Content Options:

Add to favourites

View Options:

More Resources:

External link Handbook Publications

You are viewing the version of the document as on 2021-01-12.

FEES 4.1 1Introduction

Application

FEES 4.1.1 R

1This chapter applies to every person set out in FEES 1.1.2R (2).

FEES 4.1.1A R RP

4A reference to firm in this chapter includes a reference to:15

  1. (1)

    a fee-paying payment service provider;15

  2. (2)

    a CBTL firm; 15

  3. (3)

    a fee-paying electronic money issuer;14

    15
  4. (4)

    a recognised investment exchange; and14

    15
  5. (5)

    a data reporting services provider. (other than an incoming data reporting services provider).14

20 12 6

Purpose

FEES 4.1.2 G RP

The purpose of this chapter is to set out the requirements on firms and others to pay periodic fees and transaction reporting fees in certain circumstances.

Background

FEES 4.1.3 G RP

Most of the detail of the periodic fees that are payable by firms is set out in FEES 4 Annexes 1A to 11BR11. FEES 4 Annex 12 G194 and 13FEES 4 Annex 13G provide10 guidance on the calculation of certain tariffs.5 Most of the provisions of the Annexes will vary from one fee year19 to another. Accordingly fresh FEES 4 Annexes will come into force, following consultation, for each fee year19.

4 11 19 10 19 19 9
FEES 4.1.4 G RP
  1. (1)

    The periodic fees for collective investment schemes reflect the estimated costs to the FCA of considering proposals to change regulated collective investment schemes, maintaining up to date records about them, and related policy work.

  2. (2)

    [deleted]8

    28
  3. (3)

    The periodic fees for fee-paying payment service providers, fee-paying electronic money issuers, CBTL firms, data reporting service providers (other than incoming data reporting services providers14 and issuers of regulated covered bonds7are set out in FEES 4 Annex 11R12. This annex sets out the activity groups, tariff base, valuation dates and, where applicable, the flat fees due for these firms.

    4776121212
FEES 4.1.5 G RP

The Society of Lloyd's, which has permission, has its own fee block.

18
FEES 4.1.6 G

[deleted]19

19
FEES 4.1.7 G RP

In the case of periodic fees for firms, fees are calculated individually for each firm, but they may be paid on a group basis, if the group so wishes.

FEES 4.2 Obligation to pay periodic fees

General

FEES 4.2.1 R RP

A person shown in column (1) of the table in FEES 4.2.11 R34as the relevant fee payer must pay each periodic fee applicable to it, calculated in accordance with the provisions referred to in column (2) of the applicable65 table, as adjusted by any relevant provision in this chapter:

65 65
  1. (1)

    in full and without deduction (unless permitted or required by a provision in FEES); and

  2. (2)

    on or before the date given in column (3) of that table, unless FEES 4.2.10 R applies.

FEES 4.2.2 G RP

A relevant fee payer will be required to pay a periodic fee for every year during which they have the status in column 1 of the table in FEES 4.2.11 R3434 (or in relation to collective investment schemes, for every year during which it is a regulated collective investment scheme) subject to any reductions or exemptions applicable under this chapter. If a person is the relevant fee payer for more than one status listed in column 1 of the table in FEES 4.2.11 R34 (or in relation to collective investment schemes, the relevant fee payer for more than one regulated collective investment scheme) he will be required to pay a fee in relation to each.

65 65
  1. (2) 64

    [deleted]64

FEES 4.2.2A G RP

64A recognised body may also have obligations to pay fees to the FCA under other rules arising from legislation other than the Act. For example a recognised body may have an obligation to pay a fee as an approved operator of a relevant system under the Uncertificated Securities Regulations 1995 (SI 1995/3272).

FEES 4.2.3 G RP

The FCA64 will issue invoices online5334at least 30 days before the dates on which payments fall due under FEES 4.2.1 R.

64 64
FEES 4.2.3A R

53If, in response to a request from a fee payer, the FCA issues a paper invoice, an administration charge of £50 per year will be added to the fee otherwise payable.

Method of payment

FEES 4.2.4 R RP
  1. (1)

    A64 periodic fee must be paid using either direct debit, credit transfer (BACS/CHAPS), cheque, Maestro1166, Visa Debit21 or by credit card (Visa/Mastercard only). 47

    16411661
  2. (2)

    [deleted]64

    64
FEES 4.2.4A R RP

64The FCA does not specify a method of payment for a recognised body or a designated professional body.

FEES 4.2.5 G RP

The FCA expects a recognised body or a designated professional body will generally pay their respective fees by electronic credit transfer.

Modifications for persons becoming subject to periodic fees during the course of a fee year64

FEES 4.2.6 R

[deleted]42

FEES 4.2.7 R

[deleted]42

5 18 12 9 9 65 65
FEES 4.2.7A G

[deleted]42

1 12 9 9 9 64 64 12 9 64 64 9
FEES 4.2.7B R

[deleted]42

FEES 4.2.7C G

[deleted]42

7 64 34 64 64 64
FEES 4.2.7D R

[deleted]42

15
FEES 4.2.7E R RP
  1. (1)
    1. (a)

      42A firm (other than an ICVC, a49,or an issuer of regulated covered bonds) which becomes authorised or registered, or whose permission and/or activities is extended, during the course of the fee year must pay a fee based on its projected valuation for the first twelve months of its new business.

    2. (b)

      This is the valuation provided by the firm in the course of its application or if not provided at that time, the valuation provided subsequently48.

  2. (2)

    The calculation for the first year of authorisation or registration for:

    1. (a)

      49an ICVC49is in FEES 4 Annex 4R Part 1; and

    2. (b)

      an issuer of regulated covered bonds is in FEES 4 Annex 11R Part 4.

Calculating the fee in the firm’s first year of authorisation

FEES 4.2.7F R RP

42(1)

Identify the tariff rate or rates which will be relevant to the firm as a result of its new or extended permission; and then

(2)

apply the formula (A+B+C) x D, where:

A = the amount arrived at by applying the tariff rates to the firm’s projected valuation for the first twelve months48 of its48 new business, as provided by it in accordance with FEES 4.2.7ER48;

B = the A.0 minimum fee, unless already paid;

C = any fee that becomes due in AP.0 following the calculation of A; and

D = the number of calendar months (inclusive) between the calendar month during which the firm received its new or extended permission and the last calendar month of that fee year ÷ 12.

Calculating fees in the second fee-year where the firm received permission between 1 January and 31 March in its first fee year

FEES 4.2.7G R RP

42When a firm receives permission between 1 January and 31 March, its fee for the following fee year starting 1 April will be calculated from:48

  1. (a)

    48the projected valuation for the first twelve months of its new business that it provided in accordance with FEES 4.2.7ER; or

  2. (b)

    48an annualised figure based on actual data provided by 30 April in the fee year following obtaining its new or extended permission.

48If the annualised tariff base figure provided under (b) is a cumulative measure like income, covering the full year, it must apply the formula (A÷B) x 12, where:

48A = the total income from the date the new or extended permission was obtained up to the firm’s financial year end or 31 March (whichever is sooner) of its first fee year, calculated according to the relevant rules; and

48B = the number of months in the period referred to in A.

48Where the measure is not cumulative (e.g. the number of traders for fee-block A10), the firm must use the figure as at the firm’s financial year end or 31 March (whichever is sooner) of its first fee year, calculated in accordance with the relevant rules. If trading has not commenced by the applicable date the figure is nil.

Calculating all other fees in the second and subsequent years of authorisation where a full year of tariff data is not available

FEES 4.2.7H R RP

42If it can, a firm must provide data from a complete period (as specified in FEES 4 Annex 1AR Part 5 or FEES 4 Annex 11R Part 4) that begins on or after the date that the firm obtained the relevant permissions to which the tariff base relates.

FEES 4.2.7I R RP

42If a firm does not have sufficient tariff data to enable the periodic fees calculation to be made in respect of that fee year, it must calculate an annualised figure based on actual data where possible. If the tariff base is a cumulative measure like income, covering the full year, it must apply the formula (A÷B) x 12, where:

A = the total income from the date of authorisation up to the firm’s financial year end or 31 December (whichever is sooner), calculated according to the relevant rules; and

B = the number of months in the period referred to in A.

FEES 4.2.7J G RP

42For example, suppose the tariff data for a particular permission is based on income for the financial year ending during the calendar year ending 31 December before the relevant fee year starting the following April. A firm is authorised in October and its financial year ends in June. By April, it will not have been able to report on the basis of its financial year. The value of A would therefore cover the period from October to December and the value of B would be two i.e. November and December.

If the firm was authorised in June and its financial year ended in October, then the value of A would cover June to October and the value of B would be four i.e. July to October.

FEES 4.2.7K R RP

42Where the measure is not cumulative (e.g. the number of traders for fee-block A10), the firm must use the figure relating to the valuation date specified in FEES 4 Annex 1R Part 548 (e.g. 31 December for A10)48. Table A sets out the reporting requirements for the key fee-blocks when full48 actual data is not available:

Table A: calculating tariff data for second and subsequent years of authorisation when full trading figures are not available

Fee-block

Tariff base

Calculation where trading data are not available

A1. Deposit acceptors

Average MELS for October - December

Use data available at 31 December or, if trading has not commenced by 31 December, use nil48.

A2. Home finance providers and administrators

Number of relevant contracts entered into or being administered in the twelve months up to 31 December

Apply the formula (A÷B) x 12 to arrive at an annualised figure.

A3. Insurers - general

Gross written premium for fees purposes (GWP) 43for the financial year ended in the calendar year ending 31 December and best estimate liabilities for fees purposes (BEL) 43 valued at the end of the financial year

GWP 43 – apply the formula (A÷B) x 12 to arrive at an annualised figure.

BEL – use 43 data at valuation date or, if trading has not commenced by then, use nil48.

A4. Insurers - life

Gross written premium for fees purposes (GWP) 43 for the financial year ended in the calendar year ending 31 December and best estimate liabilities for fees purposes (BEL) 43 valued at the end of the financial year

A5. Managing agents at Lloyd’s

Active capacity in respect of the underwriting year at the beginning of the period to which the fee relates

Not applicable.

A6. The Society of Lloyd’s

Bespoke fee

Not applicable.

A7. Portfolio managers

Funds under management valued at 31 December

Use data as at 31 December or, if trading has not commenced by 31 December, use nil48.

A9. Managers and depositaries of investment funds, and operators of collective investment schemes or pension schemes

Annual gross income for the financial year ended in the calendar year ending 31 December

Apply the formula (A÷B) x 12 to arrive at an annualised figure.

A10. Firms dealing as principal

Number of traders as at 31 December

Use data as at 31 December or, if trading has not commenced by 31 December, use nil48.

A13. Advisors, arrangers, dealers or brokers

Annual income for the financial year ended in the calendar year ending 31 December

Apply the formula (A÷B) x 12 to arrive at the annualised figure

A14. Corporate finance advisers

A18. Home finance providers, advisers and arrangers

A19. General insurance distribution44

A21. Firms holding client money or assets, or both

The highest amount of client money and the highest amount of custody assets held over the 12 months ending 31 December

The highest amount of client money and/or custody assets over the period between the date of authorisation and 31 December or, if trading has not started, use nil48.

B. Market operators,41 MTF operators and OTF operators41

Flat fee

Not applicable.

B. Service companies

Annual income for the financial year ended in the calendar year ending 31 December

Apply the formula (A÷B) x 12 to arrive at the annualised figure.

B. Regulated benchmark45 administrators

Annual income for the financial year ended in the calendar year ending 31 December39

Apply the formula (A÷B) x 12 to arrive at the annualised figure.39

B. Recognised investment exchanges

Annual income for the financial year ended in the calendar year ending 31 December39

Apply the formula (A÷B) x 12 to arrive at the annualised figure.39

B. [deleted]49

49

49

B. Recognised overseas investment exchanges

Flat fee

Not applicable.

CC1. Credit-related regulated activities with limited permission

Annual income for the financial year ended in the calendar year ending 31 December

Apply the formula (A÷B) x 12 to arrive at an annualised figure.

CC2. Credit related regulated activities

40

40

40

G.2 Payment services institutions – deposit acceptors

See A1 deposit acceptors

G.3. Large payment services institutions

Relevant income

Apply the formula (A÷B) x 12 to arrive at an annualised figure.

G.4 Small payment institutions

Flat fee

Not applicable.

G.5 Other payment institutions

Relevant income

Apply the formula (A÷B) x 12 to arrive at an annualised figure.

G.10 Large electronic money institutions

Average outstanding e-money over 12 months ending 31 December

Average over the period from authorisation to 31 December.

G.11 Small electronic money institutions

Flat fee

Not applicable.

G.15 Issuer of regulated covered bonds

Value as at 31 December

Not applicable.

G.20 Consumer buy-to-let (CBTL) lender

Flat fee

Not applicable.

G.21 CBTL adviser and arranger
FEES 4.2.8 R RP

49 For payment services and electronic money issuance, 12the adjustment only applies to the business to which the calculation made in FEES 4.3.12A R relates. 9

4

Fee payers ceasing to hold relevant status or reducing the scope of their permission after start of relevant period

FEES 4.2.9 G RP

The FCA34 will not refund periodic fees if, after the start of the period to which they relate:

  1. (1)

    a fee payer ceases to have the status set out in column (1) of the table in FEES 4.2.11 R34; or

    65
  2. (2)

    a firm reduces its permission or payment services activities 9so that it then falls out of the fee-block previously applied to it;9

    9

(but see FEES 2.3 (Relieving Provisions) and FEES 4.3.13 R (Firms Applying to Cancel or Vary Permission Before Start of Period)).

Extension of Time

FEES 4.2.10 R RP

A person need not pay a periodic fee on the date on which it is due under the relevant provision in FEES 4.2.1 R, if:

  1. (1)

    that date falls during a period during which circumstances of the sort set out in GEN 1.3.2 R (Emergencies) exist, and that person has reasonable grounds to believe that those circumstances impair its ability to pay the fee, in which case he must pay it on or before the fifth business day after the end of that period; or

  2. (2)

    unless FEES 4.3.6R (3), 9FEES 4.3.6R (4) or FEES 4.3.6R (4A)9 (Time and method for payment) applies, that date would otherwise fall on or before the 30th day after the date on which the FCA (in its own capacity or in its capacity as collection 34agent for the PRA)64 has sent written notification to that person of the fee payable on that date, in which case he must pay on or before the 30th day after the date on which the FCA64 sends the notification.

    96464
FEES 4.2.11 R RP

Table of periodic fees payable to the FCA65

65

1 Fee payer

2 Fee payable

3 Due date

4 Events occurring during the period leading to modified periodic fee

Any firm (except an ICVC49)

25

(1) Unless (2) applies, as37 specified in FEES 4.3.1 R in relation to FEES 4 Annex 2AR and FEES 4 Annex 11 R65.37

(2) Where a firm is paying a ring-fencing implementation fee, as specified in FEES 4 Annex 2BR.37

(1) Unless (2) or (3) apply7, on or before the relevant dates specified in FEES 4.3.6 R.12

(2) Unless (3) applies, if 7an event specified in column 4 occurs during the course of a fee year,64 30 days after the occurrence of that event, or if later the dates specified in FEES 4.3.6 R.7

(3) Where the permission is for operating a multilateral trading facility or operating an organised trading facility41, the date specified in FEES 4 Annex 10FEES 4 Annex 10R41 (Periodic fees for MTF and OTF41 operators).

7 7 64

Firm receives permission, or becomes authorised or registered under the Payment Services Regulations, article 8 of the MCD Order32, the DRS Regulations41 or the Electronic Money Regulations12;9 or firm9extends permission or its payment service activities916

67 9

Persons who hold a certificate issued by the FCA64 under article 54 of the Regulated Activities Order (Advice given in newspapers etc.)

64

£1,15151

46 31 40 31

(1) Unless (2) applies, on or before 1 August or, if later, within 30 days of the date of the invoice23

(2) If an event in column 4 occurs,52

during the course of a fee year,64 30 days after the occurrence of that event.51

23 64

Certificate issued to person by the51FCA64 under article 4054 of the Regulated Activities Order46

64

Any manager of an AUT23;

23

In relation to each unit trust the amount specified in part 1 of 25FEES 4 Annex 4

Authorisation order is made in relation to the relevant scheme24

24Any authorised fund manager of an authorised contractual scheme;

In relation to each authorised contractual scheme the amount specified in part 1 of25FEES 4 Annex 4

Any ACD of an ICVC; and

In relation to each ICVC,25 the amount specified in part 1 of25FEES 4 Annex 4

Persons who, under the constitution or founding arrangements of a recognised scheme, are 33responsible for the management of the property held for or within the scheme;

In relation to each recognised scheme the amount specified in part 1 of25FEES 4 Annex 4

The relevant scheme becomes a recognised scheme25

Not applicable

UK AIFM 49 of an LTIF49

33

In relation to each LTIF49 the amount specified in part 1 of FEES 4 Annex 433

(1) Unless (2) applies, on or before 1 August or, if later, within 30 days of the date of the invoice.33

(2) If an event in column 4 occurs during the course of a fee year, 30 days after the occurrence of that event.33

The LTIF49 is authorised by the FCA under the LTIF Regulation49

33

Designated professional body

FEES 4 Annex 5

On or before the relevant dates specified in FEES 4.3.6 R23

23

Not applicable

UK recognised body

FEES 4 Annex 6 , part 1 for a UK RIE49

65 13

(1) On or before the relevant dates specified in FEES 4.3.6 R23

(2) If the event in column 4 occurs during the course of a fee year64, 30 days after the occurrence of that event

23 64

Recognition order is made.

