COBS 3.6 Eligible counterparties

1. (1)

   An eligible counterparty is a client that is either a per se eligible counterparty or an elective eligible counterparty.

2. (2)

   A client can only be an eligible counterparty in relation to eligible counterparty business (PRIN 1 Annex 1 R is an exception to this).

Each of the following is a per se eligible counterparty (including an entity that is not from the UK that is equivalent to any of the following) unless and to the extent it is given a different categorisation under this chapter:

1. (1)

   an investment firm;

2. (2)

   a credit institution;

3. (3)

   an insurance company;

4. (4)

   a collective investment scheme authorised under the UK provisions which implemented the UCITS Directive or its management company;

5. (5)

   a pension fund or its management company;

6. (6)

   another financial institution authorised or regulated under the law of the United Kingdom;

7. (7)

   [deleted]

8. (8)

   a national government or its corresponding office, including a public body that deals with public debt at national level;

9. (9)

   a central bank; and

10. (10)

    a supranational organisation.

A firm may treat a client as an elective eligible counterparty in relation to business other than MiFID or equivalent third country business if:

1. (1)

    the client is an undertaking and:

   1. (a)

       is a per se professional client (except for a client that is only a per se professional client because it is an institutional investor under COBS 3.5.2 R (5)) and:

      1. (i)

          is a body corporate (including a limited liability partnership) which has (or any of whose holding companies or subsidiaries has) called up share capital of at least £10 million (or its equivalent in any other currency at the relevant time); or

      2. (ii)

          meets the criteria in the rule on meeting two quantitative tests (COBS 3.5.2 R (3)(b)); and

   2. (b)

       requests such categorisation; and

2. (2)

    the firm adheres to the procedure set out at COBS 3.6.4BR.

Provided that it adheres to the procedure set out at COBS 3.6.4BR, a firm may treat a client as an elective eligible counterparty in relation to MiFID or equivalent third country business if the client:

1. (1)

    is an undertaking;

2. (2)

    is a per se professional client, except for a client that is only a per se professional client because it is an institutional investor under COBS 3.5.2R(5); and

3. (3)

    requests such categorisation.

[Note: first paragraph of article 30(3) of MiFID]

A firm may obtain a prospective counterparty's confirmation that it agrees to be treated as an eligible counterparty either in the form of a general agreement or in respect of each individual transaction.