Related provisions for SUP 9.2.4
201 - 220 of 1078 items.
1In using its powers to seek insolvency orders the FCA takes full account of: the principle adopted by the courts that recourse to insolvency regimes is a step to be taken for the benefit of creditors as a whole; and the fact that the court will have regard to the public interest when considering whether to wind up a body on the grounds that it is just and equitable to do so.
1The FCA will consider the facts of each particular case when it decides whether to use its powers and exercise its rights. The FCA will also consider the other powers available to it under the Act and to consumers under the Act and other legislation, and the extent to which the use of those other powers meets the needs of consumers as a whole and the FCA'sstatutory objectives. The FCA may use its powers to seek insolvency orders in conjunction with its other powers, including
1Decisions about whether to apply to the civil courts for insolvency orders under the Act will be made by the RDC Chairman or, in an urgent case and if the Chairman is not available, by an RDC Deputy Chairman. In an exceptionally urgent case the matter will be decided by the director of Enforcement or, in his or her absence, another member of the FCA's executive of at least director of division level.
1An exceptionally urgent case in these circumstances is one where the FCA staff believe that a decision to begin proceedings (1) should be taken before it is possible to follow the procedure described in paragraph 13.2.3; and (2) it is necessary to protect the interests of consumers or potential consumers.
If a certificate is granted then, until it is revoked, it is conclusive evidence that the exclusion under article 54 of the Regulated Activities Order applies. A person to whom a certificate is given should notify the FCA of any significant changes to the purpose or nature of the content of the relevant publication or service. The FCA will need to keep the content of the publication or service in question under review.
The FCA may revoke a certificate at the request of its holder or on the FCA's own initiative if the FCA considers that it is no longer justified. If the FCA revokes a certificate on its own initiative, it would normally expect to give advance notice to the holder of the certificate together with a statement of the reasons for the proposed revocation, and give the holder of the certificate an opportunity to make representations. Where a certificate is revoked, the holder of the
The fact of a person holding a certificate granted under article 54(3) is information which may be of relevance to other persons (including investors or potential investors). For this reason, the FCA considers it appropriate that details of certificates granted under article 54(3) should be included in a list on the public record which the FCA is required to maintain under section 347 of the Act (The record of authorised persons, etc).
The Act does not provide a mechanism for appeals to the FCA2 from decisions by recognised bodies in relation to complaints. However, the FCA2 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 FCA's2 arrangements for investigating
Where the FCA2 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 FCA2 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 FCA2 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.2
The FCA expects a firm to have a validation process that includes the following:(1) standards of objectivity, accuracy, stability and conservatism that it designs its ratings systems to meet and processes that establish whether its rating systems meet those standards;(2) standards of accuracy of calibration (ie, whether outcomes are consistent with estimates) and discriminative power (ie, the ability to rank-order risk) that it designs its rating systems to meet and processes
The FCA expects a firm to be able to explain the performance of its rating systems against its chosen measure (or measures) of discriminative power. In making this comparison, a firm should rely primarily on actual historic default experience where this is available. In particular, the FCA expects a firm to be able to explain the extent of any potential inaccuracy in these measures, caused, in particular, by small sample size and the potential for divergence in the future, whether
In the case of a portfolio for which there is insufficient default experience to provide any confidence in statistical measures of discriminative power, the FCA expects a firm to use other methods. For example, analysis of whether the firm's rating systems and an external measurement approach (eg, external ratings) rank common obligors in broadly similar ways. Where such an approach is used, the FCA would expect a firm to ensure it does not systematically adjust its individual
(1) When deciding whether to take enforcement
action under Part 7 of the RCB Regulations,
and what form that enforcement action should take, the FCA will consider all relevant factors,
including:(a) the relevant factors on decisions to take action set out in DEPP 6.2.1 G;(b) whether any contractual or other arrangements agreed between the
parties can be used effectively to address any perceived failure under the RCB Regulations; and(c) the interests of investors in the relevant
When considering whether to impose
a financial penalty, the amount of penalty, and whether to impose the penalty
on the issuer or the owner, the FCA will have regard, where relevant,1 to:(1) the statement on determining the appropriate level of a financial
