Related provisions for FEES 13.2.10

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MCOB 3A.1.4RRP

This chapter applies to the communication or approval of a financial promotion of qualifying credit as follows:

Application and purpose

MCOB 3A.1

The fair, clear and not misleading rules

MCOB 3A.2, except MCOB 3A.2.5 R

Other general requirements for financial promotions

MCOB 3A.3

Qualifying credit financial promotions

MCOB 3A.4

MCD financial promotions (note 1)

MCOB 3A.5

Systems and controls

MCOB 3A.9

Note 1: This item does not apply to non-MCDfinancial promotions of qualifying credit.

MCOB 3A.1.7RRP

This chapter applies to the communication or approval of a financial promotion of a home purchase plan as follows:

Application and purpose

MCOB 3A.1

Fair, clear and not misleading rule for approval of home purchase plan financial promotions

MCOB 3A.2.5 R

Home purchase plan financial promotions

MCOB 3A.6

MCOB 3A.1.8RRP
Except for MCOB 3A.2.4R (2) and MCOB 3A.5, this chapter does not apply to a firm in relation to a financial promotion of qualifying credit that is of a kind listed in MCOB 3A.1.9 R, except if the firm approves the financial promotion, then the following apply:(1) MCOB 3A.1 (Application and purpose);(2) MCOB 3A.2.4 R (Fair, clear and not misleading financial promotions);(3) MCOB 3A.4.4 G to MCOB 3A.4.7 G (Approval of qualifying credit promotions; No approval of real time qualifying
MCOB 3A.1.11GRP
Firms are reminded that financial promotions (including those which are exempt) may be subject to more general rules, including Principle 7 (Communications with clients), SYSC 3 to SYSC 10 (Systems and controls), and MCOB 3A.2.4 R (Fair, clear and not misleading communications).
MCOB 3A.1.12GRP
The territorial scope for rules relating to communicating information to a customer is set out in MCOB 1.3.1 R.
MCOB 3A.1.14GRP
The application under MCOB 3A.1.13 R is relevant both when a firmcommunicates a financial promotion itself and when a firmapproves a non-real time financial promotion for communication by others. However, see also MCOB 3A.1.15 R (Exceptions to territorial scope: rules without territorial limitation for approval of financial promotions).
MCOB 3A.1.15RRP
Subject to MCOB 3A.1.16 R, the following parts of this chapter apply without any territorial limitation if a firmapproves a financial promotion of qualifying credit, a home reversion plan or a regulated sale and rent back agreement:(1) MCOB 3A.1 (Application and purpose);(2) rules requiring a financial promotion to be fair, clear and not misleading (see MCOB 3A.2.4 R); and (3) provisions regarding the approval of financial promotions (except those relating to approval of financial
MCOB 3A.1.16RRP
(1) Notwithstanding MCOB 3A.1.13 R and MCOB 3A.1.15 R, where a firm which satisfies the conditions in (2) communicates a financial promotion of qualifying credit, the rules in (3) do not apply.(2) The conditions are that:(a) the firmcommunicates the financial promotion of qualifying credit from an establishment maintained by the firm in an EEA State other than the United Kingdom, and not from an establishment maintained by the firm in the United Kingdom or outside the EEA;(b)
PR 5.5.1RRP
The rules in this section specify in accordance with section 84(1)(d) of the Act and for the purposes of Part 6 of the Act, the persons responsible for a prospectus.Note: In accordance with PR 1.1.9 a reference in this section to a prospectus includes a supplementary prospectus.
PR 5.5.2RRP
The rules in this section only apply in respect of a prospectus if the United Kingdom is the Home State for the issuer in relation to the transferable securities to which the prospectus relates.
PR 5.5.3RRP
(1) This rule applies to a prospectus relating to:(a) equity shares;(b) warrants or options to subscribe for equity shares, that are issued by the issuer of the equity shares; and(c) other transferable securities that have similar characteristics to transferable securities referred to in paragraphs (a) or (b).(2) Each of the following persons are responsible for the prospectus:(a) the issuer of the transferable securities;(b) if the issuer is a body corporate:(i) each person who
PR 5.5.4RRP
(1) This rule applies to a prospectus relating to transferable securities other than those to which PR 5.5.3 R applies.(2) Each of the following persons are responsible for the prospectus:(a) the issuer of the transferable securities;(b) each person who accepts, and is stated in the prospectus as accepting, responsibility for the prospectus;(c) in relation to an offer, the offeror of the transferable securities, if this is not the issuer;(d) in relation to a request for an admission
PR 5.5.7RRP
A person is not responsible for a prospectus under PR 5.5.3 R (2)(d) or PR 5.5.4 R (2)(c) if:(1) the issuer is responsible for the prospectus in accordance with the rules in this section;(2) the prospectus was drawn up primarily by the issuer, or by one or more persons acting on behalf of the issuer; and(3) the offeror is making the offer in association with the issuer.
PR 5.5.9RRP
Nothing in the rules in this section is to be construed as making a person responsible for any prospectus by reason only of the person giving advice about its contents in a professional capacity.
