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SYSC 1.1A Application

SYSC 1.1A.1 G 31/03/2023

1The application of this sourcebook is summarised at a high level in the following table. The detailed application is cut back in SYSC 1 Annex 1 and in the text of each chapter.

Type of firm	Applicable chapters
Insurer, UK ISPV 13	Chapters 2, 3, 12 5 to 18, 19F.2,14 213, 2211, 23, 24, 25, 26, 2715, 2814, 28A20 5
Managing agent	Chapters 2, 3, 11, 12, 15A,18 18, 19F.2,14 213, 2211, 23, 24, 25, 26, 2715, 2814, 28A20
Society	Chapters 2, 3, 12, 15A,18 18, 19F.2,14 213, 2211, 23, 24, 25, 26, 2715, 2814, 28A20
15Any other SMCR firm	Chapters 4 to 12, 15A,18 18, 19D, 19F, 19G19, 21, 22, 23, 24, 25, 26, 27, 28, 28A20
Every other firm	Chapters 4 to 12, 15A,18 18, 19D, 19F, 19G19, 216, 2211, 2814, 28A20 6 2 4 4 6 3 6 14

Firms that SYSC 19D applies to should also refer to the Remuneration part of the PRA Rulebook 13.

SYSC 1.1A.1A G 31/03/2023

6The application of this sourcebook to specific14 firms that are not PRA-authorised persons is summarised at a high level in the following table. The detailed application is cut back in SYSC 1 Annex 1 and in the text of each chapter.

Type of firm	Applicable chapters
Full-scope UK AIFM	Chapters11 4 to 10, 12, 18, 1219B, 19F.2,14 21, 2211, 23, 24, 25, 26, 27,17 2814, 28A20
19	19 14 10 11 17 14
MIFIDPRU investment firm 19 (including an overseas firm that would have been a MIFIDPRU investment firm 19 if it had been a UK domestic firm, except that SYSC 19G does not apply to such a firm 19)	Chapters 4 to 10, 12, 18, 19F, 19G19, 21, 2211, 23, 24, 25, 26, 27,17 2814, 28A20 14 10

SYSC 1.1A.1B G 31/03/2022

18Chapter 15A of this sourcebook also applies to:

(1)
an electronic money institution, a payment institution and a registered account information service provider;
(2)
a UK RIE.

as set out in the text of that chapter.

SYSC 1.1A.2 G 01/01/2021

21The provisions in SYSC should be read in conjunction with GEN 2.2.23 R to GEN 2.2.25 G. In particular:

(1)
[deleted]9
(2)
Provisions made by the FCA, and by the9 PRA in the PRA Rulebook,9 may be applied by both regulators to PRA-authorised persons. Such provisions are applied by each regulator to the extent of its powers and regulatory responsibilities.9
5
(3)
5For Solvency II firms, the FCA considers that the requirements and guidance 14 in Chapters 2, 3, 12 to 18,11 19F.2,14 21, 22 and 2814 of SYSC are not inconsistent with: 7
115
1. (a)
  the parts of the PRA Rulebook which implemented16 the governance provisions in the Solvency II Directive (articles 40 to 49);7
2. (b)
  the Solvency II Regulation 16, or7
3. (c)
  EIOPA guidelines on systems of governance dated 28 January 2015 (EIOPA-BoS-14/253 EN)16.7
In most cases, there is no direct overlap with those provisions because the SYSC requirements are directed at FCA conduct requirements not expressly covered by or under provisions which implemented or supplemented16 the Solvency II Directive. Where there is a direct overlap with SYSC rules and guidance, the FCA will take requirements and guidelines which implemented or supplemented16 the Solvency II Directive into account16. The definition of Solvency II firm includes (for SYSC) large non-directive insurers because the PRA have applied certain Solvency II derived requirements to those firms. Where SYSC refers to the PRA Rulebook applicable to Solvency II firms, large non-directive insurers should read those references as if they were references to the corresponding part of the PRA Rulebook applicable to large non-directive insurers.8
7

SYSC 1.2 Purpose

SYSC 1.2.1 G 07/03/2016

The purposes of SYSC are:

(1)
to encourage firms' directors and senior managers to take appropriate practical responsibility for their firms' arrangements on matters likely to be of interest to the FCA 3 because they impinge on the FCA’s 3 functions under the Act;
(2)
to increase certainty by amplifying Principle 3, under which a firm must take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems;
1
(3)
to encourage firms to vest responsibility for effective and responsible organisation in specific directors and senior managers;1 and2
1
(4)
to create a common platform of organisational and systems and controls requirements for all firms.2
1 2
(5)
[deleted]2

SYSC 1.4 Application of SYSC 11 to 28A12 2 4 3 7 8

What?

SYSC 1.4.1 G 27/07/2012

1The application of each of chapters SYSC 11 to 2SYSC 213 is set out in those chapters and in SYSC 1.4.1A R5.

3 4 4

SYSC 1.4.1-A G 31/03/2023

8The application of each of the chapters SYSC 19F.2, SYSC 22 to 9SYSC 28A12 is set out in those chapters.

SYSC 1.4.1A R 01/01/2022

SYSC 12 11 and SYSC 21 do not apply to a firm in relation to its carrying on of auction regulation bidding.

5 6

SYSC 1.4.1B G 31/03/2022

5Apart from SYSC 1211, and SYSC 21 which are disapplied by SYSC 1.4.1A R, the other chapters of SYSC 11 to SYSC 1410 do not apply in relation to a firm's carrying on of auction regulation bidding because they only apply to an insurer. SYSC 18 provides guidance on the Public Interest Disclosure Act. Other chapters of SYSC may not apply to auction regulation bidding, for example because an exempt MiFID commodities firm will not be a MIFIDPRU investment firm 11.

Actions for damages

SYSC 1.4.2 R 31/03/2023

A contravention of a rule in SYSC 11 to 2SYSC 14, SYSC 18 to10SYSC 21,7SYSC 22.8.1R, SYSC 22.9.1R or SYSC 23 to 9SYSC 28A12 does not give rise to a right of action by a private person under section 138D of the Act (and each of those rules is specified under section 138D(3) of the Act as a provision giving rise to no such right of action).

3 4 4 3 7 8

SYSC 1.5 Significant SYSC firm

Purpose

SYSC 1.5.1 G 01/01/2022

(1)
1The purpose of SYSC 1.5 is to set out the definition of a significant SYSC firm.
(2)
The following governance requirements in SYSC apply by reference to the term significant SYSC firm:
1. (a)
  SYSC 4.3A.6R on the limitations in the number of directorships;
2. (b)
  SYSC 4.3A.8R on the nomination committee; and
3. (c)
  SYSC 7.1.18R and SYSC 7.1.18AAR on the risk committee.
(3)
MIFIDPRU investment firms are not subject to SYSC 4.3A.8R or SYSC 7.1.18R, and should refer instead to MIFIDPRU 7.3.
(4)
The definition of significant SYSC firm is also relevant in determining whether a firm is an enhanced scope SMCR firm for the purposes of the senior managers and certification regime.

Definition of a significant SYSC firm

SYSC 1.5.2 R 01/01/2022

1A firm is a significant SYSC firm if it meets one or more of the following conditions:

(1)
its total assets exceed £530 million;
(2)
its total liabilities exceed £380 million;
(3)
the annual fees and commission income it receives in relation to the regulated activities carried on by the firm exceeds £160 million in the 12-month period immediately preceding the date the firm carries out the assessment under this rule;
(4)
the client money that it receives or holds exceeds £425 million; and
(5)
the assets belonging to its clients that it holds in the course of, or in connection with, its regulated activities exceeds £7.8 billion.

SYSC 1.5.3 R 01/01/2022

(1)
1This rule defines some of the terms used in SYSC 1.5.2R.
(2)
“Total assets” means the firm’s total assets:
1. (a)
  as set out in the most recent relevant report submitted to the FCA under SUP 16.12 (Integrated Regulatory Reporting); or
2. (b)
  (where the firm carries out the assessment under SYSC 1.5.4R at any time after the date of its most recent report in (a)) as the firm would report to the FCA in accordance with the relevant report, as if the reporting period for that report ended on the date of the assessment.
(3)
“Total liabilities” means the firm’s total liabilities:
1. (a)
  as set out in the most recent relevant report submitted to the FCA under SUP 16.12 (Integrated Regulatory Reporting); or
2. (b)
  (where the firm carries out the assessment under SYSC 1.5.4R at any time after the date of its most recent report in (a)) as the firm would report to the FCA in accordance with the relevant report, as if the reporting period for that report ended on the date of the assessment.
(4)
“client money” means client money that a firm receives or holds in the course of, or in connection with, all of the regulated activities that it carries on:
1. (a)
  as set out in the most recent client money and client asset report submitted to the FCA under SUP 16.12 (Integrated Regulatory Reporting); or
2. (b)
  (where the firm carries out the assessment under SYSC 1.5.4R at any time after the date of its most recent report in (a)) as the firm would report to the FCA in accordance with the relevant report, as if the reporting period for that report ended on the date of the assessment.
(5)
“Assets belonging to its clients” means the assets to which the custody rules apply:
1. (a)
  as set out in the most recent client money and client asset report submitted to the FCA under SUP 16.12 (Integrated Regulatory Reporting); or
2. (b)
  (if the firm carries out the assessment under SYSC 1.5.4R at any time after the date of its most recent report in (a)) as the firm would report to the FCA in accordance with the relevant report, as if the reporting period for that report ends on the date the assessment is carried out.

SYSC 1.5.4 R 01/01/2022

1A firm must assess regularly whether it becomes a significant SYSC firm.

SYSC 1.5.5 R 01/01/2022

(1)
1If a firm, at any time, becomes aware that it is likely to become a significant SYSC firm, it must forthwith make arrangements to establish and have in place sound, effective and comprehensive strategies, processes and systems to achieve compliance with the requirements that apply to a significant SYSC firm.
(2)
The firm in (1) must comply with the requirements that apply to a significant SYSC firm on the expiry of a period of 3 months from the date it meets any one of the conditions in SYSC 1.5.2R.

SYSC 1.5.6 R 01/01/2022

1If a firm that is a significant SYSC firm ceases to meet any of the conditions in SYSC 1.5.2R, it must continue to comply with the rules and requirements applicable to a significant SYSC firm until the first anniversary of the date on which the firm ceased to be a significant SYSC firm.

SYSC 1.5.7 G 01/01/2022

1The FCA may, on a case-by-case basis, require a firm which does not meet any of the conditions in SYSC 1.5.2R to comply with the rules and requirements that apply to a significant SYSC firm if the FCA considers it appropriate to do so to meet its strategic objective or to advance one or more of its operational objectives under the Act.

SYSC 1.5.8 G 01/01/2022

(1)
1A firm may apply to the FCA under section 138A of the Act to waive any one or more of the conditions in SYSC 1.5.2R if it believes that one or more of the governance requirements in (2) that apply to a significant SYSC firm may be disproportionate. In its application for a waiver, the FCA expects the firm to demonstrate that it should not be considered as significant, taking into account the size, nature, scope and complexity of its activities, any membership of a group and the internal organisation of that group.
(2)
The governance requirements referred to in (1) are:
1. (a)
  SYSC 4.3A.6R on the limitations in the number of directorships;
2. (b)
  SYSC 4.3A.8R on the nomination committee; or
3. (c)
  SYSC 7.1.18 R on the risk committee.
(3)
The effect of such waiver is that the firm would not be a significant SYSC firm only for the purpose of the particular governance requirement in (2) that the waiver is expressed to apply to. For the avoidance of doubt, such a firm would still be a significant SYSC firm for the purpose of the other rules in the FCA Handbook that apply to a significant SYSC firm, except where expressly otherwise provided for.

