The general purpose of this sourcebook is to set out the guidance, directions and rules made by the FCA under the RCB Regulations. Those regulations enable bonds to be issued which qualify under COLL 5.2.11R(5A) and 5.6.7R(3A) for a concession from the general spread of risk requirements in respect of transferable securities5.22
An insurer (which is not a UK Solvency II firm5 or a non-directive friendly society5) may benefit from increased counterparty limits under INSPRU 2.1.22R (3)(b). An insurer which is a UK Solvency II firm is subject to the rules in the PRA Rulebook which transposed the Solvency II Directive and also to the5 Solvency II Regulation (EU) 2015/35 of 10 October 2014.44
Issuers which are subject to an obligation to publish a prospectus under the Prospectus Regulation are required by Chapter II of the PR Regulation to disclose risk factors. These requirements are set out in PRR 2.3.1UK and PRR App 2.1.1UK, where there is a link to the relevant Annexes of the PR Regulation.755
In complying with these obligations, issuers should consider disclosing the risk that actions by a regulatory authority in relation to the issuer may adversely affect the ability of the issuer to meet its obligations to investors or the ability of the owner to meet its guarantee obligations to investors. An example of such action may include restricting the issuer's ability to transfer further assets to the asset pool.