Replacement of Financial Vehicle (novation of contracts)
20 Replacement of Financial Vehicle (novation of contracts)
This regulation applies if there is a change in the person or body appointed as the Financial Vehicle (a relevant change).
A FERM contract to which the Financial Vehicle is a party will, on the day on which a relevant change occurs (the relevant day), be taken to be a contract between the person or body which becomes the Financial Vehicle (the relevant entity) and the other party to the contract at that time.
In connection with subregulation (2) but subject to subregulation (4), on and from the relevant day—
the rights and liabilities of the person who has ceased to be the
Financial Vehicle (the former party) under the contract vest in and attach to the relevant entity as the Financial Vehicle in substitution for the former party; and
the former party is wholly released and discharged from the contract; and
a reference in the contract to the former party as a party to the contract will be taken to be a reference to the relevant entity as a party to the contract.
Subregulation (3) operates subject to any agreement between the former party and the relevant entity about rights or liabilities, or other relevant matters, under a contract to which this regulation applies.
The former party must arrange for any relevant trust assets to be to be transferred to the relevant entity in connection with a relevant change and the operation of this regulation.
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