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UK Retention Deposit Scheme

Scheme rules

UK Retention Deposit Scheme Rules

These rules govern every account opened under the scheme. They are published as a versioned document, so an award can be read against the terms in force when it was made.

Version 1.4

1. Definitions

In these Rules, terms defined in the Definitions shall have those meanings.

Bank a bank or building society but not an Electronic Money Institution (EMI), Authorised Payment Institution (API) or Small Payment Institution (SPI).

Base Rate The rate of interest for interbank lending set from time to time by the Bank of England.

Business Days Monday to Friday inclusive, excluding any day generally recognised as a public holiday in England.

Compliance Requirements Means the compliance requirements to which the Scheme is subject from time to time, whether by law or voluntarily.

Confidential Information Confidential information disclosed or otherwise made available by or on behalf of a party (in whatever medium) including all trade secrets and, in respect of an individual Employer, the identity of that individual Employer.

Construction Contract An agreement by which one party is required or permitted to: Carry out Construction Operations; Arrange for other people to carry out Construction Operations; Provide labour for the carrying out of Construction Operations; Provide architectural, design or surveying work; or Provide advice on building, engineering, interior or exterior decoration or on the laying-out of landscape.

Construction Operations For the purposes of these Rules, a Construction Operations means work falling into one of the following categories: construction, alteration, repair, maintenance, extension, demolition or dismantling of buildings, or structures forming, or to form, part of the land (whether permanent or not), construction, alteration, repair, maintenance, extension, demolition or dismantling of any works forming, or to form, part of the land, including (without prejudice to the foregoing) walls, roadworks, power-lines, electronic communications apparatus, aircraft runways, docks and harbours, railways, inland waterways, pipe-lines, reservoirs, water-mains, wells, sewers, industrial plant and installations for purposes of land drainage, coast protection or defence; installation in any building or structure of fittings forming part of the land, including (without prejudice to the foregoing) systems of heating, lighting, air-conditioning, ventilation, power supply, drainage, sanitation, water supply or fire protection, or security or communications systems; external or internal cleaning of buildings and structures, so far as carried out in the course of their construction, alteration, repair, extension or restoration; operations which form an integral part of, or are preparatory to, or are for rendering complete, such operations as are previously described in this subsection, including site clearance, earth-moving, excavation, tunnelling and boring, laying of foundations, erection, maintenance or dismantling of scaffolding, site restoration, landscaping and the provision of roadways and other access works; painting or decorating the internal or external surfaces of any building or structure; drilling for, or extraction of, oil or natural gas; extraction, whether by underground or surface working, of minerals, tunnelling or boring, or construction of underground works, for this purpose; assembly, installation or demolition of plant or machinery, or erection or demolition of steelwork for the purposes of supporting or providing access to plant or machinery, on a site where the primary activity is:9.1 nuclear processing, power generation, or water or effluent treatment, or9.2 the production, transmission, processing or bulk storage (other than warehousing) of chemicals, pharmaceuticals, oil, gas, steel or food and drink.

Contract has the meaning set out in Pre-qualification Information Paragraph 1.1.1 (and such meaning will include any Tier 1 Contract or Subcontract).

Contract Account See Pre-qualification Information Paragraph 2.8.

Contract Sum The total anticipated contract price to be paid by the Paying Party to the Receiving Party under the Contract, excluding any VAT, as may be adjusted in accordance with the Contract.

Contractor The party required or permitted to withhold and ultimately pay over a retention under a Subcontract.

Corporate KYB Has the meaning given in Pre-qualification Information Paragraph 2.2.2, as supplemented or amended from time to time by the Compliance Requirements.

Data Protection Laws The Data Protection Act 2018 and the retained EU law version of the General Data Protection Regulation (EU) 2016/679.

Deposit Bank The bank with which we hold Contract Accounts into which Retentions are deposited.

Employer The party required to withhold and ultimately pay over a retention under a Tier 1 Contract.

England Means England and the territorial sea (as defined in Section 1 of the Territorial Sea Act 1987) adjacent to England.

Final Date for Payment The date established under the Contract in respect of each payment to be made by the Paying Party by which that payment must be made.

Final Release of Retention The last payment of Retention by the Paying Party to the Receiving Party to be made under the Contract.

Individual KYC Has the meaning given in Pre-qualification Information Paragraph 2.2.1, as supplemented or amended from time to time by the Compliance Requirements.

Insolvency Has the meaning given to it in section 113(2) of the Housing Grants, Construction and Regeneration Act 1996, provided that where a party to a Contract comprises two or more individuals or entities acting jointly, that party will not be deemed insolvent for the purposes of these Rules unless all of the individuals or entities comprising that party are insolvent on an individual basis.

Pay Less Notice A notice issued under the Contract confirming the Paying Party’s intention to pay the Receiving Party less than the sum stated in a corresponding Payment Notice.

Paying Party An Employer (in respect of a Tier 1 Contract) or a Contractor (in respect of a Subcontract).

Payment Notice A notice issued under the Contract that establishes a sum due for payment to the Receiving Party.

Pre-Qualification Information The Pre-Qualification Information as may be in force from time to time which sets out qualification requirements for joining the Scheme, and the basis on which applications to join the Scheme will be made and processed, available at the Pre-qualification Information.

Receiving Party A Tier 1 Contractor (in respect of a Tier 1 Contract) or a Subcontractor (in respect of a Subcontract).

Rectification Period A period of time following the completion of the Work under the Contract during which the Paying Party may continue to hold a portion of the Retention.

Retention A Tier 1 Retention or a Subcontract Retention.

Rules These Rules, as may be amended from time to time.

Sanctions Any laws or regulations relating to economic or financial, trade, immigration, aircraft, shipping or other sanctions, export controls, trade embargoes or restrictive measures from time to time imposed, administered or enforced by a Sanctions Authority or otherwise applicable to us.

Sanctions Authority The government of the United Kingdom, the Council of the European Union, the United States of America, the United Nations (UN) and in each case their respective governmental, judicial or regulatory institutions, agencies, departments and authorities responsible for the implementation and enforcement of sanctions, including (without limitation) the UN Security Council, His Majesty's Treasury and the UK's Office of Financial Sanctions Implementation, the Department of Business and Trade and the Export Control Joint Unit.

Scheme The retention deposit protection scheme operated by us in accordance with these Rules.

Subcontract A Construction Contract that has been accepted into the Scheme using the process in Pre-qualification Information Paragraphs 2.11 and 2.12 as a subcontract of a Tier 1 Contract that has already been accepted into the Scheme.

Subcontract Account A Contract Account relating to a Subcontract.

Subcontract Retention A retention that is required or permitted to be withheld under a Subcontract.

Subcontractor The party that will ultimately become entitled to payment of the retention under a Subcontract.

Supply Chain In respect of a Tier 1 Contract, all of the Subcontractors under Subcontracts linked to that Tier 1 Contract.

Tier 1 Contract A Construction Contract that has been accepted into the Scheme as a top-level contract, and not as a Subcontract.

Tier 1 Contract Account A Contract Account relating to a Tier 1 Contract.

Tier 1 Contractor The party that will ultimately become entitled to payment of the retention under a Tier 1 Contract.

Tier 1 Retention A retention that is required or permitted to be withheld under a Tier 1 Contract.

