {{isdaprov|authorised person}} acting on behalf of its {{isdaprov|client}}, in which case it may be registered in the name of the {{isdaprov|client}} of that {{isdaprov|authorised person}};
This is the rule that provides that a {{tag|custodian}} may hold {{tag|client assets}} in its own name or that of a third party if local law or market practice makes it impracticable to do otherwise. See this rule in its natural environment on the {{tag|FCA}} website [https://www.handbook.fca.org.uk/handbook/CASS/6/2.html#D41 here].
:(2) a {{isdaprov|nominee company}} which is controlled by:
 
::(a) the {{isdaprov|firm}};
====Discussion====
::(b) an {{isdaprov|affiliated company}};
Note the interplay between CASS {{cassprov|6.2.5}}, about the recording of title to legal assets, with {{cassprov|6.2.3(4)}}.
::(c) a {{isdaprov|recognised investment exchange}} or a {{isdaprov|designated investment exchange}}; or
 
::(d) a third party with whom {{isdaprov|financial instruments}} are deposited under CASS {{isdaprov|6.3}} ({{isdaprov|Depositing assets and arranging for assets to be deposited with third parties}});
{{CASS Section 6 TOC}}
:(3) any other third party if:
::(a) the {{isdaprov|safe custody asset}} is subject to the law or market practice of a jurisdiction outside the {{isdaprov|United Kingdom}} and the {{isdaprov|firm}} has taken reasonable steps to determine that it is in the {{isdaprov|client}}'s best interests to register or record it in that way, or that it is not feasible to do otherwise, because of the nature of the applicable law or market practice; and
::(b) the {{isdaprov|firm}} has notified the {{isdaprov|client}} in writing;
:(4) the {{isdaprov|firm}} if:
::(a) the {{isdaprov|safe custody asset}} is subject to the law or market practice of a jurisdiction outside the {{isdaprov|United Kingdom}} and the {{isdaprov|firm}} has taken reasonable steps to determine that it is in the {{isdaprov|client}}'s best interests to register or record it in that way, or that it is not feasible to do otherwise, because of the nature of the applicable law or market practice; and
::(b) the {{isdaprov|firm}} has notified the {{isdaprov|client}} if a {{isdaprov|professional client}}, or obtained prior written consent if a {{isdaprov|retail client}}.

Latest revision as of 14:13, 9 November 2017

CASS Anatomy™


Template:CASS Section 6.2.3

(View Template)



IMPORTANT: CASS changed quite a bit after MiFID II. This resource therefore may well be out of date, even if it was accurate once, which it might not have been. This is an article about the FCA’s custody and client money rules — client assets — and is fondly known by its chapter in the FCA SourcebookTable of Contents | 1 | 1A | 3 | 5 | 6 (custody rules) | 7 (client money rules) | 7A | 8 | 9 (PBDA) | 10

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This is the rule that provides that a custodian may hold client assets in its own name or that of a third party if local law or market practice makes it impracticable to do otherwise. See this rule in its natural environment on the FCA website here.

Discussion

Note the interplay between CASS 6.2.5, about the recording of title to legal assets, with 6.2.3(4).

6 - Custody rules

6.1 Application
6.2 Holding of client assets

6.2.1 Requirement to protect clients' safe custody assets
6.2.2 Requirement to have adequate organisational arrangements
6.2.3 Registration and recording of legal title
6.2.4 (Nominee companies)
6.2.5 Recording title to safe custody assets
6.2.6 (Adequate investigations)
6.2.7 (documents of title to bearer assets)

6.3 Depositing assets and arranging for assets to be deposited with third parties

6.3.1 - Criteria for depositing assets with a third party
6.3.2 - Considerations when discharging obligations under this part
6.3.3 - Issues firms should address in their agreements with third party custodians
6.3.4 - Suitable jurisdictions for the deposit of safe custody assets
6.3.4A - Third-party custody agreements
6.3.4B - Third-party custody agreements
6.3.5 - Agreements with third party custodians not to contain security interests ...
6.3.6 - ... er, except in the following cases
6.3.7 - When a firm is considered to be acting on the instructions of a professional client
6.3.8 - Safe custody asset includes client money
6.3.9 - And don't think this provision allows a right of set-off

6.4 Use of safe custody assets
Template:CASS Section 6.5 TOC 6.6 Template:Records, accounts and reconciliations (From 1/6/2015)

6.6.54 Treatment of shortfalls
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