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SUP 15.1 Application

Who?

SUP 15.1.1 G

This chapter applies to every firm except that:

  1. (1)

    only SUP 15.10 applies to2 an ICVC or a UCITS qualifier; and3

  2. (2)

    SUP 15.3.22 D to SUP 15.3.25 D apply only to the Society.3

SUP 15.1.2 R

The application of this chapter to an incoming EEA firm or an incoming Treaty firm is set out in SUP 15 Annex 1.

SUP 15.1.3 G

In some cases, the application of provisions set out in SUP 15 Annex 1 depends on whether responsibility is reserved to a Home State regulator.

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SUP 15.1.3A G

7The guidance in SUP 15.13 applies to all CBTL firms whether or not they are also firms.

What?

SUP 15.1.4 R

This chapter:

  1. (1)

    applies with respect to the carrying on of both regulated activities and unregulated activities; and

  2. (2)

    takes into account any activity of other members of a group of which the firm is a member.

Where?

SUP 15.1.5 G

Firms are reminded that, unless expressly stated otherwise, where a rule or guidance includes a reference to a firm this includes all UK and overseas branches and representative offices of that firm, whether or not those branches or offices carry on any regulated activities.4

4
SUP 15.1.6 R

4This chapter does not apply to an incoming ECA provider acting as such.

Relevant authorised persons6

SUP 15.1.7 R

6The following apply only to relevant authorised persons:

  1. (1)

    SUP 15.2.5G (Purpose); and

  2. (2)

    SUP 15.11 (Notification of COCON breaches and disciplinary action).

SUP 15.2 Purpose

SUP 15.2.1 G

A firm is required to provide the FCA2 with a wide range of information to enable the FCA2 to meet its responsibilities for monitoring the firm's compliance with requirements imposed by or under the Act. Some of this information is provided through regular reports, including those set out in SUP 16 (Reporting requirements) and SUP 17 (Transaction reporting). In addition, other chapters in the Handbook set out specific notification and reporting requirements. Principle 11 includes a requirement for a firm to disclose to the FCA2 appropriately anything relating to the firm of which the FCA2 would reasonably expect notice.

8 8 8 8 8 8 8 8
SUP 15.2.2 G

This chapter sets out:

  1. (1)

    guidance on the type of event or change in condition which a firm should consider notifying in accordance with Principle 11; the purpose of this guidance is to set out examples and not to give comprehensive advice to firms on what they should notify in order to be in compliance with Principle 11;

  2. (2)

    rules on events and changes in condition that a firm must notify; these are the types of event that the FCA2 must be informed about, usually as soon as possible, if it is to be able to carry out its monitoring function effectively and react in good time to developments that may require a regulatory response;

    88
  3. (3)

    rules on the core information that a firm must provide to the FCA2 for example its name and address and the names of its other regulators, so that the FCA2 is able to maintain a relationship with the firm and with those regulators;

    88881
  4. (4)

    rules requiring a firm to ensure that information provided to the FCA2 is accurate and complete; section 398 of the Act makes it an offence knowingly or recklessly to provide the FCA2 with information which is false or misleading in a material particular, in purported compliance with any requirement imposed by or under the Act; the purpose of the rules in SUP 15.6 is to ensure that firms take due care to ensure the accuracy of information and to require them to ensure that information is not only accurate but also complete; and1

    88881
  5. (5)

    material (in SUP 15.10 (Notification of suspicious transactions or orders5 (market abuse)) which makes reference to5 the provisions of the Market Abuse Regulation that detail requirements on5 the reporting of transactions or orders5 about which there is reasonable suspicion of market abuse.

    1
SUP 15.2.3 G

Rules and guidance have also been included to set out how firms should make a notification and to determine when it may be appropriate to discuss matters with their usual supervisory contact at the FCA2 by telephone (SUP 15.7).

8
SUP 15.2.4 G

[deleted]6

SUP 15.2.5 G

3 SUP 15.11 (Notification of COCON breaches and disciplinary action) provides rules and guidance on notifications to the FCA by a relevant authorised person where the relevant authorised person4 takes disciplinary action in relation to any conduct rules staff and the reason for taking that action is a reason specified in rules made by the FCA. This is a requirement imposed4 under section4 64C of the Act.

SUP 15.2.6 G

3 SUP 15.12 (Ongoing alerts for retail adviser complaints) sets out rules and guidance on a firm’s obligation to notify the FCA of complaints against an employee acting as a retail investment adviser.

SUP 15.3 General notification requirements

Matters having a serious regulatory impact

SUP 15.3.1 R

A firm must notify the FCA11 immediately it becomes aware, or has information which reasonably suggests, that any of the following has occurred, may have occurred or may occur in the foreseeable future:

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  1. (1)

    the firm failing to satisfy one or more of the threshold conditions; or

  2. (2)

    any matter which could have a significant adverse impact on the firm's reputation; or

  3. (3)

    any matter which could affect the firm's ability to continue to provide adequate services to its customers and which could result in serious detriment to a customer of the firm; or

  4. (4)

    any matter in respect of the firm which could result in serious financial consequences to the UK financial system8 or to other firms.

    8
SUP 15.3.2 G

The circumstances which may give rise to any of the events in SUP 15.3.1 R are wide-ranging and the probability of any matter resulting in such an outcome, and the severity of the outcome, may be difficult to determine. However, the FCA11 expects firms to consider properly all potential consequences of events.

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SUP 15.3.3 G

In determining whether the FCA11 should be notified of26 an event that may occur in the foreseeable future, a firm should consider both the probability of the event happening and the severity of the outcome should it happen.

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SUP 15.3.4 G

Guidance on satisfaction of the threshold conditions is given in COND.

SUP 15.3.5 G

A firm making a notification in accordance with SUP 15.3.1 R should consider the guidance in SUP 15.7.2 G and notify the FCA11 by telephone if appropriate.

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Communication with the appropriate regulator in accordance with Principle 1126

SUP 15.3.7 G

Principle 11 requires a firm to deal with its regulators in an open and cooperative way and to disclose to the FCA11 appropriately anything relating to the firm of which the FCA11 would reasonably expect notice. Principle 11 applies to unregulated activities as well as regulated activities and takes into account the activities of other members of a group.

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SUP 15.3.7A G

10Although PRIN does not apply to a firm in relation to its carrying on of auction regulation bidding, the FCA26expects to be given notice of events that are material to the FCA's26supervision of that business and so firms carrying on that business should have regard to the guidance in SUP 15.3.8 G to SUP 15.3.10 G.

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SUP 15.3.8 G

Compliance with Principle 11 includes, but is not limited to, giving the FCA11 notice of:

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  1. (1)

    any proposed restructuring, reorganisation or business expansion which could have a significant impact on the firm's risk profile or resources, including, but not limited to:

    1. (a)

      setting up a new undertaking within a firm'sgroup, or a new branch (whether in the United Kingdom or overseas); or

    2. (b)

      commencing the provision of cross border services into a new territory; or

    3. (c)

      commencing the provision of a new type of product or service (whether in the United Kingdom or overseas); or

    4. (d)

      ceasing to undertake a regulated activity or ancillary activity, or significantly reducing the scope of such activities; or

    5. (e)

      entering into, or significantly changing, a material outsourcing arrangement (a bank1,7 a building society and a dormant account fund operator7should also see 22

      3413

      1SYSC 83, and an insurer should also see SYSC 13.94 for further details); or

      1441
    6. (f)

      a substantial change or a series of changes in the governing body of an overseas firm (other than an incoming firm); or

    7. (g)

      any change to the firm's prudential category or sub-category, as used in the Interim Prudential sourcebooks and SUP and on which guidance is given in SUP App 1; or2

    8. (h)

      any proposed change which limits the liability of any of the members or partners of a firm such as a general partner becoming a limited partner or re-registration as a limited liability company of a company incorporated with unlimited liability;2or7

    9. (i)

      in relation to a dormant account fund operator, notify the FCA11 when the operator intends to rely on a third party for the performance of operational functions which are critical or important for the performance of relevant services and activities in connection with operating a dormant account fund on a continuous and satisfactory basis;7

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  2. (2)

    any significant failure in the firm's systems or controls, including those reported to the firm by the firm's auditor;

  3. (3)

    any action which a firm proposes to take which would result in a material change in its capital adequacy or solvency, including, but not limited to:

    1. (a)

      any action which would result in a material change in the firm's financial resources or financial resources requirement; or

    2. (b)

      a material change resulting from the payment of a special or unusual dividend or the repayment of share capital or a subordinated loan; or

    3. (c)

      for firms which are subject to the rules on consolidated financial supervision, any proposal under which another group company may be considering such an action; or

    4. (d)

      significant trading or non-trading losses (whether recognised or unrecognised).

SUP 15.3.9 G

The period of notice given to the FCA11 will depend on the event, although the FCA11 expects a firm to discuss relevant matters with it at an early stage, before making any internal or external commitments.

