Related provisions for SUP 16.12.3B

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To access the FCA Handbook Archive choose a date between 1 January 2001 and 31 December 2004 (From field only).

PRIN 1.1.5GRP
Principles 3 (Management and control), 4 (Financial prudence) and (in so far as it relates to disclosing to the appropriate regulator) 11 (Relations with regulators) take into account the activities of members of a firm's group. This does not mean that, for example, inadequacy of a group member's risk management systems or resources will automatically lead to a firm contravening Principle 3 or 4. Rather, the potential impact of a group member's activities (and, for example, risk
DEPP 2.5.18GRP
Some of the distinguishing features of notices given under enactments other than the Act are as follows: (1) [deleted]66(2) [deleted]66(3) Friendly Societies Act 1992, section 58A1: The warning notice and decision notice must set out the terms of the direction which the FCA6 proposes or has decided to give and any specification of when the friendly society is to comply with it. A decision notice given under section 58A(3) must give an indication of the society's right, given by
COND 2.7.8GRP
1In deciding how they will satisfy and continue to satisfy the threshold conditions set out in paragraphs 2F and 3E of Schedule 6 to the Act, firms should consider matters including (but not limited to) the following:(1) the assumptions underlying the firm's business model and justification for it;(2) the rationale for the business the firm proposes to do or continues to do, its competitive advantage, viability and the longer-term profitability of the business;(3) the needs of
BIPRU 1.2.33GRP
The trading book policy statement may be prepared on either a consolidated or a solo (or solo-consolidated) basis. It should be prepared on a consolidated basis when a group either manages its trading risk centrally or employs the same risk management techniques in each group member. A trading book policy statement prepared on a consolidated basis should set out how it applies to each firm in the group and should be approved by each such firm'sgoverning body.
IFPRU 8.1.15GRP
The FCA will assess core UK group applications against article 113(6) on a case-by-case basis. The FCA expects to approve this treatment for core UK groupundertakings if the conditions stipulated in article 113(6) are met. A firm should note that the FCA will still make a wider judgement whether it is appropriate to grant this treatment even where the conditions in article 113(6) are met. It is the FCA's intention to continue to apply a high level of scrutiny to applications under
SYSC 20.2.2RRP
Where the firm is a member of:(1) an insurance group, in respect of which it is required to maintain group capital;(2) a UK consolidation group; or(3) a non-EEA sub-group;it must conduct the reverse stress test on a solo basis as well as on a consolidated basis in relation to the insurance group, the UK consolidation group or the non-EEA sub-group, as the case may be.
PERG 5.6.15GRP
In some cases, a person may make arrangements to enter into a contract of insurance as policyholder on its own behalf and also arrange that another person become a policyholder under the same contract of insurance. If so, the person should be aware that the effect of the narrower exclusion in article 28 as part of implementation of the IMD is that he may be arranging on behalf of the other policyholder. This may be relevant, for example, to a company which arranges insurance
SUP 15.9.3GRP
A firm should consider the requirements in SUP 15.9.2 R on a continuing basis, and in particular, when the group prepares its financial statements and on the occurrence of an event affecting the consolidated group. Such events include, but are not limited to, an acquisition, merger or sale.
PERG 8.10.12GRP
In the FCA's view, persons who may be engaging in investment activity jointly include:(1) a married couple;(2) two or more persons, who will invest jointly in a product (for example, a cohabiting couple who are not married or members of a family);(3) the directors of a company or partners in a firm;(4) members of a group of companies;(5) the participants in a joint commercial enterprise;(6) the members of an investment club; and(7) the managers or prospective managers of a company
MCOB 10.4.4RRP
(1) The amounts of the following items are not included in the total charge for credit in relation to an agreement:(a) any charge payable under the transaction to the firm upon failure by the customer to do or to refrain from doing anything which he is required to do or to refrain from doing;(b) any charge:(i) which is payable by the firm to any person upon failure by the customer to do or to refrain from doing anything which he is required under the transaction to do or to refrain
BIPRU 2.1.8RRP
(1) A firm that has a solo consolidation waiver must meet the obligations in SYSC 12.1.13 R (Application of certain systems and controls rules on a consolidated basis) on a consolidated basis with respect to the firm and each subsidiary undertaking to which the firm'ssolo consolidation waiver applies.(2) If (1) applies, SYSC 12.1.13 R applies to the group made up of the firm and its subsidiary undertakings referred to in (1) in the same way as it applies to a UK consolidation
FEES 7.2.9RRP

Table of rules in FEES 4that also apply to FEES 7 to the extent that in FEES 4 they apply to fees payable to the FCA6

