GEN 2.2 Interpreting the Handbook

The purpose of any provision in the Handbook is to be gathered first and foremost from the text of the provision in question and its context among other relevant provisions. The guidance given on the purpose of a provision is intended as an explanation to assist readers of the Handbook. As such, guidance may assist the reader in assessing the purpose of the provision, but it should not be taken as a complete or definitive explanation of a provision's purpose.

1. (1)

   The rules to which section 138C35 of the Act applies ("evidential provisions") are identified in the Handbook by the status letter "E" in the margin or heading.

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2. (2)

   Other provisions in the Handbook, although also identified by the status letter "E" in the margin or heading, are actually not rules but provisions in codes and GEN 2.2.3 R does not apply to them.17

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Chapter 6 of the Reader's Guide contains an explanation of the significance of the status letters R, E, G, D, UK, EU, P and C6, and includes further information on Handbook provisions, including6 evidential provisions.1

Expressions with defined meanings appear in italics in the Handbook, unless otherwise stated in individual sourcebooks or manuals11.

Examples of related expressions are:

1. (1)

   "advice on investments" and "advise on investments", which should be interpreted by reference to "advising on investments";

2. (2)

   "closely linked", which should be interpreted by reference to "close links";

3. (3)

   "controls" and "controlled", which should be interpreted by reference to "control";19

4. (4)

   "effect", as for example in "effect a life policy", which should be interpreted by reference to "effecting contracts of insurance"; and19

5. (5)

   “employment”, which should be interpreted by reference to “employee”.19

Unless the context otherwise requires or unless otherwise stated in a particular sourcebook or manual11, where italics have not been used, an expression bears its natural meaning (subject to the Interpretation Act 1978; see GEN 2.2.11 R to GEN 2.2.12 G).

The Interim Prudential sourcebooks (IPRU) have individual arrangements for defined terms and each contains rules or guidance on its own arrangements. In respect of those sourcebooks, reliance should not be placed on the definitions which appear in the Glossary unless otherwise indicated.

The application of the Interpretation Act 1978 to the Handbook has the effect, in particular, that:

1. (1)

   expressions in the Handbook used in the Act have the meanings which they bear in the Act, unless the contrary intention appears;

2. (2)

   where reference is made in the Handbook to an enactment, it is a reference to that enactment as amended and includes a reference to that provision as extended or applied by or under any other enactment, unless the contrary intention appears; and

3. (3)

   unless the contrary intention appears:

   1. (a)

      words in the Handbook importing the masculine gender include the feminine and words importing the feminine gender include the masculine;

   2. (b)

      words in the Handbook in the singular include the plural and words in the plural include the singular.

4 GEN 2.2.12A R and sections 246 and 247 of the Civil Partnership Act 2004 amend each reference in the Handbook to a stepchild, step-parent and certain related expressions to take account of civil partnerships. As a result a reference (for example) to a stepchild of a person (A) includes a reference to the child of the civil partner of A where that child is not A's child.

15The purpose of GEN 2.2.13AR is to ensure that cross references in the FCA Handbook to provisions outside the FCA Handbook are effective, including cross references to material that was formerly in the PRA Handbook but which the PRA has now deleted.

GEN 2.2.14 R means that, for example, electronic media may be used to make communications which are required by a provision of the Handbook to be "in writing", unless a contrary intention appears, or the use of electronic media would contravene some other requirement. GEN 2.2.14 R does not, however, affect any other legal requirement which may apply in relation to the form or manner of executing a document or agreement.

35An example of a requirement relevant to whether a communication required by a provision of the Handbook to be "in writing" may be made by use of electronic media is the requirement to treat customers fairly under Principle 6.

"Document" is a defined term in the Glossary, the definition of which includes information recorded in any form, including electronic form.

In principle, it is possible to view a change of partners7 in a partnership7, or a change in the membership of the unincorporated association, as the formation of a new partnership7 or association. GEN 2.2.18 R reflects section 32 of the Act (Partnerships and unincorporated associations), which provides for the continuing authorisation of partnerships7 and unincorporated associations following a change in partners7 or members if certain conditions are satisfied. GEN 2.2.18 R ensures a similar effect to section 327 in relation to the status of the partnership7 or unincorporated associations as a "firm" or "authorised person" for the purposes of the Handbook.

In the Glossary, the definition of designated investment exchange lists certain investment exchanges. Further information on designated investment exchanges, including guidance on the addition of an investment exchange to the list, is set out in GEN 2 Annex 1 G and the obligation to pay the application fee is set out in 53FEES 3.25.

10The agreement on the European Economic Area, signed at Oporto on 2 May 1992, extends certain EU legislation to those EEA States which are not Member States of the EU, namely Norway, Iceland and Liechtenstein. References in the Handbook concerning the territorial scope of EU law should therefore be read as extending throughout the EEA where the context requires.

10As a result of the Treaty of Lisbon, the European Union has replaced and succeeded the European Community. References in the Handbook to the European Community should therefore be interpreted as references to the European Union, where the context requires. In particular, references which are copied out directly from EU or UK legislation may contain references to the Community which should be read in conjunction with section 3 of the European Union (Amendment) Act 2008.

1. (1)

   21The purpose of GEN 2.2.22AR is to ensure consistency with the principle referred to in recital 109 to MiFID that a third country investment firm should not be treated in a more favourable way than an EEA firm. A third country investment firm does not, however, benefit from passporting rights in the manner envisaged for EEA firms and its authorisation requires consideration of other issues, including the nature and extent of regulation provided by its Home State regulator.

2. (2)

   GEN 2.2.22AR may be overridden where the application provisions at the beginning of individual Handbook chapters qualify its effect.

35The published Memorandum of Understanding between the FCA and the PRA describes their regulatory responsibilities.

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 with banking conduct requirements in BCOBS).20

1. (1)

   [deleted]12

   12
2. (2)

   [deleted]20

3. (3)

   [deleted]20

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