AUTH 5.4 EEA firms establishing a branch in the United Kingdom

There is guidance for UK firms in SUP 13 Annex X [to be added later] on what constitutes a branch. EEA firms may find this of interest although they should follow the guidance of their Home State regulators.

Before an EEA firm exercises an EEA right to establish a branch in the United Kingdom other than under the Insurance Mediation Directive, the Act requires it to satisfy the establishment conditions, as set out in paragraph 13(1), Part II of Schedule 3 to the Act (EEA Rights). These conditions are that:1

1. (1)

   the FSA has received notice (a consent notice) from the EEA firm's Home State regulator that it has given the EEA firm consent to establish a branch in the United Kingdom;

2. (2)

   the consent notice:

   1. (a)

      is given in accordance with the relevant Single Market Directive;

   2. (b)

      identifies the activities to which the consent relates; and

   3. (c)

      includes the information prescribed under regulation 2 of the EEA Passport Rights Regulations (see AUTH 5 Annex 1 G);

3. (3)

   the EEA firm has been informed of the applicable provisions or two months have elapsed beginning with the date on which the FSA received the consent notice.

1Where an EEA firm exercises its EEA right to establish a branch in the United Kingdom under the Insurance Mediation Directive, the Act requires it to satisfy the establishment conditions, as set out in paragraph 13(1A) Part II of Schedule 3 to the Act (EEA Rights). These conditions are that:

1. (1)

   the EEA firm has given its Home State regulator notice of its intention to establish a branch in the United Kingdom;

2. (2)

   the FSA has received notice ("a regulator's notice") from the EEA firm'sHome State regulator that the EEA firm intends to establish a branch in the United Kingdom;

3. (3)

   the EEA firm's Home State regulator has informed the EEA firm that the regulator's notice has been sent to the FSA; and

4. (4)

   one month has elapsed beginning with the date when the EEA firm's Home State regulator informed the EEA firm that it had sent the regulator's notice to the FSA.

For the purposes of paragraph 13 of Part II of Schedule 3 to the Act, the applicable provisions may include FSA rules. The EEA firm is required to comply with relevant rules when carrying on a passported activity through a branch in the United Kingdom as well as with relevant UK legislation.

1. (1)

   When the FSA receives a consent notice from the EEA firm's Home State regulator, it will, under paragraphs 13(2)(b), (c) and 13(3) of Part II of Schedule 3 to the Act, notify the applicable provisions (if any) to:

   1. (a)

      the EEA firm; and

   2. (b)

      in the case of an EEA firm passporting under Insurance Directives, the Home State regulator;

   within two months of the date on which the FSA received the consent notice.

2. (2)

   Although the FSA is not required to notify the applicable provisions to an EEA firm passporting under the Insurance Mediation Directive, these provisions are set out in AUTH 5 Annex 3 G (Application of the Handbook to Incoming EEA Firms).1