SYSC 1 Annex 1 Detailed application of SYSC

30/11/2024

1 Part 1	Application of SYSC 2 and SYSC 3 to an insurer, a UK ISPV, 32 a managing agent and the Society
	Who?
1.124	R	SYSC 2 and SYSC 3 only apply to an insurer, a UK ISPV,32 a managing agent and the Society except that:
		(1)	[deleted]38

				3 3
				3 3
		(2)	[deleted]38
		(3)	[deleted]38
		(4)	for a sole trader:
			(a)	SYSC 2 applies but only if he employs any person who is required to be approved under section 59 of the Act (Approval for particular arrangements);
			(b)	SYSC 3.2.6I R does not apply if he has no employees; and
		(5)	[deleted]38
		(6)	Except as provided for in (7), SYSC 2 and SYSC 3 do not apply to a firm in relation to benchmark activities.35
		(7)	SYSC 2 and SYSC 3 continue to apply to a person with permission to carry on the regulated activity of administering a specified benchmark acting as such.35
351.1A	G	(1)	As a consequence of the benchmarks regulation, the regulated activity referred to in SYSC 1 Annex 1 1.1R(7) will cease to apply in certain circumstances (see SUP TP 10 for an explanation of those circumstances).
		(2)	The effect of SYSC 1 Annex 1 1.1R(7) is that SYSC 2 and SYSC 3 continue to apply to firms which still have permission to carry on the regulated activity in SYSC 1 Annex 1 1.1R(7) when carrying on that activity.35
1.224	G		[deleted]38



	What?
1.324	R	SYSC 2 and SYSC 3 apply with respect to the carrying on of:
		(1)	regulated activities;
		(2)	activities that constitute dealing in investments as principal, disregarding the exclusion in article 15 of the Regulated Activities Order (Absence of holding out etc); 32
		(3)	ancillary activities in relation to designated investment business, home finance activity and insurance distribution activity 33; and32
		32(4)	activities directly arising from insurance risk transformation;
		except that SYSC 3.3 applies as described in SYSC 1 Annex 1 1.3AR and 33SYSC 3.2.6A R to SYSC 3.2.6J G do not apply as described in SYSC 1 Annex 1.1.4R.
331.3A	R	SYSC 3.3 only applies in relation to the carrying on of insurance distribution activities.
1.4 21	R	SYSC 3.2.6A R to SYSC 3.2.6J G do not apply:
		(1)	with respect to the activities described in SYSC 1 Annex 1.1.3R(2) and SYSC 1 Annex 1.1.3R(3); or
		(2)	in relation to the following regulated activities:
			(a)	general insurance business;
			32(aa)	insurance risk transformation;
			(b)	insurance distribution activity 33 in relation to a general insurance contract or pure protection contract;
			(c)	long-term insurance business which is outside the scope of the 38 Solvency II Directive 18 (unless it is otherwise one of the regulated activities specified in this rule);
			(d)	business relating to contracts which are within the Regulated Activities Order only because they fall within paragraph (e) of the definition of "contract of insurance" in article 3 of that Order;
			(e)	(i)	arranging, by the Society, of deals in general insurance contracts written at Lloyd's; and
				(ii)	managing the underwriting capacity of a Lloyd's syndicate as a managing agent at Lloyd's;
			(f)	home finance mediation activity and administering a home finance transaction; and
			(g)	reversion activity; or21
		21(3)	to a pure reinsurer; or32
		32(4)	in relation to activities directly arising from insurance risk transformation.
1.524	R	SYSC 2 and SYSC 3, except SYSC 3.2.6A R to SYSC 3.2.6J G, also apply with respect to the communication and approval of financial promotions which:
		(1)	if communicated by an unauthorised person without approval would contravene section 21(1) of the Act (Restrictions on financial promotion); and
		(2)	may be communicated by a firm without contravening section 238(1) of the Act (Restrictions on promotion of collective investment schemes).
1.624	R	SYSC 2 and SYSC 3, except SYSC 3.2.6A R to SYSC 3.2.6J G, also:
		(1)	apply with respect to the carrying on of unregulated activities in a prudential context; and
		(2)	take into account any activity of other members of a group of which the firm is a member.
1.724	G	SYSC 1 Annex 1 .1.6R(2) does not mean that inadequacy of a group member's systems and controls will automatically lead to a firm contravening, for example, SYSC 3.1.1 R. Rather, the potential impact of a group member's activities, including its systems and controls, and any systems and controls that operate on a group basis, will be relevant in determining the appropriateness of the firm's own systems and controls.
	Where?
1.824	R	SYSC 2 and SYSC 3 apply with respect to activities carried on from an establishment maintained by the firm (or its appointed representative or, where applicable, its tied agent) in the United Kingdom unless another applicable rule which is relevant to the activity has a wider territorial scope, in which case SYSC 2 and SYSC 3 apply with that wider scope in relation to the activity described in that rule.
211.8A	R	(1) SYSC 3, except SYSC 3.2.6AR to SYSC 3.2.6JG, and (2) for a UK domestic firm, SYSC 2; also apply in a prudential context with respect to activities wherever they are carried on.
1.924	R	SYSC 2 and SYSC 3, except SYSC 3.2.6A R to SYSC 3.2.6J G, also apply in a prudential context to a UK domestic firm with respect to activities wherever they are carried on.
1.1024	R	SYSC 3 , except SYSC 3.2.6A R to SYSC 3.2.6J G, also applies in a prudential context to an overseas firm 38with respect to activities wherever they are carried on.
1.1124	G	(1)	In considering whether to take regulatory action under SYSC 2 or SYSC 3 in relation to activities carried on outside the United Kingdom, the appropriate regulator will take into account the standards expected in the market in which the firm is operating.
		(2)	Most of the rules in SYSC 3 are linked to other requirements and standards under the regulatory system which have their own territorial limitations so that those SYSC rules are similarly limited in scope.
	Actions for damages
1.1224	R	A contravention of the rules in SYSC 2 and SYSC 3 does not give rise to a right of action by a private person under section 138D of the Act (and each of those rules is specified under section 138D(3) of the Act as a provision giving rise to no such right of action).

Part 2	Application of the common platform requirements 27 (SYSC 4 to 10) 46
	Who?
2.124	R	The common platform requirements apply to every firm apart from an insurer, a UK ISPV,32 a managing agent and the Society unless provided otherwise in a specific rule.
2.224	R	[deleted]38

			3 3


2.324	R	For a sole trader:
		(1)	SYSC 4.3 does40 not apply as long as they do40 not employ any person who is required to be approved under section 59 of the Act (Approval for particular arrangements);
		(2)	SYSC 4.1.4 R and SYSC 6.3.9 R do not apply if he has no employees.
2.424	R	For a UCITS qualifier:
		(1)	the rule on responsibility of senior personnel (SYSC 4.3) does not apply; and
		(2)	the common platform requirements apply in relation to the communication and approval of financial promotions only as set out in SYSC 1 Annex 1.2.12R.
		[Note: section 266 of the Act.]
162.4A24	R	For an AIFM qualifier:
		(1)	the rule on responsibility of senior personnel (SYSC 4.3) does not apply; and
		(2)	the common platform requirements apply in relation to the communication and approval of financial promotions only as set out in SYSC 1 Annex 1, 2.12R.
2.524	R	For an authorised professional firm when carrying on non-mainstream regulated activities, the common platform requirements on financial crime, conflicts of interest and Chinese walls do not apply.
152.5A24	R	The common platform requirements on financial crime do not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations.
2.624	R	[deleted]38 7
72.6A24	R	[deleted]38


112.6B24	R	Subject to SYSC 1 Annex 1 2.6CR, the common platform requirements do not apply to a full-scope UK AIFM of an unauthorised AIF except for:
		(1)	SYSC 4.1.1 R to SYSC 4.1.2 R and SYSC 4.1.2B R to SYSC 4.1.2D R;
		(2)	SYSC 4.2.1 R , SYSC 4.2.1B R, SYSC 4.2.2 R to SYSC 4.2.5 G, SYSC 4.2.7 R and SYSC 4.2.8 G;
		(3)	SYSC 6.1.1 R , which only applies to the extent that it relates to the obligation to establish, implement and maintain adequate policies and procedures for countering the risk that the firm (including its managers and employees) might be used to further financial crime;
		(4)	SYSC 6.1.4B G 13 13
		(5)	SYSC 6.3 ;
		(6)	SYSC 7.1.7BA G 13 13
		(7)	SYSC 10.1.1 R and SYSC 10.1.22 R to SYSC 10.1.26 R; and
		(8)	SYSC 10.2 .
2.6C24	R	The common platform requirements apply to an AIFM investment firm which is a full-scope UK AIFM in respect of its MiFID business in line with Column A in Table A 27of Part 3. 11
2.6D24	R	The common platform requirements apply to a full-scope UK AIFM of an authorised AIF in line with Column27 A++ in Table A 27of Part 3. 11
2.6E24	G	The common platform requirements apply to a small authorised UK AIFM in line with Column B in Table A 27 of Part 3 (unless such a firm is also a common platform firm, in which case they must comply with Column A).11
112.6F24	R	[deleted]38



352.6G	R	(1)	Except as provided for in (2), the common platform requirements 36 do not apply to a firm in relation to benchmark activities.
		(2)	The common platform requirements continue to apply to a person with permission to carry on the regulated activity of administering a specified benchmark acting as such. 35
35 2.6H	G	(1)	As a consequence of the benchmarks regulation, the regulated activity referred to in SYSC 1 Annex 1 2.6GR(2) will cease to apply in certain circumstances (see SUP TP 10 for an explanation of those circumstances).
		(2)	The effect of SYSC 1 Annex 1 2.6GR(2) is that the common platform requirements continue to apply to firms which still have permission to carry on the regulated activity in SYSC 1 Annex 1 2.6GR(2) when carrying on that activity.
2.724	G	[deleted]38 6
62.7A24	G	[deleted]38
			27




	What?
2.824	R	The common platform organisational requirements apply with respect to the carrying on of the following (unless provided otherwise within a specific rule):
		(1)	regulated activities;
		(2)	activities that constitute dealing in investments as principal, disregarding the exclusion in article 15 of the Regulated Activities Order (Absence of holding out etc);
		(3)	ancillary activities; 6
		(4)	in relation to MiFID business, ancillary services; and6
		6(5)	collective portfolio management.
272.8A	R	(1)	Subject to (2), (3) and (5), in SYSC 1 Annex 1 2.8R,33 articles 1(2), 21 to 25, 30 to 32 and 72 of the MiFID Org Regulation (including any relevant definitions in the Glossary 38, MiFIR and the MiFID Org Regulation) apply as if they were rules or guidance in accordance with Part 3 (Tables summarising the application of the common platform requirements to different types of firm)30 to a firm’s carrying on of the business set out in SYSC 1 Annex 1 2.8R which is not 30 MiFID business or a structured deposits regulated activity 30. 30
		(1A)30	Subject to (2), (3) and (6)33, articles 33 to 35 of the MiFID Org Regulation 33(including any relevant definitions in the Glossary 38, MiFIR and the MiFID Org Regulation) apply as if they were rules or guidance in accordance with Part 3 (Tables summarising the application of the common platform requirements to different types of firm) to a firm’s carrying on of the business set out in SYSC 10.1.1R which is not MiFID business or a structured deposits regulated activity.30
		(2)	References in Column (1) to a word or phrase used in the MiFID Org Regulation for the purpose of (1) have the meaning indicated in Column (2) of the table below:
			(1)		(2)
			“ancillary services”		ancillary services or ancillary activities associated with the firm’s regulated activities
			“client” and “potential client”		client
			“competent authority”		FCA
			“investment firm” and “firm”		firm
			“investment service” and “investment services and activities”		designated investment business
			“portfolio management” and “portfolio management service”		managing investments
			38		38
			“shall”		must
		(3)	[deleted]38
		(4)	This rule does not apply to a collective portfolio management investment firm in relation to the firm’s business other than its MiFID business.
		33(5)	The requirements in article 72 of the MiFID Org Regulation do not apply to a firm to the extent that SYSC 9.1.2CR47 applies to the firm.
		33(6)	SYSC 1 Annex 1 2.8AR(1A) does not apply to a firm to the extent that SYSC 10A applies47 to the firm (see SYSC 1 Annex 1 3.1AG). 38