United Kingdom Great Britain, Northern Ireland, Jersey, Guernsey and the Isle of Man.

User Means an individual linked to a Contract Account. Such individuals may have permission to act on the Contract Account, or simply have read-only access for reporting and administrative purposes.

VAT Value Added Tax.

Wales Means Wales and the territorial sea (as defined in Section 1 of the Territorial Sea Act 1987) adjacent to Wales.

We or Us DOS & Co. Ltd., a company registered in England and Wales with company registration number 08294966, having its registered address at 56 St. George’s Square, London SW1V 3QT.

Works Any work that must be carried out by the Receiving Party under a Construction Contract.

Your You, being an individual or entity that is a party to a Contract that has been accepted into the Scheme according to its Rules.

2. Joining the Scheme

2.1 Applications to join the Scheme are conducted in accordance with the Pre-qualification Information.

2.2 By making an application to join the Scheme, or otherwise consenting that your Contract should be admitted to the Scheme:

2.2.1 You warrant that you and your Contract comply with all eligibility criteria set out in paragraph 1 of the Pre-qualification Information;

2.2.2 You warrant that all information provided by you as required by paragraph 2 of the Pre-qualification Information is up-to-date and accurate;

2.2.3 You agree that you will notify us if at any time:

  • (a) You, the counterparty to your Contract, or the Contract itself no longer comply with the eligibility criteria set out in paragraph 1 of the pre-qualification information; or

  • (b) The compliance information you have provided under paragraph 2 of the Pre-qualification Information requires updating.

2.2.4 You agree that you will be bound by these Rules and will fully comply with any obligation that they place upon you.

3. Tier 1 Contract Accounts

3.1 Rule 3 applies only to Tier 1 Retentions.

Depositing Retention Funds

3.2 The Employer agrees to deposit all Tier 1 Retention that it withholds under the terms of the Tier 1 Contract into the Contract Account.

3.3 Whenever a payment becomes due to the Tier 1 Contractor:

3.3.1 the Employer must, on or before the Final Date for Payment, deposit into the Contract Account a sum equal to the amount of Tier 1 Retention that is due to be withheld in respect of the said payment under the terms of the Contract; and

3.3.2 the Contract Administrator (or, if there is no Contract Administrator, the Tier 1 Contractor) must, after the final date on which the Contract permits the issue of a Pay Less Notice in respect of the payment in question by the Employer, upload to the online portal a true and complete copy of:

  • (a) the Payment Notice showing the amount of Retention permitted to be withheld, or

  • (b) the Pay Less Notice showing the amount of Retention permitted to be withheld, if a Pay Less Notice has been issued in respect of the payment in question.

3.4 All deposits made under Rule 3.3.1 must be:

3.4.1 Made in pounds-sterling;

3.4.2 Made from a bank account held in the Employer’s own name, from a Bank located in the United Kingdom; and

3.4.3 Carry the Tier 1 Contract Account reference number as the payment reference.

3.5 Any transfers into the Tier 1 Contract Account that do not meet the criteria set out in Rule 3.4 will not be accepted into the Scheme, and, subject to the Compliance Requirements, will be returned to the account from which they were received and the Parties notified.

Allocation of Retention Funds

3.6 This section of the Rules sets out how we will allocate beneficial ownership of funds deposited in a Tier 1 Contract Account between the Employer and the Tier 1 Contractor. If the Tier 1 Contractor opens Subcontract Accounts that are linked to the relevant Tier 1 Contract Account using the process in paragraphs 2.11 and 2.12 of the Pre-qualification Information, then we may re-allocate the beneficial ownership of money deposited in the Tier 1 Contract Account to the Supply Chain in accordance with Rule 4. This means that money the Employer has deposited in the Tier 1 Contract Account may at times be beneficially owned by the Supply Chain and not by either of the Employer or the Tier 1 Contractor.

NB: This may have an effect on an Employer’s ability to recover the Tier 1 Retention under Rules 9.7 and 9.8 if the Tier 1 Contractor becomes Insolvent.

3.7 When we first receive a cash deposit into a Tier 1 Contract Account, we will hold the deposited funds on trust for the Employer. We will continue to hold any cash on deposit in the Tier 1 Contract Account on trust for the Employer until we have made an assessment of the Tier 1 Retention due to be withheld under the terms of the Tier 1 Contract as set out in Rules 3.8 to 3.10.

3.8 When the Contract Administrator uploads a Payment Notice or a Pay Less Notice to the online portal, we will check the uploaded document to confirm the amount of Tier 1 Retention that the Employer is required or permitted to withhold.

3.9 If the Contract Administrator does not upload a Payment Notice or a Pay Less Notice to the online portal within five Business Days of the date specified in Rule 3.3.2, either party to the Contract may upload any missing documentation.

3.10 Once we have ascertained from the most recent Payment Notice or Pay Less Notice that has been uploaded to the online portal how much Tier 1 Retention should be withheld, we will hold a portion of the deposited cash equal to the amount of Tier 1 Retention that was due for withholding as at the applicable Final Date for Payment on trust for the Tier 1 Contractor and, where applicable, the Supply Chain.

3.11 We will update our assessment of the amount of Tier 1 Retention due to be withheld under the Tier 1 Contract each time a new Payment Notice or Pay Less Notice for the relevant Tier 1 Contract Account is uploaded. Each time that we update this assessment, the amount of cash that we hold on trust for the Tier 1 Contractor and, where applicable, the Supply Chain will be updated so that we always hold on trust for the Tier 1 Contractor and, where applicable, the Supply Chain, a sum equal to the amount of Tier 1 Retention that was due for withholding as at the Final Date for Payment for the most recent Payment Notice or Pay Less Notice that has been uploaded to the online portal.

3.12 Our assessment of the Tier 1 Retention under Rules 3.8 and 3.11 and the associated change to the amounts of cash that we hold on trust for the Employer, the Tier 1 Contractor and, where applicable, the Supply Chain will take effect the day after the Final Date for Payment associated with the Tier 1 Contract Payment Notice or Pay Less Notice (as the case may be) that we have used to update our assessment, or if later, the date on which we make our assessment.

3.13 Our assessment of the amount of Tier 1 Retention withheld at any given time will be based solely on the amount of Tier 1 Retention that is stated to be required to be withheld in the most recent Payment Notice or Pay Less Notice uploaded to the online portal in respect of the Tier 1 Contract in question. We will not be responsible for checking that the Tier 1 Retention amount stated on any such notice has been correctly calculated or is properly required or permitted to be withheld.

3.14 If the most recent Payment Notice or Pay Less Notice uploaded to the online portal does not state the amount required to be withheld as Tier 1 Retention, our assessment will be taken from the most recently uploaded document, if any, that does set out the amount required to be withheld.

3.15 If at any time the amount of cash on deposit in the Tier 1 Contract Account exceeds our assessment of the certified value of the Tier 1 Retention for the time being, we will hold the surplus cash on trust for the Employer, save to the extent that we already hold the excess on trust for the Supply Chain.

3.16 If at any time the amount of cash on deposit in the Tier 1 Contract Account is lower than our assessment of the certified value of the Tier 1 Retention for the time being, we will notify the Employer of the shortfall within two Business Days. The Employer must deposit sufficient additional cash in the Tier 1 Contract Account to make up the shortfall within five Business Days of receipt of our notification.

