Related provisions for SUP App 3.6.1
Sections 87H and 87I of the Act provide:
Prospectus approved in another EEA State |
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87H |
(1) |
A prospectus approved by the competent authority of an EEA State other than the United Kingdom is not an approved prospectus for the purposes of section 85 unless that authority has provided the competent authority with – |
|
(a) |
a certificate of approval; |
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(b) |
a copy of the prospectus as approved; and |
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(c) |
if requested by the [FSA], a translation of the summary of the prospectus. |
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(2) |
A document is not a certificate of approval unless it states that the prospectus – |
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(a) |
has been drawn up in accordance with the prospectus directive; and |
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(b) |
has been approved, in accordance with that directive, by the competent authority providing the certificate. |
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(3) |
A document is not a certificate of approval unless it states whether (and, if so, why) the competent authority providing it authorised, in accordance with the prospectus directive, the omission from the prospectus of information which would otherwise have been required to be included. |
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(4) |
“Prospectus” includes a supplementary prospectus. |
Provision of information to host Member State |
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87I |
(1) |
The [FSA] must, if requested to do so, supply the competent authority of a specified EEA State with – |
|
(a) |
a certificate of approval; |
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(b) |
a copy of the specified prospectus (as approved by the [FSA]); and |
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(c) |
a translation of the summary of the specified prospectus (if the request states that one has been requested by the other competent authority). |
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(2) |
Only the following may make a request under this section – |
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(a) |
the issuer of the transferable securities to which the specified prospectus relates; |
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(b) |
a person who wishes to offer the transferable securities to which the specified prospectus relates to the public in an EEA State other than (or as well as) the United Kingdom; |
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(c) |
a person requesting the admission of the transferable securities to which the specified prospectus relates to a regulated market situated or operating in an EEA State other than (or as well as) the United Kingdom. |
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(3) |
A certificate of approval must state that the prospectus – |
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(a) |
has been drawn up in accordance with this Part and the prospectus directive; and |
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(b) |
has been approved, in accordance with those provisions, by the [FSA]. |
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(4) |
A certificate of approval must state whether (and, if so, why) the [FSA] authorised, in accordance with section 87B, the omission from the prospectus of information which would otherwise have been required to be included. |
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(5) |
The [FSA] must comply with a request under this section – |
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(a) |
if the prospectus has been approved before the request is made, within 3 working days beginning with the date of the request; or |
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(b) |
if the request is submitted with an application for the approval of the prospectus, on the first working day after the date on which it approves the prospectus. |
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(6) |
“Prospectus” includes a supplementary prospectus. |
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(7) |
“Specified” means specified in a request made for the purposes of this section. |
Table Application of Exemptions to Forms of Promotions
Financial Promotion Order |
Applies to |
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Article No. |
Title and PERG 8 reference (where applicable) |
Unsolicited real time |
Solicited real time |
Non-real time (solicited or unsolicited) |
12 |
Communications to overseas recipients (8.12.2G) |
