1The AIFM Remuneration Code (SYSC 19B) also applies to a BIPRU firm which is a full-scope UK AIFM (ie, a full-scope UK AIFM that is an AIFM investment firm subject to BIPRU). Such a full-scope UK AIFM that complies with SYSC 19B will also comply with SYSC 19C. In such cases, the FCA will not require the full-scope UK AIFM to demonstrate compliance with SYSC 19C.
Part 2 of SYSC 1 Annex 1 provides for the application of SYSC 4.1.1 R and SYSC 4.1.1C R (General Requirements). In particular, and subject to the provisions on group risk systems and controls requirements in SYSC 12, this means that:
where the BIPRU Remuneration Code applies, it applies to:
remuneration awarded, whether under a contract or otherwise, on or after 1 January 2014;
remuneration due on the basis of contracts concluded before 1 January 2014 which is awarded or paid on or after 1 January 2014; and
remuneration awarded, but not yet paid, before 1 January 2014, for services provided in 2013.
This rule applies to a firm that is unable to comply with the BIPRU Remuneration Code because of an obligation it owes to a BIPRU Remuneration Code staff member under a provision of an agreement made on or before 29 July 2010.
Until the provision in (1) ceases to prevent the firm from complying with the BIPRU Remuneration Code, the firm must adopt specific and effective arrangements, processes and mechanisms to manage the risks raised by the provision.
The BIPRU Remuneration Code does not contain specific notification requirements. However, general circumstances in which the FCA expects to be notified by firms of matters relating to their compliance with requirements under the regulatory system are set out in SUP 15.3 (General notification requirements).
In particular, in relation to remuneration matters, such circumstances should take into account unregulated activities as well as regulated activities and the activities of other members of a group and would include each of the following:
significant breaches of the BIPRU Remuneration Code;
any proposed remuneration policies, procedures or practices which could:
have a significant adverse impact on the firm's reputation; or
Such notifications should be made immediately the firm becomes aware of those circumstances, or has information which reasonably suggests that those circumstances have, or may have, occurred or may occur in the foreseeable future.
The FCA's policy on individual guidance is set out in SUP 9. Firms should particularly note the policy on what the FCA considers to be a reasonable request for guidance (see SUP 9.2.5 G). For example, where a firm is seeking guidance on a proposed remuneration structure, the FCA will expect the firm to provide a detailed analysis of how the structure complies with the BIPRU Remuneration Code, including the general requirement for remuneration policies, procedures and practices to be consistent with and promote sound and effective risk management.