Related provisions for SUP 10A.1.19

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CONC 14.1.1RRP
This chapter applies to a firm with respect to a credit-related regulated activity.
CONC 14.1.2RRP
A firm must not appoint an individual, who is not an authorised person or an exempt person, to act as an agent of the firm, in carrying on regulated activities of the firm unless all of the following conditions are met at the date of the individual's appointment and while the individual continues to act as the firm's agent:(1) the firm appoints the individual as the firm's agent;(2) the individual works as agent only for the firm and not as agent for any other principal;(3) the
CONC 14.1.4RRP
Where a firm appoints an agent in accordance with CONC 14.1.2 R to carry on the business of the firm:(1) the firm must establish, implement and maintain adequate policies and procedures sufficient to ensure compliance of the agent with the firm's obligations under the regulatory system; and (2) the firm must take all reasonable steps to identify conflicts of interest between the agent and a client of the firm that arise or may arise in the course of the firm carrying on regulated
DISP 2.3.1RRP
7The Ombudsman can consider a complaint under the Compulsory Jurisdiction if it relates to an act or omission by a firm in carrying on one or more of the following activities:(1) regulated activities (other than auction regulation bidding );10(1A) payment services;7(1B) [deleted]1312(2) [deleted]11321132(3) lending money secured by a charge on land;(4) lending money (excluding restricted credit where that is not a credit-related regulated activity1132 );1132(5) paying money
DISP 2.3.2ARRP
7The Ombudsman can consider a complaint under the Compulsory Jurisdiction if it relates to an act or omission by a payment service provider in carrying on:(1) payment services; or(2) credit-related regulated activities;11321132or any ancillary activities, including advice, carried on by the payment service provider in connection with them.
DISP 2.3.2BRRP
931The Ombudsman can consider a complaint under the Compulsory Jurisdiction if it relates to an act or omission by an electronic money issuer in carrying on:(1) issuance of electronic money; or(2) credit-related regulated activities;11321132or any ancillary activities, including advice, carried on by the electronic money issuer in connection with them.
DISP 2.3.4RRP
A complaint about an authorisedprofessional firm cannot be handled under the Compulsory Jurisdiction of the Financial Ombudsman Service if it relates solely to a non-mainstream regulated activity and can be handled by a designated professional body.630
SUP 12.7.1ARRP
(1) A firm other than:99(a) a credit union; or9(b) a firm which intends to appoint , or has appointed, an appointed representative to carry on only credit-related regulated activity;9must submit the form in SUP 12 Annex 3 online 9at http://www.fca.org.uk using the FCA'sONA10system.10(2) A credit union or a firm which intends to appoint , or has appointed, an appointed representative to carry on only credit-related regulated activity9must submit the form in SUP 12 Annex 3 R in
SUP 12.7.2GRP
A firm's notice under SUP 12.7.1 R should give details of the appointed representative and the regulated activities which the firm is, or intends to, carry on through the appointed representative, including:(1) the name of the firm's new appointed representative (if the appointed representative is a body corporate, this is its registered name);(2) any trading name under which the firm's new appointed representative carries on a regulated activity in that capacity;(3) a description
SUP 12.7.3GRP
A firm need not notify the FCA of any restrictions imposed on the regulated activities for which the firm has accepted responsibility (under SUP 12.7.2 G (4)) if the firm accepts responsibility for the unrestricted scope of the regulated activities.
SUP 12.7.8ARRP
(1) 8Subject to (2A), a 9firm other than a credit union must submit the form as set out in SUP 12 Annex 4 R online at http://www.fca.org.uk using the FCA'sONA10system.910(2) A credit union must submit the form in SUP 12 Annex 4 R in the way set out in SUP 15.7.4 R to SUP 15.7.9 G (Form and method of notification).(2A) If the notification:9(a) relates to an appointed representative whose scope of appointment covers only credit-related regulated activity; or9(b) is of a change to
SUP 13A.3.2GRP
(1) On qualifying for authorisation, subject to SUP 13A.3.1C G (1),6 an EEA firm (except for an EEA firm that has received authorisation under article 18 of the auction regulation)7 will have permission to carry on each permitted activity (see (3) below) which is a regulated activity.6(2) 6[deleted](3) The permitted activities of an EEA firm (except for an EEA firm that has received authorisation under article 18 of the auction regulation)7 are those activities identified in the
SUP 13A.3.4GRP
Under section 31 of the Act, a Treaty firm is authorised for the purposes of the Act if it qualifies for authorisation under Schedule 4 (Treaty Rights), that is:(1) the Treaty firm is seeking to carry on a regulated activity; and(2) the conditions set out in paragraph 3(1) of Schedule 4 to the Act are satisfied.
SUP 13A.3.5GRP
On qualifying for authorisation a Treaty firm will have permission to carry on each permitted activity which is a regulated activity. This permission will be treated on the same terms as those which apply to the Treaty firm'sHome State authorisation. For example, it will reflect any limitations or requirements which are included in the firm'sHome State authorisation.
SUP 13A.3.6GRP
The effect of paragraph 5(1) and 5(2) of Schedule 4 to the Act is that a Treaty firm which qualifies for authorisation under that Schedule must, at least seven days before it carries on any of the regulated activities covered by its permission, give the appropriate UK regulator10 written notice of its intention to do so. Failure to do so is a criminal offence under paragraph 6(1) of that Schedule.10
SUP 13A.3.13GRP
A UCITS qualifier has permission under paragraph 2 of Schedule 5 to the Act, to carry on, as far as is appropriate to the capacity in which it acts in relation to the scheme:88(1) the regulated activity of establishing, operating or winding up a collective investment scheme; and(2) any activity in connection with, or for the purposes of, the scheme (including the regulated activity of managing a UCITS).88
PERG 4.6.1GRP
