(1) If the objects of a credit union include the optional object specified in section 1(3ZZA) it may (subject to such terms, including as to security, as its rules may provide) -

(a) enter into a conditional sale agreement, as the seller, with a member of the credit union , or

(b) enter into a hire purchase agreement, as the person from whom goods are bailed or (in Scotland) hired, with a member of the credit union .

(2) A credit union may only enter into an agreement mentioned in subsection (1) with a corporate member if -

(a) the credit union's rules provide that it may do so, and

(b) entering into the agreement would not result in the aggregate of the outstanding balances under all such agreements made by the credit union with corporate members exceeding 10% of the aggregate of the outstanding balances under all such agreements made by the credit union with members, or such higher percentage as may be specified in regulations made by the Treasury.

(3) Subsection (4) applies where -

(a) an agreement mentioned in subsection (1) is entered into by a credit union with a member, and