*1 |
* |
* |
13 |
Communications from customers and potential customers (8.12.9G) |
* |
* |
* |
14 |
Follow up non-real time communications and solicited real time communications (8.12.10G) |
* |
* |
|
15 |
Introductions (8.12.11G) |
* |
* |
*1 |
16 |
Exempt persons (8.12.12G) |
*2 |
*3 |
*3 |
17 |
Generic promotions (8.12.14G and 8.21.4G) |
* |
* |
* |
17A1 |
Communications caused to be made or directed by unauthorised persons (8.6.7AG) |
* |
* |
* |
18 |
Mere conduits (8.12.18G) |
* |
* |
* |
18A |
Outgoing electronic commerce communications: mere conduits, caching and hosting (8.12.18G)1 |
* |
* |
* |
19 |
Investment professionals (8.12.21G and 8.21.5G) |
* |
* |
* |
20 |
Communications by journalists (8.12.23G) |
* |
||
20A |
Promotion broadcast by company director etc (8.12.23G and 8.21.6G) |
* |
* |
* |
20B |
Incoming electronic commerce communications (8.12.38G) |
* |
* |
* |
22 |
Deposits : non-real time communications (8.13) |
* |
||
23 |
Deposits : real time communications (8.13) |
* |
* |
|
24 |
Relevant insurance activity : non-real time communications (8.13) |
* |
||
25 |
Relevant insurance activity : non-real time communications : reinsurance and large risks (8.13) |
* |
||
26 |
Relevant insurance activity : real time communications (8.13) |
* |
* |
|
28 |
One-off non-real time communications and solicited real time communications (8.14.3G) |
* |
* |
|
28A |
One-off unsolicited real time communications (8.14.11G) |
* |
||
28B1 |
Real time communications: introductions in connection with qualifying credit (8.17.12G) |
* |
* |
|
29 |
Communications required or authorised by enactments |
* |
* |
* |
30 |
Overseas communicators: solicited real time communications (8.14.15G) |
* |
||
31 |
Overseas communicators: non-real time communications to previously overseas customers (8.14.17G) |
* |
||
32 |
Overseas communicators: unsolicited real time communications to previously overseas customers (8.14.16G) |
* |
||
33 |
Overseas communicators: unsolicited real time communications to knowledgeable customers (8.14.16G) |
* |
||
34 |
Governments, central banks etc |
* |
* |
|
35 |
Industrial and provident societies |
* |
* |
|
36 |
Nationals of the EEA States other than United Kingdom (8.14.18G) |
* |
* |
|
37 |
Financial markets |
* |
* |
|
38 |
Persons in the business of placing promotional material |
* |
* |
* |
39 |
Joint enterprises (8.14.19G) |
* |
* |
* |
40 |
Participants in certain recognised collective investment schemes |
* |
* |
|
41 |
Bearer instruments: promotions required or permitted by market rules (8.14.42G) |
* |
* |
|
42 |
Bearer instruments: promotions to existing holders (8.14.42G) |
* |
* |
|
43 |
Members and creditors of certain bodies corporate (8.14.41G and 8.21.8G) |
* |
* |
|
44 |
Members and creditors of open-ended investment companies |
* |
* |
|
45 |
Group companies |
* |
* |
* |
46 |
Qualifying credit to bodies corporate (8.17.10G)1 |
* |
* |
* |
47 |
Persons in the business of disseminating information (8.21.10G) |
* |
* |
* |
48 |
Certified high net worth individuals (8.14.21G) |
* |
* |
|
49 |
High net worth companies, unincorporated associations etc (8.14.25G) |
* |
* |
* |
50 |
Sophisticated investors (8.14.27G) |
* |
* |
* |
50A |
Self-certified sophisticated investors {8.14.28AG) |
*5 |
* |
* |
51 |
Associations of high net worth or sophisticated investors (8.14.29G) |
* |
* |
|
52 |
Common interest group of a company (8.14.30G) |
* |
* |
|
53 |
Settlors, trustees and personal representatives |
* |
* |
* |
54 |
Beneficiaries of trust, will or intestacy |
* |
* |
* |
55 |
Communications by members of professions (8.15.1G) |
* |
* |
|
55A |
Non-real time communication by members of the professions. (8.15.5G) |
* |
||
56 |
Remedy following report by Parliamentary Commissioner for Administration |
* |
* |
* |
57 |
Persons placing promotional material in particular publications |
* |
* |
* |
58 |
Acquisition of interest in premises run by management companies |
* |
* |
|
59 |
Annual accounts and directors' report (8.21.11G) |
* |
* |
* |
60 |
Participation in employee shares schemes |
* |
* |
* |
61 |
Sale of goods and supply of services |
* |
* |
|
62 |
Sale of body corporate (8.14.35G) |
* |
* |
* |
64 |
Takeovers of relevant unlisted companies |
* |
* |
* |
65 |
Takeovers of relevant unlisted companies: warrants etc |
* |
* |
* |
66 |
Takeovers of relevant unlisted companies: application forms |
* |
* |
* |
67 |
Promotions required or permitted by market rules (8.21.13G) |
* |
* |
|
68 |
Promotions in connection with admission to certain EEA markets (8.21.16G) |
* |
* |
|
69 |
Promotions of securities already admitted to certain markets (8.21.17G) |
* |
*1 |
|
701 |
Promotions included in listing particulars etc (8.21.20G)1 |