Article 53A of the Regulated Activities Order (Advising on regulated mortgage contracts) makes advising on regulated mortgage contracts a regulated activity. This covers advice which is both:(1) given to a person in his capacity as borrower or potential borrower; and(2) advice on the merits of the borrower:(a) entering into a particular regulated mortgage contract (whether or not the entering into is done by way of business); or(b) varying the terms of a regulated mortgage contract
PERG 4.6.2GRP
In the FCA's view, the circumstances in which a person is giving advice on the borrower varying the terms of a regulated mortgage contract so as to vary his obligations under the contract include (but are not limited to) where the advice is about:(1) the borrower obtaining a further advance secured on the same land as the original loan; or(2) a rate switch or a product switch (that is, where the borrower does not change lender but changes the terms for repayment from, say, a variable
PERG 4.6.4GRP
Each of these aspects is considered in greater detail in PERG 4.6.5 G (Advice must relate to a particular regulated mortgage contract) to PERG 4.6.17 G (Advice must relate to the merits (of entering into as borrower or varying)). Additionally, the following should be borne in mind:(1) a person may be carrying on regulated activities involving arranging, whether or not that person is advising on regulated mortgage contracts (see PERG 4.5);(2) the provision of advice or information
PERG 4.6.5GRP
Advice will come within the regulated activity in article 53A of the Regulated Activities Order only if it relates to a particular regulated mortgage contract (or several different regulated mortgage contracts). The question is whether a recommendation is made to a customer which either explicitly or implicitly steers the customer to a particular regulated mortgage contract because of its features.
PERG 4.6.22GRP
Undertaking the process of scripted questioning gives rise to particular issues concerning advice. These mainly involve two aspects of this regulated activity. These are that advice must relate to a particular regulated mortgage contract (see PERG 4.6.5 G) and the distinction between information and advice (see PERG 4.6.13 G). Whether or not scripted questioning in any particular case is advising on regulated mortgage contracts will depend on all the circumstances. If the process
PERG 8.23.1GRP
Under section 19 of the Act (The general prohibition) no person may, by way of business, carry on a regulated activity in the United Kingdom unless he is authorised or exempt. The meaning of regulated activity is set out in Part II of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (the Regulated Activities Order) (as amended). Any person who breaches section 19 of the Act commits a criminal offence for which the maximum penalty is two years’ imprisonment
PERG 8.23.2GRP
Anyone who is carrying on a regulated activity is likely to make financial promotions in the course of or for the purposes of carrying on that activity. It is beyond the scope of this guidance to cover regulated activities as such (for a general guide see PERG 2). There are circumstances, however, where persons whose main aim is either:(1) to make financial promotions for their own purposes or on behalf of others; or(2) to help other persons to make financial promotions;may find
PERG 8.23.3GRP
The regulated activities which are likely to be conducted in the circumstances referred to in PERG 8.23.2 G are:(1) giving advice on certain investments (articles 53 (Advising on investments), 53A (Advising on regulated mortgage contracts), 53B (Advising on regulated home reversion plans), 53C (Advising on regulated home purchase plans), 53D (Advising on regulated sale and rent back agreements)2 and 56 (Advice on syndicate participation at Lloyd’s) of the Regulated Activities
COBS 18.11.1RRP
1COBS applies to an authorised professional firm, except that its application in relation to non-mainstream regulated activities and financial promotion is modified as set out below.
COBS 18.11.2RRP
COBS does not apply to an authorised professional firm with respect to its non-mainstream regulated activities, except that:(1) the fair, clear and not misleading rule applies;(2) the financial promotion rules apply as modified below;(3) COBS 7 (Insurance mediation) applies but only if the designated professional body of the firm does not have rules approved by the FCA under section 332(5) of the Act that implement articles 12 and 13 of the Insurance Mediation Directive and that
COBS 18.11.3RRP
The financial promotion rules do not apply to an authorised professional firm in relation to the communication of a financial promotion if:(1) the firm's main business is the practice of its profession (see IPRU(INV) 2.1.2R(3));(2) the financial promotion is made for the purposes of and incidental to the promotion or provision by the firm of its professional services or its non-mainstream regulated activities; and(3) the financial promotion is not communicated on behalf of another
PERG 4.14.3GRP
In addition, a professional firm may, in certain circumstances, be able to use the Part XX exemption to avoid any need for authorisation. PROF 2 (Status of exempt professional firm) contains general guidance on the Part XX exemption. In particular, PROF 2.1.9 G explains that the Treasury have specified certain regulated activities to which the Part XX exemption cannot apply in the Financial Services and Markets Act 2000 (Professions) (Non-Exempt Activities Order 2001 ("the Non-Exempt
PERG 4.14.4GRP
Arranging (bringing about) a regulated mortgage contract and making arrangements with a view to a regulated mortgage contract have not been specified in the Non-Exempt Activities Order. Accordingly, a professional firm may carry on these regulated activities without authorisation, provided the other conditions of the Part XX exemption are complied with.
PERG 4.14.6GRP
Entering into a regulated mortgage contract and administering a regulated mortgage contract have both been specified in the Non-Exempt Activities Order. As an exception, a professional firm is allowed under the Part XX exemption to carry on these regulated activities if the firm is acting as a trustee or personal representative. But this is provided that the borrower is a beneficiary under the trust, will or intestacy.
PERG 5.15.2GRP
Flow chart: regulated activities related to insurance mediation activities – do you need authorisation?
PERG 5.15.4GRP