2.8B	G	The purpose of SYSC 1 Annex 1 2.8R and SYSC 1 Annex 1 2.8AR is that the common platform organisational requirements and the common platform requirements on conflicts of interest30 also apply when carrying on any of the activities listed in SYSC 1 Annex 1 2.8R or SYSC 10.1.1R respectively30 even where they do not involve investment services and/or activities and, where relevant, ancillary services (unless provided otherwise within a specific rule).
2.8C	G	SYSC 1 Annex 1 2.8AR(3) has the effect that, where the requirement in the MiFID Org Regulation that is a common platform organisational requirement or a common platform requirement on conflicts of interest30 includes a reference or cross reference to another part of the MiFID Org Regulation, that reference or cross reference is given the same meaning as for the purposes of SYSC 1 Annex 1 2.8AR.
2.8D	G	For the purpose of SYSC 1 Annex 1 2.8AR, a firm should apply any guidance published by the FCA that assists with interpreting the definitions in MiFID, MiFIR and the MiFID Org Regulation.
2.924	G27	The application of the provisions on the conflicts of interest in SYSC 10 is set out in SYSC 10.1.-4G33 to SYSC 10.1.1AR27 and SYSC 10.2.1 R
2.1024	R	The provisions on record-keeping in SYSC 9 and articles 21 and 72 of the MiFID Org Regulation 27 apply as set out in SYSC 1 Annex 1.2.8R and SYSC 1 Annex 1.2.8AR, except that they only apply to the carrying on of ancillary activities that are performed in relation to:
		(1)	designated investment business;
		(2)	home finance activity; 12
		(3)	insurance distribution activity 33;12
		(4)	credit-related regulated activity; and48 12
		48(5)	regulated pensions dashboard activity.
2.1124	R	The common platform requirements on financial crime apply as set out in SYSC 1 Annex 1 2.8R33, except that they do not apply:
		(1)	with respect to:
			(a)	activities that constitute dealing in investments as principal, disregarding the exclusion in article 15 of the Regulated Activities Order (Absence of holding out etc); and
			(b)	ancillary activities; or
		(2)	in relation to the following regulated activities:
			(a)	general insurance business;
			(b)	insurance distribution activity 33 in relation to a general insurance contract or pure protection contract;
			(c)	long-term insurance business which is outside theSolvency II Directive 18 (unless it is otherwise one of the regulated activities specified in this rule); 18
			(d)	business relating to contracts which are within the Regulated Activities Order only because they fall within paragraph (e) of the definition of "contract of insurance" in article 3 of that Order;
			(e)	(i)	arranging by the Society of deals in general insurance contracts written at Lloyd's; and
				(ii)	managing the underwriting capacity of a Lloyd's syndicate as a managing agent at Lloyd's;
			(f)	home finance mediation activity and administering a home finance transaction; 2
			(g)	reversion activity; 2 43
			(h)	meeting of repayment claims and managing dormant asset funds (including the investment of such funds)46 43; and 2
			(i)43	regulated funeral plan activities 43.
2.1224	R	The common platform organisational requirements, except the common platform requirements on financial crime, also apply with respect to the communication and approval of financial promotions which:
		(1)	if communicated by an unauthorised person without approval would contravene section 21(1) of the Act (Restrictions on financial promotion); and
		(2)	may be communicated by a firm without contravening section 238(1) of the Act (Restrictions on promotion of collective investment schemes).
2.1324	R	The common platform organisational requirements, except the common platform requirements on financial crime, also:
		(1)	apply with respect to the carrying on of unregulated activities in a prudential context; and
		(2)	take into account any activity of other members of a group of which the firm is a member.
2.13A24	R	SYSC 6.3 only applies to a firm in relation to carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 to which the Money Laundering Regulations also apply.12
2.13B24	R	SYSC 6.3.8 R and SYSC 6.3.9 R do not apply to a firm with a limited permission for entering into a regulated credit agreement as lender. 12
2.13C24	G	The persons to whom the Money Laundering Regulations apply are set out in regulation 1029 of the Money Laundering Regulations. The persons include credit institutions (for example, banks) and financial institutions (for example, persons who carry on regulated activities which consist of or include entering into regulated credit agreements as lender). These expressions are defined in regulation 1029 of those Regulations.12
36 19		20 20 20 20 25 25
		19
		19
2.1424	G	SYSC 1 Annex 1 .2.13R(2) does not mean that inadequacy of a group member's systems and controls will automatically lead to a firm contravening any of the common platform organisational requirements. Rather, the potential impact of a group member's activities, including its systems and controls, and any systems and controls that operate on a group basis, will be relevant in determining the appropriateness of the firm's own systems and controls.
272.14A	G	The systems and control requirements in article 17 of MiFID for the following are in chapter 7A of the Market Conduct sourcebook (MAR):
		(1)			algorithmic trading;
		(2)			direct electronic access to a trading venue; and
		(3)			acting as a general clearing member of a trading venue.
272.14B	G	Firms should refer to articles 38 to 42 of the MiFID Org Regulation for additional organisational requirements for underwriting and placing.
	Where?
2.1524	R	The common platform requirements, except the common platform record-keeping requirements, apply to a firm in relation to activities which:37 36 20 20 20 20 25 25 19
		(1)	(except for regulated claims management activities and ancillary activities) are carried on by it from an establishment in the United Kingdom; or37
		(2)	are, or are ancillary to, regulated claims management activities.37
2.1624	R	[deleted]38 6 6
62.16A24	R		[deleted]38 27

62.16B24	G	[deleted]38
2.16C24	R	The common platform requirements apply to a full-scope UK AIFM in respect of its management of an AIF where carried on from an establishment in the UK. 11
2.16D24	R	[deleted]38 11
2.16E24	R	The common platform requirements apply to an AIFM investment firm which is a full-scope UK AIFM in respect of its MiFID business where carried on from an establishment in the UK.11
2.16F24	R	[deleted]38 11
2.1724	R	The common platform record-keeping requirements apply to activities which:37
		(1)	(except for regulated claims management activities and ancillary activities) are carried on by it from an establishment in the United Kingdom; or37
		(2)	are, or are ancillary to, regulated claims management activities.37
		If, however,37 another applicable rule which is relevant to the activity has a wider territorial scope,37 the common platform record-keeping requirements apply with that wider scope in relation to the activity described in that rule.
		[Note: article16(11) first paragraph 27of MiFID]
372.17A	G	For an activity to amount to a regulated claims management activity it must be carried on in Great Britain (see PERG 2.4A). Subject to the exception for common platform record-keeping requirements in paragraph 2.17R of this Annex, the application of the common platform requirements to firms which carry on regulated claims management activities (and ancillary activities) depends on whether the activity is carried on in Great Britain rather than whether it is carried on from an establishment maintained in the United Kingdom.
36 24	36	The common platform organisational requirements, except the common platform requirements on financial crime, also apply in a prudential context to a UK domestic firm and to an overseas firm 38with respect to activities wherever they are carried on. 36 20 20 20 20 25 25 19
272.18A	G	SYSC 6.1.1R on systems and controls for countering the risk that a firm might be used to further financial crime is:
		(1)			a common platform organisational requirement, not a common platform requirement on financial crime; and
		(2)			subject to the application, amongst other provisions, of SYSC 1 Annex 1 2.13R, SYSC 1 Annex 1 2.16R and SYSC 1 Annex 1 2.18R.
	Actions for damages
2.1924	R	A contravention of a rule in the common platform requirements does not give rise to a right of action by a private person under section 138D of the Act (and each of those rules is specified under section 138D(3) of the Act as a provision giving rise to no such right of action).

Part 3	Tables summarising the application of the common platform requirements to different types of firm
3.124	G	The common platform requirements apply as described in the following table 27 (subject to the provisions in Part 2 of this Annex (Application of the common platform requirements)27). 6 9 9
		Type of firm			Common platform requirements
		Common platform firm			SYSC 1 Annex 1 3.2G, SYSC 1 Annex 1 3.2-AR and SYSC 1 Annex 1 3.2-BR
		Management company			SYSC 1 Annex 1 3.2AG
		Full-scope UK AIFM of an authorised AIF			SYSC 1 Annex 1 3.2BR
		MiFID optional exemption firm			SYSC 1 Annex 1 3.2CR
		Third country firm			SYSC 1 Annex 1 3.2CR
		All other firms (apart from insurers, managing agents, the Society, full-scope UK AIFMs of unauthorised AIFs, MiFID optional exemption firms and third country firms)			SYSC 1 Annex 1 .3.3R
333.1A	G	[deleted]47 38
Common platform firm27
3.224	G	For a common platform firm (other than a dormant asset fund operator 46 not subject to MiFID):27 6
		(1)27	SYSC 4 to SYSC 1027 apply in accordance with Column A in Table A below;27 and
		(2)27	articles 1(2), 21 to 25, 30 to 3530 and 72 of the MiFID Org Regulation are directly applicable to the firm 27.
453.2-ZA	G	A common platform firm that is a MIFIDPRU investment firm should read SYSC 4 to SYSC 10 together with MIFIDPRU 7. While MIFIDPRU investment firms are not in scope of the requirements in SYSC 4.3A.8R and SYSC 7.1.18R regarding nomination and risk committees, certain MIFIDPRU investment firms are required by MIFIDPRU 7.3.1R and MIFIDPRU 7.3.5R to establish nomination and risk committees.
273.2-A	R	For a common platform firm (other than a dormant asset fund operator 46 not subject to MiFID), articles 1(2), 21 to 25, 30 to 3530 and 72 of the MiFID Org Regulation apply to the firm’s business other than MiFID business or structured deposits regulated activities as if the MiFID Org Regulation applied to the firm as rules in accordance with SYSC 1 Annex 1 2.8R and SYSC 1 Annex 1 2.8AR.
273.2-B	R	For a common platform firm that is a dormant asset fund operator 46 and is not subject to MiFID:
		(1)	SYSC 4 to SYSC 10 apply in accordance with Column A in Table A below; and
		(2)	articles 1(2), 21 to 25, 30 to 3530 and 72 of the MiFID Org Regulation apply as if the MiFID Org Regulation applied to the firm as rules in accordance with SYSC 1 Annex 1 2.8R and SYSC 1 Annex 1 2.8AR.
27Management company
63.2A24	G	For a management company, the common platform requirements in SYSC 4 to SYSC 1027 apply in accordance with Column A+ in Table A27 below.
27Full-scope UK AIFM of an authorised AIF
3.2B24	R	For a full-scope UK AIFM of an authorised AIF, the common platform requirements in SYSC 4 to SYSC 1027 apply in accordance27 with Column A++ in 27Table A below. 9
27MiFID optional exemption firm and a third country firm
273.2C	R	For a MiFID optional exemption firm and a third country firm:
		(1)	SYSC 4 to SYSC 10 apply as rules or as guidance in accordance with Table B below in the following way:
			(a)	where a rule is shown modified as 'Guidance', it should be read as guidance (as if "should" appeared in that rule instead of "must"); and
			(b)	the provision should be applied in a proportionate manner, taking into account the nature, scale and complexity of the firm’s business; and
		(2)	articles 1(2), 21 to 25, 30 to 32 and 72 of the MiFID Org Regulation apply as if the MiFID Org Regulation applied to the firm as rules (in accordance with SYSC 1 Annex 1 2.8R and SYSC 1 Annex 1 2.8AR) or as guidance in accordance with Part 1 of Table C below. Part 2 of Table C sets out those articles of the MiFID Org Regulation.
273.2D	R	(1)	Subject to (2), SYSC 4.3A.6R, SYSC 4.3A.8R and SYSC 7.1.18R apply to a MiFID optional exemption firm that is ‘significant’ as a rule or as guidance in accordance with SYSC 1 Annex 1 3.2CR.
		(2)	In (1), ‘significant’ means a MiFID optional exemption firm that is a significant SYSC firm 45.
27Other firms
3.2E30 27	R	SYSC 1 Annex 1 3.3R does not apply to the following:
		(1)	insurers and UK ISPVs 32;
		(2)	managing agents;
		(3)	the Society;
		(4)	full-scope UK AIFMs of unauthorised AIFs;
		(5)	MiFID optional exemption firms; and
		(6)	third country firms.
3.324	R	For all other firms:27 32 9 32
		(1)27	SYSC 4 to SYSC 1027 apply as rules or as guidance 27 in accordance with Column B in Table A27 below in the following way:27
			(a)27	27where a rule is shown modified in Column B as 'Guidance', it should be read as guidance (as if "should" appeared in that rule 27 instead of "must"); 27and
			(b)27	the provision27 should be applied in a proportionate manner, taking into account the nature, scale and complexity of the firm’s 27 business; and27
		(2)27	articles 1(2), 21 to 25, 30 to 3530 and 72 of the MiFID Org Regulation do not apply27.
273.3A	R	36