3.17 You will be able to check via the online portal:

3.17.1 How much money is held in the Tier 1 Contract Account; and

3.17.2 How much of that money we hold on trust for each of the Employer, the Tier 1 Contractor and, where applicable, the Supply Chain.

Release of Retention Funds

3.18 Upon the satisfaction of the conditions stated in the Tier 1 Contract for the release of all or part of the Tier 1 Retention, the Tier 1 Contractor must notify us using the relevant procedure in the online portal. The Tier 1 Contractor will certify to us:

3.18.1 That the conditions for either a full or partial release of the Tier 1 Retention, as specified in the Contract, have been satisfied;

3.18.2 The cash value of the Tier 1 Retention that is due to be released;

3.18.3 In respect of those matters set out in Rules 3.18.1 and 3.18.2, the notice or certificate issued by or on behalf of the Employer demonstrating the same; and

3.18.4 The Bank account details to which the Tier 1 Retention release should be sent (a “Release Notice”)

3.19 Upon receipt of a properly completed Release Notice, we will notify the Employer that a Release Notice has been received in respect of the Tier 1 Contract Account, and provide a copy.

3.20 If there are no unreleased Subcontract Retentions outstanding in respect of any Subcontract Accounts associated with the Tier 1 Contract Account, we will release the part of the Tier 1 Retention covered by the Release Notice to the bank account stated in the Release Notice five Business Days after the Employer receives our notice under Rule 3.19, unless before the expiry of that five Business Day period:

3.20.1 The Tier 1 Contractor withdraws its Release Notice; or

3.20.2 The Employer obtains a court or arbitrator’s order preventing us from releasing the Retention.

3.21 If there are unreleased Subcontract Retentions outstanding in respect of any Subcontract Accounts associated with the Tier 1 Contract Account when we receive the Release Notice, we will follow the procedure set out in Rule 3.20 in respect of any funds in the Tier 1 Contract Account (up to the value of the Retention Release stated in the Release Notice) that we hold on trust for the Tier 1 Contractor but not for the Supply Chain at the date on which the release is made.

3.22 If we become subject to a court or arbitrator’s order as set out in Rule 3.20.2, we will continue to hold the Tier 1 Retention on trust for the Tier 1 Contractor until the order is lifted. If the order is replaced with a different order, we will deal with the Tier 1 Retention strictly in accordance with the terms of that further order. If at any time we are no longer subject to any court or arbitrator’s order with respect to the Tier 1 Retention, we will continue to hold the Tier 1 Retention on trust for the Tier 1 Contractor until:

3.22.1 We receive written notification from the Tier 1 Contractor that it releases its claim to part or all of the Tier 1 Retention; or

3.22.2 We receive written notification from the Employer that it agrees to the release of some or all of the Tier 1 Retention to the Tier 1 Contractor; or

3.22.3 Either party uploads to the online portal a copy of an adjudicator’s decision, arbitral award, court judgment, or a decision produced pursuant to any form of binding alternative dispute resolution that confirms what further action should be taken in respect of the Tier 1 Retention.

3.23 If the Tier 1 Contractor gives us notice under Rule 3.22.1, we will within two Business Days of receipt of the notice return to the Employer any part of the Tier 1 Retention funds to which the notice applies. If the notice does not cover the whole of the Tier 1 Retention, the Tier 1 Contractor will need to submit a further Release Notice in respect of the outstanding funds.

3.24 If the Employer gives us notice under Rule 3.22.2, we will within two Business Days of receipt of the notice release to the Contractor any part of the Tier 1 Retention funds to which the notice applies. If the notice does not cover the whole of the Tier 1 Retention, the Tier 1 Contractor will need to submit a further Release Notice in respect of the outstanding funds.

3.25 If we receive a submission under Rule 3.22.3, we will take such action in respect of the Tier 1 Retention as is required in order to implement the terms of the decision / judgment / award that we have been provided.

3.26 If the value of retention release stated in the Release Notice is greater than the amount of funds that we hold on trust for the Tier 1 Contractor when the release is made, we will (provided we are not prevented from doing so by the operation of Rule 3.20), upon the transfer of beneficial ownership of any Subcontract Retentions under associated Subcontracts back to the Tier 1 Contractor under Rules 4.20 or 4.22, release such additional amounts to the Tier 1 Contractor as soon as we reasonably can from those transferred funds, until the amount released matches the amount stated as due for release in the Release Notice.

3.27 If, upon the completion of the procedure for the Release of the Tier 1 Retention set out in Rules 3.18 to 3.26, there is cash remaining in the Tier 1 Contract Account that is not held on trust for the Supply Chain, we will release the outstanding money to the Employer within two Business Days.

3.28 Once the whole of the Retention (and other cash) held in the Tier 1 Contract Account has been released to the Tier 1 Contractor, Employer or the Supply Chain, as applicable, the Tier 1 Contract Account will be closed and the Tier 1 Contract will be discharged from the Scheme.

Our liabilities and obligations with regard to the release of retention funds

3.29 In respect of any releases of Retention that we are required to enact under Rule 3:

3.29.1 We will be entitled to rely without enquiry on any Release Notice that is submitted through our online portal;

3.29.2 Without limiting Rule 3.29.1, we will not be responsible for ascertaining:

  • (a) Whether the amount of Retention stated within the Release Notice as due for release has been correctly calculated, or is properly due for release under the terms of the relevant Contract; or

  • (b) Whether the issue of the Release Notice has been validly authorised on behalf of the party submitting it;

3.29.3 We will have no liability to any party for releasing funds from a Tier 1 Contract Account even if the person to who we transferred the funds was not entitled to receive it under the terms of the Contract, provided that we have acted in accordance with these Rules;

3.29.4 In carrying out our responsibilities under this section, save to the extent that such liability cannot be disclaimed, we will have no liability, and will not be responsible for:

  • (a) Confirming that any bank account details that you provide to us are correct;

  • (b) Any delay or failure on the part of the Deposit Bank with which the Tier 1 Contract Account is deposited in receiving or executing our instructions;

  • (c) Any loss or damage suffered by any person in connection with any fraud, negligence, default or other act or omission on the part of the Bank or (except to the extent directly resulting from our fraud or wilful default, or that of our directors, servants or agents) any other person; or

  • (d) Any loss or damage suffered by any person as a result of the Insolvency or any analogous event in the United Kingdom or any other jurisdiction relating to the Deposit Bank or any other person.

4. Subcontract Accounts

4.1 Rule 4 only applies to Subcontract Retentions.

Depositing Retention Funds

4.2 Whenever a payment becomes due to the Subcontractor:

4.2.1 Where required under in Rule 4.13, the Contractor must, on or before the Final Date for Payment, deposit into the applicable Subcontract Account the sum that we have notified them is required; and

4.2.2 The Subcontractor must, after the final date on which the Subcontract permits the issue of a Pay Less Notice in respect of the payment in question by the Contractor upload to the online portal a copy of:

  • (a) the Payment Notice establishing the sum due, or

  • (b) the Pay Less Notice, if a Pay Less Notice has been issued in respect of the payment in question.

