Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemptions) Regulations 2011

6 Meaning of land investment product

(1)

For the purposes of the Act, land investment product means any scheme that incorporates all of the following features:

(a)

the scheme involves a person (A) subscribing for an interest in, or a right in respect of, land; and

(b)

A subscribes to the scheme by providing money to the scheme promoter, or to any associated person of the scheme promoter; and

(c)

as a result of that subscription, A obtains, or may obtain, an interest or right in land; and

(d)

the scheme is designed or intended to provide a financial return or other benefit to A (whether or not a return or benefit is actually provided); and

(e)

the amount of any return or benefit depends on—

(i)

the use to which the scheme promoter puts A’s money; or

(ii)

the use to which the scheme promoter puts the money of other persons subscribing to the scheme; or

(iii)

a guarantee, or other right, to be paid a return by the scheme promoter under the scheme; and

(f)

A has no day-to-day control over the use or management of the interest in the land; and

(g)

the scheme is not otherwise a category 1 product.

(2)

In subclause (1), a person is an associated person of a scheme promoter if that person and the scheme promoter are—

(a)

associated persons within the meaning of section 12(1) of the Financial Markets Conduct Act 2013 (whether or not that Act otherwise applies to those persons); or

(b)

related bodies corporate within the meaning of section 12(2) of the Financial Markets Conduct Act 2013 (whether or not that Act otherwise applies to those bodies corporate); or

(c)

persons who are partners to whom the Limited Partnerships Act 2008 applies; or

(d)

parties to an agreement, arrangement, or understanding (whether express or implied), whether or not legally enforceable, under which the person acts for, with, or for the benefit of (whether directly or indirectly) the scheme promoter.

(3)

In this regulation,—

money includes money’s worth

scheme means any agreement, arrangement, or understanding (whether express or implied), whether or not legally enforceable, and irrespective of substance or form

scheme promoter means—

(a)

a person who is instrumental in the formulation of the land investment product; and

(b)

where a body corporate is a scheme promoter, every person who is a director of that body corporate.

Regulation 6(2)(a): replaced, on 1 December 2014, by section 150 of the Financial Markets (Repeals and Amendments) Act 2013 (2013 No 70).

Regulation 6(2)(b): replaced, on 1 December 2014, by section 150 of the Financial Markets (Repeals and Amendments) Act 2013 (2013 No 70).