Types of activity – are they regulated activities and, if so, why?

Type of activity

Is it a regulated activity?

Rationale

MARKETING AND EFFECTING INTRODUCTIONS

Passive display of information -for example, medical insurance brochures in doctor’s surgery (whether or not remuneration is received for this activity)

No.

Merely displaying information does not constitute making arrangements under article 25(2) (see PERG 5.6.4 G).

Recommending a broker/insurance undertaking and providing customer with contact details (whether by phone, fax, e-mail, face-to-face or any other means of communication)

Yes, but article 72C may be available.

This will constitute making arrangements under article 25(2). But, the exclusion in article 72C will apply if all the intermediary does is supply information to the customer and the conditions of article 72C are otherwise met (see PERG 5.6.5 G to PERG 5.6.9 G). Generally, this will not amount to advice under article 53 unless there is an implied recommendation of a particular policy (see PERG 5.8.4 G), in which case article 72C would not be available.

Providing an insurance undertaking/broker with contact details of customer

Yes.

This will constitute making arrangements under article 25(2) when undertaken in the context of regular or ongoing arrangements for introducing customers. Article 72C will not apply because the information is supplied to someone other than the policyholder or potential policyholder.

Marketing on behalf of insurance undertaking to intermediaries only (for example, broker consultants)

Yes.

This amounts to work preparatory to the conclusion of contracts of insurance and so constitutes making arrangements under article 25(2). Article 72C is not available because this activity does not involve provision of information to the policyholder or potential policyholder only.

Telemarketing services (that is, companies specialising in marketing an insurance undertaking's products/services to prospective customers)

Yes.