4.3 All deposits made under Rule 4.2.1 must be:

4.3.1 Made in pounds-sterling;

4.3.2 Made from a bank account held in the Contractor’s own name, from a Bank located in the United Kingdom; and

4.3.3 Carry the Subcontract Account reference number as the payment reference.

4.4 Any transfers into the Subcontract Account that do not meet the criteria set out in Rule 4.3 will not be accepted into the Scheme, and, subject to the Compliance Requirements, will be returned to the account from which they were received.

Allocation of Retention Funds

4.5 To the extent it is possible to do so, Subcontract Accounts will not be funded by cash deposits. They will instead be funded by an allocation of a portion of the Tier 1 Retention that we hold.

4.6 When a Subcontractor uploads a Payment Notice or a Pay Less Notice to the online portal, we will check the uploaded document to confirm the amount of Subcontract Retention that the Contractor is required or permitted to withhold under the Subcontract.

4.7 If the Subcontractor does not upload a Payment Notice or a Pay Less Notice to the online portal within five Business Days of the date specified in Rule 4.2.2, the Contractor may upload any missing documentation.

4.8 Once we have ascertained from the most recent Payment Notice or Pay Less Notice that has been uploaded to the online portal how much Subcontract Retention should be withheld, we will allocate to the Subcontract Account a portion of the Tier 1 Retention we hold equal to the amount of Subcontract Retention that was due for withholding as at the applicable Final Date for Payment, and we will hold that amount on trust for the Subcontractor.

4.9 We will update our assessment of the amount of Subcontract Retention due to be withheld under the Subcontract each time a new Payment Notice or Pay Less Notice for the relevant Subcontract Account is uploaded. Each time that we update this assessment, the portion of the Tier 1 Retention that we hold on trust for the Subcontractor will be updated so that we always hold on trust for the Subcontractor a sum equal to the amount of Subcontract Retention that was due for withholding as at the Final Date for Payment for the most recent Payment Notice or Pay Less Notice that has been uploaded to the online portal.

4.10 Our assessment of the Subcontract Retention under Rules 4.6 and 4.9 and the associated change to the portions of the Tier 1 Retention that we hold on trust for the Contractor and the Subcontractor will take effect the day after the Final Date for Payment associated with the Subcontract Payment Notice or Pay Less Notice (as the case may be) that we have used to update our assessment, or if later, the date on which we make our assessment.

4.11 Our assessment of the amount of Subcontract Retention withheld at any given time will be based solely on the amount of Subcontract Retention that is stated to be required to be withheld in the most recent Payment Notice or Pay Less Notice uploaded to the online portal in respect of the Subcontract. We will not be responsible for checking that the Subcontract Retention amount stated on any such notice has been correctly calculated or is properly required or permitted to be withheld.

4.12 If the most recent Payment Notice or Pay Less Notice uploaded to the online portal does not state the amount required to be withheld as Subcontract Retention, our assessment will be taken from the most recently uploaded document, if any, that does set out the amount required to be withheld.

4.13 If at any time the portion of the Tier 1 Retention that is held on trust for the Contractor is insufficient to cover the Subcontract Retention due for withholding under the Subcontract, we will notify the Contractor of the shortfall within two Business Days. The Contractor must deposit sufficient additional cash in the Tier 1 Contract Account to make up the shortfall within five Business Days of receipt of our notification.

4.14 Contractors can check via the online portal:

4.14.1 The total value of the Tier 1 Retention;

4.14.2 How much additional cash the Contractor has contributed to the related Subcontract Accounts (if any); and

4.14.3 The current allocation of the Tier 1 Retention between the Tier 1 Contractor and each associated Subcontract Account (if any).

4.15 Subcontractors can check via the online portal how much Subcontract Retention we hold on trust for them.

Release of Retention Funds

4.16 Upon the satisfaction of the conditions stated in the Contract for the release of all or part of the Retention, the Subcontractor must notify us using the relevant procedure in the online portal. The Subcontractor will certify to us in writing:

4.16.1 That the conditions for either a full or partial release of the Subcontract Retention, as specified in the Contract, have been satisfied;

4.16.2 The cash value of the Subcontract Retention that is due to be released;

4.16.3 In respect of those matters set out in Rules 4.16.1 and 4.16.2, the notice or certificate issued by or on behalf of the Employer demonstrating the same; and

4.16.4 Bank account details to which the Subcontract Retention release should be sent. (a “Subcontract Release Notice”)

4.17 Upon receipt of a properly completed Subcontract Release Notice, we will notify the Contractor that a Subcontract Release Notice has been received in respect of the Subcontract Account, and provide a copy.

4.18 The Contractor shall pay to the Subcontractor via bank transfer to the account details stated in the Subcontract Release Notice the amount of the Subcontract Retention stated as due for release in the Subcontract Release Notice within five Business Days of receipt of our notification under Rule 4.17, unless before the expiry of that five Business Day period:

4.18.1 The Subcontractor withdraws its Subcontract Release Notice; or

4.18.2 The Contractor certifies to us in writing that it disputes the Subcontractor’s entitlement to the release of the amount of the Subcontract Retention stated in the Subcontract Release Notice.

4.19 As soon as possible after making the payment to the Subcontractor as required under Rule 4.18, the Contractor shall upload via the online portal suitable evidence to confirm that the necessary payment has been made.

4.20 We will review any evidence uploaded by the Contractor within two Business Days of receipt. Once we have checked that, in our opinion, the evidence demonstrates that the required payment has been made, beneficial ownership of an amount of the Subcontract Retention equal to the sum paid by the Contractor in satisfaction of the Release Notice under Rule 4.18 will transfer back to the Contractor from the Subcontractor, and we will thereafter hold the affected portion of the Subcontract Retention once more on trust for the Contractor within the relevant Tier 1 Contract Account.

4.21 In the event of a dispute under Rule 4.18.2, we will continue to hold the Subcontract Retention on trust for the Subcontractor until:

4.21.1 We receive written notification from the Subcontractor that it releases its claim to part or all of the Subcontract Retention; or

4.21.2 The Contractor uploads suitable evidence to the online portal to confirm that the amount of Subcontract Retention stated as due for release in the Subcontract Release Notice has been paid to the Subcontractor. We will respond to any such evidence in accordance with Rule 4.20.

4.22 If the Subcontractor gives us notice under Rule 4.21.1:

4.22.1 If the notice releases the Subcontractor’s claim over the whole of the Subcontract Retention, then upon our receipt of the notice beneficial ownership of the whole of the Subcontract Retention will pass back to the Contractor from the Subcontractor.

4.22.2 If the notice releases the Subcontractor’s claim over part only of the Subcontract Retention, then upon our receipt of the notice beneficial ownership of that part of the Subcontract Retention will pass back to the Contractor from the Subcontractor. The Subcontractor will have to submit a further Subcontract Release Notice in respect of the remainder of the Subcontract Retention.

4.23 If the amount of the Retention transferred back to the Contractor under Rules 4.20 or 4.22 represents the entirety of the remaining Retention in the Subcontract Account, then following the transfer of beneficial ownership back to the Contractor, we will close the Subcontract Account and the Subcontract will be discharged from the Scheme.

4.24 If any amounts have been deposited by the Contractor into the Tier 1 Contract Account in compliance with Rule 4.13, these will be returned to the Contractor within two Business Days of the discharge of the relevant Subcontract from the Scheme.

