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REC 4.7 The section 297 power to revoke recognition

REC 4.7.1G

Under section 297 of the Act (Revoking recognition) 2and (for RAPs) under regulation 4 of the RAP regulations, the FCA3 has the power to revoke a recognition order relating to a recognised body.

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REC 4.7.2G

The FCA3 will revoke a recognition order if:

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  1. (1)

    [deleted]3

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  2. (2)

    the recognised body has asked the FCA3 to revoke the order.

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REC 4.7.2AG

2Where the FCA3 makes a revocation order under section 297 of the Act in relation to a UK RIE which is also an RAP, the FCA3 will also revoke the recognition order relating to its status as an RAP.

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REC 4.7.3G

The FCA3 will usually consider revoking a recognition order if:

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  1. (1)

    the recognised body is failing or has failed to satisfy 2one or more of the recognised body requirements 1and that failure has or will have serious consequences; or

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  2. (2)

    it would not be possible for the recognised body to comply with a direction under section 296 of the Act (FCA's3 power to give directions) or (for RAPs) regulation 3 of the RAP regulations;2 or

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  3. (3)

    for some other reason, it would not be appropriate for the FCA3 to give a direction under section 296 or (for RAPs) regulation 3 of the RAP regulations; or21

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  4. (4)

    in the case of a UK RIE, it has not carried on the business of an investment exchange during the 12 months beginning with the day on which the recognition order took effect in relation to it, or it has not carried on the business of an investment exchange at any time during the period of six months ending with the day the recognition order is revoked; or21

  5. (5)

    2in the case of an RAP in relation to its RAP recognition order, it has not carried on the business of an auction platform during the 12 months beginning with the day on which the RAP recognition order took effect in relation to it, or it has not carried on the business of an auction platform at any time during the period of six months ending with the day the RAP recognition order is revoked.

REC 4.7.4G

The FCA3 would be likely to consider the conditions in REC 4.7.3 G (2) or REC 4.7.3 G (3) to be triggered1in the following circumstances:

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  1. (1)

    the recognised body appears not to have the resources or management to be able to organise its affairs so as to satisfy one or more of the recognised body requirements; or21

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  2. (2)

    the recognised body does not appear to be willing to satisfy one or more of the recognised body requirements; or21

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  3. (3)

    the recognised body is failing or has failed to comply with a direction made under section 296 of the Act or (for RAPs) regulation 3 of the RAP regulations; or2

  4. (4)

    the recognised body has ceased to carry out regulated activities in the United Kingdom, or has so changed the nature of its business that it no longer satisfies one or more of the recognised body requirements21 in respect of the regulated activities for which recognised body status is relevant.

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REC 4.7.5G

In addition to the relevant 1factors set out in REC 4.7.4 G, the FCA3 will usually consider that it would not be able to secure an ROIE's3 compliance with the recognition requirements or other obligations in or under the Act by means of a direction under section 296 of the Act, if it appears to the FCA3 that the ROIE3 is prevented by any change in the legal framework or supervisory arrangements to which it is subject in its home territory from complying with the recognition requirements or other obligations in or under the Act.

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