*1 |
||
711 |
Material relating to prospectus for public offer of unlisted securities |
*1 |
||
721 |
Pension products offered by employers (8.14.40A) |
* |
* |
* |
731 |
Advice centres (8.14.40B) |
* |
* |
* |
1 in limited circumstances only – see article 12(2) of the Financial Promotion Order |
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2 for the purpose of article 16 (2) only |
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3 for the purpose of article 16 (1) only1 |
Frequently asked questions about allocation of functions in SYSC 2.1.3 R
This table belongs to SYSC 2.1.5 G
Question |
Answer |
|
1 |
Does an individual to whom a function is allocated under SYSC 2.1.3 R need to be an approved person? |
An individual to whom a function is allocated under SYSC 2.1.3 R will be performing the apportionment and oversight function (CF 8, see SUP 10.7.1 R) and an application must be made to the FSA for approval of the individual before the function is performed under section 59 of the Act (Approval for particular arrangements). There are exceptions from this in SUP 10.1 (Approved persons - Application). In particular, an incoming EEA firm is referred to the EEA investment business oversight function (CF 9, see SUP 10.7.6 R). |
2 |
If the allocation is to more than one individual, can they perform the functions, or aspects of the functions, separately? |
If the functions are allocated to joint chief executives under SYSC 2.1.4 R, column 2, they are expected to act jointly. If the functions are allocated to an individual under SYSC 2.1.4 R, column 2, in addition to individuals under SYSC 2.1.4 R, column 3, the former may normally be expected to perform a leading role in relation to the functions that reflects his position. Otherwise, yes. |
3 |
What is meant by "appropriately allocate" in this context? |
The allocation of functions should be compatible with delivering compliance with Principle 3, SYSC 2.1.1 R and SYSC 3.1.1 R. The FSA considers that allocation to one or two individuals is likely to be appropriate for most firms. |
4 |
If a committee of management governs a firm or group, can the functions be allocated to every member of that committee? |
Yes, as long as the allocation remains appropriate (see Question 3).If the firm also has an individual as chief executive, then the functions must be allocated to that individual as well under SYSC 2.1.4 R, column 2 (see Question 7). |
5 |
Does the definition of chief executive include the possessor of equivalent responsibilities with another title, such as a managing director or managing partner? |
Yes. |
6 |
Is it possible for a firm to have more than one individual as its chief executive? |
Although unusual, some firm may wish the responsibility of a chief executive to be held jointly by more than one individual. In that case, each of them will be a chief executive and the functions must be allocated to all of them under SYSC 2.1.4 R, column 2 (see also Questions 2 and 7). |
7 |
If a firm has an individual as chief executive, must the functions be allocated to that individual? |
Normally, yes, under SYSC 2.1.4 R, column 2. But if the firm is a body corporate and a member of a group, the functions may, instead of to the firm's chief executive, be allocated to a director or senior manager from the group responsible for the overall management of the group or of a relevant group division, so long as this is appropriate (see Question 3). Such individuals willnevertheless require approval by the FSA (see Question 1). If the firm chooses to allocate the functions to a director or senior manager responsible for the overall management of a relevant group division, the FSA would expect that individual to be of a seniority equivalent to or greater than a chief executive of the firm for the allocation to be appropriate. See also Question 14. |
8 |
If a firm has a chief executive, can the functions be allocated to other individuals in addition to the chief executive? |
Yes. SYSC 2.1.4 R, column 3, permits a firm to allocate the functions, additionally, to the firm's (or where applicable the group's) directors and senior managers as long as this is appropriate (see Question 3). |
9 |
What if a firm does not have a chief executive? |
Normally, the functions must be allocated to one or more individuals selected from the firm's (or where applicable the group's) directors and senior managers under SYSC 2.1.4 R, column 3. But if the firm: (1) is a body corporate and a member of a group; and (2) the group has a director or senior manager responsible for the overall management of the group or of a relevant group division; then the functions must be allocated to that individual (together, optionally, with individuals from column 3 if appropriate) under SYSC 2.1.4 R, column 2.2 |
