Related provisions for PERG 8.3.4
121 - 140 of 533 items.
5A firm must:(1) appoint an individual as MLRO, with responsibility for oversight of its compliance with the FSA'srules on systems and controls against money laundering; and(2) ensure that its MLRO has a level of authority and independence within the firm and access to resources and information sufficient to enable him to carry out that responsibility.
(1) Depending on the nature, scale and complexity of its business, it may be appropriate for a firm to have a separate risk assessment function responsible for assessing the risks that the firm faces and advising the governing body and senior managers on them.(2) The organisation and responsibilities of a risk assessment function should be documented. The function should be adequately resourced and staffed by an appropriate number of competent staff who are sufficiently independent
Depending on the nature, scale and complexity of its business, it may be appropriate for a firm to delegate much of the task of monitoring the appropriateness and effectiveness of its systems and controls to an internal audit function. An internal audit function should have clear responsibilities and reporting lines to an audit committee or appropriate senior manager, be adequately resourced and staffed by competent individuals, be independent of the day-to-day activities of the
A firm should have in place appropriate arrangements, having regard to the nature, scale and complexity of its business, to ensure that it can continue to function and meet its regulatory obligations in the event of an unforeseen interruption. These arrangements should be regularly updated and tested to ensure their effectiveness.
(1) This
chapter applies to every firm which
is:(a) a securities
and futures firm; or(b) a personal
investment firm; or(c) an investment
firm (including a credit
institution which is an investment
firm) not within (a) or (b) excluding a firm to whom the ISD does not apply under Article 2(2) of
the ISD.(2) This
chapter does not apply to:(a) an incoming
EEA firm in relation to its passported activities; or(b) an oil
market participant in relation to its oil market activities.
In determining whether a UK RIE is ensuring that business conducted by means of its facilities is conducted in an orderly manner (and so as to afford proper protection to investors), the FSA may have regard to whether the UK RIE's arrangements and practices:
- (1)
enable members and clients for whom they act to obtain the best price available at the time for their size and type of trade;
- (2)
ensure:
- (a)
sufficient pre-trade transparency in the UK RIE's markets taking account of the practices in those markets and the trading systems used; and
- (b)
sufficient post-trade transparency in the UK RIE's markets taking into account the nature and liquidity of the specified investments traded, market conditions and the scale of transactions, the need (where appropriate) to preserve anonymity for members and clients for whom they act, and the needs of different market participants for timely price information;
- (a)
- (3)
include procedures which enable the UK RIE to influence trading conditions or suspend trading promptly when necessary to maintain an orderly market; and
- (4)
if they include arrangements to support or encourage liquidity:
- (a)
are transparent;
- (b)
are not likely to encourage any person to enter into transactions other than for proper trading purposes (which may include hedging, investment, speculation, price determination, arbitrage and filling orders from any client for whom he acts);
- (c)
are consistent with a reliable, undistorted price-formation process; and
- (d)
alleviate dealing or other identified costs associated with trading on the UK RIE's markets and do not subsidise a market position of a user of its facilities or subsidise any margin payments (or the provision of collateral) which such a user would have to make.
- (a)
(1) Under section 41(2) of the Act (The threshold conditions), in giving or varying a Part IV permission or imposing or varying any requirement, the FSA must ensure that the firm concerned will satisfy, and continue to satisfy, the threshold conditions in relation to all of the regulated activities for which it has or will have permission.(2) If, however, the applicant for permission is an incoming firm seeking top-up permission, or variation of top-up permission, under Part IV
(1) If, among other things, a firm is failing to satisfy any of the threshold conditions, or is likely to fail to do so, section 45 of the Act (Variation etc. on the FSA's own initiative) states that the FSA may exercise its own-initiative power. Use of the FSA'sown-initiative power is explained in SUP 7 (Individual requirements), ENF 3 (Variation of Part IV permission on the FSA's own initiative) and ENF 5 (Cancellation of Part IV permission on the FSA's own initiative and withdrawal
(1) An overseas firm, which is not an incoming firm, must notify the FSA within 30 business days of any person taking up or ceasing to hold the following positions:(a) the firm's worldwide chief executive (that is, the person who, alone or jointly with one or more others, is responsible under the immediate authority of the directors for the whole of its business) if the person is based outside the United Kingdom;(b) the person within the overseas firm with a purely strategic responsibility
Under the investment condition, the reasonable investor is looking to satisfy two criteria. Both of these are fundamental to his decision to invest. But the thresholds referred to in PERG 9.6.1 G (1) and PERG 9.6.1 G (2) are different. In the FSA's view, a person expects something where he regards it as likely to happen or anticipates that events will turn out in a particular way. A person is satisfied of something where he has made up his mind or is persuaded that it is the case.