FEES 4 rules incorporated into FEES 7

Description

FEES 4.2.4 R

Method of payment

FEES 4.2.7B R

Calculation of periodic fee and tariff base for a firm's second financial year

FEES 4.2.8 R

How FEES 4.2.7 R applies in relation to an incoming EEA firm or an incoming Treaty firm

FEES 4.2.10 R

Extension of time

FEES 4.2.11 R (first entry only)

Due date and changes in permission for periodic fees

FEES 4.3.7 R

Groups of firms

FEES 4.3.13 R

Firms applying to cancel or vary permission before start of period

FEES 4.3.15 R

Firms acquiring businesses from other firms

FEES 4.4.1 R to FEES 4.4.6 R

Information on which fees are calculated
SUP 10A.6.9GRP
Examples of where SUP 10A.6.8 R might apply include (but are not limited to):(1) a chairman of an audit committee of a parent undertaking or holding company of a UK firm where that audit committee is working for that UK firm (that is, functioning as the audit committee for the group); or(2) a director (other than a non-executive director) of a parent undertaking or holding company of a UK firm exercising significant influence by way of his involvement in taking decisions for that
SUP 8.3.2AGRP
10The FCA must consult the PRA before publishing or deciding not to publish a waiver which relates to:(1) a PRA-authorised person; or(2) an authorised person who has as a member of its immediate group a PRA-authorised person;unless the waiver relates to rules made by the FCA under sections 247 or 248 of the Act.
REC 2.11.3GRP
In determining whether a UK recognised body has made satisfactory arrangements for the safeguarding and administration of assets belonging to the users of its facilities, the FCA3 may have regard to: 3(1) the level of protection which the arrangements provide against the risk of theft or other types or causes of loss;(2) whether the arrangements ensure that assets are only used or transferred in accordance with the instructions of the owner of those assets or in accordance with
LR App 2.1.2GRP

29.8

Annual financial report

9.81

R

[not used]

9.8.2

R

[not used]

9.8.3

R

[not used]

Information to be included in annual report and accounts

9.8.4

R

In addition to the requirements set out in DTR 4.1 a listed company must include in its annual financial report, where applicable, the following:

(1)

a statement of the amount of interest capitalised by the group during the period under review with an indication of the amount and treatment of any related tax relief;

(2)

any information required by LR 9.2.18 R (Publication of unaudited financial information);

(3)

details of any small related party transaction as required by LR 11.1.10 R (2)(c);

(4)

details of any long-term incentive schemes as required by LR 9.4.3 R;

(5)

details of any arrangements under which a director of the company has waived or agreed to waive any emoluments from the company or any subsidiary undertaking;

(6)

where a director has agreed to waive future emoluments, details of such waiver together with those relating to emoluments which were waived during the period under review;

(7)

in the case of any allotment for cash of equity securities made during the period under review otherwise than to the holders of the company'sequity shares in proportion to their holdings of such equity shares and which has not been specifically authorised by the company's shareholders:

(a)

the classes of shares allotted and for each class of shares, the number allotted, their aggregate nominal value and the consideration received by the company for the allotment;

(b)

the names of the allottees, if less than six in number, and in the case of six or more allottees a brief generic description of each new class of equity holder (e.g. holder of loan stock);

(c)

the market price of the allotted securities on the date on which the terms of the issue were fixed; and

(d)

the date on which the terms of the issue were fixed;

(8)

the information required by paragraph (7) must be given for any unlisted major subsidiary undertaking of the company;

(9)

where a listed company has listed shares in issue and is a subsidiary undertaking of another company, details of the participation by the parent undertaking in any placing made during the period under review;

(10)

details of any contract of significance subsisting during the period under review:

(a)

to which the listed company, or one of its subsidiary undertakings, is a party and in which a director of the listed company is or was materially interested; and

(b)

between the listed company, or one of its subsidiary undertakings, and a controlling shareholder;

(11)

details of any contract for the provision of services to the listed company or any of its subsidiary undertakings by a controlling shareholder, subsisting during the period under review, unless:

(a)

it is a contract for the provision of services which it is the principal business of the shareholder to provide; and

(b)

it is not a contract of significance;

(12)

details of any arrangement under which a shareholder has waived or agreed to waive any dividends; and

(13)

where a shareholder has agreed to waive future dividends, details of such waiver together with those relating to dividends which are payable during the period under review.

9.8.5

G

A listed company need not include with the annual report and accounts details of waivers of dividends of less than 1% of the total value of any dividend provided that some payment has been made on each share of the relevant class during the relevant calendar year.

