• CIPR Part 1.2 CIPR Part 1.2 Basic concepts

    • CIPR 1.2.1 Who is a customer of an authorised firm?

      (1) A customer of an authorised firm is a person to whom the firm provides, has provided, or offers to provide, a service that is a regulated activity, or a person who asks the firm to provide such a service. A customer may be:
      (a) a retail customer;
      (b) a business customer; or
      (c) an eligible counterparty.
      (2) The categories retail customer, business customer and eligible counterparty are mutually exclusive. To avoid any doubt, a customer of an authorised firm that is an eligible counterparty (see rule 1.2.10) is not a business customer of the firm even if the customer would otherwise qualify as a business customer under any of rules 1.2.3 to 1.2.7.
      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.2 Who is a retail customer of an authorised firm?

      A retail customer of an authorised firm is a customer of the firm who is neither a business customer nor an eligible counterparty.

      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.3 Business customers — bodies corporate with certain levels of assets or turnover

      A customer of an authorised firm is a business customer if the customer is any of the following:

      (a) a body corporate that has (or, at any time during the previous 2 years, has had) either:
      (i) called-up share capital, or net assets, of QR 18 million or more; or
      (ii) annual net turnover of QR 30 million or more;
      (b) a body corporate that has a holding company or subsidiary that has (or, at any time during the previous 2 years, has had) either:
      (i) called-up share capital, or net assets, of at least QR 18 million; or
      (ii) annual net turnover of QR 30 million or more;
      (c) a partnership or unincorporated association that has (or, at any time during the previous 2 years, has had) either:
      (i) net assets of QR 18 million or more (calculated, in the case of a limited partnership, without deducting loans owing to any of the partners); or
      (ii) annual net turnover of QR 30 million or more.
      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.4 Business customers — bodies corporate — credit arrangement business

      A customer of an authorised firm is a business customer if all of the following are true:

      (a) the customer is a body corporate that has (or, at any time during the previous 2 years, has had) net assets of QR 10 million or more;
      (b) the regulated activities that the firm will undertake for the customer are limited to arranging credit facilities or providing credit facilities (or both);
      (c) any credit facility provided or arranged has no embedded derivative or other attached hedging instrument;

      Example

      An interest rate hedging product
      (d) any credit facility provided or arranged is for use only in the business activities of 1 or more of the following:
      (i) the customer;
      (ii) another body corporate that is a member of the same group as the customer;
      (iii) a joint venture to which the customer or a body corporate referred to in subparagraph (ii) is a party.
      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.5 Business customers — collective investment schemes

      A customer of an authorised firm is a business customer if the customer is a collective investment scheme.

      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.6 Business customers — trustees

      A customer of an authorised firm is a business customer if the customer is a trustee of a trust that has (or, at any time during the previous 2 years, has had) assets of QR 18 million or more (calculated as the total value of the cash and investments that form part of the trust's assets, without deducting its liabilities).

      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.7 Business customers in relation to insurance business

      A customer of an authorised firm is a business customer if:

      (a) the relevant business is either or both of insurance business and insurance mediation business (in either case, in relation to non-investment insurance contracts); and
      (b) the customer is:
      (i) a person other than an individual; or
      (ii) an individual who is acting for the purposes of the individual's trade, business or profession.
      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.8 Business customers — customers opted-up under rule 3.3.2

      A customer of an authorised firm is a business customer if the firm classifies the customer as a business customer under rule 3.3.2. However, if the firm classifies the customer as a business customer only in relation to 1 or more particular regulated activities and specified products, the customer is a business customer of the firm only in relation to that or those activities and products.

      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.9 Business customers — customers opted-up under COND

      (1) A customer of an authorised firm is a business customer if the firm classified the customer as a business customer under COND, rule 2.3.2, and has not revoked the classification. If the customer was classified as a business customer only in relation to 1 or more particular regulated activities and specified products, the customer remains a business customer of the firm only in relation to that or those activities and products.

      Guidance
      COND was repealed on 1 January 2020. A customer who was a commercial customer under COND remains a business customer under these rules because the qualification is the same (see rule 1.2.7 of these rules and COND, rule 1.2.4). A retail customer in relation to certain types of business could not be opted-up as a commercial customer under COND, and a retail customer in relation to those types of business also cannot be opted-up as a business customer under these rules — see rule 3.3.2(2).
      (2) However, if the customer was classified as a business customer in reliance on a statement of the customer's net assets (referred to in COND rule 2.3.2A (2)), the firm must obtain confirmation of the statement from the customer periodically (at least annually).
      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.10 Who is an eligible counterparty of an authorised firm?

      (1) Each of the following, if a customer of an authorised firm, is an eligible counterparty:
      (a) an authorised firm;
      (b) a regulated financial institution;
      (c) an eligible clearing house or eligible exchange;
      (d) a government, government agency, or central bank or other national monetary authority, of any jurisdiction;
      (e) a state investment body, or a body charged with, or intervening in, the management of the public debt;
      (f) a supranational organisation, the members of which are jurisdictions, central banks or national monetary authorities.
      (2) In subrule (1) (c):

      eligible clearing house means a clearing house that meets the following requirements:
      (a) transactions on a regulated exchange may be cleared through it;

      Note For regulated exchange, see the glossary.
      (b) it is incorporated or otherwise established in a jurisdiction outside the QFC;
      (c) the Regulatory Authority has not, by notice published on an approved website, declared that this definition does not apply to the jurisdiction.
      eligible exchange means a regulated exchange for which the Regulatory Authority has not, by notice published on an approved website, declared that this definition does not apply to the jurisdiction in which the exchange is incorporated or established.
      Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR 1.2.11 When is an agent a customer of an authorised firm?

      (1) This rule applies if an authorised firm provides, or offers to provide, a service to a person (the agent) that the firm knows is acting as agent for another person (the principal), and the service is a regulated activity.
      (2) The firm must treat the principal as the firm's customer in relation to that service, unless the agent is another authorised firm or a regulated financial institution.
      Derived from QFCRA RM/2019-2 (as from 1st January 2020).