This amounts to introducing and/or other work preparatory to the conclusion of contracts of insurance and so constitutes making arrangements under article 25(2). This could also involve article 25(1) arranging where the telemarketing company actually sells a particular policy and could involve advising on investments. Article 72C will not be available where the provision of information is more than incidental to the telemarketing company’s main business or where the telemarketing company is advising on investments.

PRE-PURCHASE DISCUSSIONS WITH CUSTOMERS AND ADVICE

Discussion with client about need for insurance generally/need to take out a particular type of insurance

Generally, no. Article 72C available if needed.

Not enough, of itself, to constitute making arrangements under article 25(2), but you should consider whether, viewed as a whole, your activities might amount to arranging. If so, article 72C might be of application (see PERG 5.6.5 G to PERG 5.6.9 G).

Advising on the level of cover needed

Generally, no. Article 72C available if needed.

Not enough, of itself, to constitute making arrangements under article 25(2), but you should consider whether, viewed as a whole, your activities might amount to making arrangements under article 25(2) (see PERG 5.8.3 G). If so, article 72C might be of application (see PERG 5.6.5 G to PERG 5.6.9 G).

Pre-purchase questioning in the context of filtered sales (intermediary asks a series of questions and then suggests several policies which suit the answers given)

Yes. Subject to article 72 C exclusion where available.

This will constitute arranging although article 72C may be of application (see PERG 5.6.5 G to PERG 5.6.9 G). If there is no express or implied recommendation of a particular policy, this activity will not amount to advice under article 53 (see PERG 5.8.15 G to PERG 5.8.19 G).

Explanation of the terms of a particular policy or comparison of the terms of different policies

Possibly. Article 72C available.

This is likely to amount to making arrangements under article 25(2). In certain circumstances, it could involve advising on investments (see PERG 5.8.8 G (Advice or information)). Where the explanation is provided to the potential policyholder, and does not involve advising on investments, article 72C may be of application (see PERG 5.6.5 G to PERG 5.6.9 G), and where information is provided by a professional in the course of a profession, article 67 may apply (see PERG 5.11.9 G to PERG 5.11.12 G).

Advising that a customer take out a particular policy

Yes.

This amounts to advice on the merits of a particular policy under article 53 (see PERG 5.8.4 G to PERG 5.8.5 G).

Advising that a customer does not take out a particular policy

Yes.

This amounts to advice on the merits of a particular policy under article 53 (see PERG 5.8.4 G to PERG 5.8.5 G).

Advice by journalists in newspapers, broadcasts etc.

Generally, no because of the article 54 exclusion.

Article 54 provides an exclusion for advice given in newspapers etc (see PERG 5.8.24 G to PERG 5.8.25 G).

Giving advice to a customer in relation to his buying a consumer product, where insurance is a compulsory secondary purchase and/or a benefit that comes with buying the product

Not necessarily but depends on the circumstances.

Where the advice relates specifically to the merits of the consumer product, it is possible that references to the accompanying insurance may be seen to be information and not advice. If, however, the advice relates, in part, to the merits of the insurance element, then it will be regulated activity.

ASSISTING CUSTOMERS WITH COMPLETING/SENDING APPLICATION FORMS

Providing information to customer who fills in application form

Possibly. Subject to article 67 or 72C exclusions where available.

This activity may amount to arranging although the exclusions in article 67 (see PERG 5.11.9 G to PERG 5.11.12 G) and article 72C (see PERG 5.6.5 G to PERG 5.6.9 G) may be of application.

Helping a potential policyholder fill in an application form

Yes.

This activity amounts to arranging. Article 72C will not apply because this activity goes beyond the mere provision of information to a policyholder or potential policyholder (see PERG 5.6.5 G to PERG 5.6.9 G).

Receiving completed proposal forms for checking and forwarding to an insurance undertaking (for example, an administration outsourcing service provider that receives and processes proposal forms)

Yes.

This amounts to arranging. Article 72C does not apply because this activity goes beyond the mere provision of information to a policyholder or potential policyholder (see PERG 5.6.5 G to PERG 5.6.9 G).

Assisting in completion of proposal form and sending to insurance undertaking

Yes.

This activity amounts to arranging. Article 72C does not apply because this activity goes beyond the mere provision of information (see PERG 5.6.5 G to PERG 5.6.9 G).