COCON 4.1.1GRP
The following is a non-exhaustive list of examples of conduct that would be in breach of rule 1.(1) Misleading (or attempting to mislead) by act or omission:(a) a client; or(b) the firm for whom the person works (or its auditors); or(c) the FCA or;(d) the PRA.(2) Falsifying documents.(3) Misleading a client about:(a) the risks of an investment;(b) the charges or surrender penalties of products;(c) the likely performance of products by providing inappropriate projections of future
COCON 4.1.3GRP
The following is a non-exhaustive list of examples of conduct by any conduct rules staff that would be in breach of rule 2.(1) Failing to inform:(a) a customer; or(b) their firm (or its auditors);of material information in circumstances where the member of conduct rules staff was aware, or ought to have been aware, of such information, and of the fact that they should provide it, including the following:(i) failing to explain the risks of an investment to a customer;(ii) failing
COCON 4.1.8GRP
The following is a non-exhaustive list of examples of conduct by a manager that would be in breach of rule 2.(1) Failing to take reasonable steps to ensure that the business of the firm for which the manager has responsibility:(a) is controlled effectively;(b) complies with the relevant requirements and standards of the regulatory system applicable to that area of the business; and(c) is conducted in such a way to ensure that any delegation of responsibilities is to an appropriate
COCON 4.1.8AGRP
3Rule 2 in COCON 2.1.3R applies to a director (whether executive or non-executive) when taking part in the activities of the Board, other governing body or of its committees. This includes, for example, participating in meetings, preparing papers or other submissions for meetings and reporting to the body or committee.
COCON 4.1.9GRP
For the purpose of rule 3 in COCON 2.1.3R, regulators other than the FCA and the PRA are those which have recognised jurisdiction in relation to activities to which COCON applies and have a power to call for information from the firm or from individuals performing certain functions in connection with those regulated activities. This may include an exchange or an overseas regulator.
COCON 4.1.11GRP
The following is a non-exhaustive list of examples of conduct that would be in breach of rule 3.(1) Failing to report promptly in accordance with their firm's internal procedures (or, if none exist, direct to the regulator concerned), information in response to questions from the FCA, the PRA, or both the PRA and the FCA.(2) Failing without good reason to: (a) inform a regulator of information of which the approved person was aware in response to questions from that regulator;
COCON 4.1.13GRP
Rule 4 in COCON 2.1.4R applies to all conduct rules staff, regardless of whether that person has direct contact or dealings with customers of the firm. Persons subject to the rules in COCON should consider how their actions (or their failure to act) can affect the interests of customers or result in customers being treated unfairly.
COCON 4.1.14GRP
The following is a non-exhaustive list of examples of conduct that would be in breach of rule 4.(1) Failing to inform a customer of material information in circumstances where they were aware, or ought to have been aware, of such information and of the fact that they should provide it, including the following:(a) failing to explain the risks of an investment to a customer;(b) failing to disclose to a customer details of the charges or surrender penalties of investment products;
COCON 4.1.15GRP
A general consideration about whether or not a person's conduct complies with the relevant requirements and standards of the market, is whether they, or the firm, comply2 with relevant market codes and exchange rules. Compliance with2 relevant market codes and exchange rules will tend to show compliance with rule 5 in COCON 2.1.5R.2
DISP 1.11.5RRP
(1) A notification claiming exemption under DISP 1.1.12 R from the complaints reporting rules and the rules relating to the funding of the Financial Ombudsman Service must be given to the FCA by the Society on behalf of any member eligible for an exemption. (2) The Society must notify the FCA if the conditions relating to such an exemption no longer apply to a member who is exempt.
DISP 1.11.6RRP
The report to be sent to the FCA under the complaints reporting rules must be provided by the Society and must cover all complaints by policyholders against members falling within the scope of the complaints reporting rules.
DISP 1.11.7GRP
Each member of the Society is individually subject to the rules in this chapter as a result of the insurance market direction given in DISP 2.1.7 D23 under section 316 of the Act (Direction by a regulator).232323
DISP 1.11.9GRP
Members will individually comply with this chapter if and only if all complaints by policyholders against members are dealt with under the Lloyd's complaints procedures. Accordingly, certain of the obligations under this chapter, for example the obligation to report on complaints received and the obligation to pay fees under the rules relating to the funding of the Financial Ombudsman Service (FEES 5), must be complied with by the Society on behalf of members. Managing agents