The modified1166 periodic fee is specified in FEES 4 Annex 6 R, Part 1.491166

11 66 11 66 13 11 66 11 66

ROIE 65

65

FEES 4 Annex 6 , part 2

(1) On or before the relevant dates specified in FEES 4.3.6 R23

(2) If the event in column 4 occurs during the course of a fee year64, 30 days after the occurrence of that event.

23 64

Recognition order is made.

The modified1166 periodic fee is specified in FEES 4 Annex 6, Part 2.1166

11 66 11 66 11 66 11 66

A listed issuer35 (in LR) of shares and certificates representing certain securities35.

3 3

FEES 4 Annex 14R 35

Within 30 days of the date of the invoice

Listed issuer 3 (in LR) becomes subject to listing rules

3

A sponsor35

FEES 4 Annex 14R 35

31 10 12 23 23 31 12 10 2 31

Within 30 days of the date of the invoice

35Approval of a35sponsor35

14 14 14

All non-listed issuers (in DTR) of shares and certificates representing certain securities35.

6 6

FEES 4 Annex 14R 35

29

Within 30 days of the date of the invoice

Non-listed issuer (in DTR) becomes subject to disclosure requirements36 and transparency rules629

29Any primary information provider

FEES 4 Annex 14R 35

Within 30 days of the date of the invoice

A person is approved as a primary information provider

6All firms reporting transactions in securities derivatives10to the FCA64 in accordance with SUP 17, and market operators who provide facilities for trading in securities derivatives.10

64 10

FEES 4 Annex 9 R

Within 30 days of the date of the invoice

Not applicable

15Any issuer of a regulated covered bond.

FEES 4 Annex 11R

(1) Unless (2) applies, on or before the relevant dates specified in FEES 4.3.6 R

(2) If an event specified in column 4 occurs during the course of a fee year64, 30 days after the occurrence of that event or, if later, the dates specified in FEES 4.3.6 R

64

A person becomes registered as an issuer of a regulated covered bond

26(i) A non-UK AIFM49 which has notified the FCA of its intention to market an AIF in the UK under regulation 5949 of the AIFMD UK regulation and which has not ceased to market that AIF in the UK as at 1 April of the current fee year.

(ii) non-UK AIFM49 which has notified the FCA of its intention to market an AIF in the UK under regulation 58 or 59 of the AIFMD UK regulation and which has not ceased to market that AIF in the UK as at 1 April of the current fee year.

For each notification made by the AIFM of the kind specified in part 2 of FEES 4 Annex 4, the amount specified in part 2 of FEES 4 Annex 4

(1) Unless (2) applies, on or before 1 August, or, if later, within 30 days of the date of the invoice

(2) If an event in column 4 occurs during the course of a financial year, 30 days after the occurrence of that event

The FCA receives a notification to market in the UK

26A small registered UK AIFM

The basic fee contained in part 3 of FEES 4 Annex 4

The AIFM is registered by the FCA under regulation 10 of the AIFMD UK regulation.
30

[deleted]41

45A third country legal representative

The tariff specified in FEES 4 Annex 15R

Payable in accordance with FEES 4.3.6R

Not applicable

45A benchmark endorser

The tariff specified in FEES 4 Annex 15R

Payable in accordance with FEES 4.3.6R

Not applicable

50Any UK-based firm registered as a credit rating agency; a trade repository; a securitisation repository or any third country firm certified as a credit rating agency or recognised as a trade repository.

The tariff specified in FEES 4 Annex 16R

Within 30 days of the date of the invoice

Not applicable

53 Proxy advisor

(1) £5,000

(2) For a proxy advisor which is already trading on 1 April 2020, the amount specified in (1) upon notifying the FCA.

(3) For a proxy advisor which starting trading after 1 April 2020, the fee payable is pro-rated in proportion to the months remaining in the financial year 1 April – 31 March, including the month of notification.

(1) At the time of notification

(2) For a proxy advisor which has already notified the FCA, within 30 days of the date of the invoice

Not applicable

Note: Sponsors on the list of approved sponsors as at 1 April each year will be liable for the full year's annual fee unless FEES 4.3.13 R applies.2

FEES 4.3 Periodic fee payable by firms (other than AIFM qualifiers, ICVCs and UCITS qualifiers)13

FEES 4.3.1 R RP

The periodic fee payable by a firm (except an AIFM qualifier,13ICVC or a UCITS qualifier) is:

  1. (1)

    each periodic fee applicable to it calculated in accordance with FEES 4.3.3 R, using information obtained in accordance with FEES 4.4; plus7

    7
  2. (1A)

    any periodic fee applicable to it calculated in accordance with FEES 4.3.3A R using information relating to its UK business obtained in accordance with FEES 4.4 (or by other means in the case of the Bank of England); less7

  3. (2)

    any deductions from the periodic fee specified in Part 2 of FEES 4 Annex 2AR17or Part 7 of27FEES 4 Annex 11R17. 7

    272727
FEES 4.3.2 G RP
  1. (1)

    The amount payable by each firm will depend upon the category (or categories) of regulated activities or payment services7it is engaged in (fee-blocks)and whether it is issuing electronic money,10 and on the amount of business it conducts in each category (tariff base). The fee-blocks and tariffs are identified in FEES 4 Annex 1AR17 (and guidance on calculating certain of the tariffs is at FEES 4 Annex 12 G and 17FEES 4 Annex 13G15) 17while 27FEES 4 Annex 2AR sets 17 out the tariff rates for the relevant fee year.26 In the case of firms that provide payment services and/or issue electronic money10, the relevant fee blocks, tariffs and rates are set out in FEES 4 Annex 11R17.

    27827267
  2. (2)

    [deleted]22

    710710777

10Calculation of periodic fee for fee-paying payment service providers, CBTL firms, data reporting services providers and fee-paying electronic money issuers

FEES 4.3.3 R RP

The periodic fee referred to in FEES 4.3.1 R is (except in relation to the Society,10fee-paying payment service providers, CBTL firms,20fee-paying electronic money issuers and data reporting services providers20) 20 calculated as follows:

10 7
  1. (1)

    identify each of the tariffs set out in Part 1 of FEES 4 Annex 2AR1727 which apply to the business of the firm for the period specified in that annex;

    27
  2. (2)

    for each of the applicable27 tariffs, calculate the sum payable in relation to the business of the firm for that period;

    279
  3. (3)

    add together the amounts calculated under (2)17;

    279
  4. (4)

    work out whether an A.0, or 17, CC.0 minimum fee is payable under Part 2 of FEES 4 Annex 2AR17and if so how much (except that that minimum fee is not payable again by a firm whose permission is extended if the fee was already payable before the extension)27;9

    927
  5. (4A)

    27work out whether an AP.0 FCA prudential fee is payable under Part 2 of FEES 4 Annex 2AR and if so how much;

  6. (4B)

    [deleted] 17

    27
  7. (5)

    9add together the amounts calculated under (3), (4) and (4A) 17; and

    27
  8. (6)

    9apply any applicable payment charge specified in FEES 4.2.4 R, provided that:

    1. (a)

      for payment by direct debit, successful collection of the amount due is made at the first attempt by the FCA (in its own capacity and, if applicable, in its capacity as collection 17agent for the PRA)26; or

      26
    2. (b)

      for payment by credit transfer, the amount due is received by the FCA (in its own capacity and, if applicable, in its capacity as collection 17agent for the PRA)26 on or before the due date.

      26

    19[Note: Transitional provisions apply to FEES 4.3.3R for firms in activity groups A.3 and A.4 – see FEES TP 13]

10 7Calculation of periodic fee for fee-paying payment service providers, CBTL firms, data reporting services providers (other than incoming data reporting services providers) and fee-paying electronic money issuers

FEES 4.3.3A R RP

7The periodic fee referred to in FEES 4.3.1 R in relation to fee-paying payment service providers, CBTL firms16, data reporting services providers22 and fee-paying electronic money issuers10 is calculated in accordance with FEES 4 Annex 11 R.

28 20

Modification for firms with new or extended permissions

FEES 4.3.4 G RP
  1. (1)

    A firm which becomes authorised or registered 7during the course of a fee year26 will be required to pay a proportion of the periodic fee which reflects the proportion of the year for which it will have a permission or the right to provide particular payment services or the right to issue electronic money107- see FEES 4.2.5 G and FEES 4.2.6 R.

    26
  2. (2)

    Similarly a firm which extends its permission or its right to provide particular payment services7so that its business then falls within additional fee blocks will be required to pay a further periodic fee under this section for those additional fee blocks, but discounted to reflect the proportion of the year for which the firm has the extended permission or payment services activity 7 - see FEES 4.2.6 R and FEES 4.2.7 R.

  3. (3)

    [deleted]22

    1010
  4. (4)

    5These provisions do not apply to a firm's periodic fees in relation to its permission for operating a multilateral trading facility obtained from the FCA26 during the course of a fee year.26

    2626

Amount payable by the Society of Lloyd's

FEES 4.3.5 R RP

The periodic fee referred to in FEES 4.3.1 R in relation to the Society is specified against its name in 27FEES 4 Annex 2AR17.

27

Time of payment

FEES 4.3.6 R RP
  1. (1)

    [deleted]17

    272712112727111127
  2. (1A)

    [deleted] 17

    27
  3. (1B)

    [deleted] 17

    27
  4. (1C)

    17If a person meets either of the conditions in (1D) it must pay the FCA the fee in (1E).

  5. (1D)

    17A person meets the conditions referred to in (1C) if:

    1. (a)

      its periodic fee for the previous fee year was at least £50,000 and it is:

      1. (i)

        an FCA-authorised person; or

      2. (ii)

        a designated professional body; or

      3. (iii)

        a recognised investment exchange; or

      4. (iv)

        a regulated covered bondissuer; or

    2. (b)

      it is a PRA-authorised person and its combined FCA and PRA periodic fees for the previous fee year were at least £50,000.

  6. (1E)

    17The fee in (1C) is:

    1. (a)

      an amount equal to 50% of the FCA periodic fee payable for the previous fee year by:

      1. (i)

        118 April; or

      2. (ii)

        if later, within 30 days of the date of the invoice, in the fee year to which the sum due under FEES 4.2.1R relates; and

    2. (b)

      the balance of the FCA periodic fee due for the current fee year by:

      1. (i)

        1 September; or

      2. (ii)

        if later, within 30 days of the date of the invoice, in the fee year to which that sum relates.

    [Note: If the firm is a PRA-authorised person that meets the condition at FEES 4.3.6R(1)(D)(b), the firm will also pay its PRA periodic fees in two tranches as specified in the Fees Part of the PRA Rulebook20 . The FCA, acting as the PRA’s collection agent, will collect these fees.]

  7. (2)

    If the firm's, designated professional body's, recognised investment exchange's, 12or regulated covered bondissuer's11periodic fee for the previous fee year26 was less than £50,000, it11 must pay the periodic fee due in full by 1 August or, if later, within 30 days of the date of the invoice27 in the fee year26 to which that sum relates.

    261126
  8. (3)

    If a firm has applied to cancel its Part 4A permission26 in the way set out in SUP 6.4.5 D (Cancellation of permission), or its status as a payment institution under regulation 10 of the Payment Services Regulations (Cancellation of authorisation) or as regulation 10 is applied by regulation 14 of the Payment Services Regulations (Supplementary provisions), or its status as an electronic money issuer under regulation 10 of the Electronic Money Regulations (Cancellation of authorisation) or as regulation 10 is applied by regulation 15 of the Electronic Money Regulations (Supplementary provisions), 10or its registration as a CBTL firm under article 13(c) of the20MCD Order16 or its authorisation as a data reporting services provider under regulation 11 of the DRS Regulations,20 then (1) and (2) do not apply but it must pay the total amount due when the application is made.

    26
  9. (4)

    If the FCA17 has exercised its own-initiative powers to cancel a firm's2Part 4A permission26, then (1) and (2) do not apply but the firm must pay the total amount due immediately before the cancellation becomes effective.

    2626226
  10. (4A)

    If the FCA has cancelled a firm's authorisation or registration under regulation 10 of the Payment Services Regulations or regulation 10 of the Electronic Money Regulations10 or its registration under regulation 10 as applied by regulation 14 of the Payment Services Regulations or its registration under regulation 10 as applied by regulation 15 of the Electronic Money Regulations, or its registration under article 13 (except under article 13(c)) of the MCD Order16, or its authorisation as a data reporting services provider under regulation 11 or 12 of the DRS Regulations,2010 then (1) and (2) do not apply but the firm must pay the total amount due immediately before the cancellation becomes effective.7

  11. (5)

    [deleted]27

    627
  12. (5A)

    [deleted] 17

    14
  13. (6)

    5Paragraphs (1) and (2) do not apply to any periodic fee in relation to a firm'spermission for operating a multilateral trading facility or operating an organised trading facility20 and such a fee is not taken into account for the purposes of the split in (1). Instead any fee for this permission is

    payable on the date specified in FEES 4 Annex 10 (Periodic fees for MTF and OTF20 operators).

Groups of firms

FEES 4.3.7 R RP

A firm which is a member of a group may pay all of the amounts due from other firms in the same group under FEES 4.2.1 R, if:

  1. (1)

    it notifies the FCA (in its own capacity and, if applicable, in its capacity as collection 17agent for the PRA)26 in writing of the name of each other firm within the group for which it will pay; and

    26
  2. (2)

    it pays the fees, in accordance with this chapter, as a single amount as if that were the amount required from the firm under FEES 4.2.1 R.

FEES 4.3.8 G RP

A notification under FEES 4.3.7R (1) should be made in accordance with SUP 15.7 (Form and method of notification).

FEES 4.3.9 G RP

If the payment made does not satisfy in full the periodic fees payable by all of the members of the group notified to the FCA26 under FEES 4.3.7 R, the FCA (in its own capacity and, if applicable, in its capacity as collection 17agent for the PRA)26 will apply the sum received among the firms which have been identified in the notification given under FEES 4.3.7R (1) in proportion to the amounts due from them. Each firm will remain responsible for the payment of the outstanding balance attributable to it.

26 26
FEES 4.3.10 G RP

If a firm pays its fees through an agent outside the scope of FEES 4.3.7 R, the firm is responsible for ensuring that the FCA (in its own capacity and, if applicable, in its capacity as collection 17agent for the PRA)26 is informed that the sum being paid is for that firm's periodic fees.

26
10 7
FEES 4.3.11 G RP

[deleted]22

7 7 10 7 10 7 7 10 7 10
FEES 4.3.12 R RP

[deleted]22

20 5
FEES 4.3.12A R RP

[deleted]22

10 10

Firms Applying to Cancel or Vary Permission Before Start of Period

FEES 4.3.13 R RP
  1. (1)

    If:

    1. (a)

      a firm:20

      1. (i)

        makes an application to vary its permission (by reducing its scope), or cancel it, in the way set out in SUP 6.3.15D(3) (Variation of permission) and SUP 6.4.5D (Cancellation of permission); or20

      2. (ii)

        applies to vary (by reducing its scope) or cancel its authorisation or registration (regulation 8 and 10(1) of the Payment Services Regulations including as applied by regulation 14 of the Payment Services Regulations); or20

      3. (iii)

        applies to cancel its authorisation or registration (regulation 10 and 12 of the Electronic Money Regulations including as applied by regulation 15 of the Electronic Money Regulations); or20

      4. (iv)

        applies for revocation of its registration under article 13(c) of the MCD Order; or20

      5. (v)

        applies to vary (by reducing its scope) or cancel its authorisation as a data reporting services provider under regulation 11 and 12 of the DRS Regulations; or20

      1610771
    2. (aa)

      an issuer makes an application for de-listing; or20

    3. (ab)

      a sponsor notifies the FCA of its intention to be removed from the list of approved sponsors; and20

    4. (b)

      the firm, issuer or sponsor1 makes the application or notification 1referred to in (a), (aa) or (ab) respectively20, before the start of the fee year27 to which the fee relates;

      27

    FEES 4.2.1 R applies to the firm as if the relevant variation or cancellation of the firm'spermission or authorisation or registration under the Payment Services Regulations, MCD Order, DRS Regulations20 or the Electronic Money Regulations10, 7 de-listing or removal from the list of approved sponsors,1 took effect immediately before the start of the fee year27 to which the fee relates.