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SUP 15.3.10 G

A notification under Principle 11 may be given orally or in writing (as set out in SUP 15.7.1 R and SUP 15.7.2 G), although the FCA11 may request written confirmation of a matter. However, it is the responsibility of a firm to ensure that matters are properly and clearly communicated to the FCA.11 A firm should provide a written notification if a matter either is complex or may be such as to make it necessary for the FCA11 to take action. A firm should also have regard to Principle 11 and the guidance in SUP 15.7.2 G in respect of providing important information promptly.

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Breaches of rules and other requirements in or under the Act or the CCA 14

SUP 15.3.11 R
  1. (1)

    A firm must notify the FCA11 of:

    2626
    1. (a)

      a significant breach of a rule (which includes a Principle, a Statement of Principle or a COCONrule)20; or

      2020
    2. (aa)

      a significant breach of any requirement imposed by the CCA or by regulations or an order made under the CCA (except if the breach is an offence, in which case (c) applies), but any notification under (aa) is required to be made only to the FCA; or 14

    3. (b)

      a breach of any requirement imposed by the Act or by regulations or an order made under the Act by the Treasury (except if the breach is an offence, in which case (c) applies); or

      6
    4. (c)

      the bringing of a prosecution for, or a conviction of, any offence under the Act or the CCA14; or

    5. (d)

      a breach of a directly applicable provision in the MiFID Regulation; or6

    6. (da)

      a breach of a directly applicable provision in theEU CRR or any directly applicable regulations made under CRD or the EU CRR; or12

    7. (e)

      a breach of any requirement in regulation 4C(3) (or any successor provision) of the Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007;6 or9

    8. (ea)

      a breach of a directly applicable provision in the auction regulation; or10

    9. (f)

      it exceeding (or becoming aware that it will exceed) the limit in BIPRU 10.5.6 R;9 or13

    10. (g)

      a breach of the AIFMD UK regulation; or13

    11. (h)

      a breach of any directly applicable EU regulation made under AIFMD;13

    by (or as regards (c) against) the firm or any of its directors, officers, employees, approved persons, or appointed representativesor, where applicable, tied agents.6

  2. (2)

    A firm must make the notification in (1) immediately it becomes aware, or has information which reasonably suggests, that any of the matters in (1) has occurred, may have occurred or may occur in the foreseeable future.

SUP 15.3.11A G

6 SUP 15.3.11 R (1)(e) relates to the standard requirement in the permission of those firms which fall outside MiFID because of the Treasury's implementation of Article 3 of MiFID. Guidance on how the Treasury has exercised the Article 3 exemption for the United Kingdom is given in Q48 and the following questions and answers in PERG 13.5 (Exemptions from MiFID).

SUP 15.3.12 G

In SUP 15.3.11 R(1)(a) or (1)(aa)18, significance should be determined having regard to potential financial losses to customers or to the firm, frequency of the breach, implications for the firm's systems and controls and if there were delays in identifying or rectifying the breach.

SUP 15.3.13 G

In assessing whether an event that may occur in the foreseeable future should be notified to the FCA11 a firm should consider the guidance in SUP 15.3.3 G.

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SUP 15.3.14 G

A notification under SUP 15.3.11 R should include:

  1. (1)

    information about any circumstances relevant to the breach or offence;

  2. (2)

    identification of the rule or requirement or offence; and

  3. (3)

    information about any steps which a firm or other person has taken or intends to take to rectify or remedy the breach or prevent any future potential occurrence.

SUP 15.3.14A G
  1. (1)

    20Some matters that need to be notified under SUP 15.3.11R may also have to be notified under SUP 10A.14 (Changes to an FCA-approved person's details).

  2. (2)

    However, there is no need to make the same notification twice.

  3. (3)

    Any notification required under both SUP 10C.14 and SUP 15.3.11R should be made in accordance with SUP 10C.14, which requires notification using Forms C or D.

  4. (4)

    SUP 10C.14 only applies to relevant authorised persons. SUP 10A.14 applies similar, but less extensive, obligations to firms that are not relevant authorised persons. Paragraphs (2) and (3) apply to those notifications as well. Such notifications should however be made under SUP 10A.14.

SUP 15.3.14B
20
  1. (1)

    Some matters that need to be notified under SUP 15.3.11R may also have to be notified under SUP 15.11 (Notification of COCON breaches and disciplinary action).

  2. (2)

    If the same thing has to be notified under SUP 15.11 and SUP 15.3.11R, a firm should make separate notifications under both. This is because:23

    1. (a)

      notification under SUP 15.11 is annual and notification under SUP 15.3.11R is immediate; and23

    2. (b)

      the details of what has to be notified under those requirements are different.23

Civil, criminal or disciplinary proceedings against a firm

SUP 15.3.15 R

A firm must notify the FCA11 immediately if:

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  1. (1)

    civil proceedings are brought against the firm and the amount of the claim is significant in relation to the firm's financial resources or its reputation; or

  2. (2)

    any action is brought against the firm under section 71 of the Act (Actions for damages) or section 138D24 (Actions for damages); or

  3. (3)

    disciplinary measures or sanctions have been imposed on the firm by any statutory or regulatory authority, competition authority, 21professional organisation or trade body (other than the FCA11 or the firm becomes aware that one of those bodies has started an investigation into its affairs; or

    2626
  4. (4)

    the firm is prosecuted for, or convicted of, any offence involving fraud or dishonesty, or any penalties are imposed on it for tax evasion; or

  5. (5)

    it is an OPS firm, which is a trustee, and is removed as trustee by a court order.

SUP 15.3.16 G

A notification under SUP 15.3.15 R should include details of the matter and an estimate of the likely financial consequences, if any.

Fraud, errors and other irregularities

SUP 15.3.17 R

A firm must notify the FCA11 immediately if one of the following events arises and the event is significant:

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  1. (1)

    it becomes aware that an employee may have committed a fraud against one of its customers; or

  2. (2)

    it becomes aware that a person, whether or not employed by it, may have committed a fraud against it; or

  3. (3)

    it considers that any person, whether or not employed by it, is acting with intent to commit a fraud against it; or

  4. (4)

    it identifies irregularities in its accounting or other records, whether or not there is evidence of fraud; or

  5. (5)

    it suspects that one of its employees may be guilty of serious misconduct concerning his honesty or integrity and which is connected with the firm's regulated activities or ancillary activities.

SUP 15.3.18 G

In determining whether a matter is significant, a firm should have regard to:

  1. (1)

    the size of any monetary loss or potential monetary loss to itself or its customers (either in terms of a single incident or group of similar or related incidents);

  2. (2)

    the risk of reputational loss to the firm; and

  3. (3)

    whether the incident or a pattern of incidents reflects weaknesses in the firm's internal controls.

SUP 15.3.19 G

The notifications under SUP 15.3.17 R are required as the FCA11 needs to be aware of the types of fraudulent and irregular activity which are being attempted or undertaken, and to act, if necessary, to prevent effects on consumers or other firms. A notification under SUP 15.7.3 G should provide all relevant and significant details of the incident or suspected incident of which the firm is aware.

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SUP 15.3.20 G

In addition, the firm may have suffered significant financial losses as a result of the incident, or may suffer reputational loss, and the FCA11 will wish to consider this and whether the incident suggests weaknesses in the firm'sinternal controls.

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Insolvency, bankruptcy and winding up

SUP 15.3.21 R

A firm must notify the FCA11 immediately of any of the following events:

26 26
  1. (1)

    the calling of a meeting to consider a resolution for winding up the firm; or

  2. (2)

    an application to dissolve the firm or to strike it off the Register of Companies; or

  3. (3)

    the presentation of a petition for the winding up of the firm; or

  4. (4)

    the making of, or any proposals for the making of, a composition or arrangement with any one or more of its creditors; or

  5. (5)

    an application for the appointment of an administrator or trustee in bankruptcy to the firm; or

  6. (6)

    the appointment of a receiver to the firm (whether an administrative receiver or a receiver appointed over particular property); or

  7. (7)

    an application for an interim order against the firm under section 252 of the Insolvency Act 1986 (or, in Northern Ireland, section 227 of the Insolvency (Northern Ireland) Order 1989); or

  8. (8)

    if the firm is a sole trader:

    1. (a)

      an application for a sequestration order on the firm; or

    2. (b)

      the presentation of a petition for bankruptcy; or

  9. (9)

    anything equivalent to (1) to (8) above occurring in respect of the firm in a jurisdiction outside the United Kingdom.