Table A: Application of the common platform requirements in SYSC 4 to SYSC 10 27

9Provision SYSC 4	COLUMN A Application to a common platform firm other than to a UCITS investment firm	COLUMN A+ Application to a UCITS management company	COLUMN A++ Application to a full-scope UK AIFM of an authorised AIF	COLUMN B Application to all other firms apart from insurers, UK ISPVs,32 managing agents,32 the Society, full-scope UK AIFMs of unauthorised AIFs, MiFID optional exemption firms and third country firms27
27 SYSC 4.1.-2G	Guidance	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	Not applicable
27 SYSC 4.1.-1G	Not applicable	Not applicable	Not applicable	Not applicable
SYSC 4.1.1R 24	Rule10 10	Rule10 10	Rule10 10	Rule10 10
SYSC 4.1.1AR 24	Not applicable	Not applicable	Rule	Not applicable
SYSC 4.1.1BR 24	Not applicable	Not applicable	Rule	Not applicable
14 SYSC 4.1.1CR 24	[deleted]45	[deleted]45	[deleted]45	[deleted]45 27 27
23 SYSC 4.1.1DR	Not applicable	Rule	Not applicable	Not applicable
23 SYSC 4.1.1ER	Not applicable	Rule	Not applicable	Not applicable
23 SYSC 4.1.1FG 26	Not applicable	Guidance	Not applicable	Not applicable
SYSC 4.1.2R 24	Rule	Rule for a UCITS investment firm; otherwise guidance	Rule	Guidance
SYSC 4.1.2AG 24	Not applicable	Guidance for a UCITS firm; not applicable to a UCITS investment firm	Not applicable	Guidance
14 SYSC 4.1.2AAR 24	[deleted]45	[deleted]45	[deleted]45	[deleted]45
SYSC 4.1.2BR 24	Not applicable	Rule	Rule	Not applicable
SYSC 4.1.2CR 24	Not applicable		Rule	Not applicable
SYSC 4.1.2DR 24	Not applicable	Not applicable	Rule	Not applicable
SYSC 4.1.3R 24	[deleted]10 10	[deleted]10 10	[deleted]10 10	[deleted]10 10
SYSC 4.1.4R 24	Not applicable27	Rule	Not applicable	(1) and (3):27 Guidance; (2):27 Rule
SYSC 4.1.4AG 24	Not applicable	Not applicable	Not applicable	Guidance
SYSC 4.1.5R 24	Not applicable27	Rule	Not applicable	Not applicable
48 SYSC 4.1.5AR	Not applicable	Not applicable	Not applicable	Applies as a rule only to a firm carrying on regulated pensions dashboard activity
48 SYSC 4.1.5BR	Not applicable	Not applicable	Not applicable	Applies as a rule only to a firm carrying on regulated pensions dashboard activity
48 SYSC 4.1.5CR	Not applicable	Not applicable	Not applicable	Applies as a rule only to a firm carrying on regulated pensions dashboard activity
SYSC 4.1.6R 24	Rule	Rule for a UCITS investment firm; otherwise guidance	Not applicable	Guidance
SYSC 4.1.7R 24	Rule CRR firm for a only27	Rule	Not applicable	Guidance
SYSC 4.1.7AG 24	Not applicable	Not applicable	Not applicable	Guidance
SYSC 4.1.8G 24	Guidance	Guidance	Guidance	Guidance
39 SYSC 4.1.8AR	Applies as a rule only to an operator of an electronic system in relation to lending	Not applicable	Not applicable	Applies as a rule only to an operator of an electronic system in relation to lending
39 SYSC 4.1.8CG	Applies as guidance only to an operator of an electronic system in relation to lending	Not applicable	Not applicable	Applies as guidance only to an operator of an electronic system in relation to lending
39 SYSC 4.1.8DG	Applies as guidance only to an operator of an electronic system in relation to lending	Not applicable	Not applicable	Applies as guidance only to an operator of an electronic system in relation to lending
39 SYSC 4.1.8DAG	Applies as guidance only to an operator of an electronic system in relation to lending	Not applicable	Not applicable	Applies as guidance only to an operator of an electronic system in relation to lending
39 SYSC 4.1.8DBR	Applies as a rule only to an operator of an electronic system in relation to lending	Not applicable	Not applicable	Applies as a rule only to an operator of an electronic system in relation to lending
39 SYSC 4.1.8DCR	Applies as a rule only to an Applies as a rule only to an operator of an electronic system in relation to lending	Not applicable	Not applicable	Applies as a rule only to an operator of an electronic system in relation to lending
39 SYSC 4.1.8DDR	Applies as a rule only to an operator of an electronic system in relation to lending	Not applicable	Not applicable	Applies as a rule only to an operator of an electronic system in relation to lending
SYSC 4.1.9R 24	Not applicable27	Rule	Not applicable	Not applicable
SYSC 4.1.10R 24	Not applicable27	Rule	Not applicable	Guidance - except reference to SYSC 4.1.9 R which does not apply to these firms
SYSC 4.1.10AG 24	Not applicable	Not applicable	Not applicable	Guidance
SYSC 4.1.11G 24	Guidance	Guidance	Guidance	Guidance
SYSC 4.1.13G 24	Guidance	Guidance	Guidance	Guidance
SYSC 4.1.14G 24	Guidance	Guidance	Guidance	Guidance
SYSC 4.2.1R 24	Rule	Rule	Rule	27Guidance
SYSC 4.2.1AG 24	Not applicable	Not applicable	Not applicable	Guidance
SYSC 4.2.2R 24	Rule	Rule	Rule	Not applicable27
SYSC 4.2.3G - 4.2.5G24	Guidance	Guidance	Guidance	Not applicable27
SYSC 4.2.6R 24	Rule	Rule for a UCITS investment firm; otherwise not applicable	Not applicable	Not applicable27
SYSC 4.2.7R 24	Not applicable	Not applicable	Rule	Not applicable
SYSC 4.2.8G 24	Not applicable	Not applicable	Rule	Not applicable
SYSC 4.2.9G24	[deleted]24	[deleted]24	[deleted]24	[deleted]24
SYSC 4.3.1R 24	Not applicable27	Rule	Not applicable	Rule 38
SYSC 4.3.2R 24	Not applicable27	Rule	Not applicable	Guidance 38but42 applies as a rule to an operator of an electronic system in relation to lending 42 39 39
SYSC 4.3.2AG 24	Not applicable	Not applicable	Not applicable	Guidance (but not applicable to42 an operator of an electronic system in relation to lending)42 38 42 39
SYSC 4.3.3G 24	Guidance	Guidance	Not applicable	Guidance 38
14 SYSC 4.3A.-1R 24	[deleted]45 27 34	[deleted]45	[deleted]45	[deleted]45
10 SYSC 4.3A.1R 24	Rule 45 27 34	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
27 SYSC 4.3A.1AR	Rule 34 45	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
10 SYSC 4.3A.2R 24	Rule 45 27 34	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
27 SYSC 4.3A.2AG	Guidance 34 45	Guidance for a 45 UCITS investment firm	Not applicable	Not applicable
10 SYSC 4.3A.3R 24	Rule 27 45 34	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
41 SYSC 4.3A.3AG	Guidance	Guidance for a 45 UCITS investment firm	Not applicable	Not applicable
10 SYSC 4.3A.4R 24	Rule 27 45 34	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
10 SYSC 4.3A.5R 24	Rule 27 45 34	Rule for a UCITS investment firm 45	Not applicable	Not applicable
10 SYSC 4.3A.6R 24	Rule 27 45 34	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
10 SYSC 4.3A.7R 24	Rule 27 45 34	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
45 SYSC 4.3A.7AR	Rule (except for a MIFIDPRU investment firm)	Not applicable	Not applicable	Not applicable
45 SYSC 4.3A.7BG	Guidance for a MIFIDPRU investment firm	Guidance for a UCITS investment firm	Not applicable	Not applicable
10 SYSC 4.3A.8R 24	Rule 27 (except for a MIFIDPRU investment firm)45 34	Not applicable45	Not applicable	Not applicable
10 SYSC 4.3A.9R 24	Rule 27 45 34	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
10 SYSC 4.3A.10R 24	Rule 27 45 34	Rule for a 45 UCITS investment firm	Not applicable	Not applicable
10 SYSC 4.3A.11R 24	Rule applicable to CRR firms	Not applicable45	Not applicable	Not applicable
SYSC 4.4.1R 24 12	[deleted]24	[deleted]24	[deleted]24	[deleted]24 22 12
SYSC 4.4.1AR	Not applicable	Not applicable	Not applicable	As specified in SYSC 4.4.1AR40
SYSC 4.4.2G 24	Not applicable	Not applicable	Not applicable	Guidance only applying to the firms specified in 24SYSC 4.4.1A R8
SYSC 4.4.3R 24	Not applicable	Not applicable	Not applicable	Rule only applying to the firms specified in24SYSC 4.4.1A R8
SYSC 4.4.4G 24	Not applicable	Not applicable	Not applicable	Guidance only applying to the firms specified in24SYSC 4.4.1A R8
SYSC 4.4.5R 24	Not applicable	Not applicable	Not applicable	Rule only applying to the firms specified in24SYSC 4.4.1A R8
SYSC 4.4.6G 24	Not applicable	Not applicable	Not applicable	Guidance only applying to the firms specified in24SYSC 4.4.1A R8
36 19	36 20	36	36	36 20 27
36 20	36	36	36	36 27
36 19	36 20	36	36	36 20 27
36 19	36 20	36	36	36 20 27

9Provision SYSC 5	COLUMN A Application to a common platform firm other than to a UCITS investment firm	COLUMN A+ Application to a UCITS management company	COLUMN A++ Application to a full-scope UK AIFM of an authorised AIF	COLUMN B Application to all other firms apart from insurers, UK ISPVs,32 managing agents,32 the Society, full-scope UK AIFMs of unauthorised AIFs, MiFID optional exemption firms and third country firms27
27 SYSC 5.1.-2G	Guidance	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	Not applicable
27 SYSC 5.1.-1G	Not applicable	Not applicable	Not applicable	Not applicable
SYSC 5.1.1R 24	Not applicable27	Rule	Not applicable	Rule
SYSC 5.1.2G 24	Guidance	Guidance	Guidance	Guidance
SYSC 5.1.3G 24	Guidance	Guidance	Not applicable	Guidance
33 SYSC 5.1.3AG	Guidance	Guidance	Guidance	Guidance
SYSC 5.1.4G 24	Guidance	Guidance	Guidance	Guidance
SYSC 5.1.4AG 24	Guidance	Guidance	Guidance	Guidance
SYSC 5.1.5G 24	Guidance	Guidance	Guidance	Guidance
SYSC 5.1.5AG 24	Guidance	Guidance	Guidance	Guidance
28 SYSC 5.1.5AAR	Rule	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	38 Not applicable
28 SYSC 5.1.5ABR	Rule	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	38 Not applicable
28 SYSC 5.1.5ACG	Guidance	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	38 Not applicable
28 SYSC 5.1.5ADG				[deleted]38
28 SYSC 5.1.5AEG				[deleted]38
33 SYSC 5.1.5BR	Rule	Rule	Rule	Rule
SYSC 5.1.6R 24	Not applicable27	Rule	Guidance	Guidance
SYSC 5.1.7R 24	Rule	Rule for a UCITS investment firm; otherwise guidance	Guidance	Guidance
SYSC 5.1.7AG 24	Not applicable	Not applicable to a UCITS investment firm; otherwise guidance	Guidance	Guidance
SYSC 5.1.8G 24	Guidance	Guidance	Guidance	Guidance
SYSC 5.1.9G 24	Guidance	Guidance	Guidance	Guidance
SYSC 5.1.10G 24	Guidance	Guidance	Guidance, but not applicable for the segregation of risk management functions	Guidance
SYSC 5.1.11G 24	Guidance	Guidance	Guidance	Guidance
SYSC 5.1.12R 24	Not applicable27	Rule	Not applicable	Guidance
SYSC 5.1.12AG 24	Not applicable	Not applicable	Not applicable	Guidance
SYSC 5.1.13R 24	Not applicable27	Rule	Not applicable	Rule
SYSC 5.1.14R 24	Not applicable27	Rule	Not applicable	Guidance
SYSC 5.1.15G 24	Not applicable	Not applicable	Not applicable	Guidance
36 19	36	36	36	36
25 19	25	25	.25	25