NEGOTIATING AND CONCLUDING CONTRACTS OF INSURANCE

Negotiating terms of policy on behalf of a customer with the insurance undertaking

Yes.

This activity amounts to arranging (see PERG 5.6.2 G).

Negotiating terms of policy on behalf of insurance undertaking with the customer and signing proposal form on his behalf

Yes.

These activities amount to both arranging and dealing in investments as agent.

Concluding a contract of insurance on insurance company’s behalf, for example, motor dealer who has authority to conclude insurance contract on behalf of insurance undertaking when selling a car

Yes.

A person carrying on this activity will be dealing in investments as agent. He will also be arranging (as the article 28 exclusion only applies in the limited circumstances envisaged under article 28(3)) (see PERG 5.6.12 G).

Agreeing, on behalf of a prospective policyholder, to buy a policy.

Yes.

A person who, with authority, enters into a contract of insurance on behalf of another is dealing in investments as agent under article 21, and will also be arranging.

Providing compulsory insurance as a secondary purchase

Yes. It will amount to dealing in investments as agent or arranging.

The fact that the insurance is secondary to the primary product does not alter the fact that arranging the package involves arranging the insurance.

COLLECTION OF PREMIUMS

Collection of cheque for premium from the customer at the pre-contract stage.

Yes (as part of arranging).

This activity is likely to form part of arranging. But the mere collection/receipt of premiums from the customer is unlikely, without more, to amount to arranging.

Collection of premiums at post-contract stage

No.

The mere collection of premiums from policyholders is unlikely, without more, to amount to assisting in the administration and performance of a contract of insurance.

MID-TERM ADJUSTMENTS AND ASSIGNMENTS

Solicitors or licensed conveyancers discharging client instructions to assign contracts of insurance.

Not where article 67 applies.

As the assignment of rights under a contract of insurance (as opposed to the creation of new contracts of insurance) does not fall within the IMD, article 67 is of potential application (see PERG 5.11.9 G to PERG 5.11.12 G).

Making mid-term adjustments to a policy, for example, property manager notifies changes to the names of the leaseholders registered as “interested parties” in the policy in respect of the property.

Yes.

Assuming the freeholder (as policyholder) is obliged under the terms of the policy to notify the insurance undertaking of changes to the identity of the leaseholders, the property manager is likely to be assisting in the administration and the performance of the contract of insurance.

TRADED ENDOWMENT POLICIES (“TEPs”)

Making introductions for the purposes of selling TEPs

Yes, unless article 72C applies.

Making introductions for these purposes is arranging unless article 72C applies (see PERG 5.6.5 G to PERG 5.6.9 G). The exclusions in article 29 (Arranging deals with or through authorised persons) and 33 (Introducing) no longer apply to arranging contracts of insurance.

Market makers in TEPs

Yes, although the exclusion in article 28 may apply.

Unauthorised market makers can continue to make use of the exclusions in articles 15 (Absence of holding out etc.) and 16 (Dealing in contractually based investments), where appropriate. In order to avoid the need for authorisation in respect of arranging they may be able to rely upon article 28 (see PERG 5.6.12 G).

ASSISTING POLICYHOLDER WITH MAKING A CLAIM

Merely providing information to the insured to help him complete a claim form

No.

Of itself, this is likely to amount to assisting in the administration but not the performance of a contract of insurance. In the FCA's view, the provision of information in these circumstances is more akin to facilitating performance of a contract of insurance rather than assisting in the performance (see PERG 5.7.3 G to PERG 5.7.5 G)

Completion of claim form on behalf of insured

Potentially.

This activity amounts to assisting in the administration of a contract of insurance. Whether this activity amounts to assisting in the administration and performance of a contract of insurance will depend upon whether a person's assistance in filling in a claims form is material to whether performance of the contractual obligation to notify a claim takes place (see PERG 5.7.2 G to PERG 5.7.3 G).

Notification of claim to insurance undertaking and helping negotiate its settlement on the policyholder's behalf

Yes.

This activity amounts to assisting in the administration and performance of a contract of insurance (see PERG 5.7.4 G).

ASSISTING INSURANCE UNDERTAKING WITH CLAIMS BY POLICYHOLDERS

Negotiation of settlement of claims on behalf of an insurance undertaking

No.

Claims management on behalf of an insurance undertaking does not amount to assisting in the administration and performance of a contract of insurance by virtue of the exclusion in article 39B (see PERG 5.7.7 G).

