Finally some clarity following the Asset Land decision
In this briefing note, we set out:
- The background to the Asset Land case.
- The guidance given by the Supreme Court on the interpretation of section 235 of FSMA; and
- The likely impact on future practice.
The recent case of Asset Land Investment plc (Asset Land) v FCA has finally provided the legal market with some clarity on how the definition of a CIS (now found under section 235 of the Financial Services and Markets Act 2000 (FSMA)) should be interpreted.
In the future courts will look towards the substance of arrangements and examine all elements of the s.235 FSMA definition with the intention of piercing the legal jargon to get to the 'reality' of the situation.
Following the Asset Land decision, the FCA are likely to adopt a broader, more assertive approach in relation to land-banking schemes, with s.235 FSMA applicable to a wider class of assets than was previously thought.