9Provision SYSC 6	COLUMN A Application to a common platform firm other than to a UCITS investment firm	COLUMN A+ Application to a UCITS management company	COLUMN A++ Application to a full-scope UK AIFM of an authorised AIF	COLUMN B Application to all other firms apart from insurers, UK ISPVs,32 managing agents,32 the Society, full-scope UK AIFMs of unauthorised AIFs, MiFID optional exemption firms and third country firms27
27 SYSC 6.1.-2G	Guidance	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	Not applicable
27 SYSC 6.1.-1G	Not applicable	Not applicable	Not applicable	Not applicable
SYSC 6.1.1R 24	Rule	Rule	Rule but only regarding the obligation to establish, implement and maintain adequate policies and procedures for countering the risk that the firm (including its managers and employees) might be used to further financial crime	Rule
SYSC 6.1.1AG 24	Guidance	Guidance	Guidance	Guidance
SYSC 6.1.2R 24	Not applicable27	Rule	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39
SYSC 6.1.2AG 24	Not applicable	Not applicable	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39
SYSC 6.1.3R 24	Not applicable27	Rule	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending.39 For firms other than an operator of an electronic system in relation to lending, this39 provision shall be read with the following additional sentence at the start. "Depending on the nature, scale and complexity of its business, it may be appropriate for a firm to have a separate compliance function. Where a firm has a separate compliance function, the firm should also take into account SYSC 6.1.3R27 and SYSC 6.1.4R27 as guidance."
SYSC 6.1.3AG 24	Not applicable	Not applicable	Not applicable	Guidance, but does not apply to an operator of an electronic system in relation to lending 39
SYSC 6.1.4R 24	Not applicable27	Rule	Not applicable	(1), (3) and (4): Guidance;27 (2):27 - Rule for firms which carry on designated investment business with or for retail clients or professional clients.27 - Guidance for all other firms.27 Applies as a rule to an operator of an electronic system in relation to lending. 39
SYSC 6.1.4-AG 24	Guidance27	Not applicable	Rule	Guidance
SYSC 6.1.4AR 24	Not applicable	Not applicable	Not applicable	Rule for firms which carry on designated investment business with or for retail clients or professional clients.12
SYSC 6.1.4BG 24	Not applicable	Not applicable	Guidance	Not applicable
27 SYSC 6.1.4-CG	Guidance applies to relevant authorised persons only	Not applicable	Not applicable	Not applicable
SYSC 6.1.4CR 24	Not applicable	Not applicable	Not applicable	As specified in SYSC 6.1.4CR.40 12
SYSC 6.1.5R 24	Not applicable27	Rule	Not applicable	- Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39 - "investment services and activities" shall be read as "financial services and activities"
SYSC 6.1.6G 24	Not applicable	Not applicable	Not applicable	Guidance, but does not apply to an operator of an electronic system in relation to lending 39
SYSC 6.1.7R 24	Rule	Rule for a UCITS investment firm; otherwise not applicable	Not applicable	Guidance
39 SYSC 6.1.8G	Not applicable	Not applicable	Not applicable	Only applies to an operator of an electronic system in relation to lending
SYSC 6.2.1R 24	Not applicable27	Rule	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39
SYSC 6.2.1AG 24	Not applicable	Not applicable	Not applicable	Guidance, but does not apply to an operator of an electronic system in relation to lending 39
27 SYSC 6.2.1BG	Guidance applies to relevant authorised persons only	Not applicable	Not applicable	Not applicable
SYSC 6.2.2G 24	Guidance	Guidance	Not applicable	Guidance
SYSC 6.3.1R 24	Rule	Rule	Rule	Rule For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Rule does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations.15(FCA Handbook only)12
SYSC 6.3.2G 24	Guidance	Guidance	Guidance	Guidance For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Guidance does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations.15(FCA Handbook only)12
SYSC 6.3.3R 24	Rule	Rule	Rule	Rule For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Rule does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations.15(FCA Handbook only)12
SYSC 6.3.4G 24	Guidance	Guidance	Guidance	Guidance For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Guidance does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations. 15 (FCA Handbook only)12
SYSC 6.3.5G 24	Guidance	Guidance	Guidance	Guidance For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Guidance does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations. 15(FCA Handbook only)12
SYSC 6.3.6G 24	Guidance	Guidance	Guidance	Guidance For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Guidance does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations. 15 (FCA Handbook only)12
SYSC 6.3.7G 24	Guidance	Guidance	Guidance	Guidance For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Guidance does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations. 15 (FCA Handbook only)12
SYSC 6.3.8R 24	Rule	Rule	Rule	Rule For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Rule does not apply to a13 firm with a limited permission for entering into a regulated credit agreement as lender. Rule does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations. 15(FCA Handbook only)12
SYSC 6.3.9R 24	Rule	Rule	Rule	Rule For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Rule does not apply to a13 firm with a limited permission for entering into a regulated credit agreement as lender. Rule does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations48 (FCA Handbook only). Rule does not apply to a firm carrying on regulated pensions dashboard activity.48 15 12
SYSC 6.3.10G 24	Guidance	Guidance	Guidance	Guidance For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm. Guidance does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations.15 (FCA Handbook only)12
SYSC 6.3.11G 24	Guidance	Guidance	Guidance	Guidance For firms carrying on a credit-related regulated activity or regulated claims management activity 37, or operating an electronic system in relation to lending,17 applies only where the 13 Money Laundering Regulations apply to the firm.Guidance does not apply to a firm for which a professional body listed in Schedule 129 to the Money Laundering Regulations, and not the FCA, acts as the supervisory authority for the purposes of those regulations. 15 (FCA Handbook only)12

9Provision SYSC 7	COLUMN A Application to a common platform firm other than to a UCITS investment firm	COLUMN A+ Application to a UCITS management company	COLUMN A++ Application to a full-scope UK AIFM of an authorised AIF	COLUMN B Application to all other firms apart from insurers, UK ISPVs,32 managing agents,32 the Society, full-scope UK AIFMs of unauthorised AIFs, MiFID optional exemption firms and third country firms27
27 SYSC 7.1.-2G	Guidance	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	Not applicable
27 SYSC 7.1.-1G	Not applicable	Not applicable	Not applicable	Not applicable
SYSC 7.1.1G 24	Guidance	Guidance	Not applicable	Guidance
SYSC 7.1.2R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39
SYSC 7.1.2AG 24	Not applicable	Not applicable to a UCITS investment firm; otherwise guidance	Not applicable	Guidance, but does not apply to an operator of an electronic system in relation to lending 39
SYSC 7.1.2BG 24	Not applicable	Guidance	Not applicable	Not applicable
SYSC 7.1.3R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance, but applies as a rule for an operator of an electronic system in relation to lending 39
SYSC 7.1.4R 24	Rule	Rule for a UCITS investment firm; otherwise guidance	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39
SYSC 7.1.4AG 24	Guidance27 for a MIFIDPRU investment firm 45	Guidance for a UCITS investment firm 45	Not applicable	Guidance
SYSC 7.1.4BG 24	Not applicable	Rule for a UCITS investment firm; otherwise guidance	Not applicable	Guidance
SYSC 7.1.5R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39
SYSC 7.1.6R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39
SYSC 7.1.7R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance, but applies as a rule to an operator of an electronic system in relation to lending 39
SYSC 7.1.7AG 24	Not applicable	Rule for a UCITS investment firm; otherwise guidance	Not applicable	Guidance, but does not apply to an operator of an electronic system in relation to lending 39
SYSC 7.1.7BG 24	Guidance applicable to a CRR firm	Not applicable45	Guidance	Guidance
SYSC 7.1.7BAG 24	Not applicable	Not applicable	Guidance	Not applicable
14 SYSC 7.1.7BBG 24	[deleted]45	[deleted]45	[deleted]45	[deleted]45
SYSC 7.1.7BDG 45	Guidance applies only to a MIFIDPRU investment firm	Guidance applies only to a UCITS investment firm	Not applicable	Not applicable
SYSC 7.1.7CG 24	Guidance	Guidance	Guidance	Guidance
SYSC 7.1.8G 10 24 10	Guidance27 10 10	Guidance27 10 10	Guidance27 10 10	Guidance27 10 10
SYSC 7.1.9R	[deleted]45	[deleted]45	[deleted]45	[deleted]45
SYSC 7.1.10R 24	[deleted]45	[deleted]45	[deleted]45	[deleted]45
SYSC 7.1.11R 24	[deleted]45	[deleted]45	[deleted]45	[deleted]45
SYSC 7.1.12G 24	[deleted]45	[deleted]45	[deleted]45	[deleted]45
SYSC 7.1.13R - 7.1.16R 24	[deleted]45	[deleted]45	[deleted]45	[deleted]45
SYSC 7.1.16AG 24	[deleted]27	[deleted]27	[deleted]27	[deleted]27
SYSC 7.1.16BG 24	[deleted]27	[deleted]27	[deleted]27	[deleted]27
14 SYSC 7.1.16CR 24	[deleted]45	[deleted]45	[deleted]45	[deleted]45
SYSC 7.1.17R 24	Rule applies to a CRR firm	Not applicable45	Not applicable	Not applicable
SYSC 7.1.18R 24	Rule applies to a CRR firm	Not applicable45	Not applicable	Not applicable
14 SYSC 7.1.18AAG 27 24	Guidance27 applies to a CRR firm	Not applicable45	Not applicable	Not applicable
14 SYSC 7.1.18BR 24	Rule applies to a CRR firm	Not applicable45	Not applicable	Not applicable
SYSC 7.1.19R 24	Rule applies to a CRR firm	Not applicable45	Not applicable	Not applicable
SYSC 7.1.20R 24	Rule applies to a CRR firm	Not applicable45	Not applicable	Not applicable
SYSC 7.1.21R 24	Rule applies to a CRR firm	Not applicable45	Not applicable	Not applicable
SYSC 7.1.22R 24	Rule applies to a CRR firm	Not applicable45	Not applicable	Not applicable
27 SYSC 7.1.23G	Guidance applies to UK relevant authorised persons and third country relevant authorised persons only	Not applicable	Not applicable	Not applicable

9Provision SYSC 8	COLUMN A Application to a common platform firm other than to a UCITS investment firm	COLUMN A+ Application to a UCITS management company	COLUMN A++ Application to a full-scope UK AIFM of an authorised AIF	COLUMN B Application to all other firms apart from insurers, UK ISPVs,32 managing agents,32 the Society, full-scope UK AIFMs of unauthorised AIFs, MiFID optional exemption firms and third country firms27
27 SYSC 8.1.-2G	Guidance	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	Not applicable
27 SYSC 8.1.-1G	Not applicable	Not applicable	Not applicable	Not applicable
SYSC 8.1.1R 24	Rule	Rule for a UCITS investment firm; otherwise guidance	Not applicable	Guidance
SYSC 8.1.1AG 24	Not applicable	Not applicable to a UCITS investment firm; otherwise guidance	Not applicable	Guidance
SYSC 8.1.2G 24	Guidance	Guidance	Not applicable	Guidance
SYSC 8.1.3G 24	Guidance	Guidance	Not applicable	Guidance
SYSC 8.1.4R 24	Not applicable27	Rule for a UCITS investment firm; otherwise guidance	Not applicable	Guidance
SYSC 8.1.5R 24	Not applicable27	Rule for a UCITS investment firm; otherwise guidance	Not applicable	Guidance
SYSC 8.1.5AG 24	Not applicable	Rule for a UCITS investment firm; otherwise guidance	Not applicable	Guidance
SYSC 8.1.6R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business; otherwise guidance27	Not applicable	Rule
27 SYSC 8.1.6AG	Guidance for a UCITS investment firm in relation to its MiFID business	Not applicable	Not applicable	Not applicable
SYSC 8.1.7R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance
SYSC 8.1.8R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance
SYSC 8.1.9R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance
SYSC 8.1.10R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance
SYSC 8.1.11R 24	Not applicable27	Rule for a UCITS investment firm in relation to its non-MiFID business 27; otherwise guidance	Not applicable	Guidance
SYSC 8.1.11AG 24	Not applicable	Not applicable to a UCITS investment firm; otherwise guidance	Not applicable	Guidance
SYSC 8.1.12G 24	Guidance	Guidance	Not applicable	Guidance
SYSC 8.1.13R 24	Not applicable	Rule	Not applicable	Not applicable
SYSC 8.1.14G 24	Not applicable	Guidance	Not applicable	Not applicable
SYSC 8.2 24	[deleted]27	[deleted]27	[deleted]27	[deleted]27
SYSC 8.3 24	[deleted]27	[deleted]27	[deleted]27	[deleted]27

9Provision SYSC 9	COLUMN A Application to a common platform firm other than to a UCITS investment firm	COLUMN A+ Application to a UCITS management company	COLUMN A++ Application to a full-scope UK AIFM of an authorised AIF	COLUMN B Application to all other firms apart from insurers, UK ISPVs,32 managing agents,32 the Society, full-scope UK AIFMs of unauthorised AIFs, MiFID optional exemption firms and third country firms27
27 SYSC 9.1.-2G	Guidance	Not applicable save in relation to a UCITS investment firm and its MiFID business	Not applicable	Not applicable
27 SYSC 9.1.-1G	Not applicable	Not applicable	Not applicable	Not applicable
SYSC 9.1.1R 24	Not applicable27	Rule	Rule but only for the requirement to arrange for orderly records to be kept of its business and internal organisation which do not relate to portfolio transactions and subscription and redemptions orders	Rule
27 SYSC 9.1.1AR	Rule	Not applicable	Not applicable	Not applicable
SYSC 9.1.2R 24	Rule applies only in relation to MiFID business	Rule applies only in relation to MiFID business of a UCITS investment firm	Rule but only for records specified by the modified application of SYSC 9.1.1 R	Not applicable
33 SYSC 9.1.2AR	Rule	Rule	Rule	Rule
33 SYSC 9.1.2BG	Guidance	Guidance	Guidance	Guidance
SYSC 9.1.2CR 47 38 33	Rule applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38	Rule applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38	Rule applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38	Rule applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38
47 33	47	47	47	47
SYSC 9.1.3R 24	[deleted]27	[deleted]27	[deleted]27	[deleted]27
SYSC 9.1.4G 24	Guidance	Guidance	Guidance	Guidance
SYSC 9.1.5G 24	Guidance	Guidance	Not applicable	Guidance
SYSC 9.1.6G 24	Guidance	Guidance	Not applicable	Guidance
33 SYSC 9.1.6A	Guidance	Guidance	Guidance	Guidance
27 24	[deleted]27	[deleted]27	[deleted]27	[deleted]27
31 SYSC 9.2G	Not applicable	Not applicable	Not applicable	Applicable to credit institutions only38