Our liabilities and obligations with regard to the release of retention funds

4.25 In respect of any releases of Subcontract Retention that we are required to enact under this Rule 4:

4.25.1 We will be entitled to rely without enquiry on any Subcontract Release Notice that is validly submitted through our online portal;

4.25.2 Without limiting Rule 4.25.1, we will not be responsible for ascertaining:

  • (a) Whether the amount of Subcontract Retention stated within the Subcontract Release Notice as due for release has been correctly calculated, or is properly due for release under the terms of the relevant Contract; or

  • (b) Whether the issue of the Subcontract Release Notice has been validly authorised on behalf of the party submitting it.

4.25.3 We will have no liability to any party for transferring beneficial ownership of funds from a Subcontract Account, even if the person to who we transferred beneficial ownership to was not entitled to receive it under the terms of the Subcontract, provided that we have acted in accordance with these Rules;

4.25.4 In carrying out our responsibilities under this section, save to the extent that such liability cannot be disclaimed, we will have no liability, and will not be responsible for:

  • (a) Confirming that any bank account details you provide to us are correct;

  • (b) Any delay or failure on the part of the Deposit Bank with which the Subcontract Account is deposited in receiving or executing our instructions;

  • (c) Any loss or damage suffered by any person in connection with any fraud, negligence, default or other act or omission on the part of the Bank or (except to the extent directly resulting from our fraud or wilful default, or that of our directors, servants or agents) any other person; or

  • (d) Any loss or damage suffered by any person as a result of the Insolvency or any analogous event in the United Kingdom or any other jurisdiction relating to the Deposit Bank or any other person.

5. Our Interest in the Retention Funds

5.1 Our interest in any funds held in a Contract Account is fiduciary as trustee for the purposes set out in these Rules (but without any obligation to invest) with effect from the date that the Contract Account is set up until the Contract is discharged from the Scheme under Rule 10.1 or otherwise.

5.2 All interest accruing on amounts from time to time held in all Contract Accounts shall belong to us.

5.3 We will not be entitled to make any withdrawals or transfers out of a Contract Account except as permitted by these Rules.

6. Protection of Funds under the Scheme

6.1 Each Contract Account will be a virtual sub-account of the Scheme’s main Deposit Bank account.

6.2 We will place any cash deposits held within the Scheme in a bank account with the Bank of England, through our technology partners, the Bank of London (or with such other provider of similar banking access to the Bank of England as we may choose from time to time).

6.3 All funds deposited with the Scheme:

6.3.1 Will be held in a liquid and unencumbered manner;

6.3.2 Will be in a segregated, safeguarded account, and not subject to recourse by our, or our Deposit Bank’s creditors; and

6.3.3 Will, to the extent eligible under its rules (available at www.fscs.org/uk), be protected by the Financial Services Compensation Scheme (“FSCS”), up to £85,000 (or such other compensation limit as may apply under the FSCS from time to time) per party.

7. The Scheme Online Portal

7.1 We provide the Scheme’s online portal ‘as is’ and ‘as available’, without any express, implied or statutory warranties of title, merchantability, fitness for a particular purpose or any other type of warranty or guarantee.

7.2 Use of the online portal is subject to the online portal’s Terms & Conditions.

7.3 We disclaim any knowledge of, and do not guarantee:

7.3.1 The accuracy, reliability, or correctness of any data provided through the online portal;

7.3.2 That the online portal will meet your specific business needs or requirements;

7.3.3 That the online portal will be available at any particular location, or will function in an uninterrupted manner or be secure;

7.3.4 That we will correct any defects or errors in the online portal, its documentation or data; or

7.3.5 That the online portal is free of viruses or other harmful code. Use of data you access or download through the online portal is done at your own risk; you are solely responsible for any damage to your property, loss of data, or any other loss that results from such access or download.

7.4 We will ask you to identify the person or people you will authorise to use the online facilities we provide and who you authorise to give instructions or notices on your behalf under these Rules. We call these people ‘Users’. Each User can have different levels of access depending on the facilities that you want us to make available to the User concerned.

7.5 We offer the following User levels:

7.5.1 Authorised Signatories (which means full access); and

7.5.2 Nominated People (which means read-only access).

7.6 An individual will not have any rights under these Rules in their capacity as a User. You will be responsible for their acts, however, in the same way as you would be responsible if you acted or failed to act in the same way. As a result, you should make sure that your Users are aware of your responsibilities under these terms.

7.7 By making an application to join the Scheme, you agree, on behalf of each User, for us to carry out checks on such Users. You must make sure you can give this permission on behalf of each User before you apply to the Scheme.

7.8 Your Users must tell us as soon as they can if:

7.8.1 Any password, access or other security details are lost or stolen; or

7.8.2 They know or suspect that someone else has misused, or tried to misuse, or may try to misuse any password, access or other security details associated with a Contract Account.

7.9 Our fraud-detection systems help us to identify any unusual transactions or requests on your Contract Account. We may contact you to tell you that we think there is suspicious activity on your account. If we leave a message for you to contact us, you must contact us as soon as possible.

7.10 You are responsible for any instructions given by you, or anyone authorised to act on your behalf (including all of your Users) from the time that they successfully pass through security to the time that they leave the relevant service.

7.11 You and each User:

7.11.1 Must not reveal your security details to any other person;

7.11.2 Must not write down your password or other security details in a way that is recognisable;

7.11.3 Must not choose security details that are easy to guess, such as your date of birth or a sequence of numbers, or any combination of your names or your children’s names;

7.11.4 Must not allow anyone else to use your password or other security details, even if that person is sharing a joint account with you; and

7.11.5 Must not respond to an email asking you for your security details, even if it looks like the email is from us (we will never send you an email like this).

7.12 You should monitor your Contract Account regularly using our portal, or by checking your statements when you receive or access them.

7.13 You should tell us immediately if you notice any errors on your account; experience any problems with our services; or otherwise become aware of any unauthorised transaction or failed or incorrect payment on your account.

8. Fees & Charges

8.1 Save as they may be amended under Rule 8.9, our fees for the operation of the Scheme, including the maintenance of the Contract Account, will depend upon the level of the Base Rate.

8.2 Fees shall be charged on the 1st day of every month (each, a ‘Fee Date’) and shall be calculated by reference to the account balance and the Base Rate at 23:59 on the last day of the prior month.

8.3 When the reference Base Rate is 3.75% or above, the following fees will apply:

8.3.1 For Tier 1 Contract Accounts

  • (a) On the first two Fee Dates following the first opening of a Contract Account, no fees will be charged;

  • (b) From (and including) the third Fee Date following the first opening of a Contract Account:

  • (i) On each Fee Date where the applicable balance of the Contract Account is £5,000 or more, no fees will be charged; and

  • (ii) On each Fee Date where the applicable balance of the Contract Account is less than £5,000, we will charge a fee of £25 plus VAT.

8.3.2 For Subcontract Accounts

  • (a) No fees will be charged.

8.4 When the reference Base Rate is below 3.75% but greater than or equal to 0%, the following fees will apply:

8.4.1 For Tier 1 Contract Accounts

  • (a) On the first two Fee Dates following the first opening of a Contract Account, no fees will be charged; and

  • (b) From (and including) the third Fee Date following the first opening of a Contract Account we will charge a fee of £25 plus VAT.