Providing information to an insurance undertaking in connection with its investigation or assessment of a claim

No.

This activity does not amount to assisting in the administration and performance of a contract of insurance.

Loss adjusters and claims management services (for example, by administration outsourcing providers)

Potentially.

These activities may amount to assisting in the administration and performance of a contract of insurance. Article 39B excludes these activities, however, when undertaken on behalf of an insurance undertaking only (see PERG 5.7.7 G).

Providing an expert appraisal of a claim

No.

This activity does not amount to assisting in the administration and performance of a contract of insurance whether carried out on behalf of an insurance undertaking or otherwise.

Jeweller repairs customer’s jewellery pursuant to a policy which permits the jeweller to carry out repairs

No.

This activity does not amount to assisting in the administration and performance of a contract of insurance. It amounts to managing claims on behalf of an insurance undertaking and so falls within the exclusion in article 39B (see PERG 5.7.7 G).

PERG 5.15.6GRP
Flow Chart: Introducers.
PERG 5.15.7GRP
The flow chart in PERG 5.15.8 G sets out the questions a person needs to consider in determining whether or not his regulated activities are carried on 'in the United Kingdom'.
PERG 5.15.8GRP
Flow chart: am I carrying on regulated activities in the United Kingdom?
PERG 2.3.1GRP
Under section 22 of the Act (Regulated activities), for an activity to be a regulated activity it must be carried on 'by way of business'.
PERG 2.3.2GRP
There is power in the Act for the Treasury to change the meaning of the business element by including or excluding certain things. They have exercised this power (see the Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) Order 2001 (SI 2001/1177), the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.2) Order 2003 (SI 2003/1476),3 the Financial Services and Markets Act 2000 (Carrying on Regulated Activities
PERG 2.3.3GRP
Whether or not an activity is carried on by way of business is ultimately a question of judgement that takes account of several factors (none of which is likely to be conclusive). These include the degree of continuity, the existence of a commercial element, the scale of the activity and the proportion which the activity bears to other activities carried on by the same person but which are not regulated. The nature of the particular regulated activity that is carried on will also
PERG 2.3.5GRP
5Another aspect of the general prohibition is that an employee will not breach the general prohibition by carrying on a regulated activity on behalf of his employer. The reason for that is that it is the employer who is carrying on that activity. The employee is simply carrying on the employer's business.
PERG 2.3.6GRP
5This principle potentially also applies to agents and others who assist another to carry on that other's business. That does not mean however that agents and other such persons can never carry on a regulated activity. Apart from anything else it is clear that some regulated activities are meant to be carried on by such persons, such as dealing in investments as agent.
PERG 4.10.2GRP
Arranging (bringing about), making arrangements with a view to and advising on regulated mortgage contracts are excluded if they are carried on by a person in the course of carrying on a profession or business (other than a regulated activity). This is the case if it may reasonably be regarded as necessary for him to make the arrangements or give the advice in order to provide his professional or other services and he is not separately paid for making the arrangements or giving
PERG 4.10.3GRP
In the FCA's view, for arranging or advice to be a necessary part of other services it must, as a general rule, be the case that it is not possible for the other services to be provided unless the arranging or advising are also provided.
PERG 4.10.5GRP
There are exclusions that apply, in certain circumstances, in relation to each of the regulated mortgage activities if the person carrying on the activity is acting in the capacity of trustee or personal representative. Article 66 of the Regulated Activities Order (Trustees, nominees and personal representatives) sets out the circumstances in which the exclusions apply. The terms of these differ slightly depending on the regulated activity.
PERG 4.10.8GRP
In every case, the trustee or personal representative must not receive any remuneration that is additional to any he receives for acting in his capacity as trustee or personal representative. But a person is not to be regarded as receiving additional remuneration merely because his remuneration as trustee or personal representative is calculated by reference to time spent.
MIPRU 4.1.3GRP
The definition of insurance mediation activity refers to several activities 'in relation to a contract of insurance' which includes a contract of reinsurance. This chapter, therefore, applies to a reinsurance intermediary in the same way as it applies to any other insurance intermediary.
MIPRU 4.1.6RRP
This chapter does not apply to a firm whose Part 4A permission is limited to regulated activities which are designated investment business.
MIPRU 4.1.14GRP
