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FEES 7D.1 Application and purpose

Application

FEES 7D.1.1 R

1This chapter applies to every person listed in FEES 1.1.2R(8).

Purpose

FEES 7D.1.2 G

1The purpose of this chapter is to set out the requirements on the persons listed in FEES 7D.1.1R to fund the Treasury’s costs relating to the provision of debt advice by the Devolved Authorities, and the related FCA collection costs. For the avoidance of doubt, such persons also include supervised run-off firms.

Background

FEES 7D.1.3 G

1The Treasury’s debt advice costs are defined in subsection 1 of section 137SB (Rules to recover debt advice expenses incurred by the devolved authorities) of the Act as the expenses incurred, or expected to be incurred, by the Devolved Authorities in connection with the provision of information and advice on debt to members of the public in Scotland, Wales and Northern Ireland.

FEES 7D.1.4 G
  1. (1)

    1Section 137SB(1) of the Act requires the Treasury to notify the FCA of the amount of the debt advice costs.

  2. (2)

    Section 137SB(2 and 3) of the Act requires the FCA to make rules requiring authorised persons, electronic money issuers or payment service providers to pay specified sums, or sums calculated in a specified way to the FCA with a view to recovering:

    1. (a)

      the amount notified by the Treasury; and

    2. (b)

      expenses incurred by the FCA in connection with its functions under section 137SB of the Act.

Regulations 28 and 34 of the EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 provide that supervised run-off firms are treated as having Part 4A permission or a variation to the permission.

FEES 7D.1.5 G

1This chapter contains the rules referred to in FEES 7D.1.4G(2).

FEES 7D.1.6 G

1Under section 137SB(8) of the Act, the FCA must pay to the Treasury the amounts that it receives under these rules, apart from amounts covering its collection costs (which it may keep).

FEES 7D.1.7 G

1The total amount raised by the TPR DA levy may vary from year to year depending on the amount notified to the FCA by the Treasury.

FEES 7D.1.8 G

1These rules were made with the consent of the Treasury pursuant to section 137SB(5) of the Act.

FEES 7D.2 The TPR DA levy

Obligation to pay TPR DA levy

FEES 7D.2.1 R

1A firm must pay the TPR DA levy applicable to it:

  1. (1)

    in full and without deduction by 1 August (or, if later, within 30 days of the date of the invoice) in the financial year to which the sum relates; and

  2. (2)

    in accordance with the rules in this chapter.

FEES 7D.2.1A G

2Schedule 6A to the Act sets out a procedure to enable the FCA to cancel or vary the Part 4A permission of a person who it appears to the FCA is not carrying on a regulated activity. Paragraph 5 of that schedule sets out a procedure for annulment of cancellation or variation of Part 4A permission in specified circumstances. Where the FCA grants an application for annulment, paragraph 6 of Schedule 6A sets out its effect. In particular, the cancellation or variation of Part 4A permission is treated as if it had never taken place. As a result of the effect of annulment under Schedule 6A, the TPR DA levy in relation to the period during which the person’sPart 4A permission was cancelled or varied applies to the person.

FEES 7D.2.1B R

2Where the FCA grants a person’s application for annulment of a cancellation or variation of Part 4A permission under Schedule 6A to the Act and the person falls within FEES 7D.2.1R and the annulment takes effect after 1 August or after the invoice referred to in FEES 7D.2.1R(1) has been issued, then the date for payment referred to in FEES 7D.2.1R(1) does not apply, but the person must pay the TPR DA levy applicable to it in full and without deduction, on the date on which the annulment takes effect.

Calculation of TPR DA levy

FEES 7D.2.2 R

1The TPR DA levy is calculated as follows:

  1. (1)

    identify each of the activity groups set out in Part 1 of FEES 7D Annex 1R that apply to the business of the firm for the relevant period (for this purpose, the activity groups under FEES 7D Annex 1R are defined in that Annex or in accordance with Part 1 of FEES 4 Annex 1AR);

  2. (2)

    calculate, for each of those activity groups identified in (1), the amount payable in the way set out in FEES 7D.2.3R; and

  3. (3)

    add each of the amounts calculated under (2).

FEES 7D.2.3 R

1The amount payable by a firm with respect to a particular activity group is calculated as follows:

  1. (1)

    calculate the size of the firm’s tariff base for that activity group using:

    1. (a)

      the tariff base calculations in Part 2 of FEES 7D Annex 1R (including only business undertaken from a branch in the UK); and

    2. (b)

      the valuation date requirements in Part 3 of FEES 7D Annex 1R;

  2. (2)

    the amount payable in (1) is the amount payable by the firm with respect to that activity group.