Lloyd's of London

SUP 15.3.22 D

3 SUP 15.3.23 D to SUP 15.3.25 D are given in relation to the exercise of the powers of the Society and of the Council generally, with a view to achieving the objective of enabling the FCA11 to:

26 26
  1. (1)

    comply with its general duty under section 314 of the Act (Regulators’26 general duty);

    26
  2. (2)

    determine whether underwriting agents, or approved persons acting for them or on their behalf, are complying with the requirements imposed on them by or under the Act;

  3. (3)

    enforce the provisions of the Act, or requirements made under the Act, by enabling the FCA11 to consider, where appropriate, whether it should use its powers, for example, to:

    2626
    1. (a)

      vary or cancel the permission of an underwriting agent, under section 55J26 of the Act (Variation or cancellation on 26initiative of regulator26);

      2626
    2. (b)

      withdraw approval from an approved person acting for or on behalf of an underwriting agent, under section 63 of the Act (Withdrawal of approval) (see EG 95);

      5
    3. (c)

      prohibit an individual acting for or on behalf of an underwriting agent from involvement in regulated activities, under section 56 of the Act (Prohibition orders) (see EG 95);

      5
    4. (d)

      require an underwriting agent to make restitution, under section 384 of the Act (Power of FCA or PRA 26 to require restitution) (see EG 115);

      5
    5. (e)

      discipline an underwriting agent, or an approved person acting for it or on its behalf, for a breach of a requirement made under the Act, including the Principles, Statements of Principle and rules (see DEPP 6 and EG 75);

      5
    6. (f)

      apply to court for an injunction, restitution order or insolvency order (see EG 10, EG 11 and EG 135); and

      5
    7. (g)

      prosecute any criminal offence that the FCA11 has power to prosecute under the Act (see EG 125).

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SUP 15.3.23 D

3The Society must immediately inform the FCA11 in writing if it becomes aware that any matter likely to be of material concern to the FCA11 may have arisen in relation to:

26 26
  1. (1)

    the regulated activities for which the Society has permission; or

  2. (2)

    underwriting agents; or

  3. (3)

    approved persons or individuals acting for or on behalf of underwriting agents.

SUP 15.3.24 D

3The Society must inform the FCA11 if it commences investigations or disciplinary proceedings relating to apparent breaches:

26 26
  1. (1)

    of the Act or requirements made under the Act, including the threshold conditions or the Principles or other rules, by an underwriting agent; or

  2. (2)

    of the Statements of Principle by an individual or other person who carries out controlled functions for or on behalf of an underwriting agent.

SUP 15.3.25 D

3The Society must inform the FCA11 if it commences investigations or disciplinary proceedings which do not fall within the scope of SUP 15.3.24 D but which:

26 26
  1. (1)

    involve an underwriting agent, or an approved person who carries out controlled functions for it or on its behalf; or

  2. (2)

    may indicate that an individual acting for or on behalf of an underwriting agent may not be a fit and proper person to perform functions in relation to regulated activities.

UK AIFMs15

SUP 15.3.26 R

15A full-scope UK AIFM must notify the FCA before implementing any material changes to the conditions under which it was granted permission to manage an AIF, in particular to the information it provided in its application for that permission.

[Note: article 10(1) of AIFMD]

SUP 15.3.27 G

15Changes that the FCA would expect to be notified of under SUP 15.3.26 R include:

  1. (1)

    an AIFM being appointed to manage another AIF;

  2. (2)

    the appointment of a different depositary for an AIF the AIFM manages; and

  3. (3)

    the appointment of any new senior personnel if the AIFM is not required to apply for the FCA's approval for that appointment under section 59 of the Act.

SUP 15.3.27A R

19A full-scope UK AIFM must notify the FCA of material changes under SUP 15.3.26 R in the following manner:

  1. (1)

    for the management of a new AIF or a new investment compartment of an AIF, by using the form in SUP 15 Annex 6A R;

  2. (2)

    for changes of senior personnel whose appointment is not required to be approved by the FCA under section 59 of the Act, by using the form in SUP 15 Annex 6B R; and

  3. (3)

    for all other material changes, by using the form in SUP 15 Annex 6C R .

SUP 15.3.28 R

15Where a small authorised UK AIFM no longer meets the conditions in regulation 917 (meaning of “small AIFM”)19 of the AIFMD UK regulation it must:

17 16 19
  1. (1)

    immediately notify the FCA using the form in SUP 15 Annex 6D R;19 and

  2. (2)

    within 30 calendar days, apply to the FCA for a variation of its permission to become a full-scope UK AIFM.

[Note: article 3(3) second and third paragraphs of AIFMD]

SUP 15.3.29 R
  1. (1)

    19A small authorised UK AIFM must notify the FCA before it starts to manage a new AIF or a new investment compartment of an AIF using the form in SUP 15 Annex 6A R.

  2. (2)

    (1) does not apply where:

    1. (a)

      the management of the new AIF or investment compartment would result in the AIFM exceeding the relevant threshold of assets under management so that it will no longer meet the conditions in regulation 9 (meaning of "small AIFM") of the AIFMD UK regulation (see SUP 15.3.28 R); or

    2. (b)

      the AIF is a EuSEF or EuVECA (see SUP 15.3.31 G).

SUP 15.3.30 D

  1. (1)

    19A small registered UK AIFM must notify the FCA of changes in the following manner:

    1. (a)

      for the management of a new AIF or a new investment compartment of an AIF, by using the form in SUP 15 Annex 6A R;

    2. (b)

      (a) does not apply where:

      1. (i)

        the management of the new AIF or investment compartment would result in the AIFM exceeding the relevant threshold of assets under management so that it will no longer meet the conditions in regulation 9 (meaning of "small AIFM") of the AIFMD UK regulation (see (2)); or

      2. (ii)

        the AIF is a EuSEF or EuVECA (see SUP 15.3.31 G);

  2. (2)

    if it no longer meets the conditions in regulation 9 (meaning of “small AIFM”) of the AIFMD UK regulation, by using the form in SUP 15 Annex 6D R; and

  3. (3)

    if it ceases to meet the conditions for registration in regulation 15(1) (small registered AIFMs ceasing to meet the requirements for registration), by using the form in SUP 15 Annex 6E D.

SUP 15.3.31 G

19A EuSEF manager or a EuVECA manager should notify the FCA of the following changes in the following manner:

  1. (1)

    for changes to senior personnel, by using the form in SUP 15 Annex 6B R; and

  2. (2)

    for changes to the jurisdiction in which its EuSEF or EuVECA is marketed or to market a new EuSEF or EuVECA, by using the form in SUP 15 Annex 6F G

21Competition law infringements

SUP 15.3.32 R
  1. (1)

    21A firm must notify the FCA if it has or may have committed a significant infringement of any applicable competition law.

  2. (2)

    A firm must make the notification as soon as it becomes aware, or has information which reasonably suggests, that a significant infringement has, or may have, occurred.

  3. (3)
    1. (a)

      A firm must make the notification in writing unless (3)(b) applies.

    2. (b)

      A firm may make the notification orally where it has made or will make an oral application for leniency or immunity covering the same subject matter to any competition authority.

SUP 15.3.33 G

21A notification under SUP 15.3.32R should include:

  1. (1)

    information about any circumstances relevant to the infringement or possible infringement;

  2. (2)

    identification of the relevant law; and

  3. (3)

    information about any steps which the firm or other person has taken or intends to take to rectify or remedy the infringement or prevent any future potential occurrence.

SUP 15.3.34 G

21In determining whether a matter is significant, a firm should have regard to the actual or potential effect on competition, any customer detriment, and the duration of any infringement and implications for the firm's systems and controls.

SUP 15.3.35 G
  1. (1)

    21Where a firm notifies the FCA under SUP 15.3.32R, the firm should not infer or assume that any lack of (or delay in) a response, objection or enforcement activity by the FCA or any other competition authority means that the agreement or conduct:

    1. (a)

      does not infringe competition law; or

    2. (b)

      is, or will be, immune from enforcement.

  2. (2)

    Notification under SUP 15.3.32R is not sufficient to constitute an application for leniency or immunity from penalty in any subsequent investigation under Chapter 1 of the Competition Act 1998 or article 101 of the Treaty.

SUP 15.4 Notified persons

SUP 15.4.1 R
  1. (1)

    An overseas firm, which is not an incoming firm, must notify the FCA4 within 30 business days of any person taking up or ceasing to hold the following positions:

    77
    1. (a)

      the firm's worldwide chief executive (that is, the person who, alone or jointly with one or more others, is responsible under the immediate authority of the directors for the whole of its business) if the person is based outside the United Kingdom;

    2. (b)

      the person within the overseas firm with a purely strategic responsibility for UK operations (see SUP 10.7.4 G);

    3. (c)

      for a bank: the two or more persons who effectively direct its business in accordance with SYSC 4.2.2 R ;3

      31
    4. (d)

      for an insurer: the authorised UK representative.

  2. (2)

    The notification in (1) must be submitted in the form set out in2 Form F (SUP 15 Ann 2). However, if the person is an approved person, notification giving details of his name, the approved person's individual reference number and the position to which the notification relates, is sufficient.

    27
SUP 15.4.2 G

SUP 15.4.1 R is not made under the powers conferred on the FCA4 by Part V of the Act (Performance of Regulated Activities). A person notified to the FCA4 under SUP 15.4.1 R is not subject to the Statements of Principle or Code of Practice for Approved Persons, unless he is also an approved person.

7 7 7 7
SUP 15.4.3 G
  1. (1)

    A firm other than a credit union must submit the form in SUP 15 Ann 2 R online 7 using the FCA's4online notification and application system6.