9Provision SYSC 10	Column A Application to a common platform firm other than to a UCITS investment firm	COLUMN A+ Application to a UCITS management company	COLUMN A++ Application to a full-scope UK AIFM of an authorised AIF	Column B Application to all other firms apart from insurers, UK ISPVs,32 managing agents,32 the Society, full-scope UK AIFMs of unauthorised AIFs, MiFID optional exemption firms and third country firms27
43 SYSC 10.1. -5G	Not applicable	Not applicable	Not applicable	Guidance in relation to funeral plan distribution
33 SYSC 10.1.-4G	Guidance in relation to insurance distribution activities	Guidance in relation to insurance distribution activities	Guidance in relation to insurance distribution activities	Guidance in relation to insurance distribution activities
33 SYSC 10.1.-3R	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
27 SYSC 10.1.-2G	Guidance	Guidance in relation to relation to a UCITS investment firm in relation to its MiFID business; otherwise not applicable	Not applicable	Not applicable
27 SYSC 10.1.-1G	Not applicable	Not applicable	Not applicable	Not applicable
SYSC 10.1.1R 24	Rule	Rule	Not applicable	Rule
SYSC 10.1.1AR 24	Not applicable	Not applicable	Rule	Not applicable
SYSC 10.1.2G 24	Guidance	Guidance	Guidance in relation to insurance distribution activities. Otherwise, not33 applicable	Guidance
SYSC 10.1.3R 24	Rule	Rule	Rule in relation to insurance distribution activities. Otherwise not33 applicable	Rule
SYSC 10.1.4R 24	Not applicable27	Rule, but not applicable in relation to insurance distribution activities 33	Not applicable	Guidance - but applies as a rule in relation to the production or arrangement of investment research28, or the production or dissemination of non-independent research,28 in accordance with COBS 12.228 Not applicable in relation to insurance distribution activities 33or funeral plan distribution 43
SYSC 10.1.4AG 24	Not applicable	Not applicable	Not applicable	Guidance -but not applicable in relation to insurance distribution activities 33or funeral plan distribution 43
33 SYSC 10.1.4BR	Not applicable	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activitiesand funeral plan distribution 43
33 SYSC 10.1.4CR	Not applicable	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities and funeral plan distribution 43
SYSC 10.1.5G 24	Guidance	Guidance	Not applicable	Guidance
SYSC 10.1.6R 24	Not applicable27	Rule	Rule in relation to insurance distribution activities. Otherwise, not33 applicable	Guidance - but applies as a rule: (a)33 in relation to the production or arrangement of investment research28, or the production or dissemination of non-independent research,28 in accordance with COBS 12.228; and (b) in relation to insurance distribution activities 33and funeral plan distribution 43
SYSC 10.1.6AG 24	Not applicable	Not applicable	Guidance27 - but not applicable in relation to insurance distribution activities 33	Guidance - but not applicable in relation to insurance distribution activities 33or funeral plan distribution 43
33 SYSC 10.1.6AAR	Not applicable	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activitiesand funeral plan distribution 43
27 SYSC 10.1.6BG	Not applicable	Guidance	Guidance	Guidance
SYSC 10.1.7R 24	Rule	Rule	Rule in relation to insurance distribution activities. Otherwise not33 applicable	Rule
33 SYSC 10.1.7AR	Rule	Rule	Rule	Rule
SYSC 10.1.8R 24	Rule in relation to insurance distribution activities. Otherwise, not33 applicable 27	Rule	Rule in relation to insurance distribution activities. Otherwise, not33 applicable	Rule
24 33 33	33 27	33	33	33
SYSC 10.1.9G 24	Not applicable27	Guidance	Not applicable	Guidance
27 SYSC 10.1.9AR	Not applicable	Rule in relation to insurance distribution activities. Otherwise, not33 applicable	Rule in relation to insurance distribution activities. Otherwise, not33 applicable	Guidance - but applies as a rule in relation to insurance distribution activities and funeral plan distribution 43
SYSC 10.1.10R 24	Not applicable27	Rule	Rule in relation to insurance distribution activities. Otherwise, not33 applicable	Guidance - but applies as a rule: (a)33 in relation to the production or arrangement of investment research28, or the production or dissemination of non-independent research,28 in accordance with COBS 12.228; and (b) in relation to insurance distribution activities 33 and funeral plan distribution 43
SYSC 10.1.11R 24	Not applicable27	Rule	Rule in relation to insurance distribution activities. Otherwise, not33 applicable	Guidance - but applies as a rule: (a)33 in relation to the production or arrangement of investment research28, or the production or dissemination of non-independent research,28 in accordance with COBS 12.228; and (b) in relation to insurance distribution activities and funeral plan distribution 43
SYSC 10.1.11AG 24	Not applicable	Not applicable	Guidance27 - but not applicable in relation to insurance distribution activities 33	Guidance - but not applicable in relation to insurance distribution activities 33 or funeral plan distribution 43
33 SYSC 10.1.11AAR	Not applicable	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities and funeral plan distribution 43
33 SYSC 10.1.11ABR	Rule in relation to insurance distribution activities	Not applicable	Not applicable	Not applicable
27 SYSC 10.1.11BG	Not applicable	Guidance	Guidance	Guidance
SYSC 10.1.12G 27 24	Guidance30 27	Guidance27	Guidance27	Guidance
27 SYSC 10.1.13 - 10.1.15G	[deleted]27	[deleted]27	[deleted]27	[deleted]27
SYSC 10.1.16R 24	Not applicable	Not applicable	Not applicable	Rule
SYSC 10.1.17R 24	Not applicable	Rule	Not applicable	Not applicable
SYSC 10.1.18G [FCA]	Not applicable	Guidance	Not applicable	Not applicable
SYSC 10.1.19R 24	Not applicable	Rule	Not applicable	Not applicable
SYSC 10.1.20R 24	Not applicable	Rule	Not applicable	Not applicable
SYSC 10.1.21R 24	Not applicable	Rule	Not applicable	Not applicable
SYSC 10.1.22R 24	Not applicable	Rule	Rule	Not applicable
SYSC 10.1.23R to SYSC 10.1.26R24	Not applicable	Not applicable	Rule	Not applicable
33 SYSC 10.1A	R47 Rules applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38 38	R47 Rules applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38 38	R47 Rules applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38 38	R47 Rules applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38 38
SYSC 10.2.1R 24	Rule	Rule	Rule	Rule
SYSC 10.2.2R 24	Rule	Rule	Rule	Rule
SYSC 10.2.3G 24	Guidance	Guidance	Guidance	Guidance
SYSC 10.2.4R 24	Rule	Rule	Rule	Rule
SYSC 10.2.5G 24	Guidance	Guidance	Guidance	Guidance

27 Table B: Application of the common platform requirements in SYSC 4 to 10 to MiFID optional exemption firms and third country firms

Provision	COLUMN A MiFID optional exemption firms	COLUMN B Third country firms
SYSC 4
SYSC 4.1.-2G	Not applicable	Not applicable
SYSC 4.1.-1G	Guidance	Guidance
SYSC 4.1.1R	Rule	Rule
SYSC 4.1.1AR	Not applicable	Not applicable
SYSC 4.1.1BR	Not applicable	Not applicable
45
SYSC 4.1.1DR	Not applicable	Not applicable
SYSC 4.1.1ER	Not applicable	Not applicable
SYSC 4.1.1FG	Not applicable	Not applicable
SYSC 4.1.2R	Rule	Guidance
SYSC 4.1.2AG	Not applicable	Not applicable
45
SYSC 4.1.2BR	Not applicable	Not applicable
SYSC 4.1.2CR	Not applicable	Not applicable
SYSC 4.1.2DR	Not applicable	Not applicable
SYSC 4.1.4R	Not applicable	Not applicable
SYSC 4.1.4AG	Not applicable	Not applicable
SYSC 4.1.5R	Not applicable	Not applicable
SYSC 4.1.6R	Rule	Guidance
SYSC 4.1.7R	Rule	Guidance
SYSC 4.1.7AG	Not applicable	Not applicable
SYSC 4.1.8G	Guidance	Guidance
39 SYSC 4.1.8AR	Rule	Rule
39 SYSC 4.1.8CG	Guidance	Guidance
39 SYSC 4.1.8DG	Guidance	Guidance
39 SYSC 4.1.8DAG	Guidance	Guidance
39 SYSC 4.1.8DBR	Rule	Rule
39 SYSC 4.1.8DCR	Rule	Rule
39 SYSC 4.1.8DDR	Rule	Rule
SYSC 4.1.9R	Not applicable	Not applicable
SYSC 4.1.10R	Not applicable	Not applicable
SYSC 4.1.10AG	Not applicable	Not applicable
SYSC 4.1.11G	Guidance	Guidance
SYSC 4.1.13G	Guidance	Guidance
SYSC 4.1.14G	Guidance	Guidance
SYSC 4.2.1R	Rule	Rule
SYSC 4.2.1AG	Not applicable	Not applicable
SYSC 4.2.2R	Rule	Rule
SYSC 4.2.3G - 4.2.5G	Guidance	Guidance
SYSC 4.2.6R	Rule	Rule
SYSC 4.2.7R	Not applicable	Not applicable
SYSC 4.2.8G	Not applicable	Not applicable
SYSC 4.3.1R	Not applicable	Not applicable
SYSC 4.3.2R	Not applicable	Not applicable
SYSC 4.3.2AG	Not applicable	Not applicable
SYSC 4.3.3G	Guidance	Guidance
45	45	45
45
SYSC 4.3A.1AR	Rule	Not applicable
SYSC 4.3A.2R	Rule	Not applicable
SYSC 4.3A.2AG	Guidance	Not applicable
SYSC 4.3A.3R	Rule	Not applicable
41 SYSC 4.3A.3AG	Guidance	Not applicable
SYSC 4.3A.4R	Rule	Not applicable
SYSC 4.3A.5R	Rule	Not applicable
SYSC 4.3A.6R	Rule	Not applicable
SYSC 4.3A.7R	Rule	Not applicable
SYSC 4.3A.8R	Rule	Not applicable
SYSC 4.3A.9R	Rule	Not applicable
SYSC 4.3A.10R	Rule	Not applicable
SYSC 4.3A.11R	Not applicable	Not applicable
SYSC 4.4.1AR	As specified in SYSC 4.4.1AR40	As specified in SYSC 4.4.1AR40
SYSC 4.4.2G	As specified in SYSC 4.4.1AR40	As specified in SYSC 4.4.1AR40
SYSC 4.4.3R	As specified in SYSC 4.4.1AR40	As specified in SYSC 4.4.1AR40
SYSC 4.4.5R	As specified in SYSC 4.4.1AR40	As specified in SYSC 4.4.1AR40
SYSC 4.4.6G	As specified in SYSC 4.4.1AR40	As specified in SYSC 4.4.1AR40
36
36
36
36
36
39Note = SYSC 4.1.8AR to SYSC 4.1.8DDR apply as a rule or guidance, as indicated above, only to an operator of an electronic system in relation to lending.

SYSC 5
SYSC 5.1.-2G	Not applicable	Not applicable
SYSC 5.1.-1G	Guidance	Guidance
SYSC 5.1.1R	Not applicable	Not applicable
SYSC 5.1.2G	Guidance	Guidance
SYSC 5.1.3G	Guidance	Guidance
SYSC 5.1.4G	Guidance	Guidance
SYSC 5.1.4AG	Guidance	Guidance
SYSC 5.1.5G	Guidance	Guidance
28 SYSC 5.1.5AAR	Not applicable	Rule
28 SYSC 5.1.5ABR	Not applicable	Rule
28 SYSC 5.1.5ACG	Not applicable	Guidance
28 SYSC 5.1.5ADG	Not applicable	Guidance
28 SYSC 5.1.5AEG	Not applicable	Guidance
SYSC 5.1.5AG	Guidance	Guidance
SYSC 5.1.6R	Not applicable	Not applicable
SYSC 5.1.7R	Rule	Rule
SYSC 5.1.7AG	Not applicable	Not applicable
SYSC 5.1.8G	Guidance	Guidance
SYSC 5.1.9G	Guidance	Guidance
SYSC 5.1.10G	Guidance	Guidance
SYSC 5.1.11G	Guidance	Guidance
SYSC 5.1.12R	Not applicable	Not applicable
SYSC 5.1.12AG	Not applicable	Not applicable
SYSC 5.1.13R	Not applicable	Not applicable
SYSC 5.1.14R	Not applicable	Not applicable
SYSC 5.1.15G	Not applicable	Not applicable
36