This chapter: 88(1) sets out that a firm must meet, on a continuing basis, a basic solvency requirement and a minimum capital resources requirement (see COND 2.4 (Appropriate resources)); and8(2) amplifies Principle 4 which requires a firm to maintain adequate financial resources by setting out capital requirements for a firm according to the regulated activity or regulated activities it carries on.
MIPRU 4.1.18GRP
Social housing firms undertake small amounts of home finance1business even though their main business consists of activities other than regulated activities. Their home financing1is only done as an adjunct to their primary purpose (usually the provision of housing) and is substantially different in character to that done by commercial lenders. Furthermore, they are subsidiaries of local authorities or registered social landlords which are already subject to separate regulation.
PERG 4.1.2GRP
Certain4 activities relating to mortgages are regulated by the FCA4. The purpose of this guidance is to help persons decide whether they need authorisation and, if they do, to determine the scope of the Part 4A permission4 for which they will need to apply.444
PERG 4.1.4GRP
Rights conferred on third parties cannot be affected by guidance given by the FCA. This guidance represents the FCA'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 138D 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
PERG 4.1.6GRP
A person may be intending to carry on activities related to other forms of investment in connection with mortgages, such as advising on and arranging an endowment policy or ISA to repay an interest-only mortgage. Such a person should also consult the guidance in PERG 2 (Authorisation and regulated activities),2PERG 5 (Guidance on insurance mediation activities) and PERG 8 (Financial promotion and related activities). In addition, PERG 14 (Guidance on home reversion, home purchase
PERG 9.10.7GRP
In the Regulated Activities Order, shares in or securities of an open-ended investment company are treated differently from shares in other bodies corporate. They are treated as units in a collective investment scheme under article 81 of the Regulated Activities Order (Units in a collective investment scheme) rather than shares under article 76 (Shares etc).
PERG 9.10.8GRP
A person who carries on in the United Kingdom the business of engaging in any regulated activity that relates to units or shares will need to be an authorised person (see PERG 2.7 and PERG 2.8 (Authorisation and regulated activities)).
PERG 9.10.9GRP
In order to be authorised, a person must have permission to carry on the regulated activities in question. What the permission needs to cover may differ according to whether the regulated activity being carried on relates to units or shares. So, for example, a body corporate that is an open-ended investment company will need permission if it carries on the regulated activity of dealing as principal or agent, arranging (bringing about) or making arrangements with a view to transactions
PERG 9.10.10GRP
7(1) A person carrying on the regulated activity of establishing, operating or winding up a collective investment scheme that is constituted as an open-ended investment company will need permission for those activities. In line with section 237(2) of the Act (Other definitions), the operator of a collective investment scheme that is an open-ended investment company is the company itself and therefore the starting point for an open-ended investment company that is incorporated
COND 1.3.1GRP
The guidance in COND 2 explains each FCA1threshold condition in Schedule 6 (threshold conditions) to the Act and indicates1 how the FCA1 will interpret it in practice. This guidance is not, however, exhaustive and is written in very general terms. A firm will need to have regard to the obligation placed upon the FCA1 under section 55B (The threshold conditions) of the Act; that is, the FCA1 must ensure that the firm will satisfy, and continue to satisfy, the FCA1threshold conditions
COND 1.3.3GRP
Although the FCA1 may consider that a matter is relevant to its assessment of a firm, the fact that a matter is disclosed to the FCA1, for example in an application, does not necessarily mean that the firm will fail to satisfy the FCA1threshold conditions. The FCA1 will consider each matter in relation to the regulated activities for which the firm has, or will have, permission, having regard to its statutory objectives1. A firm should disclose each relevant matter but, if it
COND 1.3.3AGRP
1In determining the weight to be given to any relevant matter, the FCA will consider its significance in relation to the regulated activities for which the firm has, or will have, permission, in the context of its ability to supervise the firm adequately, having regard to the FCA'sstatutory objectives. In this context, a series of matters may be significant when taken together, even though each of them in isolation might not give serious cause for concern.
COND 1.3.4GRP
(1) For ease of reference, the FCA1threshold conditions in or under Schedule 6 to the Act have been quoted in full in COND 2. (1A) 1Paragraphs 2A and 3A of Schedule 6 of the Act have not been quoted. These set out the application of the FCAthreshold conditions to firms which do not carry on, or are not seeking to carry on, a PRAregulated activity and firms which carry on, or are seeking to carry on, a PRAregulated activity respectively. This application is summarised in COND