    777552
  2. (2)

    A credit union must submit the form in SUP 15 Ann 2 R in the way set out in SUP 15.7.4 R to SUP 15.7.9 G (Form and method of notification).2

  3. (3)

    Where a firm is obliged to submit an application online under (1), if the FCA's4 information technology systems fail and online submission is unavailable for 24 hours or more, until such time as facilities for online submission are restored, a firm must submit the form in SUP 15 Ann 2 R, in the way set out in SUP 15.7.4 R to SUP 15.7.9 G (Form and method of notification).2

    77
SUP 15.4.3A G
  1. (1)

    If the FCA's4 information technology systems fail and online submission is unavailable for 24 hours or more, the FCA4 will endeavour to publish a notice on its website confirming that online submission is unavailable and that the alternative methods of submission set out in SUP 15.4.3R(3) and SUP 15.7.4R to SUP 15.7.9G (Form and method of notification) should be used.2

    7777
  2. (2)

    Where SUP 15.4.3R (3) applies to a firm, GEN 1.3.2 R (Emergency) does not apply.2

SUP 15.4.4 G

If adverse information is revealed about a person notified to the FCA4 under SUP 15.4.1 R, the FCA4 may exercise its own-initiative power against the firm (see SUP 7 (Individual requirements)).

7 7 7 7

SUP 15.5 Core information requirements

Change in name

SUP 15.5.1 R

A firm must give the FCA4 reasonable advance notice of a change in:

8 8
  1. (1)

    the firm's name (which is the registered name if the firm is a body corporate);

  2. (2)

    any business name under which the firm carries on a regulated activity or ancillary activity either from an establishment in the United Kingdom or with or for clients in the United Kingdom.

SUP 15.5.2 G

A notification under SUP 15.5.1 R should include the details of the proposed new name and the date on which the firm intends to implement the change of name.

SUP 15.5.3 G

Firms are reminded that certain name changes (for example, to include 'Limited') may also require a notification under SUP 15.5.1R7.

8

Change in address

SUP 15.5.4 R

A firm must give the FCA4 reasonable advance notice of a change in any of the following addresses, and give details of the new address and the date of the change:

8 8
  1. (1)

    the firm's principal place of business in the United Kingdom;

  2. (2)

    in the case of an overseas firm, its registered office (or head office) address.

Change in telephone numbers

SUP 15.5.5 R

A firm must give the FCA4 reasonable advance notice of a change in any of the following telephone numbers, and give details of the new telephone number and the date of the change:

1 3 8 8
  1. (1)

    the number of the firm's principal place of business in the United Kingdom;

  2. (2)

    in the case of an overseas firm, the number of its head office.3

SUP 15.5.6 G

SUP 15.5.4 R and SUP 15.5.5 R mean that a firm should notify the FCA4 of a change in telephone number even if the address of the office is not changing.3

1 3 8 8

Other regulators

SUP 15.5.7 R

A firm must notify the FCA4 immediately if it becomes subject to or ceases to be subject to the supervision of any overseas regulator (including a Home State regulator).

8 8
SUP 15.5.8 G

The FCA's4 approach to the supervision of a firm is influenced by the regulatory regime and any legislative or foreign provisions to which that firm, including its branches, is subject.

8 8

Submitting notifications to the appropriate regulator8

SUP 15.5.9 R
  1. (1)

    2A firm other than:5

    5
    1. (a)

      a credit union; or5

    2. (b)

      an FCA-authorised person with permission to carry on only credit-related regulated activity;5

    must submit any notice under6SUP 15.5.1R, SUP 15.5.4Rand8SUP 15.5.5 R3 by submitting the form in SUP 15 Ann 3R online at the FCA's4 website.8

    88
  2. (2)

    A credit union or an FCA-authorised person with permission to carry on only credit-related regulated activity (other than a firm with only an interim permission to which the modifications to SUP 15 in CONC 12 apply)5 must submit any notice under SUP 15.5.1R, SUP 15.5.4R, SUP 15.5.5 R3 and SUP 15.5.7R by submitting the form in SUP 15 Ann 3R in the way set out in SUP 15.7.4R to SUP 15.7.9G (Form and method of notification).

  3. (3)

    Where a firm is obliged to submit a notice online under (1), if the FCA's4appropriate regulator's8 information technology systems fail and online submission is unavailable for 24 hours or more, until such time as facilities for online submission are restored, a firm must submit any notice under SUP 15.5.1R, SUP 15.5.4R and SUP 15.5.5 R3 in the form in SUP 15 Ann 3R and in the way set out in SUP 15.7.4R to SUP 15.7.9G (Form and method of notification).

    88
  4. (4)

    8A firm must submit any notice required under SUP 15.5.7 R by submitting the form in SUP 15 Ann 4 in the way set out in SUP 15.7.4 R to SUP 15.7.9 G (Form and method of notification).

SUP 15.5.10 G
  1. (1)

    If the FCA's4 information technology systems fail and online submission is unavailable for 24 hours or more, the FCA4 will endeavour to publish a notice on its website confirming that online submission is unavailable and that the alternative methods of submission set out in SUP 15.5.9R(3) and SUP 15.7.4R to SUP 15.7.9G (Form and method of notification) should be used.

    8888
  2. (2)

    Where 8SUP 15.5.9R (2)8 applies to a firm, GEN 1.3.2 R (Emergency) does not apply.

SUP 15.6 Inaccurate, false or misleading information

SUP 15.6.1 R

A firm must take reasonable steps to ensure that all information it gives to the FCA3 in accordance with a rule in any part of the Handbook (including Principle 11) is:

6 6
  1. (1)

    factually accurate or, in the case of estimates and judgments, fairly and properly based after appropriate enquiries have been made by the firm; and

  2. (2)

    complete, in that it should include anything of which the FCA3 would reasonably expect notice.

    66
SUP 15.6.2 G

SUP 15.6.1 R applies also in relation to rules outside this chapter, and even if they are not notification rules. Examples of rules and chapters to which SUP 15.6.1 R is relevant, are:

  1. (1)

    Principle 11, and the guidance on Principle 11 in SUP 2 (Information gathering by the FCA and PRA66 on their6 own initiative);

    6
  2. (2)

    SUP 15 (Notifications to the FCA3):

    66
  3. (3)

    SUP 16 (Reporting requirements);

  4. (4)

    SUP 17 (Transaction reporting);

    1
  5. (5)

    any notification rule (see Schedule 2 which contains a consolidated summary of such rules);1

    2
  6. (6)

    DISP 1.9 (Complaints record rule); and21

  7. (7)

    DISP 1.10 (Complaints reporting rule).2

SUP 15.6.3 G

If a firm is unable to obtain the information required in SUP 15.6.1 R(2), then it should inform the FCA3 that the scope of the information provided is, or may be, limited.

6 6
SUP 15.6.4 R

If a firm becomes aware, or has information that reasonably suggests that it has or may have provided the FCA3 with information which was or may have been false, misleading, incomplete or inaccurate, or has or may have changed in a material particular, it must notify the FCA3 immediately. Subject to SUP 15.6.5 R, the notification must include:

6 6 6 6
  1. (1)

    details of the information which is or may be false, misleading, incomplete or inaccurate, or has or may have changed;

  2. (2)

    an explanation why such information was or may have been provided; and

  3. (3)

    the correct information.

SUP 15.6.5 R

If the information in SUP 15.6.4 R (3) cannot be submitted with the notification (because it is not immediately available), it must instead be submitted as soon as possible afterwards.

SUP 15.6.6 G

The FCA3 may request the firm to provide revised documentation containing the correct information, if appropriate.

6 6
SUP 15.6.6A G

4 SUP 15.11.13R(4) adjusts the time when, and how, a relevant authorised person should make updates under SUP 15.6.4R about notifications under section 64C of the Act (Notification of disciplinary action against certain employees).

SUP 15.6.7 G

Firms are reminded that section 398 of the Act (Misleading the FCA or PRA:6 residual cases) makes it an offence for a firm knowingly or recklessly to provide the FCA3 with information which is false or misleading in a material particular in purported compliance with the FCA's3rules or any other requirement imposed by or under the Act. An offence by a body corporate, partnership or unincorporated association may be attributed to an officer or certain other persons (section 400 of the Act (Offences by bodies corporate etc)).

6 6 6 6 6

SUP 15.7 Form and method of notification

Form of notification: oral or written

SUP 15.7.1 R

A notification required from a firm under any notification rule must be given in writing, and in English, and must be submitted on the form specified for that notification rule, or if no form is specified, on the form inSUP 15 Ann 4 R3 (Notification form), and must give the firm's Firm Reference Number unless:2

3 5
  1. (1)

    the notification rulestates otherwise; or

  2. (2)

    the notification is provided solely in compliance with Principle 11 (see SUP 15.3.7 G).