    281627
  2. (2)

    But (1) does not apply if, due to the continuing nature of the business, the variation, cancellation, de-listing or removal1 is not to take effect on or before 30 June of the fee year to which the fee relates27.

    127
FEES 4.3.14 G RP

The due dates for payment of periodic fees are modified by FEES 4.3.6R(3), FEES 4.3.6R(4)and FEES 4.3.6R(4A) respectively where:20

  1. (1)

    a firm has applied to cancel its:20

    1. (a)

      Part 4A permission; or20

    2. (b)

      its authorisation or registration under the Payment Services Regulations or the Electronic Money Regulations; or20

    3. (c)

      its registration as a CBTL firm under article 13(c) of the MCD Order; or20

    4. (d)

      authorisation under regulation 11 of the DRS Regulations; or20

  2. (2)

    the FCA has exercised its:20

    1. (a)

      own-initiative powers to cancel a firm's Part 4A permission; or20

    2. (b)

      powers under regulation 10 (Cancellation of authorisation), including as applied by regulation 14 (Supplementary provisions) of the Payment Services Regulations to cancel a firm's authorisation or registration under the Payment Services Regulations; or20

    3. (c)

      powers under regulation 10 (Cancellation of authorisation), including as applied by regulation 15 (Supplementary provisions) of the Electronic Money Regulations or regulation 11 of the DRS Regulations; or 20

    4. (d)

      powers under article 13 (Revocation of registration), excluding article 13(c), of the MCD Order.20

7 10 16 17 7 7 17 17 10 16 7 7 7 7

Firms acquiring businesses from other firms

FEES 4.3.15 R

21[deleted]

FEES 4.3.16 R
  1. (1)

    [deleted]9

  2. (2)

    [deleted]9

  3. (3)

    [deleted]9

FEES 4.3.17 R RP
  1. (1)

    21This rule applies if:

    1. (a)

      a firm (A)

      1. (i)
        1. (A)

          acquires all or a part of the business of another firm (B), whether by merger, acquisition of goodwill or otherwise; and

        2. (B)

          would be required to pay a periodic fee in the fee year in which the acquisition takes place; or

      2. (ii)

        becomes authorised or registered as a result of another firm’s (B) simple change of legal status (as defined in FEES 3 Annex 1R Part 6); and

    2. (b)

      had that acquisition or simple change of legal status (or any associated cancellation) not taken place, a periodic fee would have been payable by B in that same fee year.

  2. (2)

    If, before the date of acquisition or simple change of legal status, B had paid any periodic fee that would have become payable by it in that fee year, FEES 4.2.1R and FEES 4.2.7ER to FEES 4.2.7KR will not apply to A in relation to the business of B.

  3. (3)
    1. (a)

      If, before the date of acquisition or simple change of legal status, B had not paid any periodic fee that would have become payable by it in that fee year, FEES 4.2.1R and FEES 4.2.7ER to FEES 4.2.7KR will apply to A in relation to the business of B.

    2. (b)

      Periodic fees that would have become payable in that fee year include those which may have been dis-applied under FEES 4.3.13R.

  4. (4)

    Regardless of A’s valuation date:

    1. (a)

      if the acquisition or simple change of legal status takes place before B’s valuation date, then A must report the tariff data for, and pay fees or levies on, the transferred business up to the date of the transfer; and

    2. (b)

      if the acquisition or simple change of legal status takes place after B’s valuation date and B has not paid the relevant fees or levies, then the data should be reported and fees be paid by A as if the transfer had taken place immediately before the valuation (if B continues to be authorised, it should strip the transferred business out of its report).

FEES 4.4 Information on which fees 6are calculated

FEES 4.4.1 R RP

A firm (other than the Society or8 an MTF or OTF8 operator in relation to its MTF or OTF8 business5) must notify to the FCA (in its own capacity and, if applicable, in its capacity as collection agent for the PRA) the value (as at the valuation date specified in Part 5 of FEES 4 Annex 1AR6) of each element of business on which the periodic fee payable by the firm is to be calculated.

15
FEES 4.4.2 R RP

A firm (other than the Society) must send to the FCA (in its own capacity and, if applicable, in its capacity as collection agent for the PRA)15 in writing the information required under FEES 4.4.1 R as soon as reasonably practicable, and in any event within two months, after the date specified as the valuation date in Part 5 of FEES 4 Annex 1AR in relation to 9 fees payable to the FCA6 (or FEES 4.2.7B R where applicable) unless FEES 4.4.2AR applies9.

15 15 15 2 7
FEES 4.4.2A R

9If a firm is a UK Solvency II firm11 in activity group A.3 or A.4 and the PRA or the FCA has either:

  1. (1)

    not received the necessary tariff data on a timely basis in line with Part 3 and 5 of FEES 4 Annex 1AR; or

  2. (2)

    deemed the tariff data received to be incomplete or insufficiently reliable, by reference to a specific firm or across all or part of the activity group,

the FCA may use tariff data from the previous reporting period for the periodic fees calculation.

FEES 4.4.2B R

10For firms in activity group A.3 and A.4, if the data source specified in the applicable tariff base in Part 3 of FEES 4 Annex 1AR is not available to the PRA or FCA for any reason and the same data is available to the PRA or FCA from an alternative source, the FCA may use that alternative source to calculate the tariff rates under FEES 4 Annex 2AR.

FEES 4.4.3 R RP

To the extent that a firm has provided the information required by this section 6 as part of its compliance with another provision of the Handbook, it is deemed to have complied with the provisions of this section.

14 14
FEES 4.4.4 G RP

In most cases a firm will provide the information required by this section as part of its compliance with the provisions of SUP. To the extent that the FCA6 does not obtain sufficient, or sufficiently detailed, information it 6 may seek this by using the general information gathering powers (see SUP 2 (Information gathering by the FCA or PRA6 on its own initiative)).

14 14 14 14 14 14 14
FEES 4.4.5 R RP

[deleted]11

1
FEES 4.4.6 R RP

3The obligations of a firm to supply information as set out in FEES 4.4.1 R and FEES 4.4.2 R do not apply in respect of any of its payment services business.

Information relating to payment services and the issuance of electronic money4

FEES 4.4.7 D RP

3A fee-paying payment service provider and a fee-paying electronic money issuer4 must notify to the FCA the value (as at the valuation date specified in Part 4 of FEES 4 Annex 11) of each element of business on which the periodic fee (other than a flat fee)4 payable by the firm under 1 R4 is to be calculated, including any payment services carried on by its agents from an establishment in the United Kingdom.

4
FEES 4.4.8 D RP

3A firm4 must send to the FCA in writing the information required under FEES 4.4.7 D as soon as reasonably practicable, and in any event within two months, after the date specified as the valuation date in Part 4 of FEES 4 Annex 11.

FEES 4.4.9 D RP

3To the extent that a firm4 has provided the information required by FEES 4.4.7 D to the FCA as part of its compliance with another provision of the Handbook, it is deemed to have complied with the provisions of that direction.4

4 4

FEES 4 Annex 1A FCA activity16 groups, tariff bases and valuation dates

R

45Part 1

This table shows how the FCA links the regulated activities for which a firm has permission to activity groups (fee-blocks). A firm can use the table to identify which fee-blocks it falls into based on its permission.

Activity group

Fee payer falls in the activity group if:19

A.1 Deposit acceptors

its permission includes accepting deposits or operating a dormant account fundBUT DOES NOT include either of the following:

effecting contracts of insurance;

carrying out contracts of insurance.

A.2 Home finance providers and administrators

its permission includes a regulated activity within one or more of the following:

entering into a home finance transaction; or

administering a home finance transaction; or agreeing to carry on a regulated activity which is within either of the above.

A.3 Insurers - general and UK ISPVs 21

its permission includes one or more of the following:

- effecting contracts of insurance;

- carrying out contracts of insurance;

in respect of specified investments that are:

- general insurance contracts; or

- long-term insurance contracts other than life policies

OR 21

it has permission to carry on insurance risk transformation21.

A.4 Insurers - life

its permission includes one or more of the following:

- effecting contracts of insurance;

- carrying out contracts of insurance;

in respect of specified investments including life policies;

- entering as provider into a funeral plan contract.

A.5 Managing agents at Lloyd's

its permission includes managing the underwriting capacity of a Lloyd's syndicate as a managing agent at Lloyd's.

A.6 The Society of Lloyd's

it is the Society of Lloyd's

Note for authorised professional firms:

Generally, for fee-blocks A.7 to A.19 below, only those regulated activities that are not limited to non-mainstream regulated activities should be taken into account in determining which fee-block(s) fee-payers belong to for the purpose of charging periodic fees. However, in the case that all the regulated activity within a firmpermission are limited to non-mainstream regulated activities, then that firms will be allocated to fee-block A.13 alone. This does not prevent a fee being payable by an authorised professional firm under FEES 3.2.7 R and/or FEES 3.2.7A R(c) where it applies to vary its Part 4A permission such that it would normally be allocated to fee-block(s) other than A.13 if the variation was granted.

A.7 Portfolio managers 6

6

(1) its permission includes managing investments (a firm falling within this category is a class (1) firm);

OR

(2) its permission includes

ONLY either one or both of:

safeguarding and administering of investments (without arranging); and

arranging safeguarding and administration of assets (a firm falling within this category is a class (2) firm);

4 OR

(3) the firm is a venture capital firm (a firm falling within this category is a class (3) firm if it is not a class (1) or (2) firm).

OR

(4) its permission includes managing an AIF or managing a UK UCITS29 (a class 4 firm)10

Note:

Class (1) firms are subdivided into three classes:

- class (1)A, where the funds managed by the firm belong to one or more occupational pension schemes;

- class (1)B, where:

(a) the firm is not a class (1)A firm; and

(b) the firm permission includes NEITHER of the following:

safeguarding and administering investments (without arranging);

arranging safeguarding and administration of assets; and (c) the firmEITHER:

has a requirement that prohibits the firm from holding or controlling client money, or both; OR

if it does not have such a requirement, only holds or controls client money (or both), arising from an agreement under which commission is rebated to a client; and

- class (1)C, where the firm is not within class (1)A or class (1)B.

A.9 Managers and depositaries of investment funds, and operators of collective investment schemes or pension schemes 4

(1) its permission:

(a) includes one or more of the following:

managing an AIF;4

managing a UK UCITS 29

acting as trustee or depositary of an AIF;4

acting as trustee or depositary of a UK UCITS 29 establishing, operating or winding up a collective investment scheme;5

establishing, operating or winding up a personal pension scheme or a stakeholder pension scheme (but only if the firm does not fall within activity group A1 or A4);

AND

(b) PROVIDED the firm is NOT one of the following:

OR

a corporate finance advisory firm;

a firm in which the above activities are limited to carrying out corporate finance business;

a venture capital firm;

a firm which would be a venture capital firm but for the inclusion of managing an AIF on its permission; but only where the firm is managing an AIF exclusively in respect of AIFs which only invest in venture capital investments.4

OR

(2) if the fee-payer has none of the regulated activities above within its permission, but ALL the remaining regulated activities in its permission are limited to carrying out trustee activities.

4 4 5

A.10 Firms dealing as principal

its permission includes28

(a) dealing in investments as principal28

BUT NOT if one or more of the following apply:

the firm is acting exclusively as a matched principal broker;

the above activity is limited either toestablishing, operating or winding up a collective investment scheme,5establishing, operating or winding up a personal pension scheme or a stakeholder pension scheme, or to carrying out depositary5 activities;

the firm is a corporate finance advisory firm;

the above activity is otherwise limited to carrying out corporate finance business;

the firm is subject to a limitation to the effect that the firm, in carrying on this regulated activity, is limited to entering into transactions in a manner which, if the firm was an unauthorised person, would come within article 16 of the Regulated Activities Order (Dealing in contractually based investments);

the above activity is limited to not acting as a market maker;

the firm is an oil market participant , energy market participant or a local28

its permission includes either:

- effecting contracts of insurance; or

- carrying out contracts of insurance.

5 5
6 5 6 5 6 5 6 6 6

A.13 Advisors, arrangers, dealers or brokers 6

6

(1) it is an authorised professional firm and ALL the regulated activities in its permission are limited to non-mainstream regulated activities (a firm falling within this category is a class (1) firm);

OR

(2) its permission:

(a) includes one or more of the following14:

14(i) in relation to one or more designated investments:

dealing in investments as agent;

arranging (bringing about) deals in investments;

making arrangements with a view to transactions in investments;

dealing as principal in investments where the activity is carried on as a matched principal broker, oil market participant, energy market participant or local;

advising on investments (except P2P agreements) 14

(except pension transfers and pension opt-outs);

giving basic advice on a stakeholder product;

advising on pension transfers and pension opt-outs;

advising on syndicate participation at Lloyd's;

14(ii) advising on P2P agreements;

(iii) in relation to a structured deposit:19

dealing in investments as agent; or19

arranging (bringing about deals) in investments;19

or making arrangements with a view to transactions in investments; or19

advising on investments (except P2P agreements); or19

advising on investments (except pension transfers and pension opt-outs);19

(b) BUT NONE of the following:

effecting contracts of insurance; or8

carrying out contracts of insurance;

AND 6

(c) 6PROVIDED the fee-payer is NOT any of the following:

a corporate finance advisory firm;

a firm for whom all of the applicable activities above are otherwise limited to carrying out corporate finance business;

a firm for whom all the applicable activities above5are limited to carrying out venture capital business;

a firm for whom all the applicable activities above are limited to acting as a residual CIS operator;5

a firm for whom all the applicable activities above are limited to acting as trustee or depositary of an AIF and/or acting as trustee or depositary of a UK UCITS29 a service company.

A firm falling within (2) and not (1) is a class 2 firm.

6 6 6 6 6 6 6 6 5 5 5 5

A.14 Corporate finance advisers

the firm is carrying on corporate finance businessPROVIDED the fee-payer is NOT a venture capital firm.

A.18 Home finance providers, advisers and arrangers

its permission includes a regulated activity within one or more of the following:

entering into a home finance transaction; or

arranging (bringing about) a home finance transaction ; or

making arrangements with a view to a home finance transaction; or

advising on a home finance transaction; or

agreeing to carry on a regulated activity which is within any of the above.

A.19 General insurance distribution 30

its permission includes one or more of the following in relation to a non-investment insurance contract:

dealing in investments as agent; or

arranging (bringing about) deals in investments; or

making arrangements with a view to transactions in investments; or

assisting in the administration and performance of a contract of insurance; or

advising on investments; or

agreeing to carry on a regulated activity which is within any of the above.6

6 A.21 Firms holding client money or assets, or both

(1) It is a firm carrying on a regulated activity defined in fee-block A.13;

AND EITHER OR BOTH:

(2A) It is a firm to which the client money rules apply

AND/OR

(2B) Its permissions includes safeguarding and administration of assets (without arranging)

UNLESS

CASS does not apply to that firm in accordance with CASS 1.2

18

18

15 15

B. Service companies

it is a service company.

B. MTF and OTF operators19operators

its permission includes operating a multilateral trading facilityor operating an organised trading facility19.1

17

1 12 12 12

17

12

B. Regulated benchmark administrators 23

12

it has a Part 4A permission to carry on the regulated activity of administering a benchmark.23

17 12

20 B. Recognised investment exchanges

it is a recognised investment exchange.

20 B. [deleted]28

20 B. Recognised overseas investment exchanges

it is a recognised overseas investment exchange.

7 CC1. Credit-related regulated activities with limited permission

it carries on credit-related regulated activities; and

it has a limited permission; and

it is not a not-for-profit debt advice body; and

it is not a credit union or community finance organisation27.

7 CC2. Credit-related regulated activities

it carries on credit-related regulated activities; and

it does not have a limited permission; and

it is not a not-for-profit debt advice body; and

it is not a credit union or community finance organisation27.

26 CMC.

it is a claims management company.

Part 2

This table sets out the activity groups (fee blocks) in relation to (i) the minimum fees7payable to the FCA and (ii) the prudential fee payable to the FCA.

7

Activity group

Fee payer falls into the fee-block if

A.0 FCA minimum fee

(1) it is in at least one of the fee blocks under Part 1; and

(2) it is not:

(a) a UK ISPV; or

(b) a firm whose only permission is

operating a dormant fund account; or7

(c) a firm exclusively carrying on credit-related regulated activities.7

7

AP.0 FCA prudential fee

(1) it is an FCA authorised person2 other than an FCA authorised person exclusively carrying on credit-related regulated activities7;and

(2) the periodic fee it pays to the FCA is not limited to the A.0 FCA minimum fee.2

2 2

Part 3

This table indicates the tariff base for each fee-block set out in Part 1.

