Status: Please note you should read all Brexit changes to the FCA Handbook and BTS alongside the main FCA transitional directions. Where these directions apply the 'standstill', firms have the choice between complying with the pre-IP completion day rules, or the post-IP completion day rules. To see a full list of Handbook modules affected, please see Annex B to the main FCA transitional directions.

IPRU-INV 11.2 MAIN REQUIREMENTS

Collective portfolio management firm

IPRU-INV 11.2.1RRP

A firm must:

  1. (1)

    when it first becomes a collective portfolio management firm or a collective portfolio management investment firm, hold initial capital of not less than the applicable base own funds requirement (in line with IPRU-INV 11.3.1R);

  2. (2)

    at all times, maintain own funds which equal or exceed:

    1. (a)

      the higher of:

      1. (i)

        the funds under management requirement (in line with IPRU-INV 11.3.2R); and

      2. (ii)

        the amount specified in article 97 of the UK CRR1 (Own funds based on fixed overheads) (as replicated in IPRU-INV 11.3.3AUK1)); plus

    2. (b)

      whichever is applicable of:

      1. (i)

        the professional negligence capital requirement (in line with IPRU-INV 11.3.11G(1)(a)); or

      2. (ii)

        the PII capital requirement (in line with IPRU-INV 11.3.11G(1)(b)); and

  3. (3)

    at all times, hold liquid assets (in line with IPRU-INV 11.3.17R) which equal or exceed:

    1. (a)

      the higher of:

      1. (i)

        the funds under management requirement (in line with IPRU-INV 11.3.2R) less the base own funds requirement (in line with IPRU-INV 11.3.1R); and

      2. (ii)

        the amount specified in article 97 of the UK CRR1 (Own funds based on fixed overheads); plus

    2. (b)

      whichever is applicable of:

      1. (i)

        the professional negligence capital requirement (in line with IPRU-INV 11.3.11G(1)(a)); or

      2. (ii)

        the PII capital requirement (in line with IPRU-INV 11.3.11G(1)(b)).

[Note: article 9(5) and 9(7) of AIFMD and article 7(1)(a)(iii) of the UCITS Directive]

Professional negligence

IPRU-INV 11.2.2GRP
  1. (1)

    The professional negligence capital requirement applies to a full-scope UK AIFM which, in line with IPRU-INV 11.3.11G(1)(a), covers professional liability risks by way of own funds.

  2. (2)

    The PII capital requirement applies to a full-scope UK AIFM which, in line with IPRU-INV 11.3.11G(1)(b), decides to cover professional liability risks by professional indemnity insurance.