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CASS 1.2 General application: who? what?

General application: who?

CASS 1.2.1GRP

The rules in CASS 1.2 set out the maximum scope of this sourcebook. The application of CASS is modified for certain activities by CASS 1.4. Also particular chapters or sections of CASS may have provisions which limit their application.

CASS 1.2.2RRP

CASS applies to every firm, except as provided for in CASS 1.2.3 R, with respect to the carrying on of:

  1. (1)

    all regulated activities except to the extent that a provision of CASS provides for a narrower application; and

  2. (2)

    unregulated activities to the extent specified in any provision of CASS.

CASS 1.2.3RRP

CASS does not apply to:

  1. (1)

    an ICVC; or

  2. (2)

    an incoming EEA firm other than an insurer, with respect to its passported activities; or

  3. (3)

    a UCITS qualifier.

CASS 1.2.4RRP

With the exception of this chapter and the insurance client money chapter, CASS does2 not apply to:

2
  1. (1)

    an authorised professional firm with respect to its non-mainstream regulated activities; or

  2. (2)

    the Society.

CASS 1.2.5RRP

1The insurance client money chapter2 does not apply to an authorised professional firm with respect to its non-mainstream regulated activities, which are insurance mediation activities, if:

2
  1. (1)

    the firm's designated professional body has made rules which implement article 4 of the Insurance Mediation Directive;3

    3
  2. (2)

    those rules have been approved by the FCA under section 332(5) of the Act; and

  3. (3)

    the firm is subject to the rules in the form in which they were approved.

CASS 1.2.6G

[deleted]2

2

General application: what?

CASS 1.2.7GRP
  1. (1)

    [deleted]7

    7
  2. (2) 7

    [deleted]7

  3. (3)

    [deleted]7

    7
  4. (3A)

    [deleted]7

    7
  5. (4)

    [deleted]7

    7
  6. (5)

    [deleted]52

    5
  7. (6)

    [deleted]7

    7
  8. (7)

    The debt management client money chapter applies to CASS debt management firms receiving or holding client money for, or on behalf of, a client in the course of or in connection with debt management activity.6

2Application for retail clients, professional clients and eligible counterparties2

CASS 1.2.8GRP
  1. (1)

    CASS applies directly in respect of activities conducted with or for all categories of clients.2

    2
  2. (2)

    [deleted]5

    2225
  3. (3)

    The insurance client money chapter2 does not generally distinguish between different categories of client. However, the term consumer 4is used for those to 4whom additional obligations are owed, rather than the term retail client.2 This is to be consistent with the client categories used in 1the Insurance: New Conduct of Business sourcebook4.

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  4. (4)

    Each provision in the collateral rules, 7 custody chapter, 7 the client money chapter and CASS 9 (Information to clients) 7 makes it clear whether it applies to activities carried on for retail clients, professional clients or both. 2

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  5. (4A)

    7There is no further modification of the rules in the chapters referred to in (4) for activities carried on for eligible counterparties. Such clients are treated in the same way as other professional clients for the purposes of these rules.

  6. (5)

    The debt management client money chapter generally applies in respect of relevant dealings with the client category known as customers. In general, the client categories of retail clients, professional clients, as well as eligible counterparties, have no relevance to credit-related regulated activities, including debt management activities.6

CASS 1.2.9G

[deleted]2

2

Application for affiliates7

CASS 1.2.9AGRP
  1. (1)

    7The fact that a firm's client is an affiliated company for MiFID business does not affect the operation of CASS to the firm in relation to that client.

  2. (2)

    For business that is not MiFID business, the operation of the custody chapter or the client money chapter may differ if a firm's client is an affiliated company and depending on certain other conditions (see, for example, CASS 6.1.10B R and CASS 7.1.12A R).

Investments and money held under different regimes

CASS 1.2.10R

2[deleted]5

5
CASS 1.2.11RRP
7
  1. (1)

    7A firm must not keep money in respect of which any one of the following chapters applies in the same client bank account or client transaction account as money in respect of which another of the following chapters applies:

    1. (a)

      the client money chapter;

    2. (b)

      the insurance client money chapter;

    3. (c)

      the debt management client money chapter.

  2. (2)

    7In accordance with CASS 7.1.15H R, a firm which is subject to the client money chapter and holds money both (i) in its capacity as a trustee firm and (ii) other than in its capacity as a trustee firm must not keep money held in its capacity as a trustee firm in the same client bank account or client transaction account as money held other than in its capacity as a trustee firm.

  3. (3)

    7To the extent that the restriction under (1) or (2) applies to a firm, the client bank accounts and client transaction accounts that a firm holds in respect of different chapters or in its different capacities (as the case may be) must be separately designated.

CASS 1.2.12GRP

2The purpose of the rules regarding the segregation of investments and money held under different regimes is to reduce the risk of confusion between assets held under different regimes either on an on-going basis or on the failure of a firm or a third party holding those assets.

CASS 1.2.13GRP

2A firm may, where permitted by the relevant rules7 opt to hold under a single chapter money that would otherwise be held under different chapters (see CASS 7.1.3 R5 and CASS 7.1.15BA R7). However, making such an election does not remove the requirement under CASS 1.2.11R (1). 7

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