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Status: You are viewing the version of the handbook as on 2019-01-01.

SYSC 26.4 Exclusions

Exclusions where other requirements apply

SYSC 26.4.1R

1SYSC 26.3 (Main rules) does not require a firm to ensure that SMF managers have local or overall responsibility for any activity, business area or management function that is included in an FCA-prescribed senior management responsibility that applies to the firm.

SYSC 26.4.2R

1SYSC 26.3 (Main rules) does not require a firm to ensure that SMF managers have local or overall responsibility for any activity, business area or management function that is:

  1. (1)

    included in a PRA-prescribed senior management responsibility that applies to the firm; or

  2. (2)

    managed (as part of the PRA-designated senior management function concerned) by any of the firm’s SMF managers approved to perform any of the following PRA-designated senior management functions for the firm:

    1. (a)

      the Chief Finance function;

    2. (b)

      the Chief Risk function;

    3. (c)

      the Head of Internal Audit function;

    4. (d)

      the Head of Key Business Area function;

    5. (e)

      the Chief Operations function; or

    6. (f)

      the Group Entity Senior Manager function or the Group Entity Senior Insurance Manager function.

Exclusion of the governing body and non-executive directors

SYSC 26.4.3R

1SYSC 26.3 (Main rules) does not require a firm to allocate overall or local responsibility for the running of the firm’s governing body.

SYSC 26.4.4G

1SYSC 26.4.3R means that a person does not have overall or local responsibility for a function under this chapter just by being a member of a firm’s governing body or equivalent.

SYSC 26.4.5G
  1. (1)

    1A person who just provides oversight of a function does not have overall or local responsibility for that function under this chapter.

  2. (2)

    Paragraph (1) and SYSC 26.4.4G mean that a non-executive director acting as such does not have overall or local responsibility for a function under SYSC 26.3 or perform the other overall responsibility function or the other local responsibility function.

  3. (3)

    Paragraph (1) and SYSC 26.4.4G mean that a non-executive director:

    1. (a)

      providing oversight of a function; or

    2. (b)

      being responsible for the independence of a function;

    does not have overall or local responsibility for that function under this chapter or perform the other overall responsibility function or the other local responsibility function.

Exclusion where the 12-week rule applies

SYSC 26.4.6R
  1. (1)

    1This rule applies where:

    1. (a)

      a firm appoints someone to perform a function in order to provide cover as described in SUP 10C.3.13R(1) (The 12-week rule) or the PRA equivalent; and

    2. (b)

      the firm has allocated any responsibilities (the “Responsibilities”) under SYSC 26.3 (Main rules) to the SMF manager (the absent manager) who is absent as described in SUP 10C.3.13R(2) or the PRA equivalent.

  2. (2)

    While the disapplication of the designated senior management function provided for in SUP 10C.3.13R or the PRA equivalent is still in force the firm may allocate the Responsibilities to an employee who is not an SMF manager.

  3. (3)

    For the purposes of this rule, the PRA equivalent of:

    1. (a)

      SUP 10C.3.13R is the following parts of the PRA Rulebook:

      1. (i)

        rule 2.3 in “Senior Management Functions”;

      2. (ii)

        rule 2.4 in “Insurance - Senior Management Functions”; and

      3. (iii)

        rule 2.4 in “Large Non-Solvency II Firms – Senior Management Functions”.

    2. (b)

      SUP 10C.3.13R(1) and (2) is the following parts of the PRA Rulebook:

      1. (i)

        rules 2.3(1) and (2) in “Senior Management Functions”;

      2. (ii)

        rules 2.4(1) and (2) in “Insurance - Senior Management Functions”; and

      3. (iii)

        rules 2.4(1) and (2) in “Large Non-Solvency II Firms – Senior Management Functions”.

SYSC 26.4.7G

1A firm need not allocate the Responsibilities referred to in SYSC 26.4.6R(1)(b) to the person who is providing cover for the absent SMF manager.

SYSC 26.4.8G

1SYSC 26.4.6R and SUP 10C.3.13R apply to a person performing the other overall responsibility function or the other local responsibility function as well as to a person performing one of the other designated senior management functions.