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REC 7.1 Introduction

Application

REC 7.1.1 R

1This chapter applies to every recognised body and to every applicant for recognition as a recognised body under Part XVIII of the Act (Recognised investment exchanges and clearing houses).

Purpose

REC 7.1.2 G

The purpose of this chapter is to set out the requirements on recognised bodies and applicants for recognition as recognised bodies to pay fees which (with other fee requirements in the Handbook) provide the funding for the FSA's functions.

Background

REC 7.1.3 G

GEN 3 (FSA Fees - General Provisions) applies to fees required by this chapter, and explains how the FSA sets its fees.

REC 7.1.4 G

Most of the detail of the fees payable by recognised bodies is set out in REC 7 Annex 1. The provisions of the annex will vary from one financial year to another. Accordingly a new annex will come into force, following consultation, for each financial year.2

REC 7.1.5 G

The fee applicable to a recognised body reflects the estimated cost to the FSA of discharging its functions in relation to that recognised body. Fees are set for recognised bodies on an individual basis.3

REC 7.1.6 G

Application fees are calculated from a tariff structure intended to reflect the estimated cost of processing an application of that type and complexity.

REC 7.1.7 G

A recognised body may also have obligations to pay fees to the FSA under other rules or arising from legislation other than the Act. For example, a recognised body may have an obligation to pay a fee as an approved operator of a relevant system under the Uncertificated Securities Regulations 1995.

REC 7.1.8 G

The FSA does not specify a method of payment for recognised bodies or applicants. However the FSA expects that a recognised body or an applicant will generally pay its fee by electronic credit transfer.

REC 7.2 [to follow]

REC 7.2.1 R

.

REC 7.3 Application fees

Amount

REC 7.3.1 R

An applicant for recognition as a UK recognised body under section 287 or section 288 of the Act must pay to the FSA in full and without any deduction the application fee specified for that type of application in part 1 of REC 7 Annex 2 R1.

REC 7.3.2 R

An applicant for recognition as an overseas recognised body under section 287 or section 288 and section 292 of the Act must pay to the FSA in full and without any deduction the application fee specified in part 2 of REC 7 Annex 2 R1.

Due dates

REC 7.3.3 R

An applicant must pay the application fee on or before the date on which the application is made.

REC 7.3.4 G

The FSA will not consider an application for recognition until the application fee has been paid.

REC 7 Annex 1 Periodic fees payable for the period from 1 April 2004 to 31 March 2005

R

In this Annex:

- the term recognised body includes a body which was a recognised investment exchange or a recognised clearing house recognised under the Financial Services Act 1986 and which is a recognised body as a result of Regulation 9 of the Recognition Requirements Regulations; and

- the term recognition order includes a recognition order made by the FSA under section 37 or section 39 of the Financial Services Act 1986 or a recognition order made by the Treasury under section 40 of the Financial Services Act 1986.

Part 1 - Periodic fees for UK recognised bodies

Name of UK recognised body

Amount payable

Due date

CRESTCo Limited

£290,000

30 April 2004

£298,000

1 September 2004

The International Petroleum Exchange of London Limited

£162,500

30 April 2004

£169,500

1 September 2004

LIFFE Administration and Management

£330,000

30 April 2004

£392,000

1 September 2004

LCH.Clearnet Limited

£285,000

30 April 2004

£334,000

1 September 2004

The London Metal Exchange Limited

£240,000

30 April 2004

£195,000

1 September 2004

The London Stock Exchange plc

£355,000

30 April 2004

£350,000

1 September 2004

OM London Exchange Limited

£87,500

30 April 2004

£101,500

1 September 2004

virt-x plc

£112,500

30 April 2004

£121,500

1 September 2004

EDX

£75,000

30 April 2004

£115,000

1 September 2004

Any other UK recognised investment exchange recognised as such by a recognition order made in the period

£150,000

30 days after the date on which the recognition order is made

Any other UK recognised clearing house recognised as such by a recognition order made in the period

£250,000

30 days after the date on which the recognition order is made

Part 2 - Periodic fees for overseas recognised bodies

Name of overseas recognised body

Amount payable

Due date

Cantor Financial Futures Exchange

£10,000

1 July 2004

The Chicago Mercantile Exchange

£10,000

1 July 2004

Chicago Board of Trade

£10,000

1 July 2004

EUREX Zurich

£10,000

1 July 2004

NASDAQ

£10,000

1 July 2004

NQLX

£10,000

1 July 2004

New York Mercantile Exchange

£10,000

1 July 2004

Swiss Exchange

£10,000

1 July 2004

Sydney Futures Exchange

£10,000

1 July 2004

Warenterminborse Hannover

£10,000

1 July 2004

Any other overseas investment exchange recognised as such by a recognition order made in the period

£10,000

30 days after the date on which the recognition order is made

Any other overseas clearing house recognised as such by a recognition order made in the period

£35,000

30 days after the date on which the recognition order is made 5 4 3 2 1

REC 7 Annex 2 Application fees payable

R

Description of applicant

Amount payable

Due date

Applicant for recognition as a UK RIE

£100,000

Date the application is made

Applicant for recognition as a UK RCH

£100,000

Date the application is made

Additional fees for applicant who proposes to:

- act as a central counterparty

£25,000

Date the application is made

- offer safeguarding and administration services

£25,000

Date the application is made

- use substantially new and untested information technology systems in the performance of its relevant functions

£25,000

Date the application is made

Description of applicant

Amount payable

Due date

Applicant for recognition as a recognised overseas investment exchange

£50,000

Date the application is made

Applicant for recognition as a recognised overseas clearing house

£50,000

Date the application is made

Additional fees for applicant who proposes to:

- act as a central counterparty

£25,000

Date the application is made

- offer safeguarding and administration services

£25,000

Date the application is made1