EG 19.37 UK Benchmarks Regulations 2018

EG 19.37.1

1The UK Benchmarks Regulations 2018 in part implement the benchmarks regulation. The FCA has investigative and enforcement powers in relation to both criminal and non-criminal breaches of the UK Benchmarks Regulations 2018 (including requirements imposed on persons subject to the UK Benchmarks Regulations 2018 by the benchmarks regulation and any directly applicable EU regulation made under the benchmarks regulation). Our powers in relation to Miscellaneous BM persons are set in the UK Benchmarks Regulations 2018.

EG 19.37.2

1The FCA’s approach to enforcing the UK Benchmarks Regulations 2018 will mirror our general approach to enforcing the Act, as set out in EG 2. We will seek to exercise our enforcement powers in a manner that is transparent, proportionate, responsive to the issue and consistent with our publicly stated policies. We will also seek to ensure fair treatment when exercising our enforcement powers. Finally, we will aim to change the behaviour of the person who is the subject of our action, to deter future non-compliance by others, to eliminate any financial gain or benefit from non-compliance and, where appropriate, to remedy the harm caused by the non-compliance.

EG 19.37.3

1The powers which the UK Benchmarks Regulations 2018 provide to the FCA include:

  1. (1)

    the power to require information and appoint investigators;

  2. (2)

    powers of entry and inspection;

  3. (3)

    the power to publicly censure;

  4. (4)

    the power to impose financial penalties;

  5. (5)

    the power to apply for an injunction or restitution order;

  6. (6)

    the power to require restitution;

  7. (7)

    the power to impose and vary requirements; and

  8. (8)

    the power to prosecute relevant offences.

EG 19.37.4

1The UK Benchmarks Regulations 2018, for the most part, mirror the FCA’s investigative, sanctioning and regulatory powers under the Act. The FCA has decided to adopt procedures and policies in relation to the use of those powers akin to those we have under the Act. Key features of the FCA’s approach are described below and in SUP 15B.5.

The conduct of investigations under the UK Benchmarks Regulations 2018

EG 19.37.5

1The UK Benchmarks Regulations 2018 apply much of Part 11 of the Act. The effect of this is to apply the same procedures under the Act for appointing investigators and requiring information when investigating breaches of the UK Benchmarks Regulations 2018.

EG 19.37.6

1The FCA will notify the subject of the investigation that we have appointed investigators to carry out an investigation under the UK Benchmarks Regulations 2018 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 non-criminal investigations under the UK Benchmarks Regulations 2018 is to use powers to compel the provision of information in the same way as we would in the course of an investigation under the Act.

Decision making under the UK Benchmarks Regulations 2018

EG 19.37.7

1The decision making procedures for those decisions under the UK Benchmarks Regulations 2018 requiring the giving of a warning notice, decision notice or a supervisory notice are dealt with within DEPP.

EG 19.37.8

1The UK Benchmarks Regulations 2018 do not require the FCA to have published procedures for commencing criminal prosecutions. However, in these situations the FCA expects that we will normally follow our decision making procedures for the equivalent decisions under the Act, as set out in EG 12.

EG 19.37.9

1The UK Benchmarks Regulations 2018 do not require the FCA to have published procedures to apply to the court for an injunction or restitution order. However, the FCA will normally follow our decision making procedures for the equivalent decisions under the Act, as set out in EG 10 and EG 11.

EG 19.37.10

1The UK Benchmarks Regulations 2018 require the FCA to give third party rights as set out in section 393 of the Act and to give access to certain material as set out in section 394 of the Act as applied by the UK Benchmarks Regulations 2018.

EG 19.37.11

1Certain FCA decisions (for example an imposition of a requirement) may be referred to the Tribunal by an aggrieved party.

Imposition of penalties under the UK Benchmarks Regulations 2018

EG 19.37.12

1When determining whether to take action to impose a penalty or to issue a public censure under the UK Benchmarks Regulations 2018 the FCA’s policy includes having regard to the relevant factors in DEPP 6.2 and DEPP 6.4. The FCA’s policy in relation to determining the level of a financial penalty includes having regard, where relevant, to DEPP 6.5 to DEPP 6.5D.

EG 19.37.13

1As with cases under the Act, the FCA may settle or mediate appropriate cases involving non-criminal breaches of the UK Benchmarks Regulations 2018 to assist us to exercise our functions under the UK Benchmarks Regulations 2018 in the most efficient and economic way. See DEPP 5, DEPP 6.7 and EG 5 for further information on the settlement process and the settlement discount scheme.

EG 19.37.14

1The FCA will apply the approach to publicity that is outlined in EG 6, read in light of Article 45 of the benchmarks regulation.

Statement of policy in section 169(7) (as applied by the UK Benchmarks Regulations 2018)

EG 19.37.15

1The UK Benchmarks Regulations 2018 apply section 169 of the Act which requires the FCA to publish a statement of policy on the conduct of certain interviews in response to requests from overseas regulators. For the purposes of the UK Benchmarks Regulations 2018 the FCA will follow the procedures described in DEPP 7.