DISP 1.11.12GRP
The Financial Ombudsman Service is not able to deal with the complaints listed in DISP 1.11.13 R and separate rules and guidance are therefore required.
DISP 1.11.14RRP
The Society must maintain by byelaw one or more appropriate effective schemes for the resolution of disputes between an individual member or a former member who was an individual member and:(1) his underwriting agent; or(2) the Society.
DISP 1.11.21RRP
A contravention of DISP 1.11.13 R or DISP 1.11.14 R does not give rise to a right of action by a private person under section 138D of the Act (Actions for damages) and each of those rules is specified under section 138D(3) of the Act as a provision giving rise to no such right of action.
GEN 2.2.3RRP
Any rule in the Handbook which has the status letter "E" in the margin or heading:(1) is to be taken also to provide that contravention of the rule does not give rise to any of the consequences provided for by provisions of the Act other than section 138C30 (Evidential provisions); and30(2) incorporates the status letter "E" in the margin or heading as part of the rule.
GEN 2.2.4GRP
(1) The rules to which section 138C30 of the Act applies ("evidential provisions") are identified in the Handbook by the status letter "E" in the margin or heading.30(2) Other provisions in the Handbook, although also identified by the status letter "E" in the margin or heading, are actually not rules but provisions in codes and GEN 2.2.3 R does not apply to them.17301313
GEN 2.2.5GRP
Chapter 6 of the Reader's Guide contains an explanation of the significance of the status letters R, E, G, D, UK, EU, P and C6, and includes further information on Handbook provisions, including6 evidential provisions.16
GEN 2.2.10GRP
The Interim Prudential sourcebooks (IPRU) have individual arrangements for defined terms and each contains rules or guidance on its own arrangements. In respect of those sourcebooks, reliance should not be placed on the definitions which appear in the Glossary unless otherwise indicated.
GEN 2.2.17RRP
A general rule (that is a rule made by the FCA18 the general rule making powers30) is to be interpreted as:3030(1) applying to a firm with respect to the carrying on of all regulated activities, except to the extent that a contrary intention appears; and(2) not applying to a firm with respect to the carrying on of unregulated activities, unless and then only to the extent that a contrary intention appears.
GEN 2.2.23RRP
(1) This rule applies to Handbook provisions20 where the PRA have made commensurate provisions in the PRA Rulebook. It may affect their application by the FCA to PRA-authorised persons and PRA approved persons20.3016151615(2) Where a Handbook provision (or part of one) goes beyond the FCA's20 powers or regulatory responsibilities, it is to be interpreted as applied20 to the extent of the FCA’s20 powers and regulatory responsibilities only.(3) The extent of a Handbook provision
GEN 2.2.25GRP
An example of a rule20 being interpreted as cut back by GEN 2.2.23R is SYSC 6.1.1R, which requires a firm to maintain adequate policies and procedures to ensure compliance with its obligations under the regulatory system; SYSC 6.1.1R should be interpreted as applied by the FCA in respect of a PRA-authorised person’s compliance with regulatory obligations that are the responsibility of the FCA (for example, in respect of a bank maintaining policies and procedures to ensure compliance
DTR 4.4.1RRP
The rules on annual financial reports (DTR 4.1) and 3 half-yearly financial reports (DTR 4.2) do not apply to:53333(1) a state;5(2) a regional or local authority of a state5;(3) a public international body of which at least one EEA State is a member;5(4) the European Central Bank;5(5) the European Financial Stability Facility (EFSF) established by the EFSF Framework Agreement and any other mechanism established with the objective of preserving the financial stability of European
DTR 4.4.2RRP
The rules on annual financial reports in DTR 4.1 (including DTR 4.1.7R (4)1 and3 half-yearly financial reports (DTR 4.2) do not apply to an issuer that issues exclusively debt securitiesadmitted to trading the denomination per unit of which is at least 100,000 euros2 (or an equivalent amount).[Note: article 8(1)(b) of the TD and article 45(1) of the Audit Directive]11332
DTR 4.4.3RRP
The rules on half-yearly financial reports (DTR 4.2) do not apply to a credit institution whose shares are not admitted to trading and which has, in a continuous or repeated manner, only issued debt securities provided that:(1) the total nominal amount of all such debt securities remains below 100,000,000 Euros; and(2) the credit institution has not published a prospectus in accordance with the prospectus directive.[Note: article 8(2) of the TD]
DTR 4.4.4RRP
The rules on half-yearly financial reports do not apply to an issuer already existing on 31 December 2003 which exclusively issue debt securities unconditionally and irrevocably guaranteed by the issuer'sHome Member State or by a regional or local authority of that state, on a regulated market.[Note: article 8(3) of the TD]
DTR 4.4.5RRP
The rules on half-yearly financial reports (DTR 4.2) do not apply to an issuer of transferable securities convertible into shares.3
