Related provisions for FEES 13.2.10
181 - 200 of 564 items.
Firms are reminded that they must, under SYSC 6.1.1 R, establish, implement and maintain adequate policies and procedures sufficient to ensure compliance of the firm with the rules in this chapter. This should include, for example, establishing and maintaining policies and procedures concerning: (1) the frequency and method of the checks and reconciliations the firm is required to carry out under this section; (2) the frequency with which the firm is required to review its arrangements
(1) A firm must make and retain records sufficient to show and explain any decision it has taken under CASS 6.6.44 R when determining the frequency of its internal custody record checks, physical asset reconciliations and external custody reconciliations. Subject to (2), such records must be retained indefinitely.(2) If any decision under CASS 6.6.44 R is superseded by a subsequent decision under that rule then the record of that earlier decision retained in accordance with (1)
(1) 7This rule applies to a firm following its failure. (2) A firm must perform an internal custody record check and a physical asset reconciliation that relates to the time of its failure as soon as reasonably practicable after its failure.(3) (a) A firm must perform an external custody reconciliation that relates to the time of its failure as soon as reasonably practicable after its failure.(b) If any records and accounts of the relevant third parties under CASS 6.6.35R relating
(1) This rule applies where a firm identifies a discrepancy as a result of, or that reveals, a shortfall, which the firm has not yet resolved.(2) Subject to paragraphs (3) and (4)7, until the discrepancy is resolved a firm must do one of the following:(a) appropriate a sufficient number of its own applicable assets to cover the value of the shortfall and hold them for the relevant clients under the custody rules in such a way that the applicable assets, or the proceeds of their
The FCA's4 rules on systems and controls against money laundering are set out in SYSC 3.2 and SYSC 6.3. The FCA4, when considering whether to take action for a financial penalty or censure in respect of a breach of those rules, will have regard to whether a firm has followed relevant provisions in the Guidance for the UK financial sector issued by the Joint Money Laundering Steering Group.44
In some cases it may not be appropriate to take disciplinary measures against a firm for the actions of an individual6 (an example might be where the firm can show that it took all reasonable steps to prevent the breach). In other cases, it may be appropriate for the FCA4 to take action against both the firm and the individual6. For example, a firm may have breached the rule requiring it to take reasonable care to establish and maintain such systems and controls as are appropriate
The FCA will not discipline individuals6 on the basis of vicarious liability (that is, holding them responsible for the acts of others), provided appropriate delegation and supervision has taken place (see APER 4.6.13G, APER 4.6.14G, COCON 4.1.8G and COCON 4.2.17G to COCON 4.2.24G6). In particular, disciplinary action will not be taken against an approved person performing a significant influence function or a senior conduct rules staff member6 simply because a regulatory failure
In certain cases, it may be appropriate to discipline a listed company on the basis of a Listing Principle alone. Examples include the following:55(1) where there is no detailed listing rule5 which prohibits the behaviour in question, but the behaviour clearly contravenes a Listing Principle; and1655(2) where a listed company has committed a number of breaches of detailed rules5 which individually may not merit disciplinary action, but the cumulative effect of which indicates
Compliance with Principle 11 includes, but is not limited to, giving the FCA11 notice of:3535(1) any proposed restructuring, reorganisation or business expansion which could have a significant impact on the firm's risk profile or resources, including, but not limited to:(a) setting up a new undertaking within a firm'sgroup, or a new branch (whether in the United Kingdom or overseas); or (b) commencing the provision of cross border services into a new territory; or(c) commencing
(1) A firm must notify the FCA11 of:3535(a) a significant breach of a rule (which includes a Principle, a Statement of Principle or a COCONrule)20; or2020(aa) a significant breach of any requirement imposed by the CCA or by regulations or an order made under the CCA (except if the breach is an offence, in which case (c) applies), but any notification under (aa) is required to be made only to the FCA; or 14(b) a breach of any requirement imposed by the Act or by regulations
A notification under SUP 15.3.11 R should include:(1) information about any circumstances relevant to the breach or offence;(2) identification of the rule or requirement or offence; and(3) information about any steps which a firm or other person has taken or intends to take to rectify or remedy the breach or prevent any future potential occurrence.