SUP 15.7.2 G

A firm should have regard to the urgency and significance of a matter and, if appropriate, should also notify its usual supervisory contact at the FCA4 by telephone or by other prompt means of communication, before submitting a written notification. Oral notifications should be given directly to the firm's usual supervisory contact at the FCA.4 An oral notification left with another person or left on a voicemail or other automatic messaging service is unlikely to have been given appropriately.2

5 5 5
SUP 15.7.3 G

The FCA4 is entitled to rely on any information it receives from a firm and to consider any notification received as being made by a person authorised by the firm to do so. A firm should therefore consider whether it needs to put procedures in place to ensure that only appropriate employees make notifications to the FCA4 on its behalf.

5 5 5 5

Method of notification

SUP 15.7.4 R

Unless stated in the notification rule, or on the relevant form (if specified), a written notification required from a firm under any notification rule must be:2

  1. (1)

    given to or addressed for the attention of the firm's usual supervisory contact at the FCA4 and

    55
  2. (2)

    delivered to the FCA4 by one of the methods in SUP 15.7.5A R or SUP 15.7.5B R as applicable:5

    55
SUP 15.7.5 R

[deleted]5

SUP 15.7.5A R

5Methods of notification

Method of delivery

1.

Post to the appropriate address in SUP 15.7.6A G

2.

Leaving the notification at the appropriate address in SUP 15.7.6A G and obtaining a time-stamped receipt

3.

Electronic mail to an address for the firm's usual supervisory contact at the FCA and obtaining an electronic confirmation of receipt

4.

Hand delivery to the firm's usual supervisory contact at the FCA

5.

Fax to a fax number for the firm's usual supervisory contact at the FCA and receiving a successful transmission report for all pages of the notification

6.

Online submission via the FCA's website at www.fca.org.uk.

SUP 15.7.6 G

[deleted]51

SUP 15.7.6A G

5The current published address of the FCA for postal submission or hand delivery of notifications is:

  1. (1)

    The Financial Conduct Authority

    25 The North Colonnade London

    Canary Wharf

    E14 5HS

    if the firm's usual supervisory contact at the FCA is based in London, or

  2. (2)

    The Financial Conduct Authority

    Quayside House 127

    Fountainbridge

    Edinburgh EH3 8DJ

    if the firm's usual supervisory contact at the FCA is based in Edinburgh.5

SUP 15.7.7 G

If the firm or its group is subject to lead supervision arrangements by the FCA4 the firm or group may give or address a notice under SUP 15.7.4 R(1) to the supervisory contact at the FCA4 designated as lead supervisor, if the firm has chosen to make use of the lead supervisor as a central point of contact (see SUP 1.5).

5 5 5 5
SUP 15.7.8 G

If a firm is a member of a group which includes more than one firm, any one undertaking in the group may notify the FCA4 on behalf of all firms in the group to which the notification applies. In this way, that undertaking may satisfy the obligation of all relevant firms in the group to notify the FCA.4 Nevertheless, the obligation to make the notification remains the responsibility of the individual firm itself. See also SUP 15.7.3 G.

5 5 5 5
SUP 15.7.9 G

Firms wishing to communicate with the FCA4 by electronic mail or fax should obtain the appropriate address or number from the FCA4appropriate regulator.5

5 5 5

Timely notification

SUP 15.7.10 R

If a notification rule requires notification within a specified period:

  1. (1)

    the firm must give the notification so as to be received by the FCA4 no later than the end of that period; and

    55
  2. (2)

    if the end of that period falls on a day which is not a business day, the notification must be given so as to be received by the FCA4 no later than the first business day after the end of that period.

    55
SUP 15.7.11 G

If a notification rule does not require notification within a specified period, the firm should act reasonably in deciding when to notify.

Underwriting agents: notification to the Society of Lloyd's

SUP 15.7.12 R
  1. (1)

    [deleted]5

    5
  2. (2)

    [deleted]5

    5
SUP 15.7.13 G

[deleted]5

5
SUP 15.7.14 G

The FCA4 has made arrangements with the Society of Lloyd's with respect to the monitoring of underwriting agents. Underwriting agents should check whether these arrangements provide for any notifications required under this chapter to be sent to the Society instead of to the FCA.4 [For further details see the FCA's4 website.]

5 5 5 5 5 5

Consequences of breach of form and method rules

SUP 15.7.15 G

If a firm fails to comply with the rules in this section then the notification is invalid and there may be a breach of the rule that required the notification to be given.

Service of Notices Regulations

SUP 15.7.16 G

The Financial Services and Markets Act 2000 (Service of Notices) Regulations 2001 (SI 2001/1420) contain provisions relating to the service of documents on the FCA4. They do not apply to notifications required under notification rules because of the specific rules in this section.

5 5

SUP 15.8 Notification in respect of particular products and services

Management of occupational pension scheme assets

SUP 15.8.1 R

7 3A firm which manages the assets of an occupational pension scheme must notify the FCA19 as soon as reasonably practicable if it receives any request or instruction from a trustee which it:

19
  1. (1)

    knows; or

  2. (2)

    on substantial grounds:

    1. (a)

      suspects; or

    2. (b)

      has cause reasonably to suspect;

is at material variance with the trustee's duties.1

Individual Pension Accounts

SUP 15.8.2 R

If a firm begins or ceases to administer individual pension accounts, it must notify the FCA19 as soon as reasonably practicable that it has done so.52

19

Insurers' commission clawback

SUP 15.8.3 R
  1. (1)

    An insurer must notify the FCA19in respect of any firm (the "intermediary") as soon as reasonably practicable if:

    19
    1. (a)

      any amount of commission due from the intermediary to the insurer in accordance with an indemnity commission clawback arrangement remains outstanding for four months after the date when the insurer gave notice to the intermediary that the relevant premium had not been paid; or

    2. (b)

      any amount of commission due from the intermediary to the insurer as a result of either the cancellation of an investment agreement or overpayment of commission remains outstanding for four months after the date on which the insurer gave notice to the intermediary that cancellation or overpayment had occurred.

  2. (2)

    A notification in (1):

    1. (a)

      need not be given unless the total amounts outstanding under (1)(a) and (b) in respect of the intermediary exceed £1,000; and

    2. (b)

      must give the identity of the intermediary and the amount of commission which remains outstanding.

  3. (3)

    In (1) an "indemnity commission clawback arrangement" is an arrangement under which:

    1. (a)

      an insurer pays commission to an intermediary before the date on which the premium is due under the relevant investment agreement; and

    2. (b)

      the insurer requires repayment of the commission, if the investment agreement is terminated by reason of a failure to pay a premium.

11Money service business and trust or company service providers11

SUP 15.8.4 G
  1. (1)

    467In accordance with regulation 2317 of the Money Laundering Regulations, with effect from 26 June 201717 , a firm is required to notify the FCA:19

    1111111119
    1. (a)

      before it begins or within 28 days of it beginning11; and

    2. (b)

      immediately11 after it ceases;

      11

    to operate a money service business or a trust or company service provider.11

    11
  2. (2)

    The notification referred to in (1) should be made in accordance with the requirements in SUP 15.7 (Form and method of notification)

SUP 15.8.5 G

4 6 7A firm which is already operating a money service business or a trust or company service provider11 immediately before 26 June 201717 is required by the Money Laundering Regulations to notify the FCA19 of that fact within 30 days17 and should do so in the manner specified in SUP 15.8.4 G(2)17.

11 11 11 19 11

Delegation by UK UCITS management companies14

SUP 15.8.6 R

If a UK UCITS management company intends to delegate to a third party any one or more of its functions for the more efficient conduct of its business, it must first inform the FCA19 in an appropriate manner.14

14 19

[Note: article 13(1)(a) of the UCITS Directive]14

SUP 15.8.7 G

A UK UCITS management company14 which delegates any of its functions to a third party must, as well as complying with SUP 15.8.6 R,13 comply with the requirements in SYSC 8.1.13 R (Additional requirements for a management company) and COLL 6.6.15 A R.14

13 8 13

9CTF providers

SUP 15.8.8 R
  1. (1)

    9If a firm begins or ceases to hold itself out as acting as a CTF provider, it must notify the FCA19 as soon as reasonably practicable that it has done so.

    19
  2. (2)

    A firm that acts as a CTF provider must provide theFCA,19 as soon as reasonably practicable, with details of:

    19
    1. (a)

      any third party administrator that it engages;

    2. (b)

      details of whether it intends to offer HMRC allocated CTFs12; and

      12
    3. (c)

      whether it intends to provide its own stakeholder CTF account.

SUP 15.8.9 R

10A BIPRUfirm must report to the FCA15 immediately any case in which its counterparty in a repurchase agreement or reverse repurchase agreement or securities or commodities lending or borrowing transaction defaults on its obligations.

19 19

MCD credit intermediaries

SUP 15.8.10 R

16A tied MCD credit intermediary must notify the FCA, as soon as reasonably practicable, if it intends to cease acting on behalf of and under the full responsibility of any firm.

SUP 15.8.11 R

16A MCD credit intermediary must notify the FCA, as soon as reasonably practicable, if it intends to start acting on behalf of and under the full responsibility of any firm.