DTR 4.4.7RRP
The rules on half-yearly financial reports (DTR 4.2) do not apply to an issuer of depository receipts.3
DTR 4.4.8RRP
4An issuer whose registered office is in a non-EEA State5is exempted from the rules on:(1) annual financial reports in DTR 4.1 (other than DTR 4.1.7R (4) which continues to apply); (2) half-yearly financial reports (DTR 4.2); and(3) reports on payments to governments (DTR 4.3A);5if the law of the non-EEA State in question lays down equivalent requirements or the issuer complies with requirements of the law of a non-EEA State that the FCA considers as equivalent.5[Note: article
FEES App 1.1.2GRP
2(1) The purpose of these rules is to set out the requirements for registered societies and sponsoring bodies to pay periodic and application fees which, together, will provide the funding for the FCA's functions in respect of the registrant-only fee block (Category F). 2(2) This set of rules is in respect of the registration functions relating to registered societies transferred to the FCA by section 50 of the Financial Services Act 2012, other than friendly societies authorised
FEES App 1.1.3GRP
Most of the detail of the periodic fees which will be payable by registered societies is set out in Annex 1R to these rules, the provisions of which will vary from one financial year to another. Accordingly, a revised Annex 1R will come into force, following consultation, for each financial year. Most of the detail of the application fees which will be payable by registered societies and sponsoring bodies is set out in FEES App 1 Annex 1A, the provisions of which may not change
FEES App 1.1.4GRP
FEES App 1 Annex 2 to these rules contains further information on the fees applicable to registered societies under these rules.
FEES App 1.1.6GRP
The application fee payable to register a new society is a tiered fee: the amount payable for registration of a new society is dependent on whether the rules are based on a free draft or on model rules. Further, where model rules are used in the case of the registration of a new society other than a credit union, then the number of amendments made to the model rules will affect the fee. The application fee payable by a sponsoring body for a new set of model rules is a flat f
FEES App 1.1.7GRP
In these rules:(1) an “R” in the margin or heading indicates that the provision is a rule, which creates binding obligations;(2) a “G” in the margin or heading indicates that the provision is guidance, which is designed to throw light on a particular aspect of these rules, but which is not binding nor an exhaustive description of a person's obligations.
FEES App 1.1.8RRP
In these rules, an expression in italics has the meaning given in Annex 4R.
CONC 2.7.6RRP
A firm must communicate to the consumer all the contractual terms and conditions and the information referred to in the distance marketing disclosure rules (CONC 2.7.2 R to CONC 2.7.5 R) in a durable medium1. That information must be made available and accessible to the consumer in good time before the consumer is bound by any distance contract or offer.1[Note: regulation 8(1) of SI 2004/2095][Note: articles 4(5) and 5(1) of the Distance Marketing Directive]
CONC 2.7.9RRP
In the case of a distance contract comprising an initial service agreement, followed by successive operations or a series of separate operations of the same nature performed over time, the rules in this chapter only apply to the initial agreement.[Note: regulation 5(1) of SI 2004/2095][Note: article 1(2) of the Distance Marketing Directive]
CONC 2.7.10RRP
(1) If there is no initial service agreement but the successive or separate operations of the same nature performed over time are performed between the same contractual parties, the distance marketing disclosure rules (CONC 2.7.2 R to CONC 2.7.5 R) will only apply:(a) when the first operation is performed; and(b) if no operation of the same nature is performed for more than a year, when the next operation is performed (the next operation being deemed the first in a new series
CONC 2.7.15RRP
(1) A firm must not enforce, or seek to enforce, any obligations under a distance contract against a consumer in the event of an unsolicited supply of services. The absence of a reply does not constitute consent.(2) This rule does not apply to the tacit renewal of a distance contract.[Note: regulation 15 of SI 2004/2095][Note: article 9 of the Distance Marketing Directive]
CONC 2.7.16RRP
If a consumer purports to waive any of the consumer's rights created or implied by the rules in this section, a firm must not accept that waiver, nor seek to rely on or enforce it against the consumer.[Note: article 12 of the Distance Marketing Directive]
CONC 2.7.17RRP
If a firm proposes to enter into a distance contract with a consumer that will be governed by the law of a country outside the EEA, the firm must ensure that the consumer will not lose the protection created by the rules in this section if the distance contract has a close link with the territory of one or more EEA States.[Note: regulation 16(3) of SI 2004/2095][Note: articles 12 and 16 of the Distance Marketing Directive]
COCON 1.1.1GRP
Under section 64A of the Act, the FCA may make rules about the conduct of certain persons9 working in firms9.
COCON 1.1.2RRP

