STSM042150 - Exemptions and reliefs: reliefs: stock lending and repurchase relief - conditions for relief

The terms of the FA86/S80C and S89AA require two conditions to be met.

• The return of securities of the same kind and amount to the lender.

And, either:

• Agreements to transfer are undertaken on a regulated market, MTF or recognised foreign exchange (the relevant securities being regularly traded on that regulated market, MTF or recognised foreign exchange) and must be subject to the rules of, and reported to, the regulated market, MTF or recognised foreign exchange (FA86/S80C(3) and S89AA(3)). ‘Regularly traded’ means the security appears on the list of tradeable securities maintained by the regulated market, MTF or recognised foreign exchange.

Or:

• Where neither party to the stock lending arrangement is a member of a regulated market, MTF or recognised foreign exchange but is nevertheless authorised under the law of an EEA state, UK or Gibraltar to execute orders on behalf of clients and deal on own account in relation to securities of the type concerned, relief may be available but only in respect of arrangements relating to stocks that are regularly traded on a regulated market, and applies irrespective of where the arrangement or agreement is effected (FA86/S80C(2A) and S89AA(2A)).