8.4.2 For Subcontract Accounts

  • (a) £25 plus VAT.

8.5 When the reference Base Rate is below 0%, the following fees will apply:

8.5.1 For Tier 1 Contract Accounts

  • (a) On the first two Fee Dates following the first opening of a Contract Account, no fees will be charged; and

  • (b) From (and including) the third Fee Date following the first opening of a Contract Account we will charge a fee of the greater of

  • (a) £25 plus VAT, or

  • (b) the sum of all negative interest or equivalent fees payable to the Deposit Bank in respect of the Contract Account plus £25 plus VAT.

8.5.2 For Subcontract Accounts

  • (a) £25 plus VAT.

8.6 Any fees due in accordance with this Rule will be deducted from the Contract Account each month on the relevant Fee Date.

8.7 If at any time there is insufficient cash in the Contract Account to cover the cost of the fees for the month, we will notify both parties to the relevant Contract of the deficit, and state the amount of additional cash that is required to be deposited into the account to cover the deficit.

8.8 You and the counterparty to the relevant Contract will be jointly and severally liable to contribute pay the fee shortfall into the Contract Account. If the requested sum is not paid into the account within 10 Business Days of receipt of our notice under Rule 8.7, the Contract Account will be closed and the Contract will be discharged from the Scheme.

8.9 We may update the fee rates and reference Base Rate thresholds set out in this Rule from time to time, however once a Contract has been accepted into the Scheme, the rates applicable at the time the Contract is accepted into the Scheme will apply to that Contract Account until the Contract is discharged from the Scheme.

9. Insolvency

Insolvency of an Employer

9.1 Upon the Insolvency of the Employer under a Tier 1 Contract, we will hold the balance of all sums held in the relevant Tier 1 Contract Account on trust for the Tier 1 Contractor and, where applicable, the Supply Chain.

9.2 The Tier 1 Contractor agrees that it will not seek the release of the funds we hold for it until:

9.2.1 It has uploaded to the online portal:

  • (a) A valid and completed Release Notice complying with Rule 3.18; or

  • (b) Suitable evidence that the Tier 1 Contract has been terminated; and

9.2.2 all linked Subcontracts have been discharged from the Scheme.

9.3 Provided that the condition in Rule 9.2.2 is met, we will release to the Tier 1 Contractor:

9.3.1 Any Tier 1 Retention covered by the Release Notice, if one has been provided; or

9.3.2 The balance of the Tier 1 Retention, if evidence of the termination of the Tier 1 Contract has been provided,Within two Business Days of receipt of the Release Notice or evidence of termination, as the case may be.

9.4 If there is any cash left in the Tier 1 Contract Account following the release of the Tier 1 Retention, we will hold the balance on trust for the Employer and will deal with it as directed by the Employer’s administrators or liquidators.

9.5 Upon the distribution of all funds from the Tier 1 Contract Account under Rules 9.3 and 9.4, the Contract will be discharged from the Scheme.

Insolvency of a Tier 1 Contractor

9.6 Upon the insolvency of a Tier 1 Contractor the following rules will apply:

9.7 If there are no linked Subcontract Accounts, the funds we hold on deposit in the Tier 1 Contract Account will be sent to the Employer at the same bank account from which they were originally received. If the Employer no longer maintains the said bank account, we will contact the Employer to establish which account the funds should be sent to.

9.8 If there are linked Subcontract Accounts:

9.8.1 Any funds in the Tier 1 Contract Account that are not held on trust for any Subcontractors at the time of the Tier 1 Contractor’s Insolvency will be released to the Employer on the same terms as in Rule 9.7.

9.8.2 Where we hold parts of the Tier 1 Retention on trust for the Supply Chain in linked Subcontract Accounts, the trusts established by Rules 4.6 to 4.13 will remain in place.

9.8.3 Each Subcontractor must upload to the online portal either:

  • (a) written confirmation (in the form of a termination notice) that the relevant Subcontract has been terminated; or

  • (b) written confirmation that a third party has exercised step-in rights over the Subcontract.

9.8.4 We will take no further action in respect of any Subcontract Retention until the Subcontractor that is entitled to it has taken one of the steps set out in Rule 9.8.3.

9.8.5 If a Subcontractor uploads confirmation that its Subcontract has been terminated, we will release the Subcontract Retention to the Subcontractor at any bank account held with a Bank located in the United Kingdom within five Business Days of receiving the relevant account details from the Subcontractor.

9.8.6 If a Subcontractor uploads confirmation that a third party has exercised step-in rights over the Subcontract, it must notify us of the identity of the replacement contractor and provide us with contact details of an individual who has authority to agree on behalf of the replacement contractor to join the Scheme. We will contact the replacement contractor to seek their consent to joining the Scheme.

9.8.7 If the replacement contractor agrees to join the Scheme:

  • (a) It will be required to apply for a Contract Account following the procedures set out in the Pre-Qualification Information;

  • (b) Assuming its application is successful:

  • (i) We will open a new Tier 1 Contract Account;

  • (ii) The existing Subcontract Retention will be transferred to the new Tier 1 Contract Account; and

  • (iii) The Subcontract will from then onwards be administered under the Scheme as a Tier 1 Contract with the replacement contractor as Employer, and the former Subcontractor as Tier 1 Contractor.

9.8.8 If a Subcontract Account is converted into a Tier 1 Contract Account under the process in Rule 9.8.7, the replacement contractor (acting as Employer for the purposes of the Scheme) will have no liability either to us or to its contractual counterparty in respect of:

  • (a) Any breaches of these Rules by the Insolvent original Contractor; or

  • (b) Any shortfall in the Tier 1 Contract Account at the time the replacement contractor joins the Scheme (and the replacement contractor will be required under these Rules only to pay in to the Tier 1 Contract Account such Tier 1 Retention as becomes due for withholding under the relevant Contract from the date on which the replacement contractor joins the Scheme).

9.8.9 If the replacement contractor does not agree to join the Scheme:

  • (a) We will not accept any further payments into the relevant Tier 1 Contract Account in respect of the relevant Subcontract Retention;

  • (b) We will hold the Subcontract Retention on trust for the Subcontractor until it provides us with an appropriate Payment Notice confirming that the Final Release of Retention is due to it under the Subcontract;

  • (c) Upon receipt of a Payment Notice complying with Rule 9.8.9(b), we will release the Subcontract Retention to the Subcontractor at any bank account held with a Bank located in the United Kingdom within five Business Days of receiving the relevant account details from the Subcontractor.

Insolvency of a Subcontractor

9.9 Upon the Insolvency of a Subcontractor, any funds that we hold on trust for that Subcontractor will be released from the Subcontract Account and will once more be held on trust for the Contractor under the relevant Tier 1 Contract. The Subcontract will be discharged from the Scheme.

10. Discharge from the Scheme

10.1 A Contract will be discharged from the Scheme when one or more of the following applies:

10.1.1 On the third Fee Date following the first opening of a Contract Account, no deposit has been made in respect of that Contract Account;

10.1.2 The parties to the Contract mutually agree to withdraw from the Scheme and provide us (either jointly or each separately) with written notice of this agreement;

10.1.3 All funds held within the relevant Contract Account have been distributed to the parties (subject to any deductions we may be entitled to make under these Rules) and Rule 3.28 or 4.23 applies;

10.1.4 Deductions for our costs in accordance with Rule 8 reduce the balance of the Contract Account to nil, provided that we will follow the procedure in Rules 8.7 and 8.8.

