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16 February 2023

Part IV Licence Decision Tree

The following decision tree relates to the requirement for a licence in connection with unlicensed financial platforms and intermediation, etc. under Part IV of the Lending, Credit and Finance (Bailiwick of Guernsey) Law, 2022 (the "LCF Law"; a "Part IV Licence").

The requirement or otherwise for a Part IV Licence does not mean that a licence will not be required under other parts of the LCF Law. Please visit our decision trees for Part II Licences, Part III FFB Licences and Part III VASP Licences to check.

Is the activity being undertaken by:

  • a person (where the activity is undertaken either in or from within the Bailiwick); or
  • a Bailiwick body (where the activity is undertaken in or from within any place whatsoever)?
  • "person"

    "person" includes –

    (a) an individual,

    (b) a company,

    (c) any other legal person, and

    (d) an unincorporated body

  • "Bailiwick"

    "Bailiwick" means the Bailiwick of Guernsey.

  • "Bailiwick body"

    "Bailiwick body" means –

    (a) a Guernsey body, being –

    (i) a Guernsey company,

    (ii) any other legal person registered, constituted or incorporated in Guernsey (including for the avoidance of doubt a Guernsey limited liability partnership, a Guernsey limited partnership with legal personality and a Guernsey foundation), or

    (iii) an unincorporated body whose principal place of business is in Guernsey,

    (b) an Alderney body, being –

    (i) an Alderney company, or

    (ii) an unincorporated body whose principal place of business is in Alderney,

    (c) a Sark body, being any body, other than one mentioned in paragraph (a)(i) or (ii) or (b)(i), whose principal place of business is in Sark.

yes
no

Is the person providing or carrying on, offering to provide or carry on, or holding themselves out as being willing to provide or carrying on, the activity by way of business?

  • "by way of business"

    For the purposes of the LCF Law a person who provides any service or carries on any activity shall (unless the Commission, conditionally or unconditionally, directs otherwise in any particular case or, after consultation with the States of Guernsey Policy and Resources Committee, in any particular class or description of cases) be deemed to do so "by way of business" if that person receives any income, fee, emolument or other consideration in money or money's worth for doing so.

yes
no

Is the person providing or carrying on, offering to provide or carry on, or holding themselves out as being willing to provide or carrying on, any of the following services or activities, whether by digital or other means?

  • the operation of a peer-to-peer platform;
  • the operation of a crowdfunding platform;
  • the provision of alternative non-bank credit or finance intermediation;
  • any other service or activity or class or description thereof in respect of virtual assets specified for the purposes of this Law by regulations of the States of Guernsey Policy and Resources Committee.
  • "Peer to peer platform"

    (1) In the LCF Law a "peer to peer platform" means a platform, whether electronic or not (commonly referred to as a P2P platform) –

    (a) established as a marketplace to match persons who wish to borrow money with those who wish to undertake lending,

    (b) through or by means of which –

    (i) lenders (whether institutional, business or individual) notify their willingness to undertake lending, their identity and the terms on which they are willing to transact, and

    (ii) potential borrowers are able to communicate with the lenders and enter into transactions.

    (2) For the purposes of section 26(1)(a) (operation of a peer to peer platform) the person who is the operator of the platform shall be deemed to be the person providing, offering to provide or holding themselves out as being willing to provide the service or activity in question, unless in any particular case or class or description of case the Commission directs otherwise.

  • "crowdfunding platform"

    (1) In the LCF Law a "crowdfunding platform" means a marketplace, whether electronic or not, through or by means of which persons seek to raise money or other finance through the issue of general securities and derivatives within the meaning of category 2 in Schedule 1 to the Protection of Investors (Bailiwick of Guernsey) Law, 2020.

    (2) For the purposes of section 26(1)(b) (operation of a crowdfunding platform) the person who is the operator of the platform shall be deemed to be the person providing, offering to provide or holding themselves out as being willing to provide the service or activity in question, unless in any particular case or class or description of case the Commission directs otherwise

  • "alternative non-bank credit or finance intermediation"

    (1) In the LCF Law "alternative non-bank credit or finance intermediation" means intermediation or brokerage services, whether or not provided by electronic means, for the purposes of matching lenders with borrowers.

    (2) For the purposes of section 26(1)(c) (provision of alternative non-bank credit or finance intermediation) the person who is the intermediary shall be deemed to be the person providing, offering to provide or holding themselves out as being willing to provide the service or activity in question, unless in any particular case or class or description of case the Commission directs otherwise.

  • "any other service or activity or class or description thereof specified by regulations of the States of Guernsey Policy and Resources Committee"

    Section 26(1) can be extended to include any other service or activity or class or description thereof specified for the purposes of the LCF Law by regulations of the States of Guernsey Policy and Resources Committee.

    There are currently no such regulations in place.

yes
no

Is the person exempted under s.32 of the LCF Law?

  • "section 32 of the LCF Law"

    Section 32 of the LCF Law provides as follows:

    (1) Section 26 does not apply in relation to persons, business, services or transactions of a class or description specified for the purposes of the LCF Law by regulations of the States of Guernsey Policy and Resources Committee.

    There are currently no such regulations in place.

yes
no
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