The tariff base in this Part is the means by which the FCA measures the amount of business conducted by a firm for the purposes of calculating the annual periodic fees payable to the FCA by that firm.2

Activity group

Tariff base

A.1

MODIFIED ELIGIBLE LIABILITIES

For banks and building societies:

Item B of Form ELS (Note (1)):

(1 + 2 + 3 + 4 + 0.6*5 + 6 - 8 - 9A - 9B - 10A - 10B - 10C - 11A - 11B - 0.6*12) + (1/3)*(F1 + F2 + F3 + F4 + 0.6*F5 + F6 - F8 - F9A - F9B - F10A - F10B - F10C - F11A - F11B - 0.6*F12)

- 13M

Notes:

(1) All references in the above formula are to entries on Form ELS (that is, the Eligible Liabilities Return completed to provide information by banks and building societies to the Bank of England as required by the Bank of England Act 1998).

(2) The figures reported on the Form ELS relate to business conducted out of offices in the United Kingdom.

For credit unions:

Deposits with the credit union (share capital)

LESS

the credit union's bank deposits (investments + cash at bank)

Note:

Only United Kingdom business is relevant for calculating credit unions' MELs.

Note:

For a dormant account fund operator the tariff base is not relevant and the flat fee in FEES 4 Annex 2A R is payable.

A.2

NUMBER OF HOME FINANCE TRANSACTIONS ENTERED INTO AND ADMINISTERED

The number of newhome finance transactions11 entered into;

AND

The number of home finance transactions11being administered:11

(a) multiplied by 0.05 for firms with permission for administering a home finance transaction but not permission for entering into a home finance transaction; or11

(b) by 0.5 for all other firms.11

Notes:

(1)[deleted]11

(2) For the measure of the number of contracts being administered, each charge counts as one contract, irrespective of the number of loans involved.

(3) Home finance transactions11administered include those that the firm administers on behalf of other firms.

11 11 10 11 11 11 11 11

A.3

GROSS WRITTEN PREMIUM FOR FEES PURPOSES AND BEST ESTIMATE LIABILITIES FOR FEES PURPOSES 22

Gross written premium for fees purposes means:22

(1) for UK Solvency II firms, a firm’s gross written premium as reported to the PRA, being the total of items entered under row codes R0110, R0120 and R0130, as expressed in column code C0200 where this column is completed for those row codes of the annual quantitative reporting template S.05.01.01;22 and28

(2) [deleted]28

(3) for non-directive firms, a firm’s gross premium written as reported to the PRA under item 11 of form 11, or where this is not reported because the firm is a Swiss general insurer or holds a relevant waiver given by the PRA under the PRA Rulebook25, the entry at sheet 1, line 1, column 1, of form 20A, or where the firm is a friendly society, the income and expenditure account entry for gross premium written or contributions as income receivable, as appropriate under the Friendly Societies (Accounts and Related Provisions) Regulation 1994 (SI 1994/1983).22

22 13 13

AND

Best estimate liabilities for fees purposes means: 22

(1) for UK Solvency II firms, a firm’s best estimate liabilities as reported to the PRA, being the sum of items entered under row codes R0010, R0370, R0380, R0410 and R0420, column code C0180, of the annual quantitative reporting template S17.01.01; plus the sum of items entered under row codes R0010, R0030, column codes C0090, C0140 and C0190, of the annual quantitative reporting template S12.01.01; 22and28

(2) [deleted]28for incoming EEA firms or incoming Treaty firms, a firm’s best estimate liabilities as reported to their Home State regulator, being the sum of items entered under row codes R0010, R0370, R0380, R0410 and R0420, column code C0180, of the annual quantitative reporting template S17.01.01; plus the sum of items entered under row codes R0010, R0030, column codes C0090, C0140 and C0190, of the annual quantitative reporting template S12.01.01 but only in relation to the regulated activities of the firm which are carried on in the United Kingdom, except those provided on a cross border services basis; and22

(3) for non-directive firms, a firm’s total gross technical provisions as reported to the PRA under item 19 of form 15, or where this is not reported because the firm is a marine mutual, item 29 of form M2, or where the firm is a friendly society, the balance sheet entry C3 ‘claims outstanding’ where this entry is required under the Friendly Societies (Accounts and Related Provisions) Regulations 1994 (SI 1994/1983); and otherwise zero. 22

‘Annual quantitative reporting template’ has the meaning given in Fees Chapter 1 Application and Definitions of the PRA Rulebook.22

‘Corporate pension business’ has the meaning given in Fees Chapter 1 Application and Definitions of the PRA Rulebook.22

‘UK Solvency II firm’ has the meaning given in Insurance General Application 2 of the PRA Rulebook.22

13 13 13

22

22

Notes:

(1) The recovery of the FCA’s annual funding requirement allocated to the A.3 fee-block will be weighted:22

(a) 90% from gross written premium for fees purposes; and22

(b) 10% from best estimate liabilities for fees purposes.22

(2) This tariff base (A.3 fee-block) does not include gross written premium for fees purposes and best estimate liabilities for fees purposes on which a composite firm reports data relevant for fee-block A.4.22

(3) Where any figure used in the calculation of this tariff base is a negative number, it shall instead be deemed to be zero.22

(4) For UK ISPVs this22 tariff base is not relevant and a flat fee set out in FEES 4 Annex 2AR is payable.

A.4

GROSS WRITTEN PREMIUM FOR FEES PURPOSES AND BEST ESTIMATE LIABILITIES FOR FEES PURPOSES 22 (seeFEES 4 Annex 12 G)

Gross written premium for fees purposes means:22

(1)

28for UK Solvency II firms, a firm’s gross written premium as reported to the PRA, being the item entered under row code R1410, column code C0300 of the annual quantitative reporting template S05.01.01 minus corporate pension business as reported to the PRA under the annual quantitative reporting template S14.01.01.28

28

22 22

AND

Best estimate liabilities for fees purposes means:22

28for UK Solvency II firms, a firm’s best estimate liabilities as reported to the PRA, being the sum of items entered under row codes R0010 and R0030, column codes C0150 and C0210 minus the sum of items entered under row codes R0010 and R0030, column codes C0090, C0140 and C0190 of the annual quantitative reporting template S12.01.01; minus corporate pension business reported under the annual quantitative reporting template S14.01.01.28

[deleted]28

‘Annual quantitative reporting template’ has the meaning given in Fees Chapter 1 Application and Definitions of the PRA Rulebook.22

‘Corporate pension business’ has the meaning given in Fees Chapter 1 Application and Definitions of the PRA Rulebook.22

‘UK Solvency II firm’ has the meaning given in Insurance General Application 2 of the PRA Rulebook.22

Notes:

(1) The recovery of the FCA’s annual funding requirement allocated to the A.4 fee-block will be weighted:22

(a) 60%27 from gross written premium for fees purposes; and22

(b) 40%27 from best estimate liabilities for fees purposes.22

(2) For non-directive firms, including non-directive composite firms to the extent that they come within the A.4 fee block, the tariff base is not relevant to the level of fees due and only the minimum fee as specified in Part 2(b) of FEES 4 Annex 2AR is payable.22

(3) Where any figure used in the calculation of this tariff base is a negative number, it shall instead be deemed to be zero.22

22 22 13 13 13

A.5

ACTIVE CAPACITY

The capacity of the syndicate(s) under management in the year in question. This includes the capacity for syndicate(s) that are not writing new business, but have not been closed off in the year in question.

A.6

Not applicable.

A.7

FUNDS UNDER MANAGEMENT (FuM)

The total value, in pounds sterling, of all assets (see note (a) below) in portfolios which the firm manages, on a discretionary basis (see note (b) below), in accordance with its terms of business, less:

a) funds covered by the exclusion contained in article 38 (Attorneys) of the Regulated Activities Order;

(b) funds covered by the exclusion contained in article 66(3) (Trustees, nominees and personal representatives) of the Regulated Activities Order;

(c) funds covered by the exclusion contained in article 68(6) (Sale of goods or supply of services) of the Regulated Activities Order;

(d) funds covered by the exclusion contained in article 69(5) (Groups and joint enterprises) of the Regulated Activities Order; and

(e) the value of those parts of the managed portfolios in respect of which the responsibility for the discretionary management has been formally delegated to another firm (and which firm will include the value of the assets in question in its own FuM total); any such deduction should identify the firm to which management responsibility has been delegated.

Notes on FuM

(a) Except for funds under management where the fund is an AIF, for4 the purposes of calculating the value of funds under management, assets means all assets that consist of or include any investment which is a designated investment or those assets in respect of which the arrangements for their management are such that the assets may consist of or include such investments, and either the assets have at any time since 29 April 1988 done so or the arrangements have at any time (whether before or after that date) been held out as arrangements under which the assets would do so.

(aa) for funds under management, where the fund is an AIF, assets means all assets or property of any description of the fund.4

(b) Assets managed by the firm on a discretionary basis exclude the firm's own assets. Assets managed on a non-discretionary basis, being assets that the firm has a contractual duty to keep under continuous review but in respect of which prior specific consent of the client must be obtained for proposed transactions, are also excluded as this activity is covered in those charged to fees in activity group 6A.13.

(c) In respect of collective investment schemes, assets means the total value of the assets of the scheme.

(d) For an OPS firm, the FuM should also be reduced by the value of the assets held as a result of a decision taken in accordance with article 4(6) of The Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) Order 2001 (investments in collective investment scheme or bodies corporate which have as their primary purpose the acquisition, directly, or indirectly, of relevant investments, as defined in that article).

(e) Only assets that are managed from an establishment maintained by the firm in the United Kingdom are relevant.

(f) If the firm is managing an overlay portfolio of derivative instruments and the underlying assets are managed by itself or a firm within the same group that has not reported them separately to the FCA, or by a firm outside its group, then it should calculate the value of the derivatives and other assets as prescribed in the guidance in FSA038 in SUP 16 Annex 25.

If the underlying assets are managed by another firm within the same group who has reported their value separately to the FCA, then to avoid double-counting within the group, the calculation must be restricted to the exposure of the overlay.

6

A.9

GROSS INCOME(1) For AIFMs (excluding internally managed AIFs), management companies,4 operators (including ACDs and authorised fund managers3 of unit trusts or authorised contractual schemes3 but excluding operators of a personal pension scheme or a stakeholder pension scheme) and residual CIS operators4 gross income from the activity relating to fee-block A.9 is defined as:

the amount of the annual charge on investments in the fund4 received or receivable in the latest accounting period (this is calculated as a % of funds invested, typically 1% p.a.);

PLUS(a)10

the front-end or exit charge levied on sales or redemptions of collective investment schemes (typically 4-5% of sales/redemptions) in that same accounting period; and10

(b) any amount the firm would have levied as such a charge but for a business decision to waive, discount or rebate etc. that charge;10

PLUS

any additional initial or management charges levied through a product wrapper such as an ISA;

BUT EXCLUDING box management profits.

(2)4Fordepositaries (includingtrusteesofcollective investment schemesandICVC or ACS3depositaries):

The amount of the annual charge levied on investments in funds4 for which they act as depositary (typically a % of the total funds for which they act as depositary).(3)4

For operators of a personal pension scheme or a stakeholder pension schemegross income from the activity relating to fee block A.9 is defined as:4

The amount of the charges levied on the personal pension scheme or stakeholder pension scheme for which they act as operator:

including up-front charges, fund related charges, transaction related charges and periodic charges; but

excluding charges made to an investor in respect of third party suppliers; for example, charges for stock broking, borrowing, banking services and charges for arranging third party legal services, surveys or environmental screening in connection with property.

Note:

Only the gross income corresponding to United Kingdom business is relevant.

(4) Internally managed AIFs must use a proxy for gross income for the activities relating to fee block A.9. This is the total value of funds under management (as defined in fee block A.7) multiplied by 0.01.4

3 4

A.10

NUMBER OF TRADERS

Any employee or agent, who:

ordinarily acts within the United Kingdom on behalf of an authorised person liable to pay fees to the FCA in its fee-block A.10 (firms dealing as principal); and who,

as part of their duties in relation to those activities of the authorised person, commits the firm in market dealings or in transactions in securities or in other specified investments in the course of regulated activities.

But not any employees or agents who work solely in the firm'sMTF operation.

A firm may, as an option, report employees or agents as full-time equivalents (FTE), taking account of any part-time staff. In calculating the FTE, firms must take into account the total hours employees or agents have contracted to work for the firm and not the time employees or agents devote to the dealing in investments as principal28functions set out in fee-block A.10. Any figures using the FTE calculation to be recorded to one decimal place, rounded down to the nearest decimal place.

A.13

ANNUAL INCOME

Annual income as defined in FEES 4 Annex 11A R

A.14

ANNUAL INCOME

Annual income as defined in FEES 4 Annex 11A R.

A.18

Annual income as defined in FEES 4 Annex 11A6

6

A.19

Annual income as defined in FEES 4 Annex 11A6

6

6 A.21

CLIENT MONEY/ASSETS HELD:

A value in pound sterling equal to:

Highest total amount of client money held by the firm during the 12 months ending 31 December before the relevant fee year

PLUS

Highest total value of safe custody assets held by the firm during the 12 months ending 31 December before the relevant fee year

18

18

B. Service companies

ANNUAL INCOME

Annual income as defined in FEES 4 Annex 11AR.9

9

B. MTF and OTF 19 operators

SUPERVISORY CATEGORY

The general supervisory category to which the MTF or OTF operator19 was assigned as at the start of the relevant fee year.9

31Annual income as defined in FEES 4 Annex 11AR for the purposes of the valuation date and submission time in Part 5 of FEES 4 Annex 1AR.

9 20

B. Regulated benchmark administrators 23

1

Annual income as defined in FEES 4 Annex 11AR. 17

7

20 B. Recognised investment exchanges

Annual income as defined in FEES 4 Annex 11AR. 17

20 B. [deleted]28

28

20 B. Recognised overseas investment exchanges

Not applicable.

7 CC1. Credit-related regulated activities with limited permission

Annual income as defined in FEES 4 Annex 11B R.

7 CC2. Credit-related regulated activities

Annual income as defined in FEES 4 Annex 11B R.

26 CMC.

Annual turnover as defined in FEES 4 Annex 11AR.

Part 4

This table indicates the tariff base for each fee block set out in Part 2.

The tariff base in this Part is the means by which the FCA measures the amount of business conducted by a firm for the purposes of calculating the annual periodic fees payable to the FCA by that firm.2

Activity Group

Tariff base

A.0

Not applicable because the minimum fee is a specified amount.

AP.0

The total periodic fees payable as a result of fee blocks A.2 and A.7 to A.19 in 2 Part 1 of FEES 4 Annex 2A R excluding any periodic fee for operating a dormant fund account.

Part 5

This table indicates the valuation date for each fee-block. A firm can calculate its tariff data in respect of fees payable to the FCA by applying the tariff bases set out in Part 3 with reference to the valuation dates shown in this table.

Activity group

Valuation date

IN THIS TABLE, REFERENCES TO SPECIFIC DATES OR MONTHS ARE REFERENCES TO THE LATEST ONE OCCURRING BEFORE THE START OF THE PERIOD TO WHICH THE FEE APPLIES, UNLESS OTHERWISE SPECIFIED - E.G. FOR 2013/14 FEES (1 APRIL 2013 TO 31 MARCH 2014), A REFERENCE TO DECEMBER MEANS DECEMBER 2012.

Where a firm's tariff data is in a currency other than sterling, it should be converted into sterling at the exchange rate prevailing on the relevant valuation date.

A.1

For banks:

Modified eligible liabilities (MELs), valued at:

for a firm which reports monthly, the average of the MELs for October, November and December;

for a firm which reports quarterly, the MELs for December. For credit unions:

For credit unions:

MELs, valued at December or as disclosed by the most recent annual return made prior to that date.

For building societies:

MELs, valued at the average of the MELs for October, November and December.

A.2

Number of mortgages, home purchase plans, home reversion plans and regulated sale and rent back agreements entered into in the twelve months ending 31 December.

AND

Number of mortgages, home purchase plans, home reversion plans and regulated sale and rent back agreements being administered on 31 December.

A.3

The firm’s gross written premium for fees purposes and its best estimate liabilities for fees purposes for the firm’s financial year which ends in the calendar year to 31 December prior to commencement of the fee year. 22

16

A.4

For UK Solvency II firms, including composite UK Solvency II firms to the extent that they are required to report data used for this tariff base, the firm’s gross written premium for fees purposes and its best estimate liabilities for fees purposes, for the firm’s financial year which ends in the calendar year to 31 December prior to commencement of the fee year.22

16

A.5

Active capacity (AC), in respect of the Underwriting Year (as reported to the Society of Lloyd's) which is current at the beginning of the period to which the fee relates.

[Note: this is the Underwriting Year which is already in progress at the start of the fee period - e.g. for 2013/14 fees, the fee period will begin on 1 April 2013, which is in the 2013 Underwriting Year, so the AC for that Underwriting Year is the relevant measure.]

A.6

Not applicable.

A,7

Funds under management (FuM), valued at 31 December.

A.9

Annual gross income (GI) for the financial year ended in the calendar year24 ending 201731 December.

A.10

Number of traders as at 31 December.

A.13

Annual income for the financial year ended in the calendar year ending 31 December.

A.14

Annual income for the financial year ended in the calendar year ending 31 December.