SUP 15.9 1Notifications by members of financial conglomerates

SUP 15.9.1 R

A firm that is a regulated entity must notify the FCA2 immediately it becomes aware that any consolidation group of which it is a member:

4 4
  1. (1)

    is a financial conglomerate; or

  2. (2)

    has ceased to be a financial conglomerate.

SUP 15.9.2 R
  1. (1)

    A firm that is a regulated entity must establish whether or not any consolidation group of which it is a member:

    1. (a)

      is a financial conglomerate; or

    2. (b)

      has ceased to be a financial conglomerate;

    if:

    1. (c)

      the firm believes; or

    2. (d)

      a reasonable firm that is complying with the requirements of the regulatory system would believe;

    that it is likely that (a) or (b) is true.

  2. (2)

    A firm does not need to determine whether (1)(a) is the case if the consolidation group is already being regulated as a financial conglomerate.

  3. (3)

    A firm does not need to determine whether (1)(b) is the case if notification has already been given as contemplated by SUP 15.9.4 R.

SUP 15.9.3 G

A firm should consider the requirements in SUP 15.9.2 R on a continuing basis, and in particular, when the group prepares its financial statements and on the occurrence of an event affecting the consolidated group. Such events include, but are not limited to, an acquisition, merger or sale.

SUP 15.9.4 R

A firm does not have to give notice to the FCA2 under SUP 15.9.1 R if it or another member of the consolidation group has already given notice of the relevant fact to:

4 4
  1. (1)

    the FCA2 or

    44
  2. (2)

    (if another competent authority is co-ordinator of the financial conglomerate ) that competent authority; or

  3. (3)

    (in the case of a financial conglomerate that does not yet have a co-ordinator ) the competent authority who would be co-ordinator under Article 10(2) of the Financial Groups Directive (Competent authority responsible for exercising supplementary supervision (the co-ordinator)).

SUP 15.9.5 R
  1. (1)

    3A firm must, at the level of the EEA financial conglomerate, regularly provide the FCA2 with details on the financial conglomerate's legal structure and governance and organisational structure, including all regulated entities, non-regulated subsidiaries and significant branches.

  2. (2)

    A firm must disclose publicly, at the level of the EEA financial conglomerate, on an annual basis, either in full or by way of references to equivalent information, a description of the financial conglomerate's legal structure and governance and organisational structure.

  3. (3)

    For the purposes of (1) and (2), where a firm is a member of an EEA financial conglomerate which is part of a wider UK regulated EEA financial conglomerate, reporting applies only at the level of the EEA parent mixed financial holding company or ultimate EEA mixed financial holding company.

SUP 15.10 3Reporting suspicious transactions or orders (market abuse)1

SUP 15.10.1 R

[deleted]3

3Notification of suspicious transactions or orders: general

SUP 15.10.2 R

[deleted]3

2 4 4
SUP 15.10.2A EU

3[article 16 of the Market Abuse Regulation.]

Notification of suspicious transactions: investment firms and credit institutions

SUP 15.10.3 R

[deleted]3

SUP 15.10.4 G
  1. (1)

    Notification of suspicious transactions or orders3 to the FCA requires sufficient indications (which may not be apparent until after the transaction has taken place) that the transaction or order3 might constitute market abuse. In particular a person subject to article 16 of the Market Abuse Regulation3 will need to be able to explain the basis for the3 suspicion when notifying the FCA. Certain transactions or orders3 by themselves may seem completely devoid of anything suspicious, but might deliver such indications of possible market abuse, when seen in perspective with other transactions, certain behaviour or other information (though persons subject to article 16 of the Market Abuse Regulation3 are not expected to breach effective information barriers put in place to prevent and avoid conflicts of interest so as actively to seek to detect suspicious transactions).3

    444444
  2. (2)

    Assistance in identifying the elements constituting market abuse can be found within the Market Abuse Regulation3.

3Timeframe for notification

SUP 15.10.5 R

[deleted]3

3Content of notification

SUP 15.10.6 R

[deleted]3

3Means of notification

SUP 15.10.7 G

3A person subject to article 16 of the Market Abuse Regulation making a notification to the FCA under this section may do so using the system indicated on the FCA’s website.

SUP 15.10.8 G

[deleted]3

SUP 15.10.9 R

[deleted]3

4 4

SUP 15.11 Notification of COCON breaches and disciplinary action1

Reasons for making a notification to the FCA

SUP 15.11.1 G

1Under section 64A of the Act, the FCA may make rules about the conduct of approved persons and certain other 4persons who work for a firm4.

SUP 15.11.2 G

COCON sets out rules under section 64A of the Act4and guidance on those rules for relevant authorised persons and insurers4.

SUP 15.11.3 G

[deleted]2

SUP 15.11.4 G

Under section 64C of the Act, a firm must notify the FCA if it takes disciplinary action against certain people working for a relevant authorised person4 and the reason for this action is a reason specified in rules made by the FCA (those rules are set out4 in SUP 15.11.6R)4.

SUP 15.11.5 G

Disciplinary action against a person4 is defined in section 64C of the Act as the issuing of a formal written warning, the suspension or dismissal of that person4 or the reduction or recovery of any of such person's remuneration.

SUP 15.11.6 R

If a reason for taking the disciplinary action is any action, failure to act or circumstance that amounts to a breach of COCON, then the relevant authorised person4is required to notify the FCA of the disciplinary action.

SUP 15.11.6A G

4The effect of section 64C of the Act and SUP 15.11.6R is that the reporting obligation in section 64C of the Act and in this section:

  1. (a)

    only applies to relevant authorised persons; and

  2. (b)

    only covers persons who are subject to COCON (who are called conduct rules staff in the FCA Handbook) rather than to the whole workforce of a relevant authorised person.

SUP 15.11.7 G

A firm should make a separate notification about a person under section 64C of the Act where:

  1. (1)

    it has made a notification to the FCA about a person pursuant to SUP 15.3.11R(1)(a) because of a breach of COCON2; and

  2. (2)

    it subsequently takes disciplinary action against the person for the action, failure to act, or circumstance, that amounted to a breach of COCON.

SUP 15.11.8 G

If, after a firm has made a notification for a person (A) pursuant to section 64C of the Act,2 it becomes aware of facts or matters which cause it to change its view that A has breached COCON, or cause it to determine that A has breached a provision of COCON other than the provision to which the notification related, the firm should inform the FCA of those facts and matters and its revised conclusion in line with a firm’s obligation to comply with Principle 11, SUP 15.6.4R and, if applicable, SUP 10C or SUP 15.11.13R(4)3.

2
SUP 15.11.9 G

If a firm takes disciplinary action as a result of a conduct breach (see SUP 15.11.6R) against an employee but the employee has appealed or plans to appeal, the firm should still report the disciplinary action under section 64C of the Act but should include the appeal in the notification. The firm should update the FCA on the outcome of any appeal.2

SUP 15.11.10 G

[deleted]2

SUP 15.11.11 G

In relation to any conduct rules staff, the FCA does not expect a firm to notify it pursuant to2 section 64C of the Act if the2 breach of COCON occurred before the application of COCON to that firm.

Timing and form of notifications: SMF managers

SUP 15.11.12 G

Where a firm is required to notify the FCA pursuant to2 section 64C of the Act and that notification relates to an SMF manager, SUP 10C sets out how and when the notification must be made, and the relevant notification rules in SUP 10C apply.

Timing and form of notifications: conduct rules staff other than SMF managers

SUP 15.11.13 R
  1. (1)

    A firm must make any notifications required pursuant to section 64C of the Act relating to conduct rules staff other than SMF managers4in accordance with SUP 15.11.13R to SUP 15.11.15R.3

  2. (2)

    That notification must be made annually.3

  3. (3)

    Each notification must:3

    1. (a)

      cover the 12 month period ending on the last day of August; and3

    2. (b)

      be submitted to the FCA:3

      1. (i)

        within two months of the end of the reporting period; or3

      2. (ii)

        (if the end of the reporting period in (b)(i) falls on a day which is not a business day) so as to be received no later than the first business day after the end of that period.3

  4. (4)

    SUP 15.6.4R and SUP 15.6.5R (updates to a notification that is or has become incorrect) apply to a notification under this rule but the firm must include the update or correction in the next notification it is due to make under this rule rather than in the time and manner otherwise required for notifications under those rules.3

  5. (5)

    If a firm (other than a credit union) has nothing to report under section 64C of the Act and nothing to report under SUP 15.11.13R(4) for a particular reporting period, it must notify the FCA of that fact in accordance with SUP 15.11.13R to SUP 15.11.14R.3

2
SUP 15.11.13A G

3 SUP 15.11.8G gives examples of when a notification should be updated under SUP 15.11.13R(4).

SUP 15.11.14 R
  1. (1)

    A firm other than a credit union must make each notification pursuant to SUP 15.11.13R (notifications about section 64C of the Act relating to conduct rules staff other than SMF managers4) by submitting it online through the FCA’s website using the electronic system made available by the FCA for this purpose.3

  2. (2)

    A firm must use the version of Form H (named REP008 – Notification of Disciplinary Action) 4made available on the electronic system referred to in (1), which is based on the version found in SUP 15 Annex 7R.3

  3. (3)

    If the information technology systems used by the FCA fail and online submission is unavailable for 24 hours or more, SUP 15.11.15R applies until such time as the facilities for online submission are restored.3

2
SUP 15.11.14A G
  1. (1)

    3If the information technology systems used by the FCA fail and online submission is unavailable for 24 hours or more, the FCA will endeavour to publish a notice on its website confirming that:

    1. (a)

      online submission is unavailable; and

    2. (b)

      the alternative methods of submission in SUP 15.11.15R apply.

