Under section 61(1) of the Act (Determination of applications), the appropriate regulator may grant an application for approval made under section 60 (Applications for approval) only if it is satisfied that the candidate is fit and proper to perform the controlled function to which the application relates.
The Act does not prescribe the matters which the appropriate regulator should take into account when determining fitness and propriety. However, section 61(2) states that the appropriate regulator may have regard (among other things) to whether the candidate or
2Under Article 5(1)(d) of the MiFID Implementing Directive and Article 31 and 32 of MiFID, the requirement to employ personnel with the knowledge, skills and expertise necessary for the discharge of the responsibilities allocated to them is reserved to the firm's Home State. Therefore, in assessing the fitness and propriety
of a person to perform a controlled function solely in relation to the MiFID business of an incoming EEA firm, the appropriate regulator will not have regard to that person's competence and capability. Where the controlled function relates to matters outside the scope of MiFID, for example money laundering4 responsibilities (see CF11) or activities related to a specified benchmark (see CF 40 and CF 50)5, or to business outside the scope of the MiFID business of an incoming EEA firm, for example insurance mediation activities in relation to life policies, the FCA5 will have regard to a candidate's competence and capability as well as his honesty, integrity, reputation and financial soundness.34