EG 9.2.2RP
1The FCA has the power to make a range of prohibition orders depending on the circumstances of each case and the range of regulated activities to which the individual's lack of fitness and propriety is relevant. Depending on the circumstances of each case, the FCA may seek to prohibit individuals from performing any class of function in relation to any class of regulated activity, or it may limit the prohibition order to specific functions in relation to specific regulated activities.
EG 9.2.3RP
1The scope of a prohibition order will depend on the range of functions which the individual concerned performs in relation to regulated activities, the reasons why he is not fit and proper and the severity of risk which he poses to consumers or the market generally.
PERG 2.11.1GRP
3Various persons are exempted by Order made by the Treasury under section 38 of the Act from the need to obtain authorisation for certain credit-related regulated activities in the circumstances specified in the Order (for example, in some cases, a person is exempt only when acting in a particular capacity or for particular purposes). Persons exempt under the Order cannot be exempt in relation to some regulated activities and authorised in relation to others (except where the
PERG 2.11.3GRP
This exemption applies to a scheme under which an employer provides or makes available to their employees a cycle or cyclist's safety equipment up to the value of £1,000 (which is designed to allow employees to take advantage of section 244 of the Income Tax (Earnings and Pensions) Act 2003). An employer does not require authorisation for the regulated activities relating to regulated consumer hire agreements just because it operates such a scheme.
PERG 2.11.8GRP
(1) 4The exemption in paragraph 55 of the Schedule to the Exemption Order covers special purpose vehicles and other entities which are part of a structured finance transaction and which meet the specified conditions. It confers exemption from the general prohibition on a person (“P”) for the regulated activity of exercising, or having the right to exercise. the lender’s rights and duties under a regulated credit agreement (and associated regulated activities) where there is an
SUP 10A.10.1RRP
SUP 10A.10 applies with respect to activities carried on from an establishment maintained by the firm (or by its appointed representative) in the United Kingdom.
SUP 10A.10.2GRP
Without SUP 10A.10.1 R, the description of the customer function would extend to this function wherever it was performed. The effect of SUP 10A.10.1 R is that the description is limited, in relation to regulated activities with an overseas element, in a manner which is broadly consistent with the scope of conduct of business regulation.
SUP 10A.10.5GRP
Section 59(7A) of the Act (Approval for particular arrangements) says that the customer-dealing function, in relation to the carrying on of a regulated activity by a firm (“A”), means a function that will involve the person performing it in dealing with:(1) customers of A; or(2) property of customers of A;in a manner substantially connected with the carrying on of the activity.
SUP 10A.10.6GRP
The FCA interprets the phrase “dealing with” as including having contact with customers and extending beyond “dealing” as used in the phrase “dealing in investments”. “Dealing in” is used in Schedule 2 to the Act to describe in general terms the regulated activities which are specified in Part II of the Regulated Activities Order.
EG 9.3.1RP
2When the FCA has concerns about the fitness and propriety of an approved person, it may consider whether it should prohibit that person from performing functions in relation to regulated activities, withdraw its approval, or both. In deciding whether to withdraw its approval and/or make a prohibition order, the FCA will consider in each case whether its statutory objectives can be achieved adequately by imposing disciplinary sanctions, for example, public censures or financial
EG 9.3.2RP
2When it decides whether to make a prohibition order against an approved person and/or withdraw its approval, the FCA will consider all the relevant circumstances of the case. These may include, but are not limited to those set out below. (1) The matters set out in section 61(2) of the Act. (2) Whether the individual is fit and proper to perform functions in relation to regulated activities. The criteria for assessing the fitness and propriety of approved persons
EG 9.3.3RP
2The FCA may have regard to the cumulative effect of a number of factors which, when considered in isolation, may not be sufficient to show that the individual is not fit and proper to continue to perform a controlled function or other function in relation to regulated activities. It may also take account of the particular controlled function which an approved person is performing for a firm, the nature and activities of the firm concerned and the markets within which it operates.
EG 9.3.4RP
2Due to the diverse nature of the activities and functions which the FCA regulates, it is not possible to produce a definitive list of matters which the FCA might take into account when considering whether an individual is not a fit and proper person to perform a particular, or any, function in relation to a particular, or any, firm.