Table: To whom does COCON apply? 9

    9Persons to whom COCON applies

    Comments9

    (1) An SMF manager.9

    (2) An employee (“P”) of an SMCR firm12 who:9

    (a) performs the function of an SMF manager;9

    (b) is not an approved person to perform the function in question; and9

    (c) is required to be an approved person at the time P performs that function.9

    (3) An employee of an SMCR firm12 who would be performing an FCA-designated senior management function12 but for SUP 10C.3.13R (The 12-week rule). 9

    (4) A certification employee of an SMCR firm12.9

    This applies even if the certification employee has not been notified that COCON applies to them or notified of the rules that apply to them.9

    (5) An employee of an SMCR firm who would be performing an FCA certification function but for SYSC 27.5.1R (Emergency appointments) or SYSC 27.5.3R (Temporary12 UK role). 9

    12

    (6) Any employee of an SMCR firm12 not coming within another row of this table, except one listed in column (2) of this row (6) of this table12. 9

    (A)12 This row (6)12 does not apply to an employee of an SMCR firm12 who only performs functions falling within the scope of the following roles:9

    (a) receptionists;

    (b) switchboard operators;

    (c) post room staff;

    (d) reprographics/print room staff;

    (e) property/facilities management;

    (f) events management;

    (g) security guards;

    (h) invoice processing;

    (i) audio visual technicians;

    (j) vending machine staff;

    (k) medical staff;

    (l) archive records management;

    (m) drivers;

    (n) corporate social responsibility staff;

    (o) data controllers or processors under the data protection legislation;10

    (p) cleaners;

    (q) catering staff;

    (r) personal assistant or secretary;

    (s) information technology support (ie, helpdesk); and

    (t) human resources administrators /processors.

    (B) This row (6) also does not apply to an employee of an SMCR insurance firm until 10 December 2019.12

