Citation and commencement

1. These Regulations may be cited as the Finance Act 2003, Schedule 26 Paragraph 3(3) (Designated Transactions) Regulations 2003 and shall come into force on 12th September 2003.

Designated transaction

2. —(1) In these Regulations “paragraph 3(3)” means paragraph 3(3) of Schedule 26 to the Finance Act 2003(meaning of “investment transaction” for the purposes of determining whether a person is an agent of independent status in respect of investment transactions).

(2) For the purposes of paragraph 3(3) a transaction falling within paragraph (3) is designated.

(3) A transaction falls within this paragraph if it is a contract, not otherwise falling within paragraph 3(3), whose terms—

(a) provide that—

(i) after setting off their obligations to each other under the contract, a cash payment is to be made by one party to the other in respect of the excess, if any, or

(ii) each party is liable to make to the other party one or more cash payments in respect of that party’s obligations to the other under the contract, and

(b) do not provide for the delivery of any property other than currency.

This is subject to the following qualification.

(4) A transaction does not fall within paragraph (3) if it is—

(a) a contract which relates to land;

(b) a contract of insurance; or

(c) a contract effected in the course of capital redemption business within the meaning of section 458 of the Income and Corporation Taxes Act 1988( 2 ).