penalty set out 1in DEPP 6.5 to DEPP 6.5D1;(2) the particular arrangements between the issuer and
the owner; (3) the likely impact of the penalty on the interests of investors
in a regulated covered bond;
and(4) the conduct
(1) The5 exclusion for groups and joint enterprises in article 69 of the Regulated Activities Order (Groups and joint enterprises) does not apply to transactions relating to contracts of insurance. This will affect5 a company providing services for:(a) other members of its group; or(b) other participants in a joint enterprise of which it is a participant.(2) Such companies might typically provide risk or treasury management or administration services which may include regulated
Article 67 excludes from the activities of dealing as agent, arranging (bringing about) deals in investments, making arrangements with a view to transactions in investments, assisting in the administration and performance of a contract of insurance and advising on investments, any activity which:(1) is carried on in the course of carrying on any profession or business which does not otherwise consist of the carrying on of regulated activities in the United Kingdom; and(2) may
Article 67 may also apply to activities relating to assignments of insurance policies, as, in the FCA'sview, article 2.1(1) of the IDD5 applies essentially to the creation of new contracts of insurance and not the assignment of rights under existing policies. As such, where a solicitor or licensed conveyancer arranges an assignment of a contract of insurance, the exclusion in article 67 remains of potential application. For similar reasons, trustees advising on or arranging assignments
Article 72B (see also PERG 5.3.7 G (Connected contracts of insurance)) may be of relevance to persons who supply non-motor goods or services5 or provide services related to travel in the course of carrying on a profession or business which does not otherwise consist of carrying on regulated activities. In the FCA's view, the fact that a person may carry on regulated activities in the course of the carrying on of a profession or business does not, of itself, mean that the profession
In the FCA's view, the liability risks referred to in PERG 5.11.13G (5) cover risks in relation to liabilities that the policyholder might have to others (that is, third party claims). Many policies will provide this sort of cover and so fall outside the scope of the exclusion. For example, a policy that covers the cost of unauthorised calls made when a mobile telephone is stolen includes 'liability risks' and would not be a 'connected contract of insurance'. By contrast, travel
SYSC 22 (Regulatory references) says that if1 a firm (A):3(1) is considering appointing a person (P)1 to perform any1controlled function or certain other functions1;311(2) requests a reference from a firm (B) that is P’s1 current or former employer1; and31(3) indicates to B the purpose of the request;3B should1, as soon as reasonably practicable, give a reference1 to A13
(1) The obligations to supply information to:(a) the FCA under this chapter;(b) [deleted]1apply notwithstanding any:(c) agreement (for example a 'COT 3' Agreement settled by the Advisory, Conciliation and Arbitration Service (ACAS)); or(d) any other arrangements entered into by a firm and an employee upon termination of the employee’s employment.(2) A firm should not enter into any such arrangements or agreements that could conflict with its obligations under this chapter.
(1) The effect of section 59 of the Act is that if a person is to perform certain functions (which are known as controlled functions) for a credit union, the credit union should first apply for approval to:2(a) the FCA (if the controlled function is specified by the FCA in its rules); or2(b) the PRA (if the controlled function is specified by the PRA in its rules).2(2) The firm should not allow the person to perform that function until the firm receives the approval.2(3) A person
(1) The controlled functions specified by the FCA for credit unions and other SMCR firms3 can be found in the table in SUP 10C.4.3R.2 The table in SUP 10C Annex 1 3.2R sets out which of them apply to credit unions.311(2) The controlled functions specified by the PRA for credit unions and other SMCR firms3 can be found in the PRA’s Rulebook. They are not summarised in the Handbook.2
2(1) The FCA and the PRA have specified different functions.2(2) Sometimes a person’s job description means that they are performing an FCA controlled function and a PRA controlled function at the same time for the same firm. SUP 10C.9 has arrangements that reduce the need for the same person to be approved by both the FCA and the PRA.2
2As well as listing the FCA’sdesignated senior management functions for credit unions and other SMCR firms3, SUP 10C has other requirements about SMF managers:(1) SUP 10C sets out the procedures for applying for, granting, removing and varying approval as an SMF manager.(2) SUP 10C requires firms to give various types of reports to the FCA about their SMF managers.(3) SUP 10C explains that each firm must prepare a statement of responsibilities for each of its SMF managers. A statement
1The FCA resolves many enforcement cases by settlement. Early settlement has many potential advantages as it can result, for example, in consumers obtaining compensation earlier than would otherwise be the case, the saving of FCA and industry resources, messages getting out to the market sooner and a public perception of timely and effective action. The FCA therefore considers it is in the public interest for matters to settle, and settle early, if possible.