Additional information

9.8.6

R

In the case of a listed company incorporated in the United Kingdom, the following additional items must be included in its annual financial report:

(1)

a statement setting out all the interests (in respect of which transactions are notifiable to the company under DTR 3.1.2 R) of each person who is a director of the listed company as at the end of the period under review including:

(a)

all changes in the interests of each director that have occurred between the end of the period under review and a date not more than one month prior to the date of the notice of the annual general meeting; or

(b)

if there have been no changes in the period described in paragraph (a), a statement that there have been no changes in the interests of each director;

Interests of each director include the interests of connected persons of which the listed company is, or ought upon reasonable enquiry to become, aware.

(2)

a statement showing the interests disclosed to the listed company in accordance with DTR 5 as at the end of the period under review and:

(a)

all interests disclosed to the listed company in accordance with DTR 5 that have occurred between the end of the period under review and a date not more than one month prior to the date of the notice of the annual general meeting; or

(b)

if no interests have been disclosed to the listed company in accordance with DTR 5 in the period described in (a), a statement that no changes have been disclosed to the listed company;

(3)

a statement made by the directors that the business is a going concern, together with supporting assumptions or qualifications as necessary, that has been prepared in accordance with Going Concern and Liquidity Risk: Guidance for Directors of UK Companies 2009, published by the Financial Reporting Council in October 2009;

(4)

a statement setting out:

(a)

details of any shareholders' authority for the purchase, by the listed company of its own shares that is still valid at the end of the period under review;

(b)

in the case of purchases made otherwise than through the market or by tender to all shareholders, the names of sellers of such shares purchased, or proposed to be purchased, by the listed company during the period under review;

(c)

in the case of any purchases made otherwise than through the market or by tender or partial offer to all shareholders, or options or contracts to make such purchases, entered into since the end of the period covered by the report, information equivalent to that required under Part 2 of Schedule 7 to the Large & Medium Sized Companies and Groups (Accounts and Reports) Regulations 2008 (SI 2008/410) (Disclosure required by company acquiring its own shares etc) ; and

(d)

in the case of sales of treasury shares for cash made otherwise than through the market, or in connection with an employees' share scheme, or otherwise than pursuant to an opportunity which (so far as was practicable) was made available to all holders of the listed company'ssecurities (or to all holders of a relevant class of its securities) on the same terms, particulars of the names of purchasers of such shares sold, or proposed to be sold, by the company during the period under review;

(5)

a statement of how the listed company has applied the Main Principles set out in the UK Corporate Governance Code, in a manner that would enable shareholders to evaluate how the principles have been applied;

(6)

a statement as to whether the listed company has:

(a)

complied throughout the accounting period with all relevant provisions set out in the UK Corporate Governance Code; or

(b)

not complied throughout the accounting period with all relevant provisions set out in the UK Corporate Governance Code and if so, setting out:

(i)

those provisions, if any it has not complied with;

(ii)

in the case of provisions whose requirements are of a continuing nature, the period within which, if any, it did not comply with some or all of those provisions; and

(iii)

the company's reasons for non-compliance; and

(7)

a report to the shareholders by the Board which contains all the matters set out in LR 9.8.8 R.

9.8.6A

G

(1)

The effect of LR 9.8.6 R (1) is that a listed company is required to set out a 'snapshot' of the total interests of a director and his or her connected persons, as at the end of the period under review (including certain information to update it as at a date not more than a month before the date of the notice of the annual general meeting). The interests that need to be set out are limited to those in respect of which transactions fall to be notified under the notification requirement for PDMRs in DTR 3.1.2 R. Persons who are directors during, but not at the end of, the period under review need not be included.

(2)

A listed company unable to compile the statement in LR 9.8.6 R (1) from information already available to it may need to seek the relevant information, or confirmation, from the director himself, including that in relation to connected persons, but would not be expected to obtain information directly from connected persons.

9.8.7

R

An overseas company with a premium listing must include in its annual report and accounts the information in LR 9.8.6 R (5), LR 9.8.6 R (6) and LR 9.8.8 R (9).

9.8.7A

R

(1)

An overseas company with a premium listing that is not required to comply with requirements imposed by another EEA State that correspond to DTR 7.2 (Corporate governance statements) must comply with DTR 7.2 as if it were an issuer to which that section applies.

(2)

An overseas company with a premium listing which complies with LR 9.8.7 R will be taken to satisfy the requirements of DTR 7.2.2 R and DTR 7.2.3 R, but (unless it is required to comply with requirements imposed by another EEA State that correspond to DTR 7.2) must comply with all of the other requirements of DTR 7.2 as if it were an issuer to which that section applies.