  2. (2)

    Where SUP 15.11.14R(3) applies to a firm, GEN 1.3.2R (Emergency) does not apply.

SUP 15.11.15 R

A credit union3 must make each notification pursuant to2SUP 15.11.13R (notifications about3 section 64C of the Act relating to conduct rules staff other than SMF managers4) in accordance with the rules and guidance in SUP 15.7, using Form H as set out in SUP 15 Annex 7R3.

3

General guidance on notifications of rule breaches and disciplinary action

SUP 15.11.16 G

[deleted]4

3 3 3 2
SUP 15.11.17 G

The obligation to notify pursuant to2 section 64C of the Act or to update or correct a notification under SUP 15.11.13R(4)3 does not replace or limit a firm’s obligation to comply with Principle 11.

SUP 15.11.18 G

When considering whether to make a notification pursuant to2 section 64C of the Act, a firm should also consider whether a notification should be made under any notification rules, including, without limitation, any notification rules that require a notification to be made to the PRA.

SUP 15.11.19 G

The obligations to make a notification pursuant to2 section 64C of the Act apply notwithstanding any agreement (for example a 'COT 3' Agreement settled by the Advisory, Conciliation and Arbitration Service (ACAS)) or any other arrangements entered into by a firm and an employee upon termination of the employee's employment. A firm should not enter into any such arrangements or agreements that could conflict with its obligations under this section.

SUP 15.11.20 G

Failing to disclose relevant information to the FCA may be a criminal offence under section 398 of the Act.

SUP 15.12 1Ongoing alerts for retail adviser complaints

SUP 15.12.1 R
  1. A firm must notify the FCA, using the form in SUP 15 Annex 8R, where:

    1. (a)

      in any 12-month period, it has upheld three complaints about matters relating to activities carried out by any one employee when acting as a retail investment adviser; or

    2. (b)

      it has upheld a complaint about matters relating to activities carried out by any one employee when acting as a retail investment adviser, where the redress paid exceeds £50,000.

  2. (2)

    A notification made under (1)(a) must be made by the end of the period of 20 business days, beginning on the day on which the firm upheld the third complaint.

  3. (3)

    A notification made under (1)(b) must be made by the end of the period of 20 business days, beginning on the day on which the firm upheld the complaint.

SUP 15.12.2 R

For the purpose of SUP 15.12.1R:

  1. (1)

    when calculating the number of complaints in SUP 15.12.1R(1)(a), the firm should exclude complaints previously notified to the FCA under this rule;

  2. (2)

    redress, under SUP 15.12.1R(1)(b), should be interpreted to include an amount paid, or cost borne, by the firm, where a cash value can be readily identified, and should include:

    1. (a)

      amounts paid for distress and inconvenience;

    2. (b)

      a free transfer out to another provider for which a transfer would normally be paid for;

    3. (c)

      goodwill payments and gestures;

    4. (d)

      interest on delayed settlements;

    5. (e)

      waiver of an excess on an insurance policy; and

    6. (f)

      payments to put the consumer back into the position the consumer should have been in had the act or omission not occurred; and

  3. (3)

    the amount of redress paid under SUP 15.12.1R(1)(b) should not include repayments or refunds of premiums which have been taken in error (for example, where a firm has been taking, by direct debit, twice the actual premium amount due under a policy) and the refund of the overcharge would not count as redress.

[Note: See DISP 1.10.2AR for the duty to notify complaints under the complaints reporting rules]

SUP 15.12.3 R

Notifications under SUP 15.12.1R must be made electronically using a method of notification prescribed by the FCA.

SUP 15.13 1Notification by CBTL firms

Application and purpose

SUP 15.13.1 G

This section sets out guidance for CBTL firms to assist them in complying with their obligation to notify the FCA immediately if they cease to satisfy any condition for registration in article 8(2) or 8(3) of the MCD Order.

[Note: article 12 of the MCD Order]

SUP 15.13.2 G

The nature of a CBTL firm's obligation under article 12 of the MCD Order will depend on whether the CBTL firm has a Part 4A permission to carry on one or more regulated activities.

CBTL firms which have Part 4A permission

SUP 15.13.3 G

The circumstances in which a CBTL firm which has a Part 4A permission should notify the FCA include but are not limited to when:

  1. (1)

    it ceases to carry on CBTL business and does not propose to resume carrying on CBTL business in the immediate future. This does not include circumstances where the CBTL firm temporarily withdraws its products from the market or is preparing to launch fresh products; or

  2. (2)

    it applies to cancel its Part 4A permission; or

  3. (3)

    it applies to vary its Part 4A permission so that once the variation takes effect it will cease to hold any Part 4A permission; or

  4. (4)

    it receives a final notice to cancel its Part 4A permission; or

  5. (5)

    it receives a second supervisory notice to vary its Part 4A permission so that once the variation takes effect it will cease to hold any Part 4A permission.

CBTL firms which do not have a Part 4A permission

SUP 15.13.4 G

The circumstances in which a CBTL firm which does not have a Part 4A permission should notify the FCA include but are not limited to when:

  1. (1)

    it ceases to carry on CBTL business and does not propose to resume carrying on CBTL business in the immediate future; this does not include circumstances where the CBTL firm temporarily withdraws its products from the market or is preparing to launch fresh products; or

  2. (2)

    it changes its registered office or place of residence as the case may be so that it is no longer in the United Kingdom; or

  3. (3)

    any individual responsible for the management or operation of the CBTL business within the CBTL firm:

    1. (a)

      is convicted of any offence involving fraud or dishonesty or any indictable offence, including any act or omission which would have been an offence if it had taken place in the United Kingdom; or

    2. (b)

      becomes subject to a prohibition order; or

  4. (4)

    it takes on an individual to be responsible for the management or operation of the CBTL business within the CBTL firm who has been:

    1. (a)

      convicted of any offence involving fraud or dishonesty or any indictable offence, including any act or omission which would have been an offence if it had taken place in the United Kingdom; or

    2. (b)

      is subject to a prohibition order; or

  5. (5)

    (if the CBTL firm is an undertaking) any person who:

    1. (a)

      holds 10% or more of the shares in the CBTL firm or in a parent undertaking of the CBTL firm; or

    2. (b)

      holds 10% or more of the voting power in the CBTL firm or in a parent undertaking of the CBTL firm; or

    3. (c)

      holds shares or voting power in the CBTL firm or in a parent undertaking of the CBTL firm as a result of which he is able to exercise significant influence over the management of the CBTL firm;

ceases to be a fit and proper person having regard to the need to ensure the sound and prudent conduct of the affairs of the CBTL firm; or

  1. (6)

    (if the CBTL firm is an undertaking) any person who is not a fit and proper person, having regard to the need to ensure the sound and prudent conduct of the affairs of the CBTL firm, acquires an interest such that he:

    1. (a)

      holds 10% or more of the shares in the CBTL firm or in a parent undertaking of the CBTL firm; or

    2. (b)

      holds 10% or more of the voting power in the CBTL firm or in a parent undertaking of the CBTL firm; or

    3. (c)

      holds shares or voting power in the CBTL firm or in a parent undertaking of the CBTL firm as a result of which he is able to exercise significant influence over the management of the CBTL firm; or

  2. (7)

    any of the following persons cease to be of good repute:

    1. (a)

      a person responsible for the management of the CBTL firm; or

    2. (b)

      a person responsible for the CBTL firm’sCBTL business; or

    3. (c)

      a director of the CBTL firm (if the CBTL firm is a body corporate); or

  3. (8)

    a person who is not of good repute becomes:

    1. (a)

      responsible for the management of the CBTL firm; or

    2. (b)

      responsible for the CBTL firm’sCBTL business; or

    3. (c)

      a director of the CBTL firm (if the CBTL firm is a body corporate); or

  4. (9)

    (if the CBTL firm is a CBTL arranger or a CBTL adviser) it ceases to hold professional indemnity insurance as described in article 8(f) of the MCD Order; or

  5. (10)

    the individuals responsible for the management or operation of the CBTL business of the CBTL firm lack an appropriate level of knowledge or competence in relation to CBTL credit agreements.