Section 236(3) of the Act states clearly that the investment condition must be met 'in relation to BC'. In the FSA's view, this means that the investment condition should not be applied rigidly in relation to specific events such as particular issues of shares or securities or in relation to particular points in time. The requirements of the investment condition must be satisfied in relation to the overall impression of the body corporate itself, having regard to all the circ
In the FSA's view, and within limits, the investment condition allows for the possibility that a body corporate that is an open-ended investment company may issue shares or securities with different characteristics. Some shares or securities may clearly satisfy the condition whereas others may not. The FSA considers that a reasonable investor contemplating investment in such a body corporate may still take the view, looking at the body corporate overall, that the investment condition
The FSA considers that the reference in PERG 9.6.5 G (3) to corresponding provisions in force in another EEA State will include provisions that derive from the maintenance of capital requirements of the Second Council Directive on co-ordination of safeguards which, for the protection of the interests of members and others, are required by Member States of companies (77/91/EEC).
The FSA's views on the following three elements of the investment condition are explained separately:(1) the 'reasonable investor' (see PERG 9.7 (The investment condition: the 'reasonable investor'));(2) the 'expectation' test (see PERG 9.8 (The investment condition: the 'expectation test' (section 236(3)(a) of the Act))); and(3) the 'satisfaction' test (see PERG 9.9 (The investment condition: the 'satisfaction test' (section 236(3)(b) of the Act)).
(1) 1The FSA may suspend, with effect from such time as it may determine, the listing of any securities if the smooth operation of the market is, or may be, temporarily jeopardised or it is necessary to protect investors. [Note: article 18(1) CARD](2) An issuer that has the listing of any of its securities suspended must continue to comply with all listing rules applicable to it.(3) If the FSA suspends the listing of any securities, it may impose such conditions on the procedure
Examples of when the FSA may suspend the listing of securities include (but are not limited to) situations where it appears to the FSA that:(1) the issuer has failed to meet its continuing obligations for listing; or(2) the issuer has failed to publish financial information in accordance with the listing rules; or(3) the issuer is unable to assess accurately its financial position and inform the market accordingly; or(4) there is insufficient information in the market about
Standing data is used by the FSA:(1) to ensure that a firm is presented with the correct regulatory return when it seeks to report electronically;(2) in order to communicate with a firm;(3) as the basis for some sections of the FSA Register; and (4) in order to carry out thematic analysis across sectors and groups of firms.
(1) Within 30 business days of its accounting reference date, a firm must check the accuracy of its standing data through the relevant section of the FSA website.(2) (3) If any standing data is incorrect, the firm must give the corrected standing data to the FSA, using the appropriate form submitted in accordance with instructions on that form.2
The standing data is made available to the firm when the firm logs into the appropriate section of the FSA website. The firm should check the standing data and send any corrections to the FSA. The FSA's preferred method of receiving corrections to standing data is by the online forms available at the FSA's website.2
This guidance is issued under section 157 of Act (Guidance). It is designed to throw light on particular aspects of regulatory requirements, not to be an exhaustive description of a person's obligations. If a person acts in line with the guidance in the circumstances contemplated by it, then the FSA will proceed on the footing that the person has complied with aspects of the requirement to which the guidance relates.