10.1.5 We have reasonable grounds to suspect unauthorised or fraudulent activity in respect of the Contract Account;

10.1.6 Either party to the Contract breaches these Rules, and does not remedy the breach within five Business Days of receipt of written notice from us specifying the breach and requiring its remedy;

10.1.7 The continued inclusion of the Contract within the Scheme would breach any law in force in the United Kingdom from time to time, or either party to the Contract becomes, or in our reasonable opinion may become subject to Sanctions (and in this regard we will be entitled to act upon the instructions of any national criminal enforcement agency or regulatory body without reference to the parties, and we will incur no liability to the parties for doing so);

10.1.8 We become entitled to distribute any funds held in the relevant Contract Account under the expiry provisions in Rule 12; or

10.1.9 The government of the United Kingdom brings into force any law or regulation that would render the continued operation of the Scheme illegal, or a court or tribunal of competent jurisdiction in England and Wales hands down a judgment that the continued operation of the Scheme is in breach of any existing provision of English and Welsh Law.

10.2 Where a Contract is discharged from the Scheme under Rule 10.1.2 we will distribute any cash held on deposit within the Contract Account according to the directions of the parties. If we do not receive any such directions within 5 Business Days of receipt of the parties’ notice or notices, will retain any funds held in the Contract Account until we are able to determine the appropriate course of action. In such circumstances we will be entitled to make any reasonable determination as to where and to whom we should release the retained funds and will incur no liability to the parties.

10.3 Where a Contract is discharged from the Scheme under Rule 10.1.6, we will distribute any funds held in the Contract Account to the party that is not in default at the time the Contract is discharged. The parties’ rights against each other under the Contract in respect of the Retention will be unaffected.

10.4 Where a Contract is discharged from the Scheme under Rules 10.1.5, 10.1.7 or 10.1.9, we will retain any funds held in the Contract Account until we are able to determine the appropriate course of action. In such circumstances we will be entitled to make any reasonable determination as to where and to whom we should release the retained funds and will incur no liability to the parties.

10.5 Upon discharge of a Contract from the Scheme, these Rules will cease to bind the parties, save that Rules 5, 6, 7, 9, 10.5, 11, 12.3, 13, 14, 16, 17 and 18 will continue to apply after discharge.

10.6 Rules 10.2 to 10.4 are not intended to affect the rights of any third party who might also have a beneficial interest the affected Retention under these Rules. For example, if a Tier 1 Contract is discharged under Rule 10.1.6 because of a breach of these Rules by the Tier 1 Contractor, we will only return parts of the Tier 1 Retention to the Employer that do not also constitute Subcontract Retentions under any linked Subcontracts.

11. Disputes

11.1 If a dispute arises out of or in connection with the application of these Rules or the performance, validity or enforceability of them (a “Dispute”), then all parties concerned with the Dispute shall follow the procedure set out in this Rule 11.

11.2 Any party shall give to all others written notice of the Dispute, setting out its nature and full particulars (a “Dispute Notice”), together with relevant supporting documents. The parties will attempt, in good faith, to resolve the Dispute promptly through negotiation in person or between representatives of the parties who have authority to settle.

11.3 If those negotiations are, for any reason, unable to resolve the Dispute within 21 days, the dispute shall be referred to mediation in accordance with the London Chamber of Arbitration and Mediation (“LCAM”) Model Mediation Procedures. Unless otherwise agreed between the parties, the mediation will start not later than 35 days after the date of the Dispute Notice.

11.4 If the dispute is not resolved within 42 days of the Dispute Notice, the Dispute shall be finally resolved by arbitration in accordance with the LCAM Expedited Arbitration Rules. The arbitral tribunal shall be composed of one arbitrator. The language of any arbitration or mediation shall be English. The seat of any arbitration shall be London.

11.5 The law of this arbitration agreement shall be the law of England and Wales.

11.6 If at any time we are uncertain as to our duties, obligations or responsibilities under these Rules or we receive instructions, claims or demands from either party to the Contract which in our opinion conflict with each other or any of these Rules:

11.6.1 We will issue a notice to both parties to the relevant Contract setting out:

  • (a) Our interpretation of the Rules as they apply to the uncertain matter, together with our intended course of action; and

  • (b) A time limit for the parties to dispute this intended course of action (this time limit will not be less than five Business Days).

11.6.2 If a party wishes to dispute our intended course of action as set out in the notice under Rule 11.6.1, they must issue a Dispute Notice before the end of the time limit set out in the notice.

11.6.3 If one or more parties issues a Dispute Notice, the parties will follow the procedure in Rules 11.2 to 11.4 to determine between themselves how we should proceed.

11.6.4 If the dispute resolution procedure is commenced, we will be entitled to hold any Retention and to refrain from taking any action until we receive:

  • (a) A joint instruction from both parties to the Construction Contract in terms satisfactory to us; or

  • (b) An arbitrator’s order that is binding on us,

following which we will deal with the Retention in accordance with such instruction or order.

11.6.5 If neither party issues a Dispute Notice before the end of the time limit set out in our notice under Rule 11.6.1, our interpretation of the Rules and proposed course of action will become binding on both parties, and each agrees that they will have no further ability to challenge it.

12. Expiry

12.1 If, in respect of a particular Contract Account, there has been:

12.1.1 No action logged by either party on the online portal; and

12.1.2 No written communication received by us from either party to the Contract,

for a period of six months, we will thereafter send to each party once per quarter a notice seeking instructions as to their intentions for any Retention still held within the Scheme (a “Dormancy Notice”)

12.2 If we do not receive any response from either party to any Dormancy Notices for a period of six years (counted from the date on which activity was last logged on the online portal by one of the parties, or from the last receipt by us of written communications from either party, whichever is later), then:

12.2.1 The Contract will be automatically discharged from the Scheme; and

12.2.2 We will be entitled to distribute any cash held within the relevant Contract Account to any charity of our choosing that is Registered with the Charities Commission in England and Wales (provided that the said cash is not at the time held on trust for any party other than the two parties in receipt of the Dormancy Notices).

12.3 We will incur no liability to the parties for distributing the balance of any Contract Account in compliance with this Rule 12.

13. Your Obligations

13.1 As a condition of using the Scheme, each party agrees that they:

13.1.1 Will only use our services for legitimate and legal business purposes. In particular, they agree to use the Scheme in line with this requirement, the Scheme Rules and the instructions, support and guidance we provide;

13.1.2 Will not share anything that may be offensive, violate any law, or infringe the rights of others;

13.1.3 Will not use our services in any way that might impair their functionality or interfere with others' use of them;

13.1.4 Will not undermine the security or integrity of our computing systems or networks, or to access any system without permission;

13.1.5 Will not copy, modify, adapt, reproduce, disassemble, decompile, reverse engineer or extract these Rules or the source code or any part of our services; and

13.1.6 Will not repackage, resell or sub-license any of our services or data.

14. Our Liability

14.1 Subject to Rule 14.2:

14.1.1 Our total aggregate liability in respect of each Contract Account under or in connection with the Scheme and these Rules including but not limited to our liability in contract, tort (including negligence), misrepresentation, restitution, and statutory liability shall be limited to the value of any Retention that we may hold from time to time in the Contract Account in respect of which our liability arises; and

14.1.2 we shall have no liability to any party for any indirect or consequential loss arising out of or in connection with our administration of the Scheme and these Rules.