1The possibility of settlement does not, however, change the fact that enforcement action is one of the tools available to the FCA to secure our statutory objectives. The FCA seeks to change the behaviour not only of those subject to the immediate action, but also of others who will be alerted to our concerns in a particular area. There is no distinction here between action taken following agreement with the subject of the enforcement action and action resisted by a firm before
1Settlements in the FCA context are not the same as ‘out of court’ settlements in the commercial context. An FCA settlement is a regulatory decision, taken by the FCA, the terms of which are accepted by the firm or individual concerned. So, when agreeing the terms of a settlement, the FCA will carefully consider its statutory objectives and other relevant matters such as the importance of sending clear, consistent messages through enforcement action, and will only settle in appropriate
1In recognition of the value of early settlement, the FCA operates a scheme to award a discount2 for early settlement of cases involving financial penalties, suspensions, restrictions and disciplinary prohibitions2. Details of the scheme, which applies only to settlement of cases where investigators were appointed on or after 20 October 2005, are set out in DEPP 6.7. This chapter provides some commentary on certain practical aspects of the operation of the scheme.
Some decisions2 on settlements and statutory notices arising from them are taken by two members of the FCA's senior management, rather than by the RDC (DEPP refers to these individuals as the 'settlement decision makers'). Full details of the special decision making arrangements for settlements are set out in DEPP 5. 1
The articles in IFPRU 1.2.1 G do not always carry the same wording in describing what may be significant in terms of a firm's scope, nature, scale, internal organisation and complexity, but the articles have a general policy to restrict the application of those requirements to institutions which pose higher risks by virtue of broadly their size, types of business and complexity of activities. The FCA's policy is to apply an objective definition with pre-defined thresholds to determine
(1) This rule defines some of the terms used in IFPRU 1.2.3 R.(2) "Total assets" means the firm's total assets(a) set out in the most recent relevant report submitted to the FCA under SUP 16.12 (Integrated regulatory reporting); or (b) (where the firm carries out the assessment under this rule at any time after the date of its most recent report in (a)) as the firm would report to the FCA in accordance with the relevant report, as if the reporting period for that report ends on
The FCA may, on a case-by-case basis, require a firm which does not meet any of the conditions in IFPRU 1.2.3 R to comply with the rules and requirements that apply to a significant IFPRU firm if the FCA considers it appropriate to do so to meet its strategic objective or to advance one or more of its operational objectives under the Act.
(1) A firm may apply to the FCA under section 138A of the Act to waive any one or more of the conditions in IFPRU 1.2.3 R if it believes that one or more of the governance requirements in (2) that apply to a significant IFPRU firm may be disproportionate to it. In its application for such waiver, the FCA expects the firm to demonstrate, taking into account size, nature, scope and complexity of its activities in the context of it being a member of a group and the internal organisation
2The FCA will make its assessment of whether the accounting and other standards applicable to an investment exchange or multilateral trading facility as a result of securities being admitted to trading are appropriate for the purpose of LR 13.5.27R (1)(b) having regard to at least the following matters in relation to the legal and regulatory framework applying to the target by virtue of its admission to that market:(1) the quality of auditing standards compared with International
2Where a listed company proposes to rely on LR 13.5.27R (1)(b), its sponsor must submit to the FCA an assessment of the appropriateness of the standards applicable to an investment exchange or multilateral trading facility against the factors set out in LR 13.5.27AG (1) to (7) and any other matters that it considers should be noted. The assessment must be submitted before or at the time the listed company submits the draft class 1 circular.
2The FCA may modify LR 13.5.30BR (1)(b) and (c) where it is not possible for the listed company to provide a meaningful allocation of its costs in the target's audited consolidated income statements. The class 1 circular should contain a statement to this effect where this modification has been granted. The FCA would not normally expect to grant such modifications except in respect of non-operating costs such as finance costs and tax.