Rights conferred on third parties cannot be affected by guidance given by the FSA. This guidance represents the FSA's view, and does not bind the courts, for example, in relation to an action for damages brought by a private person for breach of a rule (see section 150 of the Act (Action for damages)), or in relation to the enforceability of a contract where there has been a breach of the general prohibition on carrying on a regulated activity in the United Kingdom without authorisation
The Act does not provide a mechanism for appeals to the FSA from decisions by recognised bodies in relation to complaints. However, the FSA is required by section 299 of the Act (Complaints about recognised bodies) to have arrangements to investigate complaints (called relevant complaints in the Act) which it considers relevant to the question of whether a recognised body should remain recognised as such. This section describes aspects of the FSA's arrangements for investigating
Where the FSA receives a complaint about a recognised body, it will, in the first instance, seek to establish whether the complainant has approached the recognised body. Where this is not the case, the FSA will ask the complainant to complain to the recognised body. Where the complainant is dissatisfied with the handling of the complaint, but has not exhausted the recognised body's own internal complaints procedures (in the case of a complaint against a UK recognised body, including
When it is considering a relevant complaint, the FSA will make its own enquiries as appropriate with the recognised body, the complainant and other persons. It will usually ask the recognised body and the complainant to comment upon any preliminary or draft conclusions of its review and to confirm any matters of fact at that stage.
The characteristics that a reasonable investor can be expected to have will inform the use of judgment required by the 'expectation test' and the 'satisfaction test'. These tests relate to the investor's ability to realise an investment within a reasonable period and to do so on the basis of the net value of its assets. In the FSA's view, the characteristics of the reasonable investor include:(1) sound judgment based on good sense;(2) some knowledge of, and possibly experience
The reasonable investor is a hypothetical investor. The implications of this are that the test does not relate to actual investment by a particular person at a particular time or in relation to a particular issue of any class of shares or securities. In the FSA's view, what underlies the test is what a reasonable investor would think he was getting into if he were contemplating investment in a particular body corporate. In addition, because the investor is hypothetical, the investment
After an initial assessment, however, the FSA's view is that subsequent applications of the investment condition could produce a different result, but only if there is a change to the constitution or practice of the body corporate which is significant and sustained. For example, this may happen if there is a change in the body corporate's published intentions or regular practices. As the Economic Secretary to the Treasury said in parliamentary debate when commenting on the definition,
Section 236(3) uses the words "the investor would, if he were to participate in the scheme". This is consistent with the fact that the reasonable investor is hypothetical. But applying the test at this early stage makes it clear that there must be objectively justifiable grounds on which the reasonable investor could base the expectation in section 236(3)(a). And on which he could be satisfied on the matters in section 236(3)(b). In the FSA's view, this requires, for example,
Where a UK recognised body is to circulate any notice or other document proposing any amendment to its memorandum or articles of association (or other similar agreement or document relating to its constitution) to:(1) its shareholders (or any group or class of them); or(2) its members (or any group or class of them); or(3) any other group or class of persons which has the power to make that amendment or whose consent or approval is required before it may be made;that UK recognised
Where a UK recognised body makes an amendment to its memorandum or articles of association (or other similar agreement or document relating to its constitution), that UK recognised body must immediately give the FSA notice of that event, and give written particulars of that amendment and of the date on which it is to become or became effective.
Where any change is made to an agreement which relates to the constitution or governance of a UK recognised body:(1) between that UK recognised body and another person; or(2) between the owners of that UK recognised body; or(3) between the owners of that UK recognised body and another person; or(4) between other persons; that UK recognised body must give the FSA notice of that event as soon as it is aware of it, and give written particulars of that change and of the date on which
The purpose of REC 3.6.6 R is to ensure that the FSA is informed of changes to agreements which specify the arrangements by which a UK recognised body will be governed or by which important decisions will be taken within that body. It is not intended to cover any agreement by which someone is appointed to be a key individual or which covers the terms and conditions of service in such an appointment.