SYSC 6
SYSC 6.1.-2G	Not applicable	Not applicable
SYSC 6.1.-1G	Guidance	Guidance
SYSC 6.1.1R	Rule	Rule
SYSC 6.1.1AG	Guidance	Guidance
SYSC 6.1.2R	Not applicable	Not applicable
SYSC 6.1.2AG	Not applicable	Not applicable
SYSC 6.1.3R	Not applicable	Not applicable
SYSC 6.1.3AG	Not applicable	Not applicable
SYSC 6.1.4R	Not applicable	Not applicable
SYSC 6.1.4-AG	Guidance	Guidance
SYSC 6.1.4AR	Not applicable	Not applicable
SYSC 6.1.4-BG	Not applicable	Not applicable
SYSC 6.1.4CR	SYSC 6.1.4CR(3) 44applies as specified in SYSC 6.1.4CR43 40 Otherwise not40 applicable 43 44 43	SYSC 6.1.4CR(3) 44 applies as specified in SYSC 6.1.4CR43 Otherwise not40 applicable
SYSC 6.1.4-CG	Not applicable	Guidance for a third country relevant authorised person
SYSC 6.1.5R	Not applicable	Not applicable
SYSC 6.1.6G	Not applicable	Not applicable
SYSC 6.1.7R	Not applicable	Not applicable
SYSC 6.2.1R	Not applicable	Not applicable
SYSC 6.2.1AG	Not applicable	Not applicable
SYSC 6.2.1BG	Not applicable	Guidance for a third country relevant authorised person
SYSC 6.2.2G	Guidance	Guidance
SYSC 6.3.1R	Rule	Rule
SYSC 6.3.2G	Guidance	Guidance
SYSC 6.3.3R	Rule	Rule
SYSC 6.3.4G	Guidance	Guidance
SYSC 6.3.5G	Guidance	Guidance
SYSC 6.3.6G	Guidance	Guidance
SYSC 6.3.7G	Guidance	Guidance
SYSC 6.3.8R	Rule	Rule
SYSC 6.3.9R	Rule	Rule
SYSC 6.3.10G	Guidance	Guidance
SYSC 6.3.11G	Guidance	Guidance

SYSC 7
SYSC 7.1.-2G	Not applicable	Not applicable
SYSC 7.1.-1G	Guidance	Guidance
SYSC 7.1.1G	Guidance	Guidance
SYSC 7.1.2R	Not applicable	Not applicable
SYSC 7.1.2AG	Not applicable	Not applicable
SYSC 7.1.2BG	Not applicable	Not applicable
SYSC 7.1.3R	Not applicable	Not applicable
SYSC 7.1.4R	Rule	Guidance
SYSC 7.1.4AG	Guidance	Guidance
SYSC 7.1.4BG	Not applicable	Not applicable
SYSC 7.1.5R	Not applicable	Not applicable
SYSC 7.1.6R	Not applicable	Not applicable
SYSC 7.1.7R	Not applicable	Not applicable
SYSC 7.1.7AG	Not applicable	Not applicable
SYSC 7.1.7BG	Not applicable	Not applicable
SYSC 7.1.7BAG	Not applicable	Not applicable
45
SYSC 7.1.7CG	Guidance	Guidance
SYSC 7.1.8G	Guidance	Guidance
45
45
45
45
45
SYSC 7.1.16AG	Not applicable	Not applicable
SYSC 7.1.16BG	Not applicable	Not applicable
45
SYSC 7.1.17R	Guidance	Not applicable
SYSC 7.1.18R	Guidance	Not applicable
SYSC 7.1.18AAG	Guidance	Not applicable
SYSC 7.1.18BR	Guidance	Not applicable
SYSC 7.1.19R	Guidance	Not applicable
SYSC 7.1.20R	Guidance	Not applicable
SYSC 7.1.21R	Guidance	Not applicable
SYSC 7.1.22R	Guidance	Not applicable
SYSC 7.1.23G	Not applicable	Guidance for a third country relevant authorised person

SYSC 8
SYSC 8.1.-2G	Not applicable	Not applicable
SYSC 8.1.-1G	Guidance	Guidance
SYSC 8.1.1R	Rule	Guidance
SYSC 8.1.1AG	Not applicable	Not applicable
SYSC 8.1.2G	Guidance	Guidance
SYSC 8.1.3G	Guidance	Guidance
SYSC 8.1.4R	Not applicable	Not applicable
SYSC 8.1.5R	Not applicable	Not applicable
SYSC 8.1.5AG	Not applicable	Not applicable
SYSC 8.1.6R	Not applicable	Not applicable
SYSC 8.1.6AG	Not applicable	Not applicable
SYSC 8.1.7R	Not applicable	Not applicable
SYSC 8.1.8R	Not applicable	Not applicable
SYSC 8.1.9R	Not applicable	Not applicable
SYSC 8.1.10R	Not applicable	Not applicable
SYSC 8.1.11R	Not applicable	Not applicable
SYSC 8.1.11AG	Not applicable	Not applicable
SYSC 8.1.12G	Not applicable	Not applicable
SYSC 8.1.13R	Not applicable	Not applicable
SYSC 8.1.14G	Not applicable	Not applicable

SYSC 9
SYSC 9.1.-2G	Not applicable	Not applicable
SYSC 9.1.-1G	Guidance	Guidance
SYSC 9.1.1R	Not applicable	Not applicable
SYSC 9.1.1AR	Rule	Rule
SYSC 9.1.2R	Rule	Not applicable
33 SYSC 9.1.2AR	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
33 SYSC 9.1.2BG	Guidance in relation to insurance distribution activities	Guidance in relation to insurance distribution activities
SYSC 9.1.2CR 47 33 38	Rule applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38 38	Rule applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38 38
47 33	47	47
SYSC 9.1.4G	Guidance	Guidance
SYSC 9.1.5G	Guidance	Guidance
SYSC 9.1.6G	Guidance	Guidance
33 SYSC 9.1.6AG	Guidance in relation to insurance distribution activities	Guidance in relation to insurance distribution activities

SYSC 10
33 SYSC 10.1.-4G	Guidance in relation to insurance distribution activities	Guidance in relation to insurance distribution activities
33 SYSC 10.1.-3G	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
SYSC 10.1.-2G	Not applicable	Not applicable
SYSC 10.1.-1G	Guidance	Guidance
SYSC 10.1.1R	Rule	Rule
SYSC 10.1.1AR	Not applicable	Not applicable
SYSC 10.1.2G	Guidance	Guidance
SYSC 10.1.3R	Rule	Rule
SYSC 10.1.4R	Rule	Guidance – but applies as a rule in relation to the production or arrangement of investment research, or the production or dissemination of non-independent research, in accordance with COBS 12.228
SYSC 10.1.4AG	Not applicable	Guidance
33 SYSC 10.1.4BR	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
33 SYSC 10.1.4CR	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
SYSC 10.1.5G	Guidance	Guidance
SYSC 10.1.6R	Rule	Guidance – but applies as a rule in relation to: (a)33 the production or arrangement of investment research, or the production or dissemination of non-independent research, in accordance with COBS 12.228; and (b) insurance distribution activities 33
SYSC 10.1.6AG	Not applicable	Guidance
33 SYSC 10.1.6AAR	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
SYSC 10.1.6BG	Not applicable	Guidance
SYSC 10.1.7R	Rule	Rule
33 SYSC 10.1.7AR	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
SYSC 10.1.8R	Rule	Rule

SYSC 10.1.9G	Guidance	Guidance
SYSC 10.1.9AR	Rule in relation to insurance distribution activities. Otherwise not33 applicable	Rule in relation to insurance distribution activities. Otherwise not33 applicable
SYSC 10.1.10R	Rule	Guidance – but applies as a rule in relation to: (a)33 the production or arrangement of investment research, or the production or dissemination of non-independent research, in accordance with COBS 12.228; and (b) insurance distribution activities
SYSC 10.1.11R	Rule	Guidance – but applies as a rule in relation to: (i)33 the production or arrangement of investment research, or the production or dissemination of non-independent research, in accordance with COBS 12.228; and (ii) insurance distribution activities 33
SYSC 10.1.11AG	Not applicable	Guidance
33 SYSC 10.1.11AAR	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
33 SYSC 10.1.11ABR	Rule in relation to insurance distribution activities	Rule in relation to insurance distribution activities
SYSC 10.1.11BG	Not applicable	Guidance
SYSC 10.1.12G	Guidance	Guidance
SYSC 10.1.16R	Not applicable	Not applicable
SYSC 10.1.17R	Not applicable	Not applicable
SYSC 10.1.18G	Not applicable	Not applicable
SYSC 10.1.19R	Not applicable	Not applicable
SYSC 10.1.20R	Not applicable	Not applicable
SYSC 10.1.21R	Not applicable	Not applicable
SYSC 10.1.22R	Not applicable	Not applicable
SYSC 10.1.23R	Not applicable	Not applicable
SYSC 10.1.24R	Not applicable	Not applicable
SYSC 10.1.25R	Not applicable	Not applicable
SYSC 10.1.26R	Not applicable	Not applicable
SYSC 10.1.27G	Not applicable	Not applicable
33 SYSC 10.1A	R47 Rule applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38 38	R47 Rule applicable47 to a firm carrying on insurance distribution in relation to insurance-based investment products 38 38
SYSC 10.2.1R	Rule	Rule
SYSC 10.2.2R	Rule	Rule
SYSC 10.2.3G	Guidance	Guidance
SYSC 10.2.4R	Rule	Rule
SYSC 10.2.5G	Guidance	Guidance

27 Table C:

Part 1: Application of the requirements in articles 1(2), 21 to 25, 30 to 32 and 72 of the MiFID Org Regulation to MiFID optional exemption firms and third country firms

Provision MiFID Org Regulation		38	MiFID optional exemption firm	Third country firm
Article 1 – Subject-matter and scope	(2)	38	Not applicable	Not applicable
Article 21 – General organisational requirements	(1)	38	Rule	(a), (b) and (g): Guidance; (c), (d), (e), (f) and final paragraph: Rule
	(2)		Rule	Rule
	(3)		Rule	Guidance
	(4)		Rule	Guidance
	(5)		Rule	Guidance
Article 22 – Compliance	(1)	38	Guidance	Guidance
	(2)		Guidance	Guidance
	(3)		Guidance	(a), (c), (d) and (e): Guidance; (b): Rule
	(4)		Guidance	Guidance
Article 23 – Risk management		38	Guidance	Guidance
Article 24 – Internal audit		38	Guidance	Guidance
Article 25 – Responsibility of senior management		38	Guidance	(1): Rule; (2), (3) and (4): Guidance
Article 30 – Scope of critical and important operational functions		38	Guidance	Guidance
Article 31 – Outsourcing critical or important operational functions		38	(1): Rule; (2), (3), (4) and (5): Guidance	(1): Rule; (2), (3), (4) and (5): Guidance
Article 32(1) and (2) – Service providers located in third countries		38	Rule	Guidance
Article 72 – Retention of records		38	Rule	Guidance