2For the purposes of LR 13.5.33R (1) a significant part of the listed company or target is any part that represents over 75% of the listed company's group or the target respectively. For these purposes the FCA will take into account factors such as the assets, profitability and market capitalisation of the business.
1The FCA will notify the subject of the investigation that it has appointed officers to carry out an investigation under the Money Laundering Regulations and the reasons for the appointment, unless notification is likely to prejudice the investigation or otherwise result in it being frustrated. The FCA expects to carry out a scoping visit early on in the enforcement process in most cases. The FCA's
policy in civil investigations is to use powers to compel information
1When imposing or determining the level of a financial penalty under regulation 76 of the Money Laundering Regulations2, the FCA's
policy includes having regard, where relevant, to relevant factors in DEPP 6.2.1G and DEPP 6.5 to DEPP 6.5D. The FCA may not impose a penalty where there are reasonable grounds for it to be satisfied that the subject of the proposed action took all reasonable steps and exercised all due diligence to ensure that the relevant requirement
2When cancelling, suspending or restricting an authorisation or limitation under regulation 77 of the Money Laundering Regulations or determining the duration of any such suspension or restriction, and when imposing or determining the duration of a prohibition under regulation 78 of the Money Laundering Regulations, the FCA’s policy includes having regard, where relevant, to relevant factors in DEPP 6A.
1As with cases under the Act, the FCA may settle or mediate appropriate cases involving civil breaches of the Money Laundering Regulations or the Funds Transfer Regulation2 to assist it to exercise its functions under the Money Laundering Regulations2 in the most efficient and economic way. The settlement discount scheme set out in DEPP 6.7 applies to penalties, suspensions, restrictions and temporary prohibitions2 imposed under regulations 76, 77 and 78 of2 the Money Laundering
1The purpose of this section is to ensure that the FCA4 receives regular and comprehensive information about remuneration in a standard format to assist it to benchmark remuneration trends and practices and to collect remuneration information on high earners. It also takes account of the Capital Requirements Regulations 2013 (SI 2013/3115) together with the European Banking Authority's Guidelines to article 75(1) and (3) of the CRD4.1044
(1) 4A firm to which this rule applies must submit a Remuneration Benchmarking Information Report to the FCA annually.(2) The firm must complete the Remuneration Benchmarking Information Report in the format set out in SUP 16 Annex 33A.(3) The firm must submit the Remuneration Benchmarking Information Report to the FCA within four months of the firm'saccounting reference date.(4) A firm that:(a) is not part of a UK lead regulated group must complete that report on an unconsolidated
(1) A firm to which this rule applies must submit a High Earners Report to the FCA4 annually.104(2) The firm must submit that report to the FCA4 within four months of the end of the firm'saccounting reference date.104(3) A firm that is not part of a UK lead regulated group must complete that report on an unconsolidated basis in respect of remuneration awarded in the last completed financial year to all high earners of the firm who mainly undertook their professional activities
(1) A listed company in severe financial difficulty may find itself with no alternative but to dispose of a substantial part of its business within a short time frame to meet its ongoing working capital requirements or to reduce its liabilities. Due to time constraints it may not be able to prepare a circular and convene an extraordinary general meeting to obtain prior shareholder approval.(2) The FCA may modify the requirements in LR 10.5 to prepare a circular and to obtain shareholder
The following documents should be provided in writing to the FCA:(1) confirmation from the listed company that:(a) negotiation does not allow time for shareholder approval;(b) all alternative methods of financing have been exhausted and the only option remaining is to dispose of a substantial part of their business;(c) by taking the decision to dispose of part of the business to raise cash, the directors are acting in the best interests of the company and shareholders as a whole
An announcement should be notified to a RIS no later than the date the terms of the disposal are agreed and should contain:(1) all relevant information required to be notified under LR 10.4.1 R;(2) the name of the acquirer and the expected date of completion of the disposal;(3) full disclosure about the continuing groups prospects for at least the current financial year;(4) a statement that the directors believe that the disposal is in the best interests of the company and shareholders
(1) The FCA will wish to examine the documents referred to in LR 10.8.3 G (including the RIS announcement) before it grants the modification and before the announcement is released.(2) The documents should ordinarily be lodged with the FCA:(a) in draft form at least five clear business days before the terms of the transaction are agreed; and(b) in final form on the day on which approval is sought.