(1) An issuer'slistedsecuritised derivatives must be admitted to trading on a RIE's market for listed securities at all times.(2) An issuer must inform the FSA in writing as soon as possible if it has:(a) requested a RIE to admit or re-admit any of its listedsecuritised derivatives to trading; or(b) requested a RIE to cancel or suspend trading of any of its listedsecuritised derivatives; or(c) been informed by a RIE that the trading of any of its listedsecuritised derivatives
(1) The FSA may dispense with or modify the listing rules in such cases and by reference to such circumstances as it considers appropriate (subject to the terms of EU directives and the Act).(2) A dispensation or modification may be either unconditional or subject to specified conditions.(3) If an issuer or sponsor has applied for, or been granted, a dispensation or modification, it must notify the FSA immediately it becomes aware of any matter which is material to the relevance
(1) An application to the FSA to dispense with or modify a listing rule must be in writing.(2) The application must:(a) contain a clear explanation of why the dispensation or modification is requested;(b) include details of any special requirements, for example, the date by which the dispensation or modification is required;(c) contain all relevant information that should reasonably be brought to the FSA's attention;(d) contain any statement or information that is required by
If an issuer applies to the FSA to dispense with or modify a listing rule on the basis that it is in severe financial difficulty, the FSA would ordinarily expect the issuer to comply with the conditions in LR 10.8 (to the extent relevant to the particular rule for which the dispensation or modification is sought). In particular, the FSA would expect the issuer to comply with those conditions that are directed at demonstrating that it is in severe financial difficulty.
An issuer or sponsor should consult with the FSA at the earliest possible stage if it:
- (1)
is in doubt about how the listing rules apply in a particular situation; or
- (2)
considers that it may be necessary for the FSA to dispense with or modify a listing rule.
Address for correspondence
Note: The FSA's address for correspondence is:
The Financial Services Authority |
25 The North Colonnade |
Canary Wharf |
London, E14 5HS |
Tel: 020 7066 8333 |
Fax: 020 7066 8362 |
(1) 1An insurer with permission to effect orcarry outlife policies must submit to the FSA a persistency report in respect of life policies by 30 April each year in accordance with this section.(2) A firm with permission to establish, operate or wind up a stakeholder pension scheme must submit to the FSA:(a) a data report on stakeholder pensions by 30 April each year prepared in accordance with this section; and(b) two extra data reports on stakeholder pensions prepared in accordance
1In this section, and Forms 1R(2) to (4) in SUP 16 Annex 6R:(1) '12 month report' means the part of a persistency report or data report reporting on life policies or stakeholder pensions effected in Y-2, '24 month report' means the part of a persistency report or data report reporting on life policies or stakeholder pensions effected in Y-3, and so on;(2) 'CC' means the number of life policies or stakeholder pensions which: (a) were effected during the period to which the calculation
Business and internal control risks vary from firm to firm, according to the nature and complexity of the business. The FSA's assessment of these risks is reflected in how its rules apply to different categories of firm as well as in the use of its other regulatory tools. One of the tools the FSA has available is to give a firm individual guidance on the application of the requirements or standards under the regulatory system in the firm's particular circumstances.
The FSA may give individual guidance to a firm on its own initiative if it considers it appropriate to do so. For example:(1) the FSA may consider that general guidance in the Handbook does not appropriately fit a firm's particular circumstances (which may be permanent or temporary) and therefore decide to give additional individual guidance to the firm;(2) some of the FSA's requirements are expressed in general terms; however, there may be times when the FSA will wish to respond
GEN 6.1.5 R and GEN 6.1.6 R do not prevent a firm or member from entering into, arranging, claiming on or making any payment under a contract of insurance which indemnifies any person against all or part of the costs of defending FSA enforcement action or any costs they may be ordered to pay to the FSA.