EMPS 1.2 Parts of the Handbook applicable to energy market participants

High Level Standards

Principles for Businesses (PRIN)

This applies.

Senior management arrangements, Systems and Controls (SYSC)

This applies.

Threshold Conditions (COND)

This applies.

Statements of Principle and Code of Practice for Approved Persons (APER)

This applies to an approved person who performs a controlled function for an energy market participant.

The Fit and Proper test for Approved Persons (FIT)

This applies.

The Financial Stability and Market Confidence sourcebook (FINMAR)

This is unlikely to be of relevance to the business of an energy market participant.

General provisions (GEN)

This applies.

Prudential standards

Interim Prudential sourcebooks (IPRU)

Chapter 1 (Application and General) of (Interim Prudential sourcebook: Investment Businesses) applies.

Chapter 3 (Financial resources for Securities and Futures Firms which are not MiFID investment firmsor which are exempt BIPRU commodities firms or exempt IFPRU commodities firms2) of IPRU(INV) applies, with the following qualifications:

(a) energy market participants whose main business consists of the generation, production, storage, distribution and/or transmission of energy may be granted a waiver of Chapter 3 in the FCA's discretion: see SUP 21; and

(b) the concentrated risk requirements do not apply to an energy market participant if it is anexempt IFPRU commodities firm that applies the large exposure requirements in Part Four (articles 387 to 403) of the EUCRR: 2 see IPRU(INV) 3-1B R, IPRU(INV) 3-1C G and IPRU(INV) 3-1D G; and2

(c) the concentrated risk requirements apply to an energy market participant if it is an exempt BIPRU commodities firm that satisfies the conditions in BIPRU TP 16 in the version as at 31 December 2013.2

The other parts of IPRU(INV) do not apply.

The other sourcebooks do not apply.

General Prudential sourcebook (GENPRU)

Except for provisions on capital requirements and the ICAAP rules, this applies to an energy market participant if it is an exempt BIPRU commodities firm: see BIPRU TP 15.9 G - BIPRU TP 15.10 G.

Prudential sourcebook for Banks, Building Societies and Investment Firms (BIPRU)

Except for provisions on capital requirements and the ICAAP rules, this applies to an energy market participant if it is an exempt BIPRU commodities firm: see BIPRU TP 15.9 G - BIPRU TP 15.10 G.2

2Prudential sourcebook for Investment Firms (IFPRU)

Except for provisions on combined buffer, own funds, own funds requirements and the ICAAPrules, this applies to an energy market participant if it is an exempt IFPRU commodities firm: see IFPRU 1.1.1 G.

Business standards

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Conduct of Business sourcebook (COBS)

Only some parts of COBS apply to energy market activity: see COBS 18.2.

Mortgages: Conduct of Business sourcebook (MCOB)1

Client assets sourcebook (CASS)

This applies.

Market Conduct sourcebook (MAR)

This applies. However MAR 2 (Stabilisation)4 is likely to be of only marginal relevance to the business of an energy market participant. MAR 5 (Multilateral Trading Facilities) applies to an energy market participant that operates an ATS.

Training and Competence sourcebook (TC)

TC does not apply to energy market participants as they do not carry on activities for retail clients. But they are subject to the competent employees rule in SYSC.

Regulatory processes

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Supervision manual (SUP)

This applies, with the following qualifications:

(a) in SUP 3 (Auditors), only some provisions apply if IPRU(INV) 3 (Financial Resources for Securities and Futures Firmswhich are not MiFID investment firms or which are exempt BIPRU commodities firms or exempt IFPRU commodities firms2) does not apply to an energy market participant (because it has been granted a waiver of that chapter): see SUP 3.1.2 R;

(b) in SUP 10 (Approved persons), if an energy market participant's principal purpose is to carry on activities other than regulated activities, then the scope of the significant influence functions is restricted to the required functions: see SUP 10A.1.18 R - SUP 10A.1.19 G10- ;

(c) SUP 16.12 (Integrated Regulatory Reporting): energy market participants whose main business consists of the generation, production, storage, distribution and/or transmission of energy may be granted a waiver of this section in the FCA's discretion: see SUP 21;

(d) SUP 17

(Transaction reporting): energy market participants which are not MiFID investment firms or third country investment firms may be granted a waiver of this section in the FCA's discretion: see SUP 21; and

(e) SUP App 2 (Insurers: Scheme of operations) does not apply.

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Decision Procedures and Penalties Manual (DEPP)

This applies.

Redress

Dispute resolution: Complaints sourcebook (DISP)

Energy market participants are subject to the compulsory jurisdiction of the Financial Ombudsman Service.

However, a firm which does not, and notifies the FCA under DISP 1.1.12 R that it does not, conduct business with eligible complainants (persons eligible to have a complaint considered under the Financial Ombudsman Service, as defined in DISP 2.4) will be exempt from the rules on treating complainants fairly (DISP 1.2 to DISP 1.11) and from the Financial Ombudsman Funding rules (FEES 5.1 to FEES 5.7).

Compensation sourcebook (COMP)

COMP applies to all firms. However, energy market participants that do not conduct business that could give rise to a protected claim by an eligible claimant as defined and have no reasonable likelihood of doing so can gain exemption under FEES 6.2 from some compensation scheme levies.

Complaints against the FCA (COAF)

This applies.

Specialist sourcebooks

Collective Investment Schemes sourcebook (COLL)

This does not3 apply to an energy market participant.3

3Investment Funds sourcebook (FUND)

This does not apply to an energy market participant.

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Professional firms sourcebook (PROF)

None of the other specialist sourcebooks applies.

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Recognised Investment Exchange and Recognised Clearing House sourcebook (REC)

Special guides

Special guide for service companies (SERV)

This does not apply because an energy market participant is defined to exclude a service company.

Special guide for energy market participants (EMPS)

This applies.

Special guide for oil market participants (OMPS)

This does not apply because an energy market participant is defined to exclude an oil market participant.

Schedules

Summary schedules

1. Record keeping requirements

2. Notification requirements

3. Fees and other required payments

4. Powers exercised in making the Handbook

5. Rights of action for damages

6. Rules that can be waived

7. Releases

These apply, but only to the extent that the sourcebook or manual to which they relate applies.

Glossary of definitions

This applies.

Index

This applies.