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FEES 7.2 The CFEB levy

Obligation to pay CFEB levy

FEES 7.2.1R

A firm must pay each CFEB levy applicable to it:

  1. (1)

    in full and without deduction (unless permitted or required by a provision in FEES); and

  2. (2)

    in accordance with the provisions of FEES 4.3.6 R as modified by FEES 7.2.1A R.1

FEES 7.2.1AR
  1. (1)

    1For the purposes of FEES 7.2.1R (2), FEES 4.3.6R(1C)-(1E)2, as applied by FEES 7.2.8 R, is modified so that if a firm's periodic fees for the previous financial year was at least £50,0002, the firm must pay:1

    1. (a)

      an amount equal to 50% of the CFEB levy payable for the previous year, by 12 April in the financial year to which the sum due under FEES 7.2.1 R relates; and

    2. (b)

      the balance of the CFEB levy due for the current financial year by 1 September in the financial year to which that sum relates.

  2. (2)

    For the purposes of FEES 7.2.1R (2), FEES 4.3.6R (2), as applied by FEES 7.2.8 R, is modified so that if the firm's periodic fee for the previous financial year was less than 50,000, the firm must pay its CFEB levy in full by 1 July in the financial year to which that sum relates.

Calculation of CFEB levy

FEES 7.2.2R

The CFEB levy is calculated as follows:

  1. (1)

    identify each of the activity groups set out in Part 1 of FEES 7 Annex 1 that apply to the business of the firm for the relevant period (for this purpose, the activity groups are defined in accordance with Part 1 of FEES 4 Annex 1A);3

    3
  2. (2)

    for each of those activity groups, calculate the amount payable in the way set out in FEES 7.2.3 R;

  3. (3)

    add the amounts calculated under (2);

  4. (4)

    work out whether a minimum fee is payable under Part 2 of FEES 7 Annex 1 and if so how much;

  5. (5)

    add together the amounts calculated under (3) and (4);

  6. (6)

    modify the result as indicated by the table in FEES 4.2.6 R and FEES 4.2.7 R (if applicable);

  7. (7)

    apply any applicable payment charge specified in FEES 4.2.4 R to the amount in (6), provided that:

    1. (a)

      for payment by direct debit, successful collection of the amount due is made at the first attempt by the FCA; or

    2. (b)

      for payment by credit transfer, the amount due is received by the FCA on or before the due date;

  8. (8)

    make the calculations using information obtained in accordance with FEES 4.4.

FEES 7.2.3R

The amount payable by a firm with respect to a particular activity group is calculated as follows:

  1. (1)

    calculate the size of the firm's tariff base for that activity group using the tariff base calculations in Part 3 of FEES 4 Annex 1A3 and Part 3 of FEES 4 Annex 111 and the valuation date requirements in Part 5 of FEES 4 Annex 1A3 and Part 3 of FEES 4 Annex 11;1

  2. (2)

    use the figure in (1) to calculate which of the bands set out in column 2 of the table in Part 1 of FEES 7 Annex 1 the firm falls into;

  3. (3)

    add together the fixed sums, as set out in column 3 of the table in Part 1 of FEES 7 Annex 1, applicable to each band identified under (2);

  4. (4)

    the amount in (3) is the amount payable by the firm with respect to that activity group.

FEES 7.2.4R

For the purposes of FEES 7.2.3 R:

  1. (1)

    a firm may apply the relevant tariff bases and rates to its non-UK business, as well as to its UK business, if:

    1. (a)

      it has reasonable grounds for believing that the costs of identifying the firm's UK business separately from its non-UK business in the way described in Part 3 of FEES 4 Annex 1A3 and Part 1 of FEES 4 Annex 111 are disproportionate to the difference in fees payable; and

    2. (b)

      it notifies the FCA in writing at the same time as it provides the information concerned under FEES 4.4 (Information on which fees are calculated), or, if earlier, at the time it pays the fees concerned;

  2. (2)

    for a firm which has not complied with FEES 4.4.2 R (Information on which fees are calculated) orFEES 4.4.8 D (Information relating to payment services and the issuance of electronic money)1 for this period, the CFEB levy is calculated using (where relevant) the valuation or valuations of business applicable to the previous period, multiplied by the factor of 1.10.

FEES 7.2.5R

The modifications in Part 3 of 3FEES 4 Annex 2A3 and Part 7 of FEES 4 Annex 11 apply.1

Amount payable by the Society of Lloyds

FEES 7.2.6R

The CFEB levy in relation to the Society is specified against its activity group in Part 1 of FEES 7 Annex 1.

FEES 4 rules incorporated into FEES 7 by cross-reference

FEES 7.2.7G

The Handbook provisions relating to the CFEB levy are meant to follow closely the provisions relating to the payment of periodic fees under FEES 4.3.1 R In the interests of brevity, not all of these provisions are set out again in FEES 7. In some cases, certain FEES 4 rules are applied to the payment of the CFEB levy by individual rules in FEES 7. The rest are set out in the table in FEES 7.2.9 R.

FEES 7.2.8R

The rules set out in the table in FEES 7.2.9 R and any other rules in FEES 4 included in FEES 7 by cross-reference apply to the CFEB levy in the same way as they apply to periodic fees payable under FEES 4.3.1 R.

FEES 7.2.9R

Table of rules in FEES 4that also apply to FEES 7 to the extent that in FEES 4 they apply to fees payable to the FCA3

FEES 4 rules incorporated into FEES 7

Description

FEES 4.2.4 R

Method of payment

FEES 4.2.7B R

Calculation of periodic fee and tariff base for a firm's second financial year

FEES 4.2.8 R

How FEES 4.2.7 R applies in relation to an incoming EEA firm or an incoming Treaty firm

FEES 4.2.10 R

Extension of time

FEES 4.2.11 R (first entry only)

Due date and changes in permission for periodic fees

FEES 4.3.7 R

Groups of firms

FEES 4.3.13 R

Firms applying to cancel or vary permission before start of period

FEES 4.3.15 R

Firms acquiring businesses from other firms

FEES 4.4.1 R to FEES 4.4.6 R

Information on which fees are calculated

FEES 7.2.9AD

1FEES 4.4.7 D to FEES 4.4.9 D (Information relating to payment services and the issuance of electronic money) also apply to FEES 7.

FEES 7.2.10G

References in a FEES 4 rule incorporated into FEES 7 by cross-reference to a periodic fee should be read as being to the CFEB levy. References in a FEES 4 rule incorporated into FEES 7 to market operators, service companies, MTF operators, investment exchanges, or3 designated professional bodies should be disregarded.

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FEES 7.2.11G

In some cases, a FEES 4 rule incorporated into FEES 7 in the manner set out in FEES 7.2.7 G will refer to another rule in FEES 4 that has not been individually incorporated into FEES 7. Such a reference should be read as being to the corresponding provision in FEES 7. The main examples are set out in FEES 7.2.12 G.

FEES 7.2.12G