3SUP 15.3.23 D to SUP 15.3.25 D are given in relation to the exercise of the powers of the Society and of the Council generally, with a view to achieving the objective of enabling the FCA11 to:3535(1) comply with its general duty under section 314 of the Act (Regulators’35 general duty);35(2) determine whether underwriting agents, or approved persons acting for them or on their behalf, are complying with the requirements imposed on them by or under the Act;(3) enforce the provisions
The following financial items may be recognised as eligible collateral under all approaches and methods:(1) cash on deposit with, or cash assimilated instruments held by, the lending firm;(2) debt securities issued by central governments or central banks which securities have a credit assessment by an eligible ECAI or export credit agency recognised as eligible for the purposes of the standardised approach, which is associated with credit quality step 4 or above under the rules
Debt securities issued by institutions which securities do not have a credit assessment by an eligible ECAI may be recognised as eligible collateral if they fulfil the following criteria:(1) they are listed on a recognised investment exchange or a designated investment exchange;(2) they qualify as senior debt;(3) all other rated issues by the issuing institution of the same seniority have a credit assessment by an eligible ECAI associated with credit quality step 3 or above under
(1) In addition to the collateral set out in BIPRU 5.4.2 R to BIPRU 5.4.7 R, where a firm uses the financial collateral comprehensive method, the following financial items may be recognised as eligible collateral:(a) equities or convertible bonds not included in a main index but traded on a recognised investment exchange or a designated investment exchange;(b) units in CIUs if the following conditions are met:(i) they have a daily public price quote; and(ii) the CIU is limited
In the tables in BIPRU 5.4.35 R – BIPRU 5.4.38 R and in BIPRU 5.4.41 R to BIPRU 5.4.43 R, the credit quality step with which a credit assessment of the debt security is associated is the credit quality step with which the external credit assessment is associated under the standardised approach. For the purposes of this rule, BIPRU 5.4.7 R also applies.[Note:BCD Annex VIII Part 3 point 38]
(1) In both of the cases in BIPRU 2.2.17 Gcapital resources should be calculated in the same way as they are in GENPRU 2.2 (Capital resources). This includes the rules limiting the amount of capital that can be included in the various tiers of capital when capital resources are being calculated.(2) GENPRU 2.2.42 R does not allow innovative tier one capital to count as tier one capital resources for certain purposes. This restriction does not apply for the purposes in BIPRU 2.2.17
(1) Individual capital guidance may also be given with respect to group capital resources. This paragraph explains how such guidance should be interpreted unless the individual capital guidance specifies another interpretation.(2) If BIPRU 8.2.1 R (General consolidation rule for a UK consolidation group) applies to the firm the guidance relates to its UK consolidation group. If BIPRU 8.3.1 R (General consolidation rule for a non-UK sub-group7) applies to the firm the guidance
A firm with an IRB permission must ensure that there is no significant risk that it will not be able to meet its capital resource requirements for credit risk under GENPRU 2.1 (Calculation of capital resources requirements) at all times throughout an economic cycle, including the capital resources requirements for credit risk indicated by any stress test carried out under BIPRU 4.3.39 R to BIPRU 4.3.40 R (Stress tests used in assessment of capital adequacy for a firm with an IRB
Counterparty risk rules only partially capture the risk of settlement failure as the quantification of risk is only based on mark-to-market values and does not take account of the volatility of the securities over the settlement period. A securities firm's assessment of its exposure to counterparty risk should take into account:(1) whether it acts as arranger only or whether it also executes trades;(2) the types of execution venues which it uses; for example, the London Stock
This chapter (the custody rules) applies to a firm:21(1) [deleted]22(a) [deleted]22(b) [deleted]22(1A) 2when it holds financial instruments belonging to a client in the course of its MiFID business;7(1B) 2when it is safeguarding and administering investments, in the course of business that is not MiFID business;7(1C) when it is acting as trustee or depositary of an AIF;
79(1D) when it is acting as trustee or depositary of a UK UCITS16; and97(1E) in respect of any arrangement for
(1) 9Following the termination of a TTCA14 , where a firm does not immediately return the safe custody assets to the client the firm should consider whether the custody rules apply in respect of the safe custody assets pursuant to CASS 6.1.1R14.(2) Where the custody rules apply to a firm for safe custody assets in these circumstances then the firm is required to comply with those rules and should, for example, update the registration under CASS 6.2(Holding of client assets), update
(1) Subject to (2) and CASS 6.1.12B R and with the written agreement of the relevant client, a9firm need not treat this chapter as applying in respect of a delivery versus payment transaction through a commercial settlement system if:9929(a) in respect of a client's purchase, the firm intends for the asset in question to be due to the client within one business day following the client's fulfilment of its payment obligation to the firm;9 or9(b) in respect of a client's sale, the
The rules in this chapter are designed primarily to restrict the commingling of client and the firm's assets and minimise the risk of the client'ssafe custody assets2
being used by the firm without the client's agreement or contrary to the client's wishes, or being treated as the firm's assets in the event of its insolvency.2
1(1) This sourcebook3 applies to every firm that:113(a) carries on a home finance activity3 (subject to 31the business loan and loans to high net worth mortgage customers7 application provisions3); or3(b) communicates or approves a financial promotion of qualifying credit, of a home purchase plan,6of a home reversion plan3or of a regulated sale and rent back agreement.636(2) Where a firm has outsourced activities to a third party processor, any rule in MCOB which requires the
In relation to a regulated mortgage contract for a business purpose or with a high net worth mortgage customer7, if a firm has opted for the tailored route, it must adopt the following modifications to the sourcebook:333(1) 11substitute an alternative description of the facility provided under the regulated mortgage contract for 'mortgage' where that term is used in any disclosure;733337(2) substitute the term 'illustration' for ‘Key facts illustration’ when opting to use the
The disclosure rules in MCOB place particular emphasis on the description of borrowing. Where the regulated mortgage contract is for a business purpose or with a high net worth mortgage customer7 who is not a consumer under an MCD regulated mortgage contract8, a firm should reflect this emphasis in any disclosure by first describing any borrowing before addressing the other facilities provided under the regulated mortgage contract.