When making a decision on an application
for registration under the RCB Regulations,
or in relation to material changes to the contractual terms of the regulated covered bond, or in relation to
a change of owner, or when
seeking to use direction, revocation or penalty powers, the RCB
Regulations require the FCA to give the subject of the intended
action a warning notice and
a decision notice. The recipient
of a warning notice has the
right to make representations to the decision
Regulation 44 of the RCB Regulations (Warning notices and decision
notices) applies Part XXVI of the Act (Notices)
in respect of notices that we give under the RCB
Regulations. This means that the provisions of section 393
of the Act (Third party rights)
and section 394 of the Act (Access
to Authority material) apply to penalty procedures under the RCB Regulations and that, if the matter
is not referred to the Tribunal,
then upon taking the action to which a decision
notice relates,
Decisions on applications for registration,
in relation to material changes to contractual terms of the regulated
covered bond, or in relation to a change of owner, or decisions
to issue a direction under the RCB Regulations or
to revoke an issuer's registration,
will be taken under executive procedures following
the process set out in DEPP 4.
(1) 1This section deals with the circumstances and manner in which an ACS is to be wound up or a sub-fund of a co-ownership scheme is to be terminated otherwise than by the court as an unregistered company under the Insolvency Act 1986 or the Insolvency (Northern Ireland) Order 1989 (further rules regarding schemes of arrangement are found in COLL 7.6 (Schemes of arrangement)).(2) An ACS may be wound up under this section only if it is solvent. Under section 261W of the Act (Requests
This table belongs to COLL 7.4A.1G (5) (Explanation of COLL 7.4A)
Summary of the main steps in winding up an ACS or terminating a sub-fund of a co-ownership scheme under FCArules Notes: N = Notice to be given to the FCA under section 261Q of the Act in a section 261Q case. R = Request to wind up the scheme under section 261W of the Act in a section 261W case. E = commencement of winding up or termination W/U = winding up FAP = final accounting period |
|||
Step number |
Explanation |
When |
|
1 |
Commence preparation of solvency statement |
7.4A.5R(2) |
|
2 |
Send audited solvency statement to the FCA with copy to depositary. |
7.4A.5R(4) and (5) |
|
3 |
In a section 261Q case: - the authorised contractual scheme manager receiving FCA approval; - or one month having passed after submitting the requisite notice under section 261Q of the Act without the authorised contractual scheme manager or depositary having received from the FCA a warning notice under section 261R in respect of the proposal. In a section 261W case, the authorised contractual scheme manager or depositary receives an indication from the FCA that, subject to there being no change in any relevant factor, on the conclusion of the winding up of the ACS, the FCA will agree to the request to wind up the ACS. |
Section 261Q of the Act (in a section 261Q case) 7.4A.4R(3)(c) to (e) (in a section 261W case) |
|
4 |
Normal business ceases; notify unitholders |
E |
7.4A.4R |
5 |
Depositary to realise and distribute proceeds |
ASAP after E |
7.4A.6R(1)-(5) |
6 |
Send annual long report of authorised contractual scheme manager, depositary and auditor to the FCA |
Within 4 months of FAP |
7.4A.9R(7) |
7 |
Request FCA to revoke relevant authorisation order |
On completion of W/U |
7.4A.6R(6) |
(1) Upon the happening of any of the matters or dates referred to in (3), and subject to the requirement of (4) being satisfied, and not otherwise:(a) COLL 6.2 (Dealing), COLL 6.3(Valuation and pricing), COLL 6.6.20R to COLL 6.6.24G (Assessment of value)3 and COLL 5 (Investment and borrowing powers) cease to apply to the ACS or to the units and scheme property in the case of a sub-fund of a co-ownership scheme; (b) the depositary must cease to issue and cancelunits, except in
(1) Either before notice is given under section 261Q of the Act or before a request is made under section 261W of the Act in relation to the proposals referred to in COLL 7.4A.4R (4), the authorised contractual scheme manager must make a full inquiry into the ACS's (or, in the case of the termination of a sub-fund of a co-ownership scheme, the sub-fund's) affairs, business and property to establish whether the ACS or the sub-fund will be able to meet all its liabilities.(2) The
(1) Where COLL 7.4A.4R (3)(f) applies, the depositary must cancel all units in issue and wind up the ACS or terminate the sub-fund of the co-ownership scheme in accordance with the approved scheme of arrangement.(2) In any other case falling within COLL 7.4A.4 R:(a) once the ACS falls to be wound up or sub-fund terminated, the depositary must realise the scheme property;(b) after paying out or retaining adequate provision for all liabilities payable and for the costs of the winding
(1) [deleted]2(2) [deleted]2(3) For any annual accounting period or half-yearly accounting period which begins after commencement of the winding up or termination2, a copy of the long report must be supplied free of charge to any unitholder upon request.(4) The2authorised contractual scheme manager must ensure that it keeps unitholders appropriately informed about the winding up or termination, including its likely duration. (5) The authorised contractual scheme manager must send
A request by an issuer for the listing of its securities to be suspended or cancelled must be in writing and must include:(1) the issuer's name;(2) details of the securities to which it relates and the RIEs on which they are traded;(3) a clear explanation of the background and reasons for the request;(4) the date on which the issuer requests the suspension or cancellation to take effect;(5) for a suspension, the time the issuer wants the suspension to take effect;(6) if relevant,
Cancellations will only be specified to take effect when the market opens on a specified day. An issuer should therefore ensure that all accompanying information has been provided to the FCA well before the date on which the issuer wishes the cancellation to take effect and at the very latest by 3 p.m. on the business day before it is to take effect. If the information is received after 3:00 p.m. on the day before the issuer wishes the cancellation to take effect, it will normally
(1) If an issuer requests the FCA to suspend or cancel the listing of its securities, it may withdraw its request at any time before the suspension or cancellation takes effect. The withdrawal request should initially be made by telephone and then confirmed in writing as soon as possible, with an explanation of the reasons for the withdrawal.(2) Even if an issuer withdraws its request, the FCA may still suspend or cancel the listing of the securities if it considers it is necessary
4If an issuer requests the FCA to suspend or cancel the listing of its securities under LR 5.3.1 R and the FCA agrees to do so, the notification given by the FCA to the issuer will include the following information: (1) the date on which the suspension or cancellation took effect or will take effect;(2) details of the suspension or cancellation; and (3) in relation to requests for suspension, details of the issuer's right to apply for the suspension of its listed securities to
1The guidance in COND 2.7 should be read as applying to both paragraph 2F of Schedule 6 to the Act and, as far as relevant to the discharge by the FCA of its functions under the Act in respect of firms carrying on, or seeking to carry on, a PRA-regulated activity, paragraph 3E of Schedule 6 of the Act.
1The FCA's assessment of a firm's satisfaction of the3threshold conditions set out in paragraphs 2F and 3E of Schedule 6 to the Act will not necessarily be limited to a firm'sregulated activities if the FCA believes the firm's other business activities, if any, may impact on a firm'sregulated activities.
It is likely to be misleading for a firm that is not authorised by the FCA or PRA to state or imply that it is so authorised. It is also likely to be misleading for a firm to state or imply that a client will have recourse to the Financial Ombudsman Service or the FSCS where this is not the case.2(3) [deleted]44
4As well as potentially breaching the requirements in this section, misleading statements by a firm may involve a breach of Principle 7 (Communications with clients) or section Part 7 (Offences relating to financial services) of the Financial Services Act 2012, as well as giving rise to private law actions for misrepresentation.
(1) [deleted] [Editor’s note: The text of this provision has been moved to SYSC 25.6.2G(1)]3(2) [deleted] [Editor’s note: The text of this provision has been moved to SYSC 25.6.2G(2)]3(3) [deleted] [Editor’s note: The text of this provision has been moved to SYSC 25.1.6G(3)]3(4) [deleted] [Editor’s note: The text of this provision has been moved to SYSC 25.6.2G(4)]3