(1) Regulations 4 to 9 and Schedule 2 apply in relation to -

(a) the performance of third country audit functions by persons who are eligible for appointment as statutory auditors,

(b) the monitoring by the competent authority of the performance of third country audit functions by persons who are eligible for appointment as statutory auditors, and

(c) the imposition of sanctions by the competent authority in relation to the performance of third country audit functions by persons who are eligible for appointment as statutory auditors,

as they apply to the conduct of statutory audit work, the monitoring of that work and the imposition of sanctions in relation to that work, subject to the modifications set out in paragraphs (3) to (6).

(2) Paragraph (1) does not apply in respect of monitoring of the performance of third country audit functions -

(a) for an audited entity which -

(i) is incorporated in an equivalent third country, or

(ii) is incorporated in a transitional third country; or