(1) 10By virtue of amendments to articles 60B, 60C and 61 of the Regulated Activities Order which came into force on 21 March 2016, certain regulated credit agreements became regulated mortgage contracts (but see the transitional provisions described in (3) below). The provisions of MCOB that apply to these regulated mortgage contracts include:(a) MCOB 7 (Disclosure at start of contract and after sale);(b) MCOB 12 (Charges); and(c) MCOB 13 (Payment difficulties17 and repossessions:
(1) 4When entering into a regulated sale and rent back agreement,5 a firm must ensure that, under the terms of the regulated sale and rent back agreement:5(a) the entitlement of the SRB agreement seller (or trust beneficiary or related person) to occupy the property is governed by a tenancy, which is structured:(i) if the property is in England and Wales, as an assured tenancy (including an assured shorthold tenancy) under the Housing Act 1988 (as amended);(ii) if the property
For the purpose of this section (except this rule), a reversion arranger or reversion administrator'scustomer:(1) includes a reversion occupier or potential reversion occupier who enters, or proposes to enter, into a home reversion plan with an unauthorised reversion provider who is the firm'scustomer; and(2) excludes an unauthorised reversion provider.
2For the purpose of this section (except this rule), a SRB arranger's or SRB administrator's customer:(1) includes a SRB agreement seller or potential SRB agreement seller who enters, or proposes to enter, into a regulated sale and rent back agreement with an unauthorised SRB agreement provider who is the firm'scustomer; and(2) excludes an unauthorised SRB agreement provider.
1Where, in relation to a UK RIE a proposal has been made to appoint or elect a person as a member of the management body4, that UK RIE must at least 30 days before the date of the appointment or election give notice of that event, and give the information specified for the purposes of this rule in REC 3.4.4A R to the FCA.3 [Note: article 45(8)4 of MiFID]3
Where:(1) a firm enters into an agreement for high-cost short-term credit in contravention of a rule in CONC 5A.2; or(2) a firm facilitates an individual becoming a borrower under an agreement for high-cost short-term credit in contravention of a rule in CONC 5A.4; or(3) a firm within CONC 5A.5.1 R (1) imposes a charge in contravention of a rule in CONC 5A.3; or(4) a firm within CONC 5A.5.1 R (4) imposes a charge on behalf of a lender in contravention of a rule in CONC 5A.3; or(5)
CONC 5A.5.3 R is a residual provision that applies to a firm established in the UK which carries on debt administration or debt collection, but where the rules in CONC 5A do not apply to a lender because the lender is established outside the UK and provides electronic commerce activities into the UK. Where a borrower gives notice to the lender referred to in CONC 5A.5.3 R, only charges which exceed the amounts set out in CONC 5A.2 or CONC 5A.3 are void. The borrower remains
In the case of OPS activity undertaken by an OPS firm, CASS applies with the following general modifications:(1) references to customer are to the OPS or welfare trust, whichever fits the case, in respect of which the OPS firm is acting or intends to act, and with or for the benefit of which the relevant activity is to be carried on; and(2) if an OPS firm is required by any rule in CASS to provide information to, or obtain consent from, a customer, that firm must ensure that the
2In certain cases, despite concerns about a person’s behaviour or evidence of a rule
breach, the FCA may decide that it is not appropriate, having regard to all the circumstances of the case, to bring formal action for a financial penalty or public censure. This is consistent with the FCA's risk-based approach to enforcement. In such cases, the FCA may give a private warning to make the person aware that they came close to being subject to formal action.