A.18

Annual income (AI) for the financial year ended in the calendar year ending 31 December.

A.19

Annual income (AI) for the financial year ended in the calendar year ending 31 December.6

6 A.21

In respect of client money, the highest amount of client money held over the 12 months ending 31 December before the relevant fee year.

In respect of safe custody assets, the highest amount of safe custody assets held over the 12 months ending 31 December before the relevant fee year.

18

18

B. Service companies

Annual income for the financial year ended in the calendar year ending 31 December.9

9

B. MTF 20 and OTF 19 operators

The start of the relevant fee year.9

31Annual income for the financial year ended in the calendar year ending 31 December 2019, to be submitted to the FCA in writing by 30 September 2020.

9

B. Regulated benchmark administrators 23

1 20

Annual income for the financial year ended in the calendar year ending 31 December17.20

7

20 B. Recognised investment exchanges

Annual income for the financial year ended in the calendar year ending 31 December17.

20 B. Recognised auction platforms

Not applicable.

20 B. Recognised overseas investment exchanges

Not applicable.

7 CC1. Credit-related regulated activities with limited permission

Annual income for the financial year ended in the calendar year ending 31 December.

7 CC2. Credit-related regulated activities

Annual income for the financial year ended in the calendar year ending 31 December.

26 CMC.

Annual turnover for the financial year ended in the calendar year ending 31 December.

FEES 4 Annex 2A 5 7 7 11 18 20 23 25FCA Fee rates and EEA/Treaty firm modifications for the period from 1 April 2020 to 31 March 2021

R

41Part 1

This table shows the tariff rates applicable to each of the fee blocks set out in Part 1 of FEES 4 Annex 1AR.

(1)

For each activity group specified in the table below, the fee is the total of the sums payable for each of the tariff bands applicable to the firm's business, calculated by multiplying the value of the firm's tariff base by the rate applicable to each tranche of the tariff base, as indicated.

(2)

A firm may apply the relevant tariff bases and rates to non-UK business, as well as to its UK business, if:

(a)

it has reasonable grounds for believing that the costs of identifying the firm'sUK business separately from its non-UK business in the way described in Part 3 of FEES 4 Annex 1A R are disproportionate to the difference in fees payable; and

(b)

it notifies the FCA in writing at the same time as it provides the information concerned under FEES 4.4 (Information on which fees are calculated), or, if earlier, at the time it pays the fees concerned.

(3)

For a firm which has not complied with FEES 4.4.2R8 (Information on which fees are calculated) for this period:

(a)

the fee is calculated using (where relevant) the valuation or valuations of business applicable to the previous period, multiplied by the factor of 1.10; and11

(b)

an additional fee of £250 is payable, unless the firm is a PRA-authorised person in which case an additional fee of £125 is payable instead.11

(c)

[deleted]11

5 5 7 7 7 7

Activity group

Fee payable

A.1

Band width (£2million of Modified Eligible Liabilities (MELs))

Fee (£/£m or part £m2 of MELs)

2

General Periodic fee

>10 - 140

15.310525

2 5 5 7 7 11 13 18 23

>140 - 630

15.310525

2 5 5 7 7 11 13 18 23

>630 - 1,580

15.310525

2 5 5 7 7 11 13 18 23

>1,580 - 13,400

19.13825

2 5 5 7 7 11 13 18 23

>13,400

25.26225

2 5 5 7 7 11 13 18 23

The tariff rates in A.1 are not relevant for the permissions relating to operating a dormant account fund. Instead a flat fee of £6,367 23 is payable in respect of these permissions.18

11 13 18

A.2

Band width (No. of mortgages and/or home finance transactions)

Fee (£2/mortgage)

>50

2

2.71825

2 5 5 7 7 11 13 18 23

A.3

Gross written premium for fees purposes (GWP)16

Periodic fee

Band Width (£2million of GWP16)

Fee (£2/m or part £m of GWP16)

>0.5

2

370.9025

2 5 5 7 7 11 13 16 18 23

PLUS

Best estimate liabilities for fees purposes (BEL)16

General Periodic fee

Band Width (£2million of BEL16)

Fee (£2/£2m or part £2m of BEL16)

>1

2

22.7325

2 5 5 7 7 11 13 16 18 23

For UKISPVs the tariff rates are not relevant and a flat fee of 7 £505 25 is payable in respect of each FCA financial year (the 12 months ending 31 March).

7 7 11 7 13 16 18 23

A.4

Gross written premium for fees purposes (GWP)16

General Periodic fee

Band Width (£2million of GWP16)

Fee (£2/£2m or part £2m of GWP16)

>1

2

186.0225

2 5 5 7 7 11 13 16 18 23

PLUS

Best estimate liabilities for fees purposes (BEL)16

General Periodic fee

Band Width (£2million of BEL16)

Fee (£2/£2m or part £2m of BEL16)

>1

2

13.5125

2 5 5 7 7 11 13 16 18 23

A.5

Band Width (£2million of Active Capacity (AC))

Fee (£2/£2m or part £2m of AC)

>50

2

8.015825

2 5 5 7 7 11 13 18 23

A.6

Flat fee (£)2

376,291.1825

2 5 5 7 7 11 13 18 23

A.7

For class 1(C), (2) , (3) and (4)6firms:

6

Band Width (£2million of Funds under Management (FuM))

Fee (£2/£2m or part £2m of FuM)

>10

2

5.047225

2 5 5 7 7 11 13 18 23

For class 1(B) firms: the fee calculated as for class 1(C) firms above, less 15%. For class 1(A) firms: the fee calculated as for class 1(C) firms above, less 50%.2

A.9

Band Width (£2million of Gross Income (GI))

Fee (£2/£2m or part £2m of GI)

>1

2

907.6325

2 5 5 7 7 11 13 18 23

A.10

Band Width (No. of traders)

Fee (£2/person)

>12

2

6,805.3325

2 5 5 7 7 11 13 18 23

22

2 3 2 3

A.13

Band Width (£ thousands of annual income (AI))

Fee (£/£ thousand or part £ thousand of AI)

>1002

2

2.835625

2 5 5 7 7 11 13 18 23

A.14

Band Width (£ thousands of annual income (AI))

Fee (£/£ thousand or part £ thousand of AI)

>1002

2

1.652425

2 5 5 7 7 11 13 18 23

A.18

Band Width (£2 thousands of Annual Income (AI))

Fee (£2/£2 thousand or part £2 thousand of AI)

>100

2

10.59825

2 5 5 7 7 11 13 18 23

A.19

Band Width (£2 thousands of Annual Income (AI))

Fee (£2/£2 thousand or part £2 thousand of AI)

>100

2

1.69325

2 5 5 7 7 11 13 18 23

3A.21

Client money

Band Width (£ client money) (CM) held

Fee (£/£ millions or part £ million of CM)

less than £1 million5

5

123.71925

5 5 7 7 11 13 18 23

an amount equal to or greater than £1 million but less than or equal to £1 billion

92.7925

5 5 7 7 11 13 18 23

more than £1 billion5

5

61.8625

5 5 7 7 11 13 18 23

PLUS

Safe custody assets

Band Width (£ safe custody assets) (CA) held

Fee (£/£ millions or part £ million of CA)

less than £10 million5

5

0.464125

5 5 11 13 18 23

an amount equal to or greater than £10 million and less than or equal to £100 billion

0.348125

5 5 13 18 23

more than £100 billion5

5

0.232125

5 5 13 18 23

13

2

13

2 7 7 11

5B. Service Companies

Band Width

Fee (£)18

12

Annual income up to and including £100,000

1,13223

7 7 11 12 13 18

PLUS: 18

Band width18

Fee (£/£thousand or part £ thousand of income)18

Annual income over £100,00012

1.3125

7 7 11 12 13 18 23

12

12

7 7 11

12

1 13 7

11 7 7

13

7 7 11
7 7 11 7

B. Regulated benchmark administrators17

12

Band width12

Fee (£)15

12

Annual income up to and including 100,00017

12

1,15123

17 12 18

15 PLUS:

15Band width

Fee (£/£ thousand or part £18 thousand of income)

Annual income over 100,00017

12

1.17925

23 19 17 12 15

12B. Recognised investment exchanges

Band width

Fee (£)15

Annual income up to and including £10,000,000

107,16125

18 23

15 PLUS:

15Band width

Fee (£/£ thousand or part £18 thousand of income)

Annual income over £10,000,000

3.96925

15 18 23

12B. [deleted]22

22[deleted]

13 18

12B. Recognised overseas investment exchanges

61,200, 25 except as provided below24

13 18 23

Recognised overseas investment exchanges that are EEA market operators before 26IP completion day

24

No fee is payable in respect of any complete fee year beginning on or after 1 April 2018 and ending before IP completion day26.

For the fee year in which 26IP completion day occurs the fee payable is in accordance with the formula set out below.24

(The above fee ÷ 12) multiplied by the number of calendar months (inclusive) between the calendar month in which 26IP completion day occurs and the last calendar month of that fee year.24

24

Recognised overseas investment exchanges (including those that were EEA market operators immediately before IP completion day27 for fee years following the fee year in which IP completion day27 occurs)21

60,00021

B. MTF and OTF14 operators

As set out in FEES 4 Annex 10R14 (Periodic fees for MTF and OTF14 operators).

4CC1. Credit-related regulated activities with limited permission

Band Width (£ thousands of annual income (AI))

Fee (£)5

0 - 105

5

10623

5 5 13 18

>10 - 505

5

26623

5 5 13 18

>50 - 1005

5

42423

5 5 13 18

>1005

5

53023

5 5 13 18

5 PLUS:

5Fee (£/£ thousand or part £ thousand of AI)

>2505

5

0.4016725

5 5

4CC2. Credit-related regulated activities

Band Width (£ thousands of annual income (AI))

Fee (£)

5

0 - 505

5

31823

5 5 13 18

>50 - 1005

5

53023

5 5 13 18

>1005

5

1,06123

5 5 13 18

5 PLUS:

5Fee (£/£ thousand or part £ thousand of AI)

>2505

5

1.3054225

5 5 11

20CMC.

Band width (£ thousands of annual turnover)

Fee (£) for 2020/2125

0-50

500

50-100

1,000

>100

5.0584 25per £ thousand or part per £ thousand

24 Notes

1.

For the purposes of this table, 26“IP completion day” has the same meaning as in the European Union (Withdrawal Agreement) Act 2020 (see section 39(1) to (5) of that Act) 26and regulations made under that section.24

Part 2

The tables below show 9the tariff rates (minimum fees) applicable to each of the fee blocks set out in Part 2 of FEES 4 Annex 1AR.

9Part 2(a) shows the tariff rates (minimum fees) payable to the FCA by FCA-authorised persons and Part 2(b) shows the tariff rates (minimum fees) payable to the FCA by PRA-authorised persons.

[Note:PRA-authorised persons will also pay minimum fees to the PRA as set out in Chapter 3 of the Fees Part of the PRA Rulebook16.]

9 Part 2(a) tariff rates (minimum fees) payable to the FCA by FCA-authorised persons

A.0

(1)

£1,15123 unless it is a community finance organisation with a tariff base of:11

2 2 7 11 7 9 13 18

11(a)

up to and including 3 mortgages and/or home finance transactions, in which case a minimum fee of £1762313is payable; or

18

11(b)

more than 3 but no more than 10 mortgages and/or home finance transactions, in which case a minimum fee of £59723 is payable; or

2 2 7 7 18 13

11(c)

more than 10 but no more than 50 mortgages and/or home finance transactions, in which case a minimum fee of £1,10623 is payable.

2 7 7 18 13
2 2 7 7

(2)
2 2 7 7

[deleted]9

3 3 2 2 7 7

(3)

[deleted]9

[deleted]9

2

(4)

[deleted]9

2

AP.0

Periodic fees payable under fee blocks A.2, A.7 to A.19and A. 21 5in 2 Part 1 multiplied by rate £0.1036525

23 18 2 5 7 7 13 11

9 Part 2(b) tariff rates (minimum fees) payable to the FCA by PRA-authorised persons

A.0

(1)

£57423 unless:

13 18

(a)

It is a credit union that meets the conditions in (2), in which case the minimum fee payable is as set out in (2);

(b)

it is a non-directive friendly society that falls into the A.3 activity group but not the A.4 activity group and has, for that activity, 0.5 million or less in gross written premium for fees purposes and holds best estimate liabilities for fees purposes of 1.0 million or less16, in which case the minimum fee payable is £24723; or

18 16 13

(c)

it is a non-directive friendly society that falls into the A.4 activity group but not the A.3 activity group and has, for that activity, written 1.0 million or less in gross written premium for fees purposes and holds best estimate liabilities for fees purposes of 1.0 million or less16, in which case the minimum fee payable is £24723; or

18 16 13

(d)

it is a non-directive friendly society that falls into the A.3 and A.4 activity groups and meets the conditions in (3)(a) and (3)(b), in which case the minimum fee payable is £24723.

18 16 13

(2)

The conditions referred to in (1)(a) are that the credit union has a tariff base (Modified Eligible Liabilities) of:

(a)

0 to 0.5million, in which case a minimum fee of £9223 is payable; or

13 18

(b)

greater than 0.5millon but less than 2.0million, in which case a minimum fee of £31023 is payable.

13 18

(3)

The conditions referred to in (1)(d)16 are that:

(a)

the non-directive friendly society falls into the A.3 activity group and has, for that activity, 0.5 million or less in gross written premium for fees purposes and holds best estimate liabilities for fees purposes16 of 1.0 million or less;

(b)

the non-directive friendly society falls into the A.4 activity group and has, for that activity, written 1.0 million or less in gross written premium for fees purposes and holds best estimate liabilities for fees purposes16 of 1.0 million or less.

The figures for gross written premium for fees purposes and best estimate liabilities for fees purposes16 are the same as used for Part 1 of this Annex.

Part 3 [deleted]22

FEES 4 Annex 2B Ring-Fencing Implementation Fee [deleted]

R

4

FEES 4 Annex 4 1 9 10 16 15 16 18 19 20 21 24Periodic fees in relation to collective investment schemes, AIFs marketed in the UK, small registered UK AIFMs and money market funds payable for the period 1 April 2020 to 31 March 2021

R

1Part 1 - Periodic fees payable

Scheme type

Basic fee (£)

Total funds/sub-funds aggregate

Fund factor

Fee (£)

ICVC 18,

AUT 18,

ACS 18,

LTIFs 22,

Money market funds with effect from 21 July 201821

22

11 17 16 16 12 15 12 16 16

363.50249

23 20 19 18 16 2 4 6 8 9 15 15 16

1-2

3-6

7-15

16-50

>50

1

2.5

5

11

22

363.5024

908.7524

1,817.5024

3,998.5024

7,997.00249999

23 23 23 23 23 20 20 20 20 20 19 19 19 19 19 18 18 18 18 18 16 16 16 16 16 2 3 6 2 3 6 2 3 6 2 3 6 2 3 6 7 8 8 8 8 8 9 9 9 9 9 10 10 10 10 10 15 16 15 15 15 15

non-UK AIFs 22 recognised under section 272 of the Act18

12 12 15

1,478.5024

23 20 19 2 4 7 8 9 10 15 16 16 18

1-2

3-6

7-15

16-50

>50

1

2.5

5

11

22

1,478.5024

3,696.2524

7,392.5024

16,263.5024

32,527.0024

23 23 23 23 23 20 20 20 20 20 19 19 19 19 19 2 3 6 2 3 2 3 6 2 3 6 2 3 6 7 8 8 8 8 8 9 9 9 9 9 10 10 10 10 10 15 15 16 16 15 16 16 15 16 16 15 16 16 15 16 16 18 18 18 18 18

Fees are charged according to the number of funds or sub-funds5operated by a firm as at 31 March preceding the relevant fee year14.83 Where a new collective investment scheme becomes authorised during a fee year14, fees are charged according to the number of funds or sub-funds5operated by a firm as at the date of authorisation. Where more than one fund or sub-fund5is operated,5 the number of funds (not including the umbrella5or parent fund) produces a 'fund factor' in accordance with the table above,5 which is then applied to a basic fee to produce one total fee per operator5. Fund factors are applied per operator5rather than per scheme5so that the fees relate to the number of funds rather than the number of schemes5. This means that, for example, an authorised fund manager5 of three schemes5pays the same as an operator5or authorised fund manager5of one scheme5with three sub-funds5(as only the sub-funds5are counted).