Method, form and timing of notifications

SUP 15.13.5 G

Any notification given by a CBTL firm under article 12 of the MCD Order should be:

  1. (1)

    in writing;

  2. (2)

    in English;

  3. (3)

    given to or addressed for the attention of the CBTL firm's usual supervisory contact at the FCA (where the CBTL firm does not have an identified supervisory contact this will be the FCA's Contact Centre);

  4. (4)

    delivered to the FCA by one of the methods in SUP 15.7.5AR to the appropriate address set out in SUP 15.7.6AG; and

  5. (5)

    given by a person who has full knowledge of the facts giving rise to the notification and who is responsible for the management of the CBTL firm or the CBTL firm’sCBTL business.

SUP 15.13.6 G

A notification given under article 12 of the MCD Order should contain at least the following information:

  1. (1)

    the CBTL firm’s name and reference number;

  2. (2)

    the name and telephone, postal and email (where available) contact details of the person responsible for making the notification;

  3. (3)

    a statement that the notification is given under article 12 of the MCD Order;

  4. (4)

    a statement setting out the specific condition of article 8 of the MCD Order that the notification relates to;

  5. (5)

    full details of the facts giving rise to the notification, including in particular when the relevant events occurred and when the CBTL firm became aware of them (if different); and

  6. (6)

    full details of any steps taken or proposed to be taken by the CBTL firm to address the issues giving rise to the obligation to make the notification, including a proposed timeline for the steps, if applicable.

SUP 15.13.7 G

The MCD Order requires notification to be given immediately. The FCA expects CBTL firms to act with all due urgency in notifying it of any relevant event, and it is unlikely that the FCA will regard delay in excess of 5 working days as complying with the CBTL firm's obligations.

SUP 15 Annex 1 1 9Application of SUP 15 to incoming EEA firms and incoming Treaty firms9

R

1 .

SUP 15 applies in full to an incoming EEA firm, or incoming Treaty firm , which has a top-up permission.

2 .

[deleted]13

13

5 2A

[deleted]13

13

3 .

For any other incoming EEA firm or incoming Treaty firm, SUP 15 applies as set out in the following table.

Applicable sections

Application

SUP 15.1 , SUP 15.2

Application, Purpose

Apply in full

SUP 15.3.1 R to SUP 15.3.6 G

Matters having a serious regulatory impact

Apply in so far as responsibility for the matter in question is not reserved by an EU instrument to the firm's Home State regulator 8

8

SUP 15.3.7 G to SUP 15.3.10 G

Communication with the FCA 7 in accordance with Principle 11 13

13

Apply in so far as responsibility for the matter in question is not reserved by an EU 4 instrument to the firm's Home State regulator

4

8 SUP 15.3.11 R 8 to SUP 15.3.14 G

Breaches of rules and other requirements in or under the Act

Apply in full

8 SUP 15.3.15 R 8 to SUP 15.3.16 G

Civil, criminal or disciplinary proceedings against a firm

Apply in so far as responsibility for the matter in question is not reserved by an EU 4 instrument to the firm's Home State regulator

4

8 8 SUP 15.3.17 R to SUP 15.3.20 G

Fraud, errors and other irregularities

Apply in so far as responsibility for the matter in question is not reserved by an EU 4 instrument to the firm's Home State regulator

4

SUP 15.3.2 G

Insolvency, bankruptcy and winding up

Apply in so far as responsibility for the matter in question is not reserved by an EU 4 instrument to the firm's Home State regulator

4

SUP 15.3.32R to SUP 15.3.35G9

Competition law infringements 9

Apply in so far as responsibility for the matter in question is not reserved by an EU instrument to the firm’s Home State regulator 9

SUP 15

Notified persons

Does not apply

SUP 15.5.1 R to SUP 15.5.3 G

Change in name

Apply in full

SUP 15.5.4 R

Change in address: principal place of business in the UK

Applies in full

SUP 15.5.4 R (2)

Change in address: registered office

Applies to an incoming Treaty firm . Does not apply to an incoming EEA firm, but see SUP 14 (Incoming EEA firms: changing authorisation and cancelling qualification for authorisation).

SUP 15.5.5 R to SUP 15.5.6 G

Change in telephone numbers 6

6

Applies in full 6

6

SUP 15.5.7 R and SUP 15.5.8 G

Other regulators

Apply in so far as responsibility for the matter in question is not reserved by an EU 4 instrument to the firm's Home State regulator

4

SUP 15.6

Inaccurate, false or misleading information

Applies in full

SUP 15.7

Form and method of notification

Applies in full

SUP 15.8

Notifications in respect of particular products and services

Applies in full 2

SUP 15.10 3

Reporting suspicious transactions or orders 11 (market abuse) 3

Applies in full subject to article 16 of the Market Abuse Regulation 11

3

10 SUP 15.11

Notification of COCON breaches and disciplinary action

Applies in full

SUP 15 Annex 1A
  1. (1)

    13SUP 15 does not apply to an incoming EEA firm which has permission for cross border services only and which does not carry on regulated activities in the United Kingdom.

  2. (2)

    SUP 15 does not apply to an EEA pure reinsurer which does not have a top-up permission.

SUP 15 Ann 2 Form F: Changes in notified persons3

R

This annex consists only of one or more forms. Forms can be completed online now by visiting: 7the FCA's4 website.7

The forms are also to be found through the following address:

Supervision forms - SUP 15 Annex 26The notes for the form can be found at the following address

Form F notes

5

SUP 15 Ann 3 Standing data form1

R

This annex consists only of one or more forms. Forms can be completed online now by visiting: 3the FCA's2 website.3

The forms are also to be found through the following address:

Standing Data - SUP 15 Annex 3

SUP 15 Ann 4 Notification form1

R

This annex consists only of one or more forms. Forms are to be found through the following address:

Notifications Form - SUP 15 Annex 4

SUP 15 Ann 5 2Indications of Possible Suspicious Transactions or Orders

1

1.

The following examples of indications are intended to be a starting point for consideration of whether a transaction or order2 is suspicious. They are neither conclusive nor comprehensive.

Possible Signals of Insider Dealing

2.

A client opens an account and immediately gives an order to conduct a significant transaction or, in the case of a wholesale client, an unexpectedly large or unusual order, in a particular security - especially if the client is insistent that the order is carried out very urgently or must be conducted before a particular time specified by the client.

3.

A transaction or order2 is significantly out of line with the client's previous investment behaviour (e.g. type of security; amount invested; size of order; time security held).

4.

A client specifically requests immediate execution of an order regardless of the price at which the order would be executed (assuming more than a mere placing of 'at market' order by the client).

5.

There is unusual trading in the shares of a company before the announcement of price sensitive information relating to the company.

6.

An employee's own account transaction is timed just before clients' transactions and related orders in the same financial instrument.

2

7.

[deleted]2

8.

[deleted]2

9.

[deleted]2

SUP 15 Annex 6 Notifications by UK AIFMs

R

1This annex consists of one or more forms. Forms can be completed online now by visitinghttps://www.handbook.fca.org.uk/form

The forms referred to below can be found in the following Annexes in SUP:

SUP 15 Annex 6A R - AIFMD new fund under management notification

SUP 15 Annex 6B R - AIFMD notification of senior personnel amendments or removal form

SUP 15 Annex 6C R - AIFMD full-scope UK AIFM material change notification

SUP 15 Annex 6D R - AIFMD notice of sub-threshold AIFM exceeding AuM limit

SUP 15 Annex 6E D - AIFMD small registered AIFM change form

SUP 15 Annex 6F G - EuSEF and EuVECA management and marketing notifications

SUP 15 Annex 6A R AIFMD new fund under management notification

R

1This annex consists of one or more forms. Forms can be completed online now by visiting https://www.handbook.fca.org.uk/form

SUP 15 Annex 6AR - AIFMD new fund under management notification

SUP 15 Annex 6B R AIFMD notification of senior personnel amendments or removal form

R

1This annex consists of one or more forms. Forms can be completed online now by visiting https://www.handbook.fca.org.uk/form

SUP 15 Annex 6BR - AIFMD notification of senior personnel amendments or removal form

SUP 15 Annex 6C R AIFMD full-scope UK AIFM material change notification

R

1This annex consists of one or more forms. Forms can be completed online now by visiting https://www.handbook.fca.org.uk/form

SUP 15 Annex 6CR - AIFMD full-scope UK AIFM material change notification

SUP 15 Annex 6D R AIFMD notice of sub-threshold AIFM exceeding AuM limit

R

1This annex consists of one or more forms. Forms can be completed online now by visiting https://www.handbook.fca.org.uk/form

SUP 15 Annex 6DR - AIFMD notice of sub-threshold AIFM exceeding AuM limit

SUP 15 Annex 6F G EuSEF and EuVECA management and marketing notifications

G

1This annex consists of one or more forms. Forms can be completed online now by visiting https://www.handbook.fca.org.uk/form

SUP 15 Annex 6FG - EuSEF and EuVECA management and marketing notifications

SUP 15 Annex 7R 1Form H: Form for the notification of disciplinary action relating to conduct rules staff (other than SMF managers) in relevant authorised persons

SUP 15 Annex 7R R

SUP 15 Annex 8R Form G: The Retail Investment Adviser Complaints Notifications 2Form1

SUP 15 Annex 8R R