Part 2: Articles 1(2), 21 to 25, 30 to 32 and 72 of the MiFID Org Regulation

UK38	Article 1 - Subject-matter and scope
	2	References to investment firms shall encompass credit institutions and references to financial instruments shall encompass structured deposits in relation to all the requirements (so far as relevant) in Chapters II to IV of this Regulation38.
UK38	Article 21 - General organisational requirements
	1	Investment firms shall comply with the following organisational requirements:
		(a)	establish, implement and maintain decision-making procedures and an organisational structure which clearly and in documented manner specifies reporting lines and allocates functions and responsibilities;
		(b)	ensure that their relevant persons are aware of the procedures which must be followed for the proper discharge of their responsibilities;
		(c)	establish, implement and maintain adequate internal control mechanisms designed to secure compliance with decisions and procedures at all levels of the investment firm;
		(d)	employ personnel with the skills, knowledge and expertise necessary for the discharge of the responsibilities allocated to them;
		(e)	establish, implement and maintain effective internal reporting and communication of information at all relevant levels of the investment firm;
		(f)	maintain adequate and orderly records of their business and internal organisation;
		(g)	ensure that the performance of multiple functions by their relevant persons does not and is not likely to prevent those persons from discharging any particular function soundly, honestly, and professionally.
		When complying with the requirements set out in the this paragraph, investment firms shall take into account the nature, scale and complexity of the business of the firm, and the nature and range of investment services and activities undertaken in the course of that business.
	2	Investment firms shall establish, implement and maintain systems and procedures that are adequate to safeguard the security, integrity and confidentiality of information, taking into account the nature of the information in question.
	3	Investment firms shall establish, implement and maintain an adequate business continuity policy aimed at ensuring, in the case of an interruption to their systems and procedures, the preservation of essential data and functions, and the maintenance of investment services and activities, or, where that is not possible, the timely recovery of such data and functions and the timely resumption of their investment services and activities.
	4	Investment firms shall establish, implement and maintain accounting policies and procedures that enable them, at the request of the competent authority, to deliver in a timely manner to the competent authority financial reports which reflect a true and fair view of their financial position and which comply with all applicable accounting standards and rules.
	5	Investment firms shall monitor and, on a regular basis, evaluate the adequacy and effectiveness of their systems, internal control mechanisms and arrangements established in accordance with paragraphs 1 to 4, and take appropriate measures to address any deficiencies.
UK38	Article 22 - Compliance
	1	Investment firms shall establish, implement and maintain adequate policies and procedures designed to detect any risk of failure by the firm to comply with its obligations under UK law on markets in financial instruments (“UK obligations”)38, as well as the associated risks, and put in place adequate measures and procedures designed to minimise such risk and to enable the competent authorities to exercise their powers effectively under UK law on markets in financial instruments38. Investment firms shall take into account the nature, scale and complexity of the business of the firm, and the nature and range of investment services and activities undertaken in the course of that business.
	2	Investment firms shall establish and maintain a permanent and effective compliance function which operates independently and which has the following responsibilities:
		(a)	to monitor on a permanent basis and to assess, on a regular basis, the adequacy and effectiveness of the measures, policies and procedures put in place in accordance with the first subparagraph of paragraph 1, and the actions taken to address any deficiencies in the firm's compliance with its obligations;
		(b)	to advise and assist the relevant persons responsible for carrying out investment services and activities to comply with the firm's UK obligations38;
		(c)	to report to the management body, on at least an annual basis, on the implementation and effectiveness of the overall control environment for investment services and activities, on the risks that have been identified and on the complaints-handling reporting as well as remedies undertaken or to be undertaken;
		(d)	to monitor the operations of the complaints-handling process and consider complaints as a source of relevant information in the context of its general monitoring responsibilities.
		In order to comply with points (a) and (b) of this paragraph, the compliance function shall conduct an assessment on the basis of which it shall establish a risk-based monitoring programme that takes into consideration all areas of the investment firm’s investment services, activities and any relevant ancillary services, including relevant information gathered in relation to the monitoring of complaints handling. The monitoring programme shall establish priorities determined by the compliance risk assessment ensuring that compliance risk is comprehensively monitored.
	3	In order to enable the compliance function referred to in paragraph 2 to discharge its responsibilities properly and independently, investment firms shall ensure that the following conditions are satisfied:
		(a)	the compliance function has the necessary authority, resources, expertise and access to all relevant information;
		(b)	a compliance officer is appointed and replaced by the management body and is responsible for the compliance function and for any reporting as to compliance required in relation to its UK obligations and by38 Article 25(2) of this Regulation;
		(c)	the compliance function reports on an ad-hoc basis directly to the management body where it detects a significant risk of failure by the firm to comply with its UK obligations38;
		(d)	the relevant persons involved in the compliance function are not involved in the performance of services or activities they monitor;
		(e)	the method of determining the remuneration of the relevant persons involved in the compliance function does not compromise their objectivity and is not likely to do so.
	4	An investment firm shall not be required to comply with point (d) or point (e) of paragraph 3 where it is able to demonstrate that in view of the nature, scale and complexity of its business, and the nature and range of investment services and activities, the requirements under point (d) or (e) are not proportionate and that its compliance function continues to be effective. In that case, the investment firm shall assess whether the effectiveness of the compliance function is compromised. The assessment shall be reviewed on a regular basis.
UK38	Article 23 - Risk management
	1	Investment firms shall take the following actions relating to risk management:
		(a)	establish, implement and maintain adequate risk management policies and procedures which identify the risks relating to the firm's activities, processes and systems, and where appropriate, set the level of risk tolerated by the firm;
		(b)	adopt effective arrangements, processes and mechanisms to manage the risks relating to the firm's activities, processes and systems, in light of that level of risk tolerance;
		(c)	monitor the following:
			(i)	the adequacy and effectiveness of the investment firm's risk management policies and procedures;
			(ii)	the level of compliance by the investment firm and its relevant persons with the arrangements, processes and mechanisms adopted in accordance with point (b);
			(iii)	the adequacy and effectiveness of measures taken to address any deficiencies in those policies, procedures, arrangements, processes and mechanisms, including failures by the relevant persons to comply with such arrangements, processes and mechanisms or follow such policies and procedures.
	2	Investment firms shall, where appropriate and proportionate in view of the nature, scale and complexity of their business and the nature and range of the investment services and activities undertaken in the course of that business, establish and maintain a risk management function that operates independently and carries out the following tasks:
		(a)	implementation of the policy and procedures referred to in paragraph 1;
		(b)	provision of reports and advice to senior management in accordance with Article 25(2).
		Where an investment firm does not establish and maintain a risk management function under the first sub-paragraph, it shall be able to demonstrate upon request that the policies and procedures which it is has adopted in accordance with paragraph 1 satisfy the requirements therein.
UK38	Article 24 - Internal audit
	Investment firms shall, where appropriate and proportionate in view of the nature, scale and complexity of their business and the nature and range of investment services and activities undertaken in the course of that business, establish and maintain an internal audit function which is separate and independent from the other functions and activities of the investment firm and which has the following responsibilities:
		(a)	establish, implement and maintain an audit plan to examine and evaluate the adequacy and effectiveness of the investment firm's systems, internal control mechanisms and arrangements;
		(b)	issue recommendations based on the result of work carried out in accordance with point (a) and verify compliance with those recommendations;
		(c)	report in relation to internal audit matters in accordance with Article 25(2).
UK38	Article 25 - Responsibility of senior management
	1	Investment firms shall, when allocating functions internally, ensure that senior management, and, where applicable, the supervisory function, are responsible for ensuring that the firm complies with its obligations under UK law on markets in financial instruments (“UK obligations”)38. In particular, senior management and, where applicable, the supervisory function shall be required to assess and periodically review the effectiveness of the policies, arrangements and procedures put in place to comply with the UK obligations38 and to take appropriate measures to address any deficiencies. The allocation of significant functions among senior managers shall clearly establish who is responsible for overseeing and maintaining the firm’s organisational requirements. Records of the allocation of significant functions shall be kept up-to-date.
	2	Investment firms shall ensure that their senior management receive on a frequent basis, and at least annually, written reports on the matters covered by Articles 22, 23 and 24 indicating in particular whether the appropriate remedial measures have been taken in the event of any deficiencies.
	3	Investment firms shall ensure that where there is a supervisory function, it receives written reports on the matters covered by Articles 22, 23 and 24 on a regular basis.
	4	For the purposes of this Article, the supervisory function shall be the function within an investment firm responsible for the supervision of its senior management.
UK38	Article 30 - Scope of critical and important operational functions
	1	For the purposes of [SYSC 8.1.1R] and rule 2.1 of the Outsourcing Part of the PRA Rulebook38, an operational function shall be regarded as critical or important where a defect or failure in its performance would materially impair the continuing compliance of an investment firm with the conditions and obligations of its authorisation or its other obligations under UK law on markets in financial instruments38, or its financial performance, or the soundness or the continuity of its investment services and activities.
	2	Without prejudice to the status of any other function, the following functions shall not be considered as critical or important for the purposes of paragraph 1:
		(a)	the provision to the firm of advisory services, and other services which do not form part of the investment business of the firm, including the provision of legal advice to the firm, the training of personnel of the firm, billing services and the security of the firm's premises and personnel;
		(b)	the purchase of standardised services, including market information services and the provision of price feeds.
UK38	Article 31 - Outsourcing critical or important operational functions
	1	Investment firms outsourcing critical or important operational functions shall remain fully responsible for discharging all of their obligations under UK law on markets in financial instruments38 and shall comply with the following conditions:
		(a)	the outsourcing does not result in the delegation by senior management of its responsibility;
		(b)	the relationship and obligations of the investment firm towards its clients under the terms of UK law on markets in financial instruments38 is not altered;
		(c)	the conditions with which the investment firm must comply in order to have permission under Part 4A of FSMA to carry on a regulated activity which is any of the investment services and activities (within the meaning of regulation 2(1) of the Markets in Financial Instruments Regulations 2017)38, and to remain so, are not undermined;
		(d)	none of the other conditions subject to which the firm's authorisation was granted is removed or modified.
	2	Investment firms shall exercise due skill, care and diligence when entering into, managing or terminating any arrangement for the outsourcing to a service provider of critical or important operational functions and shall take the necessary steps to ensure that the following conditions are satisfied:
		(a)	the service provider has the ability, capacity, sufficient resources, appropriate organisational structure supporting the performance of the outsourced functions, and any authorisation required by law to perform the outsourced functions, reliably and professionally;
		(b)	the service provider carries out the outsourced services effectively and in compliance with applicable law and regulatory requirements, and to this end the firm has established methods and procedures for assessing the standard of performance of the service provider and for reviewing on an ongoing basis the services provided by the service provider;
		(c)	the service provider properly supervises the carrying out of the outsourced functions, and adequately manage the risks associated with the outsourcing;
		(d)	appropriate action is taken where it appears that the service provider may not be carrying out the functions effectively or in compliance with applicable laws and regulatory requirements;
		(e)	the investment firm effectively supervises the outsourced functions or services and manage the risks associated with the outsourcing and to this end the firm retains the necessary expertise and resources to supervise the outsourced functions effectively and manage those risks;
		(f)	the service provider has disclosed to the investment firm any development that may have a material impact on its ability to carry out the outsourced functions effectively and in compliance with applicable laws and regulatory requirements;
		(g)	the investment firm is able to terminate the arrangement for outsourcing where necessary, with immediate effect when this is in the interests of its clients, without detriment to the continuity and quality of its provision of services to clients;
		(h)	the service provider cooperates with the competent authorities of the investment firm in connection with the outsourced functions;
		(i)	the investment firm, its auditors and the relevant competent authorities have effective access to data related to the outsourced functions, as well as to the relevant business premises of the service provider, where necessary for the purpose of effective oversight in accordance with this article, and the competent authorities are able to exercise those rights of access;
		(j)	the service provider protects any confidential information relating to the investment firm and its clients;
		(k)	the investment firm and the service provider have established, implemented and maintained a contingency plan for disaster recovery and periodic testing of backup facilities, where that is necessary having regard to the function, service or activity that has been outsourced;
		(l)	the investment firm has ensured that the continuity and quality of the outsourced functions or services are maintained also in the event of termination of the outsourcing either by transferring the outsourced functions or services to another third party or by performing them itself.
	3	The respective rights and obligations of the investment firms and of the service provider shall be clearly allocated and set out in a written agreement. In particular, the investment firm shall keep its instruction and termination rights, its rights of information, and its right to inspections and access to books and premises. The agreement shall ensure that outsourcing by the service provider only takes place with the consent, in writing, of the investment firm.
	4	Where the investment firm and the service provider are members of the same group, the investment firm may, for the purposes of complying with this Article and Article 32, take into account the extent to which the firm controls the service provider or has the ability to influence its actions.
	5	Investment firms shall make available on request to the competent authority all information necessary to enable the authority to supervise the compliance of the performance of the outsourced functions with the requirements of UK law on markets in financial instruments38.
UK38	Article 32 - Service providers located in third countries
	1	In addition to the requirements set out in Article 31, where an investment firm outsources functions related to the investment service of portfolio management provided to clients to a service provider located in a third country, that investment firm ensures that the following conditions are satisfied:
		(a)	the service provider is authorised or registered in its home country to provide that service and is effectively supervised by a competent authority in that third country;
		(b)	there is an appropriate cooperation agreement between the competent authority of the investment firm and the supervisory authority of the service provider.
	2	The cooperation agreement referred to in point (b) of paragraph 1 shall ensure that the competent authorities of the investment firm are able, at least, to:
		(a)	obtain on request the information necessary to carry out their supervisory tasks pursuant to UK law on markets in financial instruments38 and Regulation (EU) No 600/2014;
		(b)	obtain access to the documents relevant for the performance of their supervisory duties maintained in the third country;
		(c)	receive information from the supervisory authority in the third country as soon as possible for the purpose of investigating apparent breaches of the requirements of UK law on markets in financial instruments38 and its implementing measures and Regulation (EU) No 600/2014;
		(d)	cooperate with regard to enforcement, in accordance with the national and international law applicable to the supervisory authority of the third country and the competent authorities in the United Kingdom 38 in cases of breach of the requirements of UK law on markets in financial instruments38.
	3	The FCA must publish on its38 website a list of the supervisory authorities in third countries with which they have a cooperation agreement referred to in point (b) of paragraph 1. 38
UK38	Article 72 - Retention of records
	1	The records shall be retained in a medium that allows the storage of information in a way accessible for future reference by the competent authority, and in such a form and manner that the following conditions are met:
		(a)	the competent authority is able to access them readily and to reconstitute each key stage of the processing of each transaction;
		(b)	it is possible for any corrections or other amendments, and the contents of the records prior to such corrections or amendments, to be easily ascertained;
		(c)	it is not possible for the records otherwise to be manipulated or altered;
		(d)	it allows IT or any other efficient exploitation when the analysis of the data cannot be easily carried out due to the volume and the nature of the data; and
		(e)	the firm’s arrangements comply with the record keeping requirements irrespective of the technology used.
	2	Investment firms shall keep at least the records identified in Annex I to this Regulation depending upon the nature of their activities. The list of records identified in Annex I to this Regulation is without prejudice to any other record-keeping obligations arising from other legislation.
	3	Investment firms shall also keep records of any policies and procedures they are required to maintain pursuant to Regulation (EU) No 600/2014, Regulation (EU) No 596/2014 and their implementing measures (as amended under the European Union (Withdrawal) Act 2018) and the law of the United Kingdom or any part of the United Kingdom which was relied on immediately before IP completion day to implement Directive 2014/65/EU, Directive 2014/57/EU and their implementing measures38 in writing. Competent authorities may require investment firms to keep additional records to the list identified in Annex I to this Regulation.