2A private warning is not intended to be a determination by the FCA as to whether the recipient has breached the FCA'srules. However, private warnings, together with any comments received in response, will form part of the person's compliance history. In this sense they are no different to other FCA correspondence, but the weight the FCA attaches to a private warning is likely to be greater. They may therefore influence the FCA's decision whether to commence action for a penalty
Breaching Principle 11, or the rules in this chapter, makes a firm liable to regulatory sanctions, including discipline under Part XIV of the Act (Disciplinary Measures), and may be relevant to the use of the appropriate regulator's other powers, including the statutory information gathering and investigation powers (see further PRIN 1.1.7 G to PRIN 1.1.9 G). But, unlike a breach of a requirement imposed under the statutory powers listed in SUP 2.1.5 G, a breach of Principle 11
The FCA1 would not normally seek to gather information using the methods described in SUP 2.3 or SUP 2.4 in a situation where the FCA1 could not have obtained it under the powers in Part XI of the Act (Information Gathering and Investigations). In particular, the limitations in the following sections of the Act are relevant to this chapter:11(1) section 175(5) (Information and documents: supplementary powers) under which no person may be required under Part XI of the Act (Information
6CBTL firms are subject to a duty to deal with the FCA in an open and co-operative manner under article 18(1)(d) of the MCD Order. SUP 2.3 applies to CBTL firms in relation to complying with that duty as though:(1) a reference to firm included a reference to a CBTL firm;(2) a reference to the regulatory system were a reference to the provisions of the MCD Order, rules, directions and guidance applicable to CBTL firms;(3) a reference to Principle 11 were a reference to the duty
The purpose of SUP 2.3 is to amplify Principle 11 in the context of information gathering by the FCA on its own initiative in the discharge of its functions under the Act. SUP 2.3 therefore sets out, in guidance on Principle 11 and in rules, how the FCA expects firms to deal with the FCA in that context, including the steps that a firm should take with a view to ensuring that certain connected persons should also cooperate with the FCA.
(1) A person who in any place outside the United Kingdom acts or engages in conduct:(a) for the purposes of stabilising2 the price of investments;(b) in conformity with the provisions specified in (2), (3) or (4); and(c) in relation to an offer which is governed by the law of a country (or a state or territory in a country) so specified;is to be treated for the purposes of section 89(3)(a) and section 90 (9)(b) of the Financial Services Act 20122 as acting or engaging in conduct
A person who is treated under MAR 2.5.1R (1) as acting or engaging in conduct in conformity with the price stabilising rules is also to be treated to an equivalent extent as so acting or engaging for the purposes of:(1) [deleted]2(2) Part XIV (Disciplinary measures); and (3) Part XXV (Injunctions and Restitution) of the Act.
Application of different sections of SUP 16 (excluding49 SUP 16.13, SUP 16.15, 60SUP 16.22 and56 SUP 16.2656)50534266393927
(1) Section(s) |
(2) Categories of firm to which section applies |
(3) Applicable rules and guidance |
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All categories of firm except: |
Entire sections |
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(a) |
an ICVC; |
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(b) |
[deleted]51 |
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| 20 | |||||
| 49 | |||||
| 3 | 141439 | ||||
| 39 | |||||
(c) |
[deleted]51 |
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All categories of firm except: |
Entire sections |
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(-a) |
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(a) |
an ICVC; |
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(b) |
[deleted]51 |
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(c) |
[deleted]51 |
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(d) |
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(e)4 |
[deleted]4 |
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(f) |
a sole trader; |
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(g) |
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(h) |
[deleted]51 88 |
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(i)8 |
a firm with permission to carry on only retail investment activities;8 |
8 | |||
(ia)38 |
a firm with permission only to advise on P2P agreements (unless that activity is carried on exclusively with or for professional clients);38 |
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(j)8 |
a firm with permission to carry on only insurance distribution activity52, home finance mediation activity,16 or both;8 16 |
8 | |||
(ja)30 |
an FCA-authorised person with permission to carry on only credit-related regulated activity; |
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48(jb) |
a firm with permission to carry on only regulated claims management activities; |
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58(jc) |
a firm with permission to carry on only funeral plan distribution; |
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(k)8 |
a firm falling within a combination of (i), (ia), (j), (ja), (jb) and (jc)58. 30483830 |
8 | |||
46(l) |
a firm with permission to carry on only the regulated activity of administering a benchmark; |
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| 27 | |||||
| 2628 | |||||
| 28 | 28 | ||||
Depositary of an authorised fund41 |
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A firm subject to the requirement in SUP 16.7A.3 R or SUP 16.7A.5 R |
Sections as relevant |
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Insurer with permission to effect or carry out life policies, unless it is a non-directive friendly society3 |
Entire section |
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3Firm with permission to establish, operate or wind up a personal pension scheme or a stakeholder pension scheme14 14 |
