SYSC 2.1.3 R provides that a firm must appropriately allocate to one or more individuals the functions of dealing with the apportionment of responsibilities under SYSC 2.1.1 R, and of overseeing the establishment and maintenance of systems and controls under SYSC 3.1.1 R. Where there is a chief executive, he or she must be one of the individuals to whom the functions are allocated (unless the functions are allocated to someone of greater seniority): see SYSC 2.1.6 G.
The fact that there is a person performing the apportionment and oversight function, and who has responsibility for activities subject to regulation by the FSA, may have a bearing on whether a manager who is based overseas will be performing a controlled function. It is a factor to take into account when assessing the likely influence of the overseas manager.
Generally, in relation to a UK establishment of an overseas firm or a firm which is part of an overseas group, where an overseas manager's responsibilities in relation to the United Kingdom are strategic only, he will not need to be an approved person. However, where, in accordance with SYSC 3, he is responsible for implementing that strategy in the United Kingdom, and has not delegated that responsibility to a senior manager in the United Kingdom, he is likely to be performing a controlled function, such as, for example, the chief executive function.
4PRU 9.1.3 R provides that an insurance intermediary, other than a sole trader, must allocate to a director or senior manager the responsibility for the firm's insurance mediation activityPRU 9.1.4 R (2) provides that the firm may allocate this responsibility to the person performing the apportionment and oversight function.
The EEA investment business oversight function is the function of acting in the capacity of an individual who is responsible, in accordance withSYSC 2.1.3 R (2), for overseeing the establishment and maintenance of systems and controls in relation to designated investment business carried on from a branch in the United Kingdom of an incoming EEA firm.
Where an overseas individual has not delegated this function to a senior manager in the United Kingdom, he is likely to be performing this controlled function. However, the FSA anticipates that any individual carrying out this function will normally be located in the United Kingdom. He may be the local chief executive or one or more of the individuals approved to perform the significant management (designated investment business) function. If the local chief executive (or other individual) is approved for this function, this does not mean that all his responsibilities are the concern of the FSA. SUP 10.1.9 R preserves the principle of Home State prudential regulation whenever it applies and in respect of each controlled function.1
Compliance in SYSC 3.2.8 R means compliance with the rules in COB, COLL or CIS and CASS. The FSA anticipates that some firms will include oversight of compliance with PRIN, MAR, and other requirements and standards, within its compliance function. These other responsibilities would not, however, be brought within the compliance oversight function (see also 36SUP 10.4.3 G).
Some firms, particularly firms with complex structures or which are part of a group, may find it appropriate to seek approval for the group head of compliance and other persons to perform the compliance oversight function. Examples of other persons include the senior manager responsible for compliance in a firm which is a subsidiary within the group and a senior manager in a reporting line, where compliance is organised along product lines.1
The effect of SUP 4.1.1 R (Application) and SUP 4.3.1 R (Appointment of an actuary) is that a long-term insurer (unless it is a certain kind of friendly society) must appoint one or more actuaries to perform the actuarial function in respect of all classes of its long-term insurance business and the with-profits actuary function in respect of all classes of its with-profits business7. The kinds of friendly society to which the provisions do not apply are:7
The actuarial function and the with-profits actuary function 7 do not extend to the giving of actuarial advice to a firm by an actuary who has not been appointed to perform these functions7. A person who gives actuarial advice, whether occasionally or regularly, other than in his capacity 7as an actuary appointed to perform these functions would not be performing a controlled function7.77777