DEC 2.2 Warning notice procedure

Under the circumstances listed in DEC 2 Annex 1 G, if FSA staff consider that action is appropriate, they will recommend to the relevant decision maker that a warning notice be given. A specimen warning notice for enforcement cases is at DEC 2 Annex 5 G.

After considering the staff recommendation, the decision maker may:

1. (1)

   decide not to take further action (with or without a private warning (see ENF 11.3(Private warnings)); or

2. (2)

   decide to give a warning notice to the person concerned.

In the case of a proposed refusal of an application for approval under section 59 of the Act, the FSA must send a warning notice to all interested parties. Under section 62(5) of the Act (Applications for approval: procedure and right to refer to Tribunal), the interested parties in relation to an application for approval, are:

1. (1)

   the applicant;

2. (2)

   the person in respect of whom the application is made ('A');

3. (3)

   the person by whom A's services are to be retained, if not the applicant.

Under regulation 22 of the OEIC Regulations, in the case of a warning notice concerning a proposed change in respect of an ICVC, the notice must be given to the depositary as well as the ICVC. The only exception is if the proposal is to replace the depositary or any director.

If the FSA decides to give a warning notice to a person, in accordance with section 387 of the Act (Warning notices), the warning notice must:

1. (1)

   state the action which the FSA proposes to take;

2. (2)

   be in writing;

3. (3)

   give the FSA's reasons for the proposed action;

4. (4)

   state whether section 394 of the Act (Access to FSA material) applies (see DEC 2.4); and

5. (5)

   if that section applies, describe its effect and state whether any secondary material exists to which the person concerned must be allowed access under it.

If the FSA decides to take no further action and the FSA had previously informed the person concerned that it intended to recommend action, the FSA will communicate this decision promptly to the person concerned.

The warning notice will contain a statement that the person concerned is entitled to make representations to the FSA. The notice must specify a reasonable period, of at least 28 days from receiving (see DEC 5.3) the warning notice, within which the person to whom it is given may make representations.

The procedures for making representations are set out in DEC 4.4.

The warning notice will contain (where appropriate) a statement that the mediation scheme is available. The applicability of the FSA's mediation scheme is described in DEC App 1.