Report to shareholders

9.8.8

R

The report to the shareholders by the Board required by LR 9.8.6 R (7) must contain the following:

(1)

a statement of the listed company's policy on executive directors' remuneration;

(2)

information presented in tabular form, unless inappropriate, together with explanatory notes as necessary on:

(a)

the amount of each element in the remuneration package for the period under review of each director, by name, including but not restricted to, basic salary and fees, the estimated money value of benefits in kind, annual bonuses, deferred bonuses, compensation for loss of office and payments for breach of contract or other termination payments;

(b)

the total remuneration for each director for the period under review and for the corresponding prior period;

(c)

any significant payments made to former directors during the period under review; and

(d)

any share options, including Save-as-you-earn options, for each director, by name, in accordance with the requirements of the Directors' Remuneration Report Regulations;

(3)

details of any long-term incentive schemes, other than share options as required by paragraph (2)(d), including the interests of each director, by name, in the long-term incentive schemes at the start of the period under review;

(4)

details of any entitlements or awards granted and commitments made to each director under any long-term incentive schemes during the period, showing which crystallize either in the same year or in subsequent years;

(5)

details of the monetary value and number of shares, cash payments or other benefits received by each director under any long-term incentive schemes during the period;

(6)

details of the interests of each director in the long-term incentive schemes at the end of the period;

(7)

an explanation and justification of any element of a director's remuneration, other than basic salary, which is pensionable;

(8)

details of any director's service contract with a notice period in excess of one year or with provisions for pre-determined compensation on termination which exceeds one year's salary and benefits in kind, giving the reasons for such notice period;

(9)

details of the unexpired term of any directors' service contract of a director proposed for election or re-election at the forthcoming annual general meeting, and, if any director proposed for election or re-election does not have a directors' service contract, a statement to that effect;

(10)

a statement of the listed company's policy on the granting of options or awards under its employee share scheme and other long-term incentive schemes, explaining and justifying any departure from that policy in the period under review and any change in the policy from the preceding year;

(11)

for money purchase schemes details of the contribution or allowance payable or made by the listed company in respect of each director during the period under review; and

(12)

for defined benefit schemes

a)

details of the amount of the increase during the period under review (excluding inflation) and of the accumulated total amount at the end of the period in respect of the accrued benefit to which each director would be entitled on leaving service or is entitled having left service during the period under review;

(b)

either:

(i)

the transfer value (less director's contributions) of the relevant increase in accrued benefit (to be calculated in accordance with regulations 7 to 7E of the Occupational Pension Schemes (Transfer Values) Regulations 1996 but making no deduction for any under-funding) as at the end of the period; or

(ii)

so much of the following information as is necessary to make a reasonable assessment of the transfer value in respect of each director:

(A) age;

(B) normal retirement age;

(C) the amount of any contributions paid or payable by the director under the terms of the scheme during the period under review;

(D) details of spouses and dependants benefits;

(E) early retirement rights and options;

(F) expectations of pension increases after retirement (whether guaranteed or discretionary); and

(G) discretionary benefits for which allowance is made in transfer values on leaving and any other relevant information which will significantly affect the value of the benefits; and

(c)

no disclosure of voluntary contributions and benefits.

Information required by law

9.8.9

G

The requirements of LR 9.8.6 R (6) and LR 9.8.8 R relating to corporate governance are additional to the information required by law to be included in the listed company's annual report and accounts.

Auditors report

9.8.10

R

A listed company must ensure that the auditors review each of the following before the annual report is published:

(1)

LR 9.8.6R(3) (statement by the directors that the business is a going concern); and

(2)

the parts of the statement required byLR 9.8.6 R (6) (corporate governance) that relate to the following provisions of the UK Corporate Governance Code:

(a)

C.1.1;

(b)

C.2.1; and

(c)

C.3.1 to C.3.7.

9.8.11

R

A listed company must ensure that the auditors review the following disclosures:

(1)

LR 9.8.8 R (2) (amount of each element in the remuneration package and information on share options);

(2)

LR 9.8.8 R (3), LR 9.8.8 R (4) and (5) (details of long term incentive schemes for directors);

(3)

LR 9.8.8 R (11) (money purchase schemes); and

(4)

LR 9.8.8 R (12) (defined benefit schemes).

9.8.12

R

If, in the opinion of the auditors the listed company has not complied with any of the requirements set out in LR 9.8.11 R the listed company must ensure that the auditors' report includes, to the extent possible, a statement giving details of the non-compliance.

Summary financial statements

9.8.13

R

Any summary financial statement issued by a listed company as permitted under the Companies Act 2006, must disclose:

(1)

earnings per share; and

(2)

the information required for summary financial statements set out in or under the Companies Act 2006.