10 |
What do you mean by "group division within which some or all of the firm's regulated activities fall"? |
A "division" in this context should be interpreted by reference to geographical operations, product lines or any other method by which the group's business is divided. If the firm's regulated activities fall within more than one division and the firm does not wish to allocate the functions to its chief executive, the allocation must, under SYSC 2.1.4 R, be to: (1) a director or senior manager responsible for the overall management of the group; or (2) a director or senior manager responsible for the overall management of one of those divisions; together, optionally, with individuals from column 3 if appropriate. (See also Questions 7 and 9.) |
11 |
How does the requirement to allocate the functions in SYSC 2.1.3R apply to an overseas firm which is not an incoming EEA firm, incoming Treaty firm or UCITS qualifier? |
The firm must appropriately allocate those functions to one or more individuals, in accordance with SYSC 2.1.4 R, but: (1) The responsibilities that must be apportioned and the systems and controls that must be overseen are those relating to activities carried on from a UK establishment with certain exceptions (see SYSC 1.1.7 R). Note that SYSC 1.1.10 R does not extend the territorial scope of SYSC 2 for an overseas firm. (2) The chief executive of an overseas firm is the person responsible for the conduct of the firm's business within the United Kingdom (see the definition of "chief executive"). This might, for example, be the manager of the firm's UK establishment, or it might be the chief executive of the firm as a whole, if he has that responsibility. The apportionment and oversight function applies to such a firm, unless it falls within a particular exception from the approved persons regime (see Question 1). |
12 |
How does the requirement to allocate the functions in SYSC 2.1.3R apply to an incoming EEA firm or incoming Treaty firm? |
SYSC 1.1.1 R (2) and SYSC 1.1.7 R restrict the application of SYSC 2.1.3 R for such a firm. Accordingly: (1) Such a firm is not required to allocate the function of dealing with apportionment in SYSC 2.1.3 R (1). (2) Such a firm is required to allocate the function of oversight in SYSC 2.1.3 R (2). However, the systems and controls that must be overseen are those relating to matters which the FSA, as Host State regulator, is entitled to regulate (there is guidance on this in SUP 13A Annex 2 G3). Those are primarily, but not exclusively, the systems and controls relating to the conduct of the firm's activities carried on from its UK branch. (3) Such a firm need not allocate the function of oversight to its chief executive; it must allocate it to one or more directors and senior managers of the firm or the firm's group under SYSC 2.1.4 R, row (2). (4) An incoming EEA firm which has provision only for cross border services is not required to allocate either function if it does not carry on regulated activities in the United Kingdom; for example if they fall within the overseas persons exclusions in article 72 of the Regulated Activities Order. See also Questions 1 and 15.1 3 |
13 |
What about a firm that is a partnership or a limited liability partnership? |
The FSA envisages that most if not all partners or members will be either directors or senior managers, but this will depend on the constitution of the partnership (particularly in the case of a limited partnership) or limited liability partnership. A partnership or limited liability partnership may also have a chief executive (see Question 5). A limited liability partnership is a body corporate and, if a member of a group, will fall within SYSC 2.1.4 R, row (1) or (2). |
14 |
What if generally accepted principles of good corporate governance recommend that the chief executive should not be involved in an aspect of corporate governance? |
The Note to SYSC 2.1.4 R provides that the chief executive or other executive director or senior manager need not be involved in such circumstances. For example, the Combined Code developed by the Committee on Corporate Governancerecommends that the board of a listed company should establish an audit committee of non-executive directors to be responsible for oversight of the audit. That aspect of the oversight function may therefore be allocated to the members of such a committee without involving the chief executive. Such individuals may require approval by the FSA in relation to that function (see Question 1). |
15 |
What about incoming electronic commerce activities? |
ECO 1.1.6 R has the effect that SYSC does not apply to an incoming ECA provider acting as such.1 |