Document ID: chunk:federal_register_of_legislation:F2021L01333:body:0:p3
Version: federal_register_of_legislation:F2021L01333
Segment Type: other
Provision Reference: 
Character Range: 5652–8479

the course of providing services to a person as part of carrying on a prime broking business or custodial business, the person has, under a securities lending arrangement, given to the provider:
            (a) where the provider or an entity nominated by the provider holds the securities on behalf of the person or an entity nominated by the person—a present right (borrowing right) to, at some future time, deal in the securities on its own behalf or on behalf of a person;
            (b) otherwise—a present right (borrowing right) to, at some future time, have the securities held by or on behalf of the person delivered to the provider or an entity nominated by the provider and to have the title in those securities vested in the entity to which they are delivered;
         provided both of the following are satisfied:
            (c) the person is not subject to any restriction (other than a permissible restriction) by or under any relevant agreement between the person and the provider or an associate of the provider in how it can deal with the securities in respect of which the borrowing right is given;
            (d) the borrowing right is acquired by the provider as part of a bona fide arrangement entered into in the ordinary course of carrying on that business.
         (10B)  For the avoidance of doubt, subsection (10A) stops applying in respect of particular securities when the service provider exercises the borrowing right in respect of those securities.
         (10C)  An agent lender does not have a relevant interest in securities under subsection 608(8) merely because the agent lender has been given the rights (the lending authority) referred to in paragraphs (a) and (b) of the definition of authorisation agreement to act on behalf of a lender, provided both of the following are satisfied:
            (a) the lender is not subject to any restriction (other than a permissible restriction) by or under any relevant agreement between the lender and the agent lender or an associate of the agent lender in how it can deal with the securities in respect of which the lending authority is given;
            (b) the lending authority is given to the agent lender as part of a bona fide authorisation agreement entered into in the ordinary course of carrying on an agency lending business.
         (10D) For the avoidance of doubt:
            (a) in subsection (10C), the borrower under a securities lending arrangement entered into pursuant to the authorisation agreement may be the agent lender itself acting in the capacity as borrower under the securities lending arrangement; and
            (b) subsection (10C) stops applying in respect of particular securities when the agent lender transfers the securities to the borrower.
         (10E) In subsections (10A) to (10D) and in this