CG56027 | Futures: scope of legislation: commodity/financial over the counter futures

TCGA92/S143 (3), TCGA92/S143 (8)

As explained in CG56000, over the counter futures are contracts individually tailored to meet the specific needs of particular clients. Because they are not dealt in on recognised futures exchanges they do not fall within the definition in TCGA92/S143 (1). However they are brought within the scope of the Section by TCGA92/S143 (3) where one of the parties is an authorised person.

The definition of an authorised person is contained in Section 143(8) and is a person who -

1. falls within section 31(1)(a),(b) or (c) of the Financial Services and Markets Act 2000, and

2. has permission under that Act to carry on one or more of the activities specified in Regulation 14 and, in so far as it applies to that Regulation, Regulation 64 of the FSMA 2000 (Regulated Activities) Order 2001 (SI 2001/544).

HMRC officers may accept that a reputable financial concern such as a High Street bank operating in the UK will meet these requirements. If uncertain then the Financial Conduct Authority’s public register is at register.fca.org.uk. Any case of doubt or difficulty should be referred to Capital Gains Technical Group.