Entire section3 |
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| 5 | 5 | 5 | |||
Entire section9 |
9
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(a)9 |
9 | ||||
(b)9 |
[deleted]51 2142 |
9 | |||
(c)9 |
[deleted]42 219 |
9 | |||
21(d) |
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(1) |
A firm, other than a managing agent, which is: |
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(a) |
a home finance provider; or |
Entire section |
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(b) |
an insurer; or |
Entire section |
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(c) |
the operator of a regulated collective investment scheme or an investment trust savings scheme; or |
Entire section |
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(d) |
a person who issues or manages the relevant assets of the issuer of a structured capital-at-risk product; or |
Entire section |
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(e) |
one of the following:64 |
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64(i) |
SUP 16.11.1R(1), SUP 16.11.3R(1), SUP 16.11.5R, SUP 16 Annex 20R and SUP 16 Annex 21R. |
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64(ii) |
Entire section |
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64(iii) |
Entire section |
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64(iv) |
Entire section |
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64(v) |
Entire section |
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(2) |
a firm in whom the rights and obligations of the lender under a regulated mortgage contract are vested. |
The provisions governing performance data reports in SUP 16.11 and SUP 16 Annex 21 |
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A firm undertaking the regulated activities as listed in SUP 16.12.4 R, unless exempted in SUP 16.12.1 G |
Sections as relevant to regulated activities as listed in SUP 16.12.4 R23 |
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A CASS large firm and a CASS medium firm |
Entire section29 |
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[deleted]60 34 |
5943 | ||||
A firm subject to the Money Laundering Regulations and within the scope of SUP 16.23.1R |
Entire Section |
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A firm undertaking the regulated activities in SUP 16.23A.1R51 |
Entire section |
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A firm with permission to effect or carry out contracts of insurance in relation to life and annuitycontracts of insurance45 to the extent that the firm and its business falls within the scope of SUP 16.24.1R. |
Entire Section |
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A firm with permission to carry on regulated claims management activities. |
Entire section |
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A firm which, in respect of general insurance contracts, is: |
Entire section |
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(a) |
an insurer; |
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(b) |
55a 55(i) TP firm which has temporary permission; or 55 (ii) a Gibraltar-based firm, treated as having permission, to effect contract of insurance 55 including those providing services from an establishment outside the UK with a customer in the UK55; |
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(c) |
a managing agent; or |
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(d) |
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to the extent that the firm and its business falls within the scope of SUP 16.27.7R. |
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A firm which, in respect of general insurance contracts, is: |
Entire section |
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(1) |
an insurer; |
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(2) |
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(3) |
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(4) |
a TP firm; or |
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(5) |
a Gibraltar-based firm that is not a TP firm. |
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to the extent that the firm and its business falls within the scope of SUP 16.28.8R. |
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A MIFIDPRU investment firm other than in the circumstances specified in SUP 16.29.1R. |
Entire section |
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Entire section63 |
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(1) |
a firm except as specified in SUP 16.30.1R;63 |
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(2) |
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(3) |
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(4) |
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(5) |
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(6) |
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(7) |
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A firm with approver permission. |
Entire section |
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Entire section |
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| 26 | |||||
27Note 2 50The application of SUP 16.13 is set out under SUP 16.13.1 G;66 the application of SUP 16.15 is set out under SUP 16.15.1 G; the application of SUP 16.16 is set out SUP 16.16.1 R and SUP 16.16.2 R the application of SUP 16.17 is set out in SUP 16.17.3 R and SUP 16.17.4 R66; and the application of SUP 16.26 is set out in SUP 16.26.1R50. 4366 |
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29Note 3 50The application of SUP 16.18 for the types of AIFMs specified in SUP 16.1.1C G is set out in SUP 16.18.2 G. 43 |
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(1) This chapter contains requirements to report to the FCA37 on a regular basis. These requirements include reports relating to a firm's financial condition, and to its compliance with other rules and requirements which apply to the firm. Where the relevant requirements are set out in another section of the Handbook, this chapter contains cross references. An example of this is financial reporting for insurers and friendly societies.6666(2) Where such requirements already apply