    (7) [deleted]12

    9

    12

    9

    (8) A board director of: a UK SMCR firm.12

    9999

    12

    9

    12

    9
COCON 1.1.3RRP
Rules 1 to 5 in COCON 2.1 apply to all conduct rules staff.
COCON 1.1.4RRP
(1) Rules SC1 to SC4 in COCON 2.2 apply to all senior conduct rules staff members (subject to (2)).9(2) SC1 to SC3 in COCON 2.2 do not apply to a senior conduct rules staff member within paragraph (d) of the definition of senior conduct rules staff member (P)12 unless P also falls into paragraph (a) or (b) of that definition.129
COCON 1.1.9RRP
(1) COCON applies to the conduct of 6conduct rules staff set out in (2) 6wherever it is performed.(2) 6This rule applies to:(a) a senior conduct rules staff member; and(b) a certification employee performing FCA certification function (6)12 (material risk takers) in the table in SYSC 27.7.3R for a UK SMCR firm12.12
COCON 1.1.10RRP
(1) This rule applies to members of a firm’sconduct rules staff apart from conduct rules staff in COCON 1.1.9R. 6522(2) Subject to (3), COCON only applies to the conduct of persons to whom this rule applies (as set out in (1)) if that conduct:6(a) 6is performed from an establishment maintained in the United Kingdom by the SMCR firm; or12(b) 6involves dealing with a client of the firm in the United Kingdom from an establishment overseas.5(3) 6Paragraph (2)(b) only applies to a
COCON 1.1.13GRP
The purpose of this chapter is to set out rules for conduct rules staff and to provide guidance about those rules2 to firms whose staff are subject to them2.
ICOBS 3.1.4GRP
The rules setting out the responsibilities of insurers and insurance intermediaries for producing and providing information apply to requirements in this section to provide information (see ICOBS 6.-1.1R2).
ICOBS 3.1.8RRP
A firm must communicate to the consumer all the contractual terms and conditions and the information referred to in the distance marketing disclosure rules in writing or another durable medium available and accessible to the consumer in good time before conclusion of any distance contract.[Note: article 5(1) of the Distance Marketing Directive]
ICOBS 3.1.12RRP
In the case of a distance contract comprising an initial service agreement, followed by successive operations or a series of separate operations of the same nature performed over time, the rules in this section only apply to the initial agreement.[Note: article 1(2) of the Distance Marketing Directive]
ICOBS 3.1.13RRP
If there is no initial service agreement but the successive operations or separate operations of the same nature performed over time are performed between the same contractual parties, the distance marketing disclosure rules will only apply:(1) when the first operation is performed; and(2) if no operation of the same nature is performed for more than a year, when the next operation is performed (the next operation being deemed to be the first in a new series of operations).[Note:
ICOBS 3.1.17RRP
(1) A firm must not enforce, or seek to enforce, any obligations under a distance contract against a consumer, in the event of an unsolicited supply of services, the absence of reply not constituting consent.(2) This rule does not apply to the tacit renewal of a distance contract.[Note: article 9 of the Distance Marketing Directive]
ICOBS 3.1.18RRP
If a consumer purports to waive any of the consumer's rights created or implied by the rules in this section, a firm must not accept that waiver, nor seek to rely on or enforce it against the consumer.[Note: article 12 of the Distance Marketing Directive]
ICOBS 3.1.19RRP
