Nonbank activities, some of which would normally not be permissible for bank holding companies and foreign banks in the United States, but which were acquired or engaged in before a particular date. Such activities may be continued under the "grandfather" clauses of the Bank Holding Company Act and the International Banking Act.
Activities that are permitted when they otherwise would not be permitted because of a grandfather clause. A grandfather clause is a portion of a new law, regulation, or anything else that exempts certain persons or businesses from abiding by it. For example, suppose a country passes a law stating that it is illegal to own a cat. A grandfather clause may allow persons who already own cats to continue to keep them, but would prevent people who do not own cats from buying them. In this case, owning a cat is a grandfathered activity. Grandfathered activities are controversial, but they are also relatively common.