This manual gives guidance on the FSA's decision making and other procedures for giving statutory notices listed in DEC 2 Annex 1 G and DEC 3 Annex 1 G. This manual also gives guidance on the FSA's procedure for using its powers under Part XXIV of the Act (Insolvency), Part XXV of the Act (Injunctions and restitution), Part XXVII of the Act (Criminal Offences) and the Unfair Terms Regulations. It also gives guidance on the FSA's procedures for using certain similar powers with respect to insolvency and criminal offences under the Building Societies Act 1986, the Friendly Societies Acts 1974 and 1992, the Credit Unions Act 1979 and the Industrial and Provident Societies Act 1965. It is relevant to firms, approved persons, applicants for Part IV permission, persons for whom an application for approval under section 59 of the Act has been made, and other persons, whether or not they are regulated by the FSA. The UKLA's procedure for giving statutory notices under Part VI of the Act (Official listing) is set out in the listing rules and related guidance.21

Section 395 of the Act (The FSA's procedures) requires the FSA to publish a statement of its procedure for the giving of statutory notices. The purpose of the Decision making manual (DEC) is to fulfil this obligation.1

DEC 4.6.1 G and DEC 4.6.2 G1 set out the FSA's policy on the procedure to be followed:

1. (1)

   if the FSA decides to use its:

   1. (a)

      powers to apply to the civil courts for insolvency orders, injunctions, restitution orders and collective investment scheme related orders; or

   2. (b)

      powers to prosecute criminal offences; and

2. (2)

   if the FSA decides to discontinue any proceedings begun by the use of these powers.

1 DEC 4.6.2A G and DEC 4.6.2B G set out the FSA's policy on the procedure to be followed:

1. (1)

   if the FSA decides to use its powers to prosecute criminal offences under the Building Societies Act 1986, the Friendly Societies Acts 1974 and 1992, the Credit Unions Act 1979 and the Industrial and Provident Societies Act 1965, in each case as amended; and

2. (2)

   if the FSA decides to discontinue any proceedings begun by the use of these powers.

The Authorisation manual (AUTH), the Supervision manual (SUP), the Enforcement manual (ENF) and the Decision making manual (DEC) form the regulatory processes part of the Handbook:

1. (1)

   AUTH sets out the relationships between the FSA and applicants for Part IV permission and persons wishing to exercise EEA rights, Treaty rights or UCITS directive rights;

2. (2)

   SUP sets out the relationship between the FSA and authorised persons (referred to in the Handbook as firms). As a general rule, material that is of a continuing relevance after authorisation is in SUP;

3. (3)

   ENF describes the FSA's enforcement powers under the Act and sets out its policies for using those powers; and

4. (4)

   DEC is principally concerned with, and sets out, the FSA's decision making procedures for decisions that involve the giving of statutory notices.

The Act designates certain notices as warning notices, decision notices or supervisory notices ('statutory notices') for which there are certain specified procedures, actions and protections.DEC 1.2.3 G summarises the statutory notices and related notices and provides references to where they are described in the Act.

The FSA has different decision making procedures depending on whether or not a statutory notice is given.

Events leading to the giving of a statutory notice are covered in AUTH, SUP, ENF and COLL1 or CIS. DEC 2 Annex 1 G and DEC 3 Annex 1 G list the relevant references.

Decisions whether to give a statutory notice and decisions associated with the statutory notice once it has been given (a 'statutory notice associated decision', see DEC 4.1.2 G) will be taken by a 'decision maker'. References to the 'decision maker' concerning statutory notice decisions refer to decisions taken by:

1. (1)

   the Regulatory Decisions Committee (RDC); or

2. (2)

   FSA staff under executive procedures.

DEC 4.1 describes the allocation of decisions between the RDC and executive procedures. DEC 4.2 provides further information on the RDC. DEC 4.3 provides further information on executive procedures.

The FSA will make regulatory decisions falling outside section 395 of the Act. These will include exercise of statutory powers which do not require statutory notices to be given, for example: when the FSA grants an application for a Part IV permission on the terms applied for (such decisions are made by internal staff procedures as described in AUTH 8.2.5 G to AUTH 8.2.8 G); when the FSA grants other applications; decisions on applications for waivers; decisions to give individual guidance; and decisions generally in the course of the FSA's oversight of regulated institutions. They also include decisions on recommendations by FSA staff to the RDC.

The FSA's general policy is that regulatory decisions should be taken at a level of seniority which is appropriate to the decision having regard to such factors as:

1. (1)

   the significance of the decision to those who would be affected by it;

2. (2)

   its novelty in the light of stated policy and established practice;

3. (3)

   the complexity of the relevant considerations;

4. (4)

   the range of alternative options; and

5. (5)

   the extent to which the facts relating to the decision are or may be disputed.

The FSA expects that most decisions will be made by individuals accountable through line management to the Board within the management structure of the FSA. Where appropriate, decisions will be made collectively by a group of staff. Decisions will be made within the stated policies of the FSA and in accordance with the Act and other legal requirements.