FEES 7D.2.4 R

1For the purposes of FEES 7D.2.3R:

  1. (1)

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

    1. (a)

      it has reasonable grounds for believing that the costs of identifying its UK business separately from its non-UK business in the way described in Part 2 of FEES 7D Annex 1R are disproportionate to the difference in fees payable; and

    2. (b)

      it notifies the FCA in writing at the same time as it provides the information concerned under FEES 7D.2.3R(1), or, if earlier, at the time it pays the TPR DA levy applicable to it.

  2. (2)

    for a firm which has not complied with FEES 4A.2.6R for this period, the TPR DA levy is calculated using (where relevant) the valuation or valuations of business applicable to the previous period, multiplied by the factor of 1.10.

TPR DA levy commencement

FEES 7D.2.5 R

1The TPR DA levy under FEES 7D relates to the whole of any fee year and is due for payment from the commencement of the fee year. Any payment made under FEES 7D.2.1R is not refundable.

FEES 7D.3 FEES 4 rules incorporated into FEES 7D by cross-reference

FEES 7D.3.1 R

1The FCA Handbook provisions relating to FEES 7D are meant to follow closely the provisions relating to the payment of the periodic fees in FEES 4. In the interests of brevity, not all of these provisions are set out again in FEES 7D. In some cases, certain FEES 4rules are applied to the payment of the TPR DA levy by individual rules in FEES 7D. The rest are set out in the table in FEES 7D.3.3R.

FEES 7D.3.2 R

1The rules set out in the table in FEES 7D.3.3R and any other rules in FEES 4 included in FEES 7D by cross-reference apply to the TPR DA levy in the same way as they apply to periodic fees payable under FEES 4.

FEES 7D.3.3 R

1Table of rules in FEES 4 that also apply to FEES 7D to the extent that in FEES 4 they apply to fees payable to the FCA

FEES 4 rules incorporated into FEES 7D

Description

FEES 4.2.4R

Method of payment

FEES 4.2.10R

Extension of time

FEES 4.3.7R

Groups of firms

FEES 4.3.17R

Firms acquiring businesses from other firms

FEES 7D Annex 1R TPR DA levy for the period from 1 April 2023 to 31 March 20242

R

1This table shows the TPR DA levy applicable to each activity group (fee-block).

Part 1

Activity group

A TP firm falls in the activity group if:

A.2 Home finance providers and administrators

It falls under activity group A.2 as defined in Part 1 of FEES 4 Annex 1AR.

CC.3 Consumer credit lending

Its permission is in relation to the following regulated activities:

- entering into a regulated credit agreement as lender (article 60B(1) of the Regulated Activities Order);

- exercising, or having the right to exercise, the lender’s rights and duties under a regulated credit agreement (article 60B(2) of the Regulated Activities Order);

which is carried on by way of business and relates to the following specified investments:

(a) a regulated credit agreement (excluding high-cost short-term credit, a home credit loan agreement and a bill of sale loan agreement);

(b) high-cost short-term credit;

(c) a home credit loan agreement;

(d) a bill of sale loan agreement.

Part 2

Activity group

Tariff base

A.2 Home finance providers and administrators

The sterling value of any residential loans to individuals being the sum of gross unsecuritised and securitised balances (applying the definitions of Unsecuritised balances and Securitised balances set out in Section A: Balance Sheet of SUP 16 Annex 19BG.)

CC.3 Consumer credit lending

Value of lending in column A of data item CCR003 reported by firms under SUP 16 Annex 38AR, being the sum of data elements entered in rows:

- 1 Debt purchasing;

- 2 Hire purchase/conditional sale agreements;

- 3 Home credit loan agreements;

- 4 Bill of sale loan agreements;

- 5 Pawnbroking;

- 6 High-cost short-term credit;

- 11 Overdrafts;

- 12 Other running-account credit; and

- 8 Other lending.

Part 3

This table indicates the valuation date for each fee-block. A firm can calculate its tariff data in respect of the TPR DA levy payable to the FCA by that firm.

Activity group

Valuation date

A.2 Home finance providers and administrators

The 31 December before the start of the period to which the fee applies or, if earlier, the date of the valuation as disclosed by the annual return made in the calendar year prior to the 31 December.

CC.3 Consumer credit lending

Value of lending under Part 2 valued at the firm’s accounting reference date in the calendar year ending 31 December occurring before the start of the period to which the TPR DA levy applies.

Part 4

This table shows the tariff rates applicable to each of the fee-blocks set out in Part 1.

Activity group

TPR DA levy payable

A.2 Home finance providers and administrators

Band width (£ million of secured debt)

Fee (£/£m or part £m of secured debt)

>0

3.754

2 3

CC.3 Consumer credit lending

Band width (£ million of value of lending)

Fee (£/£m or part £m of value of lending)

>0 (Note 1)

23.964

2 3

Note

(1) Credit unions and community finance organisations do not pay any TPR DA levy payable on the first £2,000,000 of value of lending.