Schemes 5 set up under section 264 of the Act are charged according to the number of funds or sub-funds5which a firm is operating and marketing into the UK as at 31 March immediately before the start of the period to which the fee applies. For example, for 2010/117fees a reference to 31 March means 31 March 2010.7

Part 2 - Periodic fees for AIFs marketed in the UK, following a notification to the FCA under regulation 57, 58 or 59 of the AIFMD UK regulation13

5 2 3 5 8 9 14 14 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 3 7 3

13Kind of notification

Fee per AIF (£)

Notification under regulation 57 of the AIFMD UK regulation

33724

19 18 20 23

Notification under regulation 58 of the AIFMD UK regulation

23524

19 18 20 23

Notification under regulation 59 of the AIFMD UK regulation

33724

19 18 20 23

Part 3 - Periodic fees paid by small registered UK AIFMs13

13The annual fee for small registered UK AIFMs is £66324

23 20 18 19

FEES 4 Annex 5 Periodic fees for designated professional bodies: tariff base, valuation date and tariff rates15111617171819

R

24

1 10

24Part 1

This table sets out the tariff base and valuation date for the designated professional bodies fee-block. The tariff base and valuation date in this Part is the means by which the FCA calculates the annual periodic fees payable by a designated professional body to the FCA.

Activity group

Fee payer falls in the activity group if:

Tariff base

Valuation date

D.1 Designated professional bodies

It is a designated professional body

Number of exempt professional firms regulated or supervised by a designated professional body

As at 31 December prior to the fee-year

24Part 2

This table sets out the tariff rates applicable to designated professional bodies

Fee payable in relation to 2020/21

Amount payable

Minimum fee, payable by all designated professional bodies

£10,00023

Variable fee, payable by designated professional bodies where the number of exempt professional firms regulated or supervised by a designated professional body is greater than 1

£15.86 23 multiplied by the total number of exempt professional firms in excess of 1

Note20

20The Financial Services Register includes details of exempt professional firms carrying out insurance distribution activity20.

4 2

FEES 4 Annex 6 1 4 9 12 17 16 17Periodic fees for recognised investment exchanges, and recognised auction platforms payable in relation to the period 1 April 2016 to 31 March 201719

R

[deleted]20

12 22 12 12 15 15 17

FEES 4 Annex 10 Periodic fees for MTF operators payable in relation to the period 1 April 2020 to 31 March 202114467789

R

General supervisory category of MTF or OTF10 operator (see Note below)

Fee payable (£)

Due date

(i)8 1 August 202014; or8

(ii)8 30 days from the date of the invoice in the case of a firm which receives permission to be operating a multilateral trading facility or to be operating an organised trading facility10 or whose permission is extended to include either10 activity in the course of the relevant financial year.8

7 7 13 11 10

MTF or OTF10 operator has a named individual fixed portfolio supervisor8

350,22514

7 9 7 11 13

All other MTF or OTF10 operators (i.e. those supervised by a team of flexible portfolio supervisors)8

33,02814

7 7 9 8 11 13

[deleted]8

 7 7

12

8

12

7 7 7 7 7 7 8

8

7 7

Note: subject to FEES 4.3.13 R, this table applies to all MTF or OTF10 operators with permission to operate an MTF or OTF10 as at 1 April of the applicable fee year; irrespective of whether, and if so when, their permission to operate an MTF or OTF10 was subsequently cancelled during that fee year.

FEES 4 Annex 11 23Periodic fees in respect of payment services, electronic money issuance, regulated covered bonds, CBTL business, data reporting services and third party verifiers in relation to the period 1 April 2020 to 31 March 2021664321089911

R

17This Annex sets out the periodic fees in respect of payment services carried on by fee-paying payment service providers under the Payment Services Regulations and electronic money issuance by fee-paying electronic money issuers under the Electronic Money Regulations and issuance of regulated covered bonds by issuers and CBTL business carried on by CBTL firms under the MCD Order and data reporting services providers (other than incoming data reporting services providers) under the DRS Regulations.1413

2Part 1 - Method for calculating the fee for fee-paying payment service providers4

(1)

The periodic fee for fee-paying payment service providers is calculated by identifying the relevant activity group under Part 2 and then4adding the minimum fee to an additional fee calculated by multiplying the tariff base identified in Part 3 of FEES 4 Annex 11 by the appropriate rates applying to each tranche of the tariff base as indicated in the table at Part 5. For small payment institutions and small electronic money institutions4the tariff rates are not relevant and a flat fee is payable.

4

(2)

A fee-paying payment service provider may apply the relevant tariff bases and rates to non-UK business, as well as to its UK business, if:

(a)

it has reasonable grounds for believing that the costs of identifying the firm'sUK business separately from its non-UK business in the way described in Part 3 of FEES 4 Annex 11 is disproportionate to the difference in fees payable; and

(b)

it notifies the FCA in writing at the same time as it provides the information concerned under FEES 4.4 (Information on which fees are calculated), or, if earlier, at the time it pays the fees concerned.

(3)

For a fee-paying payment service provider which is required to comply with FEES 4.4.9 D (Information on which fees are calculated) and has not done so for this period:

(a)

the fee is calculated using (where relevant) the valuation or valuations of business applicable to the previous period, multiplied by the factor of 1.10; and11

(b)

an additional administrative fee of £250 is payable.11

(c)

[deleted]11

9 9

4Part 1A - Method for calculating the fee for fee-paying electronic money issuers

(1)

The periodic fee for fee-paying electronic money issuers is calculated by identifying the relevant activity group under Part 2A and then multiplying the tariff base identified in Part 3 of 1 R by the appropriate rates applying to each tranche of the tariff base as indicated in the table at Part 5. For small electronic money institutions, the tariff rates are not relevant and a flat fee is payable.

(2)

A fee-paying electronic money issuer may apply the relevant tariff bases and rates to non-UK business, as well as to its UK business, if:

(a)

it has reasonable grounds for believing that the costs of identifying the firm'sUK business separately from its non-UK business in the way described in Part 3 of 1 R is disproportionate to the difference in fees payable; and

(b)

it notifies the FCA in writing at the same time as it provides the information concerned under FEES 4.4 (Information on which fees are calculated), or, if earlier, at the time it pays the fees concerned.

(3)

For a fee-paying electronic money issuer which is required to comply with FEES 4.4 (Information on which fees are calculated) and has not done so for this period:

(a)

the fee is calculated using (where relevant) the valuation or valuations of business applicable to the previous period, multiplied by the factor of 1.10; and11

(b)

an additional administrative fee of £250 is payable.11

(c)

[deleted]11

9 9

4Part 1B - Method for calculating the periodic fee where the firm is both a fee-paying payment service provider and a fee-paying electronic money issuer

Add the fee calculated under Part 1 to the fee calculated under Part 1A.

6Part 1C - Method for calculating the fee for an issuer of a regulated covered bond

The issuance of regulated covered bonds by issuers is linked to activity group G.15 in this annex. The periodic fees for issuers of regulated covered bonds is calculated by multiplying the tariff base relevant to G.15 in Part 3 of 1 R by the appropriate rates applying to each tranche of the tariff base as indicated in the table at Part 5.

Part 2 - Activity groups relevant to fee-paying payment service providers4

This table shows how the payment services performed by fee-paying payment service providers are linked to activity groups (fee-blocks). A fee-paying payment service provider can use the table to identify which fee-blocks it falls into based on its authorisation or registration.

Activity group

Fee payer falls into this activity group if:

G.2 Certain deposit acceptors

4

it is a fee-paying payment service provider not falling within any of the other fee-blocks in this table

G.3 Large payment institutions and registered account information service providers16

it is a fee-paying payment service provider that is 4an authorised payment institution,421a registered account information service provider, 21 the Post Office Limited or a fee-paying electronic money issuer (except if it is a small electronic money institution)4

4 4 16

G.4 Small payment institutions

it is a fee-paying payment service provider that is 4a small payment institution or a small electronic money institution4

4

G.5 - Other institutions

it is the Bank of England or a government department or local authority that provides payment services other than when carrying out functions of a public nature.

4Part 2A - Activity groups relevant to fee-paying electronic money issuers

This table shows how the electronic money issuance by fee-paying electronic money issuers is linked to activity groups ('fee-blocks'). A fee-paying electronic money issuer can use the table to identify which fee-blocks it falls into based on its authorisation, registration or permission, as applicable.

4Activity group

Fee payer falls into this activity group if:

G.10 Large electronic money institutions

it is a fee-paying electronic money issuer (except if it is a small electronic money institution)

G.11 Small electronic money institutions

it is a small electronic money institution

13

17

10Part 2B – Activity groups relevant to CBTL firms

This table shows how CBTL business carried on by CBTL firms is linked to activity groups ('fee-blocks'). A CBTL firm can use the table to identify which fee-blocks it falls into based on its registration

Activity Group

Fee payer falls into this activity group if11

G.20 CBTL lender11

It is a CBTL lender and does not have permission to carry out any regulated activities11

G.21 CBTL arranger and CBTL adviser11

it11 is a CBTL arranger or a CBTL adviser and does not have permission to carry out any regulated activities11

14Part 2C – Activity group relevant to data reporting services providers

Activity Group

Fee payer falls into this group if:

G.25 DRSP

it is a data reporting services provider. (other than an incoming data reporting services provider).

20Part 2D – Activity group relevant to third party verifiers

Activity Group

Fee payer falls into this group if:

G.26 TPV

it is a third party verifier.

Part 3

This table indicates the tariff base for each fee-block. The tariff base is the means by which the FCA measures the amount of business conducted by fee-paying payment service providers,6fee-paying electronic money issuers, CBTL firms, data reporting services providers (other than incoming data reporting services providers),20firms registered under the Money Laundering Regulations,2016issuers of regulated covered bonds and third party verifiers20.4

6 14 15 10 13 12 17 6

Activity Group

Tariff base

13

17

13

G.2

MODIFIED ELIGIBLE LIABILITIES

These are determined in the same manner as the tariff-base for relevant firms in the A.1 fee-block set out in FEES 4 Annex 1 Part 2 R.

G.3

RELEVANT INCOME

This is the sum of the following elements of the firm'sUK business:

Interest income

Interest expenses

Gross commissions and fees received

Gross other operating income

calculated in the same manner as the relevant indicator referred to in paragraph 10(3) 16

of Schedule 3 to the Payment Services Regulations.

For the Post Office Limited only, Relevant Income relates only to its payment services business.

G.4

Not applicable.

G.5

As in G.3 and Relevant Income only relates to payment services business.

4G.10

Average outstanding electronic money as defined under regulation 2(1) of the Electronic Money Regulations.

This is the average total amount of financial liabilities related to electronic money in issue at the end of each calendar day over the preceding twelve5 calendar months (which is the period ending on the date set out under Part 4), calculated on the first calendar day of each calendar month and applied for that calendar month (£million).5

5 6

4G.11

Not applicable.

6G.15

Regulated covered bonds issued in the 12 months ending on the valuation date and valued as at the valuation date.

10G.20

Not applicable

10G.21

Not applicable

14G.25

Not applicable

20G.26 TPV

Not applicable

Part 4 - Valuation period

This table indicates the valuation date for each fee-block. A fee-paying payment service provider,6 a fee-paying electronic money issuer,20 a regulated covered bondissuer64and a third party verifier20 can calculate tariff data by applying the tariff bases set out in Part 34 with reference to the valuation dates shown in this table.

6 4 4

Activity group

Valuation date

In this table, reference to specific dates or months are references to the latest one occurring before the start of the period to which the fee applies e.g. for 2010/11 fees (1 April 2010 to 31 March 2011), a reference to December means December 2009.

Where the tariff data of a fee-paying payment service provider or a fee-paying electronic money issuer4 is in a currency other than sterling, it must be converted into sterling at the exchange rate prevailing on the relevant valuation date.

4

13

17

13

G.2

For banks and building societies as in FEES 4 Annex 1 Part 3.

4

G.3

Relevant income for the financial year ended in the calendar year ending 31 December.

G.4

Not relevant.

G.5

Relevant income for the twelve months ending 31 December.

4G.10

31 December.

4G.11

Not relevant.

6G.15

(1) The last day of the financial quarter during which the issuer became registered as an issuer in the FCA financial year (the 12 months ending 31 March).

(2) For subsequent FCA financial years, 31 December unless (3) applies.

(3) If the issuer became registered as an issuer between 1 January and 31 March inclusive, 31 March in respect of the FCA financial year immediately following the FCA financial year during which it became registered and 31 December in respect of all further FCA financial years.

A reference to a financial quarter in this box means any of the following periods: 1 April to 30 June inclusive, 1 July to 30 September inclusive, 1 October to 31 December inclusive or 1 January to 31 March inclusive.

20G.26 TPV

Not relevant

Part 5 - Tariff rates

Activity group

Fee payable in relation to 2020/212364

4 22 19 6 7 8 9 9 11 17

13

17

13

13

G.2

Minimum fee (£)

52522

9 9 13 19

£ million or part £m 3of Modified Eligible Liabilities (MELS)

Fee (£/£m or part £m of MELS)
3 3

3> 0.1

6 4 0.587323

4 6 7 8 9 9 11 13 19 22

G.3

Minimum fee (£)

52522

9 9 13 19

£ thousands or part thousand of Relevant Income

Fee (£/£thousand or part £thousand of Relevant Income)
3 3

3> 1004

4

6 40.3948223

4 6 7 8 9 9 11 13 19 22

G.4

Flat fee (£)7

53623

9 9 13 19 22

G.5

As in G.311

4G.10

Minimum fee (£)

1,72622

9 9 13 19

£74million or part m of average outstanding electronic money (AOEM)

Fee (£7/£7m11, or part £11m of AOEM)

4>5.0

665.4023

6 7 7 9 9 11 19

4G.11

Flat fee (£)7

1,17423

6 6 9 9 13 19 22

6G.15

Minimum fee for the first registered programme (£)7

91,55223

7 8 8 9 9 11 13 19 22

Minimum fee for all subsequent registered programmes

75% of minimum fee for first registered programme

£11million or part £11m of regulated covered bonds issued in the 12 months ending on the valuation date.

Fee (£11/£11m or part £11m of regulated covered bonds issued in the 12 months ending on the valuation date)

>0.00

7.1423

7 8 8 9 9 11 13 19 22

For the purposes of calculating fees, any regulated covered bonds denominated in a currency other than sterling must be converted into sterling at the applicable exchange rate set out below.

Where an exchange rate hedging agreement was entered into in connection with the issuance of regulated covered bonds denominated in a currency other than sterling, the applicable exchange rate for those regulated cover bonds is the exchange rate stipulated in the exchange rate hedging agreement.

An exchange rate hedging agreement is any agreement entered into to hedge the market risk relating to fluctuations in exchange rates.

In all other cases, the applicable exchange rate is the daily spot rate available on the Bank of England's Statistical Interactive Database (the Bank of England exchange rate) applying on the valuation date. If the valuation date is not a business day, then the applicable exchange rate is the Bank of England exchange rate applying on the first business day following the valuation date.

10G.20

Flat fee (£)

43323

11 13 19 22

10G.21

Flat fee (£)

21623

11 13 19 22

14G.25

Flat fee (£) for first data reporting service plus 50% flat fee for each additional data reporting service for which the data reporting services provider (other than an incoming data reporting services provider) has authorisation.

26,79023

18 19 22

20G.26 TPV

26023

22

Part 7 [deleted]21

3 4 3 4 3 3
3 3
3 3 3
4

FEES 4 Annex 11A 2 4 10Definition of annual income for the purposes of calculating fees in fee blocks A.13, A.14, A.18, A.19, A.23 and B. Service Companies, UK Recognised Investment Exchanges, Multilateral Trading Facilities, Organised Trading Facilities, Regulated Benchmark Administrators and Claims Management Companies

R

Annual income definition 2

2

General definition for all relevant fee-blocks (other than where the firm 11 is an operator of a UK 12 Recognised Investment Exchange, 10 a Multilateral Trading Facility, an Organised Trading Facility 12 a Regulated Benchmark Administrator or a Claims Management Company 10 )

"Annual income" for a particular fee block (the “relevant fee block”) is the gross inflow of economic benefits (i.e. cash, receivables and other assets) recognised in the firm's accounts during the reporting year2 in respect of, or in relation to, the provision in the UK of the regulated activities specified in FEES 4 Annex 1A R Part 115 as belonging to the relevant fee block 2.

The figure should be reported for the relevant fee block without netting off the operating costs or business expenses, but including:

(a) all brokerages, commissions, fees, and other related income (for example, administration charges, overriders, profit shares etc) due to the firm in respect of, or in relation to, the provision in the UK of the regulated activities specified in FEES 4 Annex 1A R Part 115 as belonging to the relevant fee block 2and which the firm has not rebated to clients or passed on to other authorisedfirms15 (for example, where there is a commission chain).

PLUS:2

(b) any ongoing commission from previous business received by the firm during the reporting year.

PLUS:2

(c) the “fair value” of any goods or services the firm provided to clients. This is the commission equivalent or 2an estimate of the amount the firm would otherwise have received for any regulated activity under (a) above, but for which it has made a business decision to waive or discount its charges2.

Definition for UK 12 Recognised Investment Exchanges 6

“Annual income” for a UK12recognised investment exchange is the gross inflow of economic benefits (i.e. cash, receivables and other assets) recognised in the firm’s accounts during the reporting year in respect of, or in relation to activities that comprise a necessary part of an exchange’s business as an investment exchange.6 This should include all revenues the firm derives from operating multilateral trading facilities and organised trading facilities.9

For the purposes of calculating annual income of the UK12recognised investment exchange include amounts received in relation to the operation of its markets; access to those markets; the submission, management and execution of orders; quotes or transactions on those markets; the supply of pre-and post- trade transparency information about those markets; fees for admission to trading or listing; membership of connectivity charges; fees for order execution or management; trade reporting; market data and any other relevant revenue streams.6

Definition for firms operating Multilateral Trading Facilities and Organised Trading Facilities 12

This refers to firms operating a multilateral trading facility or organised trading facility . 12

“Annual income” for an operator of a multilateral trading facility or organised trading facility is the gross inflow of economic benefits (i.e. cash, receivables and other assets) recognised in the firm’s accounts during the reporting year in respect of, or in relation to activities that comprise a necessary part of the firm’s business as an operator of a multilateral trading facility or organised trading facility.12

For the purposes of calculating annual income of the operator of a multilateral trading facility or organised trading facility include amounts received in relation to the operation of its markets; access to those markets; the submission, management and execution of orders; quotes or transactions on those markets; the supply of pre-and post-trade transparency information about those markets; fees for admission to trading or listing; membership of connectivity charges; fees for order execution or management; trade reporting; market data and any other relevant revenue streams.12

Where the firm is a Regulated 8 Benchmark Administrator 6

“Annual income” for a regulated benchmark administrator8 is the gross inflow of economic benefits (i.e. cash, receivables and other assets) recognised in the firm’s accounts during the reporting year in respect of, or in relation to activities in the UK9 that comprise a necessary part of its business as a regulated benchmark administrator8.

Where the sales and marketing of a benchmark are undertaken by a separate legal entity, the regulated benchmark administrator8 is responsible for identifying the relevant income and reporting it to us as its own income. To avoid double counting, the regulated benchmark administrator8 should report only the income from sales 11and exclude any amount paid to it from that income to pay for its expenses as a regulated benchmark administrator8.

Where the firm’s regulated activities are carried on by an appointed representative of the firm 5

The firm's annual income must include income received by an appointed representative carrying a regulated activity in a relevant fee block on behalf of the firm. 5

The appointed representative's annual income must be calculated in the same way as the firm's. However, to avoid double counting, the appointed representative's annual income must not include any income also recognised in the firm’s accounts, including income recognised as a result of a commission sharing arrangement with the appointed representative.

Where the relevant fee-block is fee-block A.18 2

For the purposes of calculating annual income for fee-block A.18, also include the following:2

(d) for any home finance mediation activity carried out by the firm for which it receives payment from the lender or provider on a basis other than that in (a), the value of all new mortgage advances and amounts provided under other home finance transactions resulting from that activity multiplied by 0.004;2

PLUS:2

(e) if the firm is a home finance provider, the value of all new mortgage advances and amounts provided under other home finance transactions which are regulated mortgage contracts, home purchase plans, home reversion plans or regulated sale and rent back mediation activity, multiplied by 0.004m, excluding mortgage advances and home finance transactions which result from home finance mediation activity carried on by another firm, where payment has been made by the home finance provider to that other firm under (a);2

PLUS: 2

(f) for firms whose permission includes administering regulated mortgage contracts, but not entering into a regulated mortgage contract and firms whose permission includes administering a home finance transaction but not entering into a home finance transaction, and in either case whose permission does not include advising on a home finance transaction, the relevant amounts are multiplied by 0.15. 2

2

Where the relevant fee-block is fee-block A.19 2

For the purposes of calculating annual income for fee-block A.19, also include the following:2

(g) in relation to any activities in (a), for any insurance distribution activity7 carried out by the firm for which it receives payment from the insurer on a basis other than that in (a), the amount of premiums receivable on its contracts of insurance multiplied by 0.07;2

PLUS: 2

(h) if the firm is an insurer in relation to the activities in (a), the amount of premiums receivable on its contracts of insurance multiplied by 0.07,3excluding those contracts of insurance which:2

- result from insurance distribution activity7 by another firm, where payment has been made by the insurer to the firm under (a); or2

- are not general insurance contracts or pure protection contracts.2

AND2

(i) for the purposes of calculating annual income for fee-block A.19:2

- the provision in the UK of the regulated activities specified in FEES 4 Annex 1A Part 1 as belonging to the relevant fee block includes the provision of activities that would have been insurance distribution activity7 in relation to general insurance contracts or pure protection contracts if they had been carried on after 13 January 2005 or, in relation to connected travel insurance contracts, from 1 January 2009; 2- a reference to a "firm " includes a reference to any person, including a connected travel insurance intermediary, who carried on activities which would be insurance distribution activity7 (in respect of general insurance contracts or pure protection contracts) if they had been carried on after 13 January 2005 or, in relation to connected travel insurance contracts, from 1 January 2009.2Guidance on the interpretation of this definition is presented in FEES 4 Annex 13 G.2

Where the firm is a Claims Management Company (fee-block claims management company) 10

Income is defined as turnover. 10

“Turnover” means the sum of the amounts paid to, or received by, an authorised claims management company in respect of regulated claims management activities in Great Britain, including:10

(j) charges, commission, the share of any compensation, fees and subscriptions;10

(k) the monetary value of any services received by the claims management company where it makes no payment for those services or where the payment received is worth less than the monetary value of the services; and10

(l) the monetary value of any advertising in respect of the claims management company that it has not paid for out of funds referred to in sub-paragraphs (j) and (k).10

6 2 15 2 2 15 2 15 2 2 2 2 6 9 6 3

FEES 4 Annex 11B Definition of annual income for the purposes of calculating fees in fee blocks CC1 and CC2

FEES 4 Annex 11B R

(1) Annual income definition for credit related regulated activities 4

1 4

“Annual income” is the gross inflow of economic benefits (i.e. cash, receivables and other assets) recognised in the firm's accounts during the reporting year in respect of, or in relation to, the provision in the UK of the regulated activities specified in FEES 4 Annex 1AR7 Part 1 as belonging to fee-blocks CC1 or CC2 as applicable.

The figure should be reported without netting off the operating costs or business expenses, but including:

(a) all interest received on loans, brokerages, commissions, fees, and other related income (for example, administration charges, overriders, profit shares etc) due to the firm in respect of, or in relation to, the provision in the UK of the credit-related regulated activities specified in FEES 4 Annex 1AR7 Part 1 as belonging to fee-blocks CC1 and CC2 and which the firm has not rebated to clients or passed on to other authorised firms (for example, where there is a commission chain).

(aa) In the case of consumer hire agreements, interest should be calculated as the total revenue over the period of the lease minus depreciation of the asset over the same period. Where depreciation is not recorded in the accounts and a firm uses its own internal conventions for calculating depreciation, it must be ready on request to demonstrate that its methodology uses straight-line depreciation or an alternative depreciation method in line with the UK Financial Reporting Standard (FRS 102) or International Accounting Standards (IAS). In the absence of internal conventions for calculating depreciation, the assumption should be made that the asset depreciates to zero over the period (or minimum period) of the lease, or (if no period is specified) over a reasonable period.7

Plus:

(b) any ongoing commission from previous business received by the firm during the reporting year.

(ba) any vouchers, reward cards or other benefits staff have received from other firms as recompense for making introductions as a credit broker.5

Plus:

(c) the “fair value” of any goods or services the firm provided to clients. This is an estimate of the amount the firm would otherwise have received for any regulated activity under (a) above, but for which it has made a business decision to waive or discount its charges.

Plus:

(d) [deleted]4

Or4

(e) The figure must be reported using the proxy measure of annual income if the firm receives no annual income of the type in 1(a) to (c) and meets the criteria in (2).4

2 4 3 4 3 4 3 4 4

(2) Proxy measure of annual income

(a) A firm that receives no annual income of the type in 1(a) to (c) must report its annual income using the proxy measure in (b) if:4

(i) its main business is to sell goods or supply services, and is not to carry on a credit activity in 2(a)(ii) or 2(a)(iii);4

and4

(ii) it carries on:4

(aa) credit broking in relation to credit agreements, except for credit broking in relation to buy-to-let mortgages; or4

(bb) entering into a regulated credit agreement as lender;4

or4

(iii) it carries on:4

(aa) credit broking in relation to consumer hire agreements; or4

(bb) entering into a regulated consumer hire agreement as owner.4

(b) The proxy measure for annual income is calculated:4

(i) for activities in 2(a)(ii), by multiplying the gross loan amount under all agreements falling within the activity by the percentage value at (b)(iii);4

(ii) for activities in 2(a)(iii), by multiplying the gross value of all goods under all agreements falling within the activity by the percentage value at (b)(iii);4

(iii) the percentage value is 5% plus the Bank of England base rate on the final day of the firm’saccounting reference date.4

(iv) any proxy income should be calculated on the basis of the Bank of England base rate in force at the time of submission.6

(3) Where the firm’s regulated activities are being carried on by an appointed representative of the firm 4

The firm's annual income must include income received by an appointed representative carrying a regulated activity in a relevant fee block on behalf of the firm.4

The appointed representative's annual income must be calculated in the same way as the firm's. However, to avoid double counting, the appointed representative's annual income must not include any income also recognised in the firm's accounts, including income recognised as a result of a commission sharing arrangement with the appointed representative.4

Guidance on the interpretation of this definition is presented in Table 2 of FEES 4 Annex 13 G.4

FEES 4 Annex 12 Guidance on the calculation of tariffs set out in FEES 4 Annex 1AR Part 3 64

G

The following table sets out guidance on how a firm should calculate tariffs for fee-block A.4.3

3 2 3 3 3

Gross written premium for fees purposes (GWP) and Best estimate liabilities for fees purposes (BEL) - calculation of new regular premium business 7

(1) 7If any business is transferred to a firm (A) from another firm (B) under the procedure set out at Part VII of the Act and that business would have been included in B's tariff base in the absence of such a transfer, this business should be included in either A's or B's tariff base, depending on the date of transfer. FEES 4.3.17R7 explains in whose tariff base it should be included.

(2) Best estimate liabilities for fees purposes7 should take account of all of A's business, including all new business transferred from B.
3

FEES 4 Annex 13 Guidance on the calculation of tariffs set out in FEES 4 Annex 1AR Part 3

FEES 4 Annex 13 G

Table 11

The following table sets out guidance on how a firm should calculate tariffs for fee blocks A.13,9 A.14, A.18, A.19 and B. Service Companies, Recognised Investment Exchanges,10 Multilateral Trading Facilities, Organised Trading Facilities,12 Regulated9 Benchmark Administrators and Claims Management Companies10.3

3 6

Calculating and apportioning annual income - FEES 4 Annex 11AR

Calculating annual income

Defining relevant income streams

(1)

The firm should refer to the fee-block definitions in FEES 4 Annex 1AR6, Part 1 to decide which particular income streams should be taken into account when calculating its annual income for the purposes of fee-blocks A.13, A.14, A.18, A.19 and B. Service Companies, Recognised Investment Exchanges, Multilateral Trading Facilities, Organised Trading Facilities12 and Benchmark Administrators6.3

3

(2)

For the avoidance of doubt, the only income streams reportable for a relevant fee-block are those income streams which relate to a regulated activity listed in that fee-block. Income streams that do not relate to a regulated activity listed in the relevant fee-block should not be reported. Service companies, operators of recognised investment exchanges and regulated benchmark administrators9 should report the income relating to each of these activities, excluding income from any other activities in the B fee-block on which they pay FCA fees.6 Operators of recognised investment exchanges should include all income derived from operating multilateral trading facilities and organised trading facilities.9

Under FEES 4 Annex 11AR, where the sales and marketing of a benchmark are undertaken by a separate legal entity within the same group, the income generated as a result is also deemed to relate to the regulated activity carried on by the benchmark administrator and so should be reported to the FCA by the benchmark administrator as its own income (for fees setting purposes). 6

Firms 6 should exclude from the calculation of their annual income for any particular fee-block all income6 directly derived from the performance of regulated activities belonging to other fee-blocks. For example:6

(a)6 interest from loans made in the course of providing or administering home finance (A.2) should be excluded from commission earned from arranging home finance agreements (A18);6

(b)6 premium interest from carrying out or effecting life insurance contracts (A.3), income from managing the underwriting capacity of a Lloyd’s syndicate as a managing agent at Lloyds (A.5) should be excluded from commissions for arranging general insurance (A.19);6

(c)6 income from managing investments, collective investment schemes or pensions schemes (A.7 or A.9) or income from operating multi-lateral trading facilities (FEES 4 Annex 10R) should be excluded from income derived from investment intermediation (A.13) or operating a recognised investment exchange or administering a specified benchmark.6

3 3

(3)

Firms should only include revenue streams that relate to regulated activities which are carried on 'in the United Kingdom'. In many cases, it will be quite straightforward to identify where an activity is carried on. But when there is a cross-border element, for example because a client is outside the United Kingdom or because some other element of the activity happens outside the United Kingdom, the question may arise as to where the activity is carried on. PERG 2.4 generally and PERG 4.11 regarding activities relating to regulated mortgage contracts, PERG 5.12 regarding activities relating to insurance distribution activities8 and PERG 14.6 regarding home reversion plans and home purchase plans describe the legislation that is relevant to this question and gives the FCA's views on various scenarios.

Reporting period

(4)

Except for claims management companies, the10 “reporting year” is the firm's financial year end during the calendar year prior to the FCAfee year. This fee year starts on 1 April. This is specified in part 5 of FEES 4 Annex 1A.

(5)

The income that should be included is the income that was recognised in the accounts of the relevant reporting year. This means that some income due may not be reported until the following year because it has not yet been recognised in the accounts, while other income may be carried forward from previous years.

Fair value

(6)

Except in relation to fee-block A.18 and A.19 where one or more of paragraphs (d) to (f) or (g) to (i) of FEES 4 Annex 11A apply, the firm should report a “fair value” price for any services for which it has made a business decision not to charge to clients.

We consider fair value to refer to the amount at which goods or services could be exchanged in an arm’s length transaction between informed and willing parties, other than in a forced or liquidation sale.

For example, where a firm has forgone or discounted the commission or fee would actually have charged but for the business decision to grant a discount in a particular case or on a temporary basis, it should report the amount it would have otherwise have charged for providing equivalent activities.

In the case of home finance mediation in fee-block A.18 and general insurance intermediation in fee-block A.19 where one or more of paragraphs (e) to (f) or (g) to (i) of FEES 4 Annex 11A apply, instead of asking for firms to estimate fair value, certain ratios are prescribed in FEES 4 Annex 11BR where the client is not charged directly for the service provided.

Inclusions

(7)

Annual income should include:

(a)

all amounts due to the firm arising out of the regulated activities referred to in the relevant fee block for which the firm holds permission, including regular charges and instalments due to the firm during the reporting year;

(b)

any payment from a parent to facilitate the discounting or forgoing of any amounts that would otherwise be charged in full to a client, to the extent that the payment exceeds the “fair value” price reported in accordance with paragraph (6) above;

(c)

(i) amounts earned by a firm'sappointed representative when carrying on a regulated activity for the firm to which FEES 4 Annex 11A applies; and 4

(ii) amounts earned by a person who will become the firm'sappointed representative immediately after authorisation; 4

4

(d)

administrative charges and any interest from income related to the regulated activities specified in the relevant fee block.

(8)

Additional inclusions in respect of fee-block A.18:

(a)

a firm must include in paragraph (a) any survey and booking fees due to it in respect of home finance mediation activity.

Prohibited deductions

(9)

Deductions should not be made for:

(a)

bad debts;

(b)

customer benefits such as cash rewards, complimentary travel insurance, air miles vouchers etc.;

(c)

items such as general business expenses (e.g. employees’ salaries and overheads);

(d)

fines or penalties levied against the firm;

(e)

commission a firm pays another party to arrange a transaction with a client unless it receives a fee in respect of the same transaction;

(f)

the difference (if positive) between the fee payable by a firm to another party for arranging a transaction and the amount payable to the firm by the end client in respect of that transaction (here, the firm must net any excess payable by the end client to zero);

(g)

payments made to clients by way of redress.

Exclusions

(10)

The following should be excluded from the calculation of annual income:

(a)

To avoid double-counting, amounts which have been passed on to other firms may be excluded from the calculation of annual income, for example, where there is a commission chain. Transfers of income to other firms may be especially common within groups where, to present a single interface to clients, all amounts due to the group may be collected by one firm for subsequent redistribution to other firms within the group. It is for groups themselves to decide the most convenient way to report such annual income - i.e. whether the firm which receives the full amount should declare that full amount, or whether each firm in the group should report its separate distribution.

(b)

Any payment from a parent to facilitate the discounting or forgoing of any amount that would otherwise be charged in full to a client should be excluded to the extent that the payment does not exceed or equal the “fair value” price reported in accordance with paragraph (6) above.

(c)

(i)

rebates to customers and members of a recognised investment exchange, multilateral trading facility and organised trading facility; and11

(ii)

fees or commissions passed onto other firms.11

(d)

Authorised professional firms should exclude the income from non-mainstream regulated activities. They may estimate the proportion of their business that is derived from those activities and split the income from individual invoices accordingly.