14.2 Nothing in these Rules shall limit any party’s liability for fraud or wilful default or any other liability that may not be limited by law.

14.3 We may delay or refuse to carry out any transaction we are required to effect under these Rules until such time that we are satisfied that such transaction complies with the Compliance Requirements and all applicable money laundering and other laws and our own anti-money laundering policies. We will not be liable or responsible for any failure to take, or any delay in taking, any action which in our judgment may:

14.3.1 Be contrary to any provision of these Rules or any court order or any money laundering or other laws and regulations, the Compliance Requirements, or any of our own anti-money laundering or other risk management policies; or

14.3.2 Expose us to any liabilities or expense against which we have not been indemnified to our satisfaction.

14.4 We have measures in place to prevent fraud, money laundering and terrorist activity. We must also respect any restrictions imposed by the UK Government or by the international community on providing payment and other banking services to individuals or entities currently included in any relevant sanctions or embargo list. This may involve us investigating or intercepting payments into and out of your Contract Account.

14.5 We may also need to investigate the source of the funds or the intended payee. This may delay carrying out your instructions or how quickly you receive cleared funds. Where possible, we will tell you the reasons for and the likely length of any delay. If we are not satisfied that a payment into or out of your Contract Account meets the Compliance Requirements, we may refuse to process it.

14.6 Our responsibilities under these Rules are administrative only.

14.7 In the administration of the Scheme, we will only have those duties, obligations and responsibilities expressly set out in these Rules and we will have no implied duties, obligations or responsibilities. In particular, we will not be bound by the terms of the Contract or any other arrangement or understanding between the parties.

14.8 We will not be treated as having any actual, constructive or implied knowledge of any of the terms of the Contract to which any Contract Account relates, or any other arrangement or understanding between the parties.

15. Data Protection

We are a data controller for the purposes of Data Protection Legislation. We will handle any personal data collected from you, or that you provide to us, in accordance with our data protection policy.

16. Confidentiality

16.1 We and you each will:

16.1.1 Keep the Confidential Information of the other secret and confidential;

16.1.2 Not use the Confidential Information of the other party except for the proper exercise of our rights and performance of our obligations under these Rules including but not limited to the operation of our online portal (the “Permitted Purpose”);

16.1.3 Not disclose or permit the disclosure of the Confidential Information of the other except as permitted in Rule 16.2; and

16.1.4 Take all necessary and proper security precautions to safeguard every part of the Confidential Information.

16.2 We may disclose your Confidential Information to those of our employees, officers and professional advisers (“Representatives”) who need to have access to it for the Permitted Purpose, provided that we ensure that those Representatives comply with this Rule 16.

16.3 The provisions of Rule 16.1 will not apply to Confidential Information that:

16.3.1 the receiving party can prove was known to the receiving party or in its possession on a non-confidential basis and other than as a result of breach of confidence before that information was acquired from, or from some person on behalf of, the other party;

16.3.2 is in or enters the public domain through no default of the receiving party provided that this Rule 16.3.2 shall only apply from the date that the relevant Confidential Information enters the public domain;

16.3.3 the receiving party receives from a third party without obligations of confidence in circumstances where the third party did not obtain that information as a result of a breach of an obligation of confidence; or

16.3.4 is required to be disclosed by any applicable law or by the order of a court or other tribunal of competent jurisdiction to the extent of the required disclosure.

16.4 The provisions of this Rule 16 shall continue to apply for a period of six years from the discharge of the relevant Contract from the Scheme.

17. Notices

17.1 A notice or notification required to be given to a party under these Rules:

17.1.1 Shall be in writing and in English;

17.1.2 Shall be signed by or on behalf of the party giving it. A notice given by email will be deemed to be signed for the purposes of this Rule if the name of the sender appears in a signature position after the body of the email. Any notice issued via the online portal will be deemed to be signed on behalf of the party giving it;

17.1.3 May be sent to the party for the attention of the contact and at the address or email address listed or referenced in Rule 17.2, or such other address or email address as that party may notify from time to time; or

17.1.4 May be sent through the online portal.

17.2 The addresses and email addresses for the service of notices are:

17.2.1 For notices addressed to us:

Address: The UK Retention Deposit Scheme, c/o DOS & Co. Ltd., SB.149 China Works, 100 Black Prince Road, London SE1 7SJ

For the attention of: The Compliance Officer

Email address: legalnotices@dosandco.com

17.2.2 Notices addressed to you shall be sent to the address or email address, and for the attention of the individual nominated by you for that purpose when completing the online form to register for the Scheme.

17.3 Notices sent in connection with the Scheme and these Rules will be deemed to be delivered:

17.3.1 If sent by pre-paid first class post or other next working day delivery service, at 2.00pm on the next Business Day after posting, exclusive of the day of posting;

17.3.2 If sent by email, at the time of transmission, unless the recipient is able to provide satisfactory evidence that it did not receive the email in question.

17.4 If deemed receipt under Rule 17.3.2 would take place outside of the hours of 9.00am – 5.00pm, on Business Days, it deemed receipt will be deferred until 9.00am the next Business Day.

17.5 This Rule does not apply to the service of any proceedings or other documents in any legal action save that the provisions of this Rule 17 will apply to notices given in relation to dispute resolution in accordance with Rule 11.

18. Governing Law

These Rules and any dispute or claim (including non-contractual disputes or claims) arising out of or in connection with them or their subject matter shall be governed by and construed in accordance with the law of England and Wales.

19. Rights of Third Parties

19.1 These Rules set out the basis upon which we will operate the Scheme. The agreement that the administration of Retention due under your Contract will become subject to these Rules takes effect as an agreement between you, us and the counterparty to your Contract.

19.2 No one outside of you, us and the counterparty to your Contract has any rights under the Contracts (Rights of Third Parties) Act 1999 to enforce, or to enjoy the benefit of any provision of these Rules.

20. Severance

If any Rule or part-Rule of these Rules is or becomes invalid, illegal or unenforceable in the United Kingdom it shall to that extent be deemed deleted but that shall not affect the legality, validity or enforceability in of any other part of these Rules.

21. Updates to these Rules

21.1 We may update any of these Rules from time to time.

21.2 Any updates to the Rules will take effect when a revised version of these Rules is published to our website at retentiondepositscheme.org/scheme-rules.

21.3 Subject to Rule 21.4 the version of the Rules applicable to a specific Contract and Contract Account will be the Rules in force at the time the Contract is accepted into the Scheme.

21.4 If we have to update these Rules due to changes in law in order to ensure that these Rules and our operation of the Scheme remain compliant with the law, any such changes will apply immediately to Contract Accounts that have already been accepted into the Scheme, as well as new ones for Contracts accepted after their publication.

21.5 If we are required to update these Rules and Rule 21.4 applies, we will notify you and will notify you of the change to the Rules.