Part VII Transfer
Barclays’ Brexit response will be effected in part through the Part VII, an English court approved transfer mechanism under Part VII of the Financial Services and Markets Act 2000.
The Part VII will enable Barclays to move existing in-scope clients and prospective clients, and migrate the related business, client relationships and associated contracts from the current Barclays counterparty (Barclays Bank PLC, Barclays Capital Securities Ltd) to BBI via court order rather than by requiring individual legal document re-papering.
Because of the efficiencies that Barclays believes the Part VII process affords clients, where appropriate, Barclays expects to use a Part VII to transfer and/or duplicate legal documents governed by English law, as well as those governed by, amongst others, German, French, Spanish and Italian law.
Barclays will contact you directly with details of the specific contracts that you have and the specific transfer mechanisms applicable to you.
Timeline for the Part VII
A Part VII court process generally involves at least two hearings before an English Court which in practice are scheduled over a period of at least three months:
A Directions Hearing, which took place on 23 October 2018 in which Barclays submitted a scheme to the court, setting out the proposed transfers and duplications (the “Scheme”) and proposals for public notifications.
A Sanction Hearing, which is currently scheduled for 22 January 2019, where Barclays will ask the court to approve the Scheme (and the court would consider any objections raised by stakeholders or the public).
If the court approves the Scheme at the Sanction Hearing, client legal documents will transfer or be duplicated in accordance with the mechanisms specified in the Scheme Document.
It is likely that there will be more than one effective date specified by Barclays to allow different clients and different legal documents to transfer or be duplicated at different times, following the Sanction Hearing as part of a carefully managed process. If you have any questions about the date of transfer or duplication, you should reach out to your Barclays contact.
Following the Sanction Hearing, the Part VII court order, the document which legally executes the Part VII, will be made available on the “Court Documents” section of this website. In some cases we may also contact you at this stage to facilitate the migration.
Court Documents and further Part VII Information
Summary of Contractual Amends
In order to facilitate and give effect to the transfer of your business relationship(s) to BBI, we may need to make certain consequential amendments to the contracts and terms you have with Barclays (whether transferring and/or duplicating contracts through the Part VII or through one of the other mechanisms). Such amendments will be limited to those changes which support the migration to BBI (e.g., to address the new jurisdiction and/or regulatory regime), and many such amendments will be administrative, e.g., changes to the Barclays entity name, contact details, address, custody/securities account details, bank account details, process agent details, applicable regulator(s), and jurisdiction of incorporation.
Certain amendments will be generic and apply to all transferring agreements, while other changes may be specific to the particular agreement type. While many of these amendments are being made to bring the resulting transferred/replicated agreement in line with the templates for new BBI documentation, note that they may not always result in exactly the same agreement.
The amendments Barclays has identified in our review of transferring contracts have been summarised in the documents below:
- General (for all in scope agreements and businesses) (PDF 396KB)
- Corporate Banking (PDF 370KB)
- Investment Banking – Terms of Business (PDF 676KB)
- Investment Banking - Markets specific (ISDA Master Agreement, CSA, GMRA & GMSLA) (PDF 417KB)
- Investment Banking - Rahmenvertrag (German) (PDF 172KB)
- Investment Banking - FBF (French) (PDF 342KB)
- Investment Banking - Contrato Marco de Operaciones Financieras (CMOF) (Spanish) (PDF 527KB)
- Investment Banking - all other agreements referenced in the Scheme (PDF 438KB)
- Private Banking and Overseas Clients (PDF 323KB)
- Supplier contracts (PDF 280KB)
If you have any questions or concerns in relation to your existing positions, we encourage you to contact the Brexit support team, your relationship manager, or your Private Banker.
Ways to make sure your views are considered
If you believe that you may be adversely affected by the Scheme, you have the right to object to the Scheme and attend the Court hearing for approval of the Scheme. You can write to us even if you are not going to appear at the hearing, and we will ensure that your objections are provided to the Court. When considering whether to approve the Scheme, the Court will take into account whether the Scheme adversely affects you or anyone else.
If you intend to object to the Scheme, it would be helpful, but not obligatory, if you would provide us with details of your objection and your written representation or details of your intention to attend or be represented at the Court hearing. Please provide these details, preferably at least five business days before 22 January 2019, in writing by post to the following address:
Barclays Brexit Part VII
1 Churchill Place
Barclays will acknowledge and reply in writing to all objections we receive. Barclays will also submit details of all objections received to the court for consideration as part of their decision on the Scheme, as well as to the PRA and FCA.
You may also file a claim directly with The Business and Property Courts of England and Wales. This can be filed electronically (instructions here) or in writing at:
The Business and Property Courts of England and Wales
7 Rolls Building
Reference should be made to case number CR-2018-008846.
Barclays will keep you updated on any changes to the court dates on this website.
Our responses to some Frequently Asked Questions (“FAQs”) about the Part VII as follows: