Related provisions for SUP App 2.7.2
41 - 60 of 176 items.
(1) A reference in the Handbook to another provision in the Handbook is a reference to that provision as amended from time to time.13(2) Unless a contrary intention appears:34(a) a reference in the Handbook to a provision in the PRA Rulebook is a reference to that provision as amended from time to time;3413(b) 34a reference in a Handbook rule (other than a rule made by FOS Ltd) to an enactment is a reference to that enactment as amended from time to time;(c) for the purposes
36Unless a contrary intention appears, to the extent that a provision made by the FCA15 ('the referring provision') contains a cross-reference to another provision that is not made by the FCA including a provision formerly made by the PRA which the PRA has now deleted15 ('the referred provision'), the referred provision as amended from time to time (excepting deletion in its entirety)15 is to be treated as having15 been made by the FCA15 to the extent necessary to make the referring
(1) This rule applies to Handbook provisions20 where the PRA have made commensurate provisions in the PRA Rulebook. It may affect their application by the FCA to PRA-authorised persons and PRA approved persons20.3616151615(2) Where a Handbook provision (or part of one) goes beyond the FCA's20 powers or regulatory responsibilities, it is to be interpreted as applied20 to the extent of the FCA’s20 powers and regulatory responsibilities only.(3) The extent of a Handbook provision
An example of a rule20 being interpreted as cut back by GEN 2.2.23R is SYSC 6.1.1R, which requires a firm to maintain adequate policies and procedures to ensure compliance with its obligations under the regulatory system; SYSC 6.1.1R should be interpreted as applied by the FCA in respect of a PRA-authorised person’s compliance with regulatory obligations that are the responsibility of the FCA (for example, in respect of a bank maintaining policies and procedures to ensure compliance
(1) This direction applies to an application under Form A or Form E.(2) An5 application 4must be made by submitting the Form in accordance with the requirements in SUP 10C.15 (Forms and other documents and how to submit them to the FCA) about the submission of those Forms6. 11322(2A) [deleted]51(3) [deleted]4(4) [deleted]6(5) [deleted]64
If the appropriate regulator1 gives a firm a waiver, then the relevant rule no longer applies to the firm. But:1(1) if a waiver directs that a rule is to apply to a firm with modifications, then contravention of the modified rule could lead to appropriate regulator1 enforcement action and (if applicable) a right of action under section 138D1 of the Act (Actions for damages); and11(2) if a waiver is given subject to a condition, it will not apply to activities conducted in breach
Substantive changes to the rules (this would not include simple editorial changes) in the Handbook may affect existing waivers, changing their practical effect and creating a need for a change to the original waiver. The appropriate regulator1 will consult on proposed rule changes. A firm should note proposed rule changes and discuss the impact on a waiver with its appropriate1 supervisory contact.111
Action which a firm takes either to restore its capital resources to the levels set by the intervention points in PRA2 Rulebook: Solvency II Firms: Undertakings in Difficulty or PRA Rulebook: Non-Solvency II firms: Run Off Operations2, or to prevent its capital resources falling below those points, should be consistent with Principle 6 of the FCA's Principles for Businesses. Principle 6 requires a firm to pay due regard to the interests of its customers and treat them fairly.
Where a firm submits a plan for restoration under2 PRA Rulebook: Solvency II Firms: Undertakings in Difficulty or PRA Rulebook: Non-Solvency II firms: Run Off Operations2, the FCA would expect an explanation of how any actions it plans to take to restore its capital resources are consistent with the firm's obligations under Principle 6 (Customers' interests).
Firms are also referred to SUP 15.6 (Inaccurate, false or misleading information). This requires, in SUP 15.6.4 R, a firm to notify the appropriate regulator1 if false, misleading, incomplete or inaccurate information has been provided. This would apply in relation to information provided in an application for a waiver.1
1Section 59(1) is relevant where the firm directly employs the person concerned. Under the provision, a firm ('A') must take reasonable care to ensure that no person performs a controlled function under an arrangement entered into by A in relation to the carrying on by it of a regulated activity, unless the appropriate regulator (as defined in section 59(4) of the Act)
approves the performance by that person of the controlled function to which the approval relates.
1Section 59(2) is relevant where the person is employed by a contractor of the firm. It requires a firm ('A') to take reasonable care to ensure that no person performs a controlled function under an arrangement entered into by a contractor of A in relation to the carrying on by A of a regulated activity, unless the appropriate regulator (as defined in section 59(4) of the Act)
approves the performance by that person of the controlled function to which the approval
Once the appropriate regulator1 has given a waiver, it may vary it with the firm's consent, or on the firm's application. If a firm wishes the appropriate regulator1 to vary a waiver, it should follow the procedures in SUP 8.3.3 D, giving reasons for the application. In a case where a waiver has been given to a number of firms (see SUP 8.3.10 G), if the appropriate regulator1wishes to vary such waivers with the consent of those firms, it will follow the procedures in SUP 8.3.10
A firm must not appoint as appropriate actuary an actuary who has been disqualified by the FCA5 under section 345 of the Act (Disciplinary measures: FCA) or the PRA under section 345A of the Act (Disciplinary measures: PRA5) from acting as an actuary either for that firm or for a relevant class of firm.55
(1) Section 55C of the Financial Services Act 2012 (Power to amend Schedule 6) gave HM Treasury the power to amend Schedule 6 of the Act. HM Treasury exercised this power by making The Financial Services and Markets Act 2000 (Threshold Conditions) Order 2013 which entered into force on 1 April 2013 (the "TC Order"). The TC Order's main result is the creation of four sets of threshold conditions, namely:(i) conditions for firms authorised and regulated by the FCA only (paragraphs
(1) As a result of the new legal framework for threshold conditions described in COND 1.1A.1G (1), PRA-authorised persons and firms seeking to become PRA-authorised persons are subject to two sets of threshold conditions:(i) the FCA-specific conditions referred to in COND 1.1A.1G (1)(ii)and(ii) one of the two PRA-specific conditions referred to in COND 1.1A.1G (1)(iii) or (iv), depending on the PRA-regulated activities which the PRA-authorised person or firm carries on, or is
3For
the purpose of this Statement of Principle,
regulators in addition to the FCA and
the PRA are those which have
recognised jurisdiction in relation to regulated
activities and a power to call for information from the approved person in connection with their 1accountable function or (in the case of
an individual performing an accountable higher management function)1 in connection with the business for which they are1 responsible.
This may include an exchange or an oversea
1Failing
to report promptly in accordance with his APER employer2 internal
procedures (or if none exist direct to the regulator concerned), information which it would be
reasonable to assume would be of material significance to the regulator concerned), whether in response to questions
or otherwise, falls within APER 4.4.3 G. The
regulator concerned is:(1) the FCA if
it would be reasonable to assume that it would be of material significance
to it;3(2) the PRA if
it would be reasonable
A firm must take reasonable care to ensure that every letter (or electronic equivalent) which it or its employees send to a retail client4, with a view to or in connection with the firm carrying on a regulated activity, includes the disclosure in GEN 4 Annex 1 R (firms that are not PRA-authorised persons) or GEN 4 Annex 1AR (PRA-authorised persons) as applicable15.14
(1) An application or submission by a firm made under this rule must be made by submitting the form or document online at fca.org.uk using the FCA's and PRA'sonline notification and application system6.(2) A firm must use the version of the form or document made available on the electronic system referred to in (1). If the form or document is included in an Annex to this chapter, that electronic version is based on the version found in the applicable Annex to this chapter 6(which
If the information technology systems used by the FCA fail and online submission is unavailable for 24 hours or more, the FCA and PRA will endeavour to publish a notice on their websites confirming that:(1) online submission is unavailable; and(2) the alternative methods of submission in SUP 10C.15.14R applies.
1The application of this sourcebook is summarised at a high level in the following table. The detailed application is cut back in SYSC 1 Annex 1 and in the text of each chapter.
Type of firm |
Applicable chapters |
Chapters 2, 3, 12 5 to 18, 19F.2,14 213, 2211, 23, 24, 25, 26, 2715, 2814, 28A20 5 |
|
Chapters 2, 3, 11, 12, 15A,18 18, 19F.2,14 213, 2211, 23, 24, 25, 26, 2715, 2814, 28A20 |
|
Chapters 2, 3, 12, 15A,18 18, 19F.2,14 213, 2211, 23, 24, 25, 26, 2715, 2814, 28A20 |
|
Chapters 4 to 12, 15A,18 18, 19D, 19F, 19G19, 21, 22, 23, 24, 25, 26, 27, 28, 28A20 |
|
Every other firm |
Chapters 4 to 12, 15A,18 18, 19D, 19F, 19G19, 216, 2211, 2814, 28A20 624463614 |
Firms that SYSC 19D applies to should also refer to the Remuneration part of the PRA Rulebook13.
6The application of this sourcebook to specific14firms that are not PRA-authorised persons is summarised at a high level in the following table. The detailed application is cut back in SYSC 1 Annex 1 and in the text of each chapter.
Type of firm |
Applicable chapters |
Chapters11 4 to 10, 12, 18, 1219B, 19F.2,14 21, 2211, 23, 24, 25, 26, 27,17 2814, 28A20 |
|
| 1410111714 | |
MIFIDPRU investment firm19 (including an overseas firm that would have been a MIFIDPRU investment firm19 if it had been a UK domestic firm, except that SYSC 19G does not apply to such a firm19) |
Chapters 4 to 10, 12, 18, 19F, 19G19, 21, 2211, 23, 24, 25, 26, 27,17 2814, 28A20 1410 |
21The provisions in SYSC should be read in conjunction with GEN 2.2.23 R to GEN 2.2.25 G. In particular:(1) [deleted]9(2) Provisions made by the FCA, and by the9PRA in the PRA Rulebook,9 may be applied by both regulators to PRA-authorised persons. Such provisions are applied by each regulator to the extent of its powers and regulatory responsibilities.95(3) 5For Solvency II firms, the FCA considers that the requirements and guidance14 in Chapters 2, 3, 12 to 18,11 19F.2,14 21,
6Paragraph 2B(1) of Schedule 6 to the Act implements article 7(1)(d) of the UCITS Directive, paragraphs 2B(1) to 2B(23) of Schedule 6 to the Act implement article 5(4) of MiFID, paragraph 2B(4) of Schedule 6 to the Act implements article 2(1)(10) of the IDD7 and paragraph 2B(7) of Schedule 6 to the Act implements article 8(1)(e) of AIFMD, although the Act extends the threshold condition set out in paragraph 2B of Schedule 6 of the Act to authorised persons that are not PRA-authorised
Section 340 of the Act gives the PRA6 power to make rules requiring an authorised person, or an authorised person falling into a specified class, to appoint an actuary3. The PRA has exercised its power to make such rules in PRA Rulebook: Solvency II firms: Actuaries; and PRA Rulebook: Non-Solvency II firms: Actuarial Requirements.5 The rule-making powers of the PRA and FCA6 under section 340 of the Act also extend to an actuary's3 duties.636666663336
The functions3 described by SUP 4.2.2 G (1) are performed by one or more actuaries who are3 required to hold office continuously and must be approved persons3. Solvency II firms are required to have an actuarial function. Solvency II firms are not required to appoint an external actuary to fulfil the actuarial function for the purposes of rule 6 of the PRA Rulebook: Solvency II firms: Conditions Governing Business, but they must do so if they do not have the internal capability
3In making appointments under this chapter and in allocating duties to actuaries, firms are reminded of their obligation under SYSC 2.1.1 R or rule 2.2(2) of the PRA Rulebook: Solvency II firms: Conditions Governing Business4 to maintain a clear and appropriate apportionment of significant responsibilities so that it is clear who has which of those responsibilities and that the business and affairs of the firm can be adequately monitored and controlled by the directors, relevant
(1) Depending on the nature, scale and complexity of its business, it may be appropriate for a firm to have a separate risk assessment function responsible for assessing the risks that the firm faces and advising the governing body and senior managers on them.(2) The organisation and responsibilities of a risk assessment function should be documented. The function should be adequately resourced and staffed by an appropriate number of competent staff who are sufficiently independent
(1) SYSC 3.2.13 G includes assessing an individual's honesty, and competence. This assessment should normally be made at the point of recruitment. An individual's honesty need not normally be revisited unless something happens to make a fresh look appropriate.(2) Any assessment of an individual's suitability should take into account the level of responsibility that the individual will assume within the firm. The nature of this assessment will generally differ depending upon whether
9(1) Depending on the nature, scale and complexity of its business, it may be appropriate for a firm to delegate much of the task of monitoring the appropriateness and effectiveness of its systems and controls to an internal audit function. An internal audit function should have clear responsibilities and reporting lines to an audit committee or appropriate senior manager, be adequately resourced and staffed by competent individuals, be independent of the day-to-day activities
A firm, other than a Solvency II firm,15 should have in place appropriate arrangements, having regard to the nature, scale and complexity of its business, to ensure that it can continue to function and meet its regulatory obligations in the event of unforeseen interruption. These arrangements should be regularly updated and tested to ensure their effectiveness. Solvency II firms are subject to the business continuity requirements in PRA Rulebook: Solvency II firms: Conditions
Where this section applies with respect to a financial conglomerate, the risk management processes referred to in SYSC 12.1.8R (2) or, for a Solvency II firm, the risk management system referred to in the PRA Rulebook: Solvency II firms: Conditions Governing Business, rule 3,12 must include:(1) sound governance and management processes, which must include the approval and periodic review by the appropriate managing bodies within the financial conglomerate of the strategies and
Where this section applies with respect to a financial conglomerate, the internal control mechanisms referred to in SYSC 12.1.8R (2) or, for a Solvency II firm, the internal control system referred to in the PRA Rulebook: Solvency II firms: Conditions Governing Business, rule 3,12 must include:(1) mechanisms that are adequate to identify and measure all material risks incurred by members of the financial conglomerate and appropriately relate capital in the financial conglomerate