(e)

For the avoidance of doubt, income relating to or in respect of an activity is not part of annual income for the purposes of the definition in FEES 4 Annex 11A to the extent that the activity benefits from the exclusion in article 69 of the Financial Services and Markets Act 2000 (Regulated Activities Order) 2001 (Groups and joint enterprises). Firms should refer to the guidance on the application of this exclusion is contained in PERG 2.9.

Apportioning annual income

Where a firm cannot separate its income on the basis of activities, it may apportion the income on the basis of the proportionate split of business that the firm otherwise undertakes. For instance:

(1)

If a firm receives annual income from a platform-based business it may report this in line with a wider breakdown of its activities.

(2)

A firm providing corporate finance advice which does not maintain records of the split between regulated activities and non-regulated activities for individual cases may calculate that regulated business accounts for a certain proportion of its business overall and apply that as a multiplier across its income.

(3)

A firm may allocate ongoing commission from previous business on the basis of the type of firm it receives the commission from. This avoids tracking back legacy business which may no longer match the provider's current business model.

(4)

An authorised professional firm may estimate the proportion of its business that is derived from regulated activity and split its income for individual invoices accordingly.

(5)

If a firm has invested income from regulated activities, then any interest received should be reported as income, in proportion to the volume of regulated business it undertakes to avoid tracking back old payments.

(6)

Firms' systems ought to be able to distinguish UK from non-UK business to establish which conduct of business regime it was conducted under. If, however, they do not relate the figures back to income streams for the specific regulated activities in a particular fee-block then the firm may make a proportionate split as described above, calculating its regulated UK income on the basis of the overall split between UK and overseas income.

(7)

It is for individual firms to determine how they should calculate the appropriate split of income. The FCA is not prescriptive about the methodology. It requires only that:

(a)

the approach should be proportionate - the FCA is looking for firms to make their best efforts to estimate the split;

(b)

the firm must be able on request to provide a sound and clearly expressed rationale for its approach - for example, if all invoices were analysed over a particular period, the firm should be able to justify the period as representative of its business across the year;

(c)

the methodology should be objective - for example, based on random sampling of invoices or random stratified sampling;

(d)

the firm must on request be able to provide an audit trail which demonstrates that the choice of methodology was properly considered at an appropriate level or in the appropriate forums within the firm, and the decision periodically reviewed at the same level or in an equivalent forum.

2Table 2

The following table sets out guidance on how a firm should calculate tariffs for fee blocks CC.1 and CC.2.9

Calculating and apportioning annual income - FEES 4 Annex 11BR

Calculating annual income

Defining relevant income streams

(1)

Firms should report the total income from the credit-related regulated activities for which they have permission.

(2)

Firms should only include revenue streams that relate to regulated activities which are carried on 'in the United Kingdom'. In many cases, it will be quite straightforward to identify where an activity is carried on. But when there is a cross-border element, for example because a client is outside the United Kingdom or because some other element of the activity happens outside the United Kingdom, the question may arise as to where the activity is carried on. PERG 2.4 describes the legislation that is relevant to this question.

Reporting period

(3)

The “reporting year” is the firm's financial year end during the calendar year prior to the FCAfee year. This fee year starts on 1 April. This is specified in part 5 of FEES 4 Annex 1A.

(4)

The income that should be included is the income that was recognised in the accounts of the relevant reporting year. This means that some income due may not be reported until the following year because it has not yet been recognised in the accounts, while other income may be carried forward from previous years.

Fair value

(5)

The firm should report a “fair value” price for any services for which it has made a business decision not to charge to clients. We consider fair value to refer to the amount at which goods or services could be exchanged in an arm’s length transaction between informed and willing parties, other than in a forced or liquidation sale.

Some examples where fair value may be relevant in the context of consumer credit are:

(a) “Imputed interest”: where a loan has been provided interest-free or at a discounted rate, the charge should be rounded up to the prevailing rate normally chargeable to a client with a similar credit rating;

(b) “Commission-equivalent” or “fee-equivalent”: where a firm has foregone or discounted the commission or fee it would actually have charged but for the business decision to grant a discount in a particular case or on a temporary basis, it should report the amount it would otherwise have charged for providing equivalent credit-related regulated activity.

(6)

Firms should not estimate a fair value where:

(a) there is a statutory prohibition on charging interest (such as bankruptcy debts); or

(b) they have reduced or suspended their normal charging structure because the debtor is unable to meet contractual repayments and an alternative repayment arrangement has been agreed with the creditor; or

(c) they have made a “borrower-lender-supplier” agreement to allow a customer to pay the cash price of goods or services in instalments - any penalties or interest charged where the customer is in default should be declared as income.
3 5

3(6A)

[deleted]5

5 5 5

5(6B)

Proxy measure of annual income FEES 4 Annex 11BR(2)

FEES 4 Annex 11BR(2) sets out the proxy measure of annual income for a firm defined in FEES 4 Annex 11BR(1)(e). An example of what a firm would report as a proxy measure of annual income is provided below:

If a firm enters into a regulated credit agreement as lender:

(a) providing a gross loan amount of £1,000;

(b) to enable a customer to purchase goods from it priced at £1,000; and

(c) the Bank of England base rate on the final day of the firm’saccounting reference date is 0.5%;

the firm should report: (5% + 0.5%) x (£1000) = £55

(Historic Bank of England base rates (currently known as the Official Bank Rate) are available here: http://www.bankofengland.co.uk/statistics/Documents/rates/baserate.pdf)

Inclusions

(7)

Annual income should include:

(a)

all amounts due to the firm arising out of credit-related regulated activities for which the firm holds permission, including regular charges and instalments due to the firm during the reporting year;

(b)

income received in relation to the provision of current account overdrafts interest charges, arrangement fees and credit cards charges;

(c)

any payment from a parent to facilitate the discounting or forgoing of any amounts that would otherwise be charged in full to a client, to the extent that the payment exceeds the “fair value” price reported in accordance with paragraph (5) above;

(d)

(i) amounts earned by the firm'sappointed representatives when carrying on a regulated activity for the firm to which FEES 4 Annex 11B R applies; and4

(ii) amounts earned by a person who will become the firm'sappointed representative immediately after authorisation; and

4

(e)

administrative charges and any interest from income related to its credit-related regulated activity.

Prohibited deductions

(8)

Deductions should not be made for:

(a)

bad debts;

(b)

customer benefits such as cash rewards, complimentary travel insurance, air miles vouchers etc;

(c)

items such as general business expenses (eg, employees’ salaries and overheads);

(d)

fines or penalties levied against the firm;

(e)

commission a firm pays to another party to arrange a transaction with a client unless it receives a fee in respect of the same transaction;

(f)

the difference (if positive) between the fee payable by a firm to another party for arranging a transaction and the amount payable to the firm by the end client in respect of that transaction (here, the firm must net any excess payable by the end client to zero);7

(g)

payments to clients made by way of redress; and7

(h)

commission or fees clawed back by a third party firm in subsequent years, for example because a client introduced by a credit broker to a lender repays a loan early or defaults.7

Exclusions

(9)

The following should be excluded from the calculation of annual income:

(a)

Any income arising from business which is not a credit-related regulated activity.

(b)

(i) Repayments of principal lent by the firm in the course of it carrying on a credit-related regulated activity and (ii) sums received by the firm in exchange for the rights to principal owed to the firm where the principal was lent by the firm in the course of carrying on a credit-related regulated activity and where the rights are not sold at a premium to the value of the principal outstanding, should not be included. By the same token, the money a firm has received for the purpose of lending on to consumers as principal (e.g. money raised through wholesale borrowing, grant-aid, intra-group transfers, etc) should not be treated as income.

(c)

On the same principle, the income on debt purchase is the difference between the price paid for the purchased book and the amount collected.

(d)

To avoid double-counting, amounts which have been passed on to other firms carrying on credit-related regulated activity may be excluded from the calculation of annual income, for example where there is a commission chain. Transfers of income to other firms may be particularly common within groups where, to present a single interface to clients, all amounts due to the group may be collected by one firm for subsequent redistribution to other firms within the group. It is for groups themselves to decide the most convenient way to report such annual income, ie whether the firm which receives the full amount should declare that full amount or whether each firm in the group should report its separate distribution.

(e)

Any payment from a parent to facilitate the discounting or forgoing of any amount that would otherwise be charged in full to a client should be excluded to the extent that the payment does not exceed or equal the “fair value” price reported in accordance with paragraph (6) above.

(f)

Rebates to customers and fees or commissions passed onto other firms should be excluded.

(g)

The costs of wholesale funding should be excluded from the calculation - ie interest payments on money borrowed in order to lend on to customers.

(h)

If the total income a firm reports to us in one year includes an estimate for potential income which had been recognised in the accounts but not in practice received, and which has subsequently been written off as a bad debt, the amount may be deducted from the following year’s reported income.

(i)

Any debit backs deducted from an intermediary by a lender where a customer settles the loan early or defaults.

(j)

Authorised professional firms should exclude the income from non-mainstream regulated activities. They may estimate the proportion of their business that is derived from those activities and split the income from individual invoices accordingly.

(k)

For the avoidance of doubt, income relating to operating current accounts and debit card transactions should be excluded except where the income relates to the provision of overdrafts (see paragraph (6)(c) above).

(l)

For the avoidance of doubt, income relating to or in respect of an activity is not part of annual income to the extent that the activity benefits from the exclusion in article 69 of the Financial Services and Markets Act 2000 (Regulated Activities Order) 2001 (Groups and joint enterprises). Firms should refer to the guidance on the application of this exclusion is contained in PERG 2.9.

9(m)

Where a consumer hire agreement is open ended, its term should be taken as the period over which depreciation is calculated to zero. If the agreement is in practice terminated before depreciation reaches zero, the residual value may not be subtracted from the revenue. Where an agreement ends before depreciation reaches zero, but is subsequently renewed, the residual value of the asset should determine its cost at the beginning of the new agreement and depreciation recalculated accordingly. For example, if the cost of the asset at the start of the original agreement was £500 and depreciation was 80%, then its residual value carried forward to the new agreement would be £100. If the asset was assumed to depreciate to zero during the original agreement, then there is no residual value to carry forward and the income for the second agreement would be the total revenue from the lease.

Apportioning annual income

Where a firm cannot separate its income on the basis of credit-related regulated activities, it may apportion the income on the basis of the proportionate split of business that the firm otherwise undertakes. Examples are outlined below.

(1)

If a firm receives annual income from a platform-based business it may report this in line with a wider breakdown of its activities.

(2)

A firm may allocate ongoing commission from previous business on the basis of the type of firm it receives the commission from. This avoids tracking back legacy business which may no longer match the provider's current business model.

(3)

If a firm has invested income from credit-related regulated activities, then any interest received should be reported as income, in proportion to the volume of business relating to credit-related regulated activities it undertakes to avoid tracking back old payments.

(4)

Firms' systems ought to be able to distinguish UK from non-UK business to establish which conduct of business regime it was conducted under. However, if, a firm has a mix of business and its systems do not relate the figures back to the income streams from credit-related regulated activities, then it may make a proportionate split as described above, calculating its regulated UK income on the basis of the overall split between UK and non-UKincome.

(5)

An authorised professional firm may estimate the proportion of its business that is derived from regulated activity and split its income for individual invoices accordingly.

(6)

It is for individual firms to determine how they should calculate the appropriate split of income. The FCA is not prescriptive about the methodology. It requires only that:

(a)

the approach should be proportionate - the FCA is looking for firms to make their best efforts to estimate the split;

(b)

the firm must be able on request to provide a sound and clearly expressed rationale for its approach - for example, if all invoices were analysed over a particular period, the firm should be able to justify the period as representative of its business across the year;

(c)

the methodology should be objective - for example, based on random sampling of invoices or random stratified sampling; and

(d)

the firm must on request be able to provide an audit trail which demonstrates that the choice of methodology was properly considered at an appropriate level or in the appropriate forums within the firm, and the decision periodically reviewed at the same level or in an equivalent forum.

FEES 4 Annex 14 UKLA periodic fees for the period from 1 April 2020 to 31 March 20213

R

1

Part 1 Base fee

Activity group or invoice code (Note 1)

Description

Base fee payable (£)

E.1

Discontinued

E.2

Premium listed issuer

A listed issuer of equity shares and certificates representing shares4 with a premium listing (see Note 2)

5,5747

8 6 3 5

E.3

Standard listed issuer

A listed issuer of shares and certificates representing certain securitieswith a standard listing and not with a premium listing (see Note 2)

21,1147

8 3 5 5 6

E.4

Discontinued

E.5

Discontinued

E.6

Non-listed issuer (in DTR)

A non-listedissuer (in DTR)

07

8

E.7

Primary information provider

A primary information provider

17,6217

8 6 5 3

ES.01

Sponsor

A sponsor (see Note 3)

29,3517

8 6 5 3

Notes

Note 1

The ‘E’ activity groups are codes that appear on FCA invoices for periodic fees.

Note 2

A listedissuer of shares and certificates representing certain securities need not pay periodic fees if the following conditions apply:

(1) the listedissuer, or a related entity, has already paid a periodic fee in respect of the period concerned; or

(2) the listedissuer is subject to listing rules as a result of a reverse takeover; or

(3) the listedissuer is a newly formed entity, created as a result of a restructuring.

Note 3

In the case of approval of a sponsor following a change of legal status in accordance with FEES 3 Annex 1R Part 7, the balance of the fees otherwise due from the original sponsor is due from the sponsor that is a result of the change of legal status.

Part 2 Variable fee additional to base fee

Activity Group

Market capitalisation as at the last business day of the September8 prior to the fee-year in which the fee is payable in £million

Fee payable in £per £million or £part million

E.2

Premium listed issuer (as described in Part 1)

0 - 100

07

8

> 100 - 250

32.9815937

8 6 5 2 3

> 250 – 1,000

12.7252717

8 6 5 2 3

> 1,000 – 5,000

7.8329267

8 6 5 2 3

> 5,000 – 25,000

0.1910687

8 6 5 2 3

> 25,000

0.0617307

8 6 5 2 3

FEES 4 Annex 16R Periodic fees for credit rating agencies, trade repositories and securitisation repositories

1This Annex sets out the periodic fees in respect of credit rating agencies, trade repositories and securitisation repositories.

Part 1 – Method for calculating the fee for fee-paying payment service providers

The periodic fee is calculated by identifying the relevant activity group under Part 2 and multiplying the tariff base identified in Part 3 of FEES 4 Annex 16R by the appropriate rates in the table at Part 42.

Part 2 – Activity groups

Activity group

Fee payer falls into this group if:

J.1

it is a credit rating agency or certified credit rating agency; or

J.2

it is a trade repository or recognised trade repository; or

J.3

it is a securitisation repository.

Part 3

This table indicates the tariff base for each fee-block. The tariff base is the means by which the FCA measures the amount of business conducted by a firm.

J.1 Credit rating agencies

APPLICABLE TURNOVER

This is revenue generated from the credit rating agency’s2 activities and ancillary services.

J.2 Trade repositories

APPLICABLE TURNOVER

This is the sum of revenues generated from:

(a) the core functions of centrally collecting and maintaining records of derivatives and securities financing transactions2; and

(b) ancillary services that are directly related to centrally collecting and maintaining records of derivatives and securities financing transactions2.

Ancillary services include:

(i) direct provision by the trade repository;

(ii) indirect provision by a company within the trade repository’s group; and

(iii) where an entity with which the trade repository has concluded an agreement in the context of the trading or post-trading chain or business line to cooperate in the provision of services provides the ancillary services.

Where a trade repository’s accounts do not distinguish revenue from ancillary services under different activities, it should determine the share each activity represents of the turnover from providing core services and apply that to the composite ancillary revenue figure.

J.3 Securitisation repositories

APPLICABLE TURNOVER

This is the sum of revenues generated from:

(a) the core functions of centrally collecting and maintaining records of securitisations; and

(b) ancillary services that are directly related to centrally collecting and maintaining records of securitisations.

Ancillary services include:

(i) direct provision by the securitisation repository;

(ii) indirect provision by a company within the securitisation repository’s group;

(iii) where an entity with which the securitisation repository has concluded an agreement in the context of the trading or post-trading chain or business line to cooperate in the provision of services provides the ancillary services.

Part 4 2– Tariff rates

Fee block

Activity group

Fee payable in relation to the fee year 2021/20222

J.1

Registered credit rating agencies and third country certified credit rating agencies with applicable turnover of £8,969m or less

Exempt

Registered credit rating agencies with turnover above £8,969m

£[tbc] per £1k or part-£1k (applies to all turnover)

Certified credit rating agencies with turnover above £8,969m

£5,381

J.2

Registered trade repositories

£[tbc] per £1k or part-£1k, subject to a minimum payment of £26,907

Recognised trade repositories

£4,484

J.3

Registered securitisation repositories

£[tbc] per £1k or part-£1k subject to a minimum payment of £26,907