If a firm proposes to enter into a distance contract with a consumer that will be governed by the law of a country outside the EEA, the firm must ensure that the consumer will not lose the protection created by the rules in this section if the distance contract has a close link with the territory of one or more EEA States.[Note: articles 12 and 16 of the Distance Marketing Directive]
SUP 12.1.1ARRP
(1) 5 The territorial scope of SUP 12 is modified to the extent necessary to be compatible with EU law (see SUP 12.1.1BG and 12.1.1CG for guidance on this). (2) This rule overrides every other rule in this chapter.
SUP 12.1.1BGRP
5For a UK MiFID investment firm, in our view, rules in this chapter that are within the scope of MiFID apply to its MiFID business carried on from an establishment in the United Kingdom or another EEA State. [Note: articles 34(1) and 35(1) and (8) of MiFID]
SUP 12.1.1CGRP
5 For an EEA MiFID investment firm, in our view, rules in this chapter that are within the scope of MiFID apply only to its MiFID business to the extent they relate to the knowledge and competence of one or more of its UK tied agents. An EEA MiFID investment firm should complete the Appointed representative appointment form in SUP 12 Annex 3R when appointing a UK tied agent to carry on MiFID business on its behalf. [Note: article 29(3) of MiFID]
SUP 12.1.1DGRP
5 In addition to those rules in SUP 12 relating to the MiFID business of appointed representatives and tied agents, there are other MiFID obligations in the Handbook relevant to the knowledge and competence of tied agents and related compliance obligations (see SYSC 5.1, TC and FIT (in respect of appointed representatives that are approved persons)). These provisions are subject to the territorial application requirements in their respective chapters.
SUP 12.1.3GRP
The chapter also sets out the FCA'srules, and guidance on these rules, that apply to a firm before it appoints, when it appoints and when it has appointed an appointed representative. The main purpose of these rules is to place responsibility on a firm for seeking to ensure that: (1) its appointed representatives are fit and proper to deal with clients in its name; and (2) clients dealing with its appointed representatives are afforded the same level of protection as if they had
SUP 12.1.5GRP
2This chapter also sets out:5(1) guidance about section 39A of the Act, which is relevant to a UK MiFID investment firm that is considering appointing an FCA registered tied agent; and5(2) the FCA’s rules, and guidance on those rules, in relation to the appointment of:5(a) an EEA tied agent by a UK MiFID investment firm;5(b) a MiFID optional exemption appointed representative; and5(c) a structured deposit appointed representative.5
SYSC 5.2.7GRP
[deleted] Editor’s note: The text of this provision has been moved to SYSC 27.2.5G]8
SYSC 5.2.14GRP
[deleted] Editor’s note: The text of this provision has been moved to SYSC 27.2.12G]84
SYSC 5.2.27RRP
[deleted] Editor’s note: The text of this provision has been moved to SYSC 27.5.1R]8
SYSC 5.2.28ARRP
[deleted] Editor’s note: The text of this provision has been moved to SYSC 27.5.3R]8
SYSC 5.2.28CGRP
(1) [deleted] Editor’s note: The text of this provision has been moved to SYSC 27.5.5G]838(2) [deleted] Editor’s note: The text of this provision has been moved to SYSC 27.5.6G]88
SYSC 5.2.31GRP
[deleted] Editor’s note: The text of this provision has been moved to SYSC 27.7.4G]8
REC 4.5.1GRP
UK RIEs1which, under their rules, have market contracts are required to have default rules enabling them (among other things) to take action in relation to a member who appears to be unable to meet his obligations in respect of one or more unsettled market contracts. The detailed recognition requirements relating to the default rules are set out in REC 2.17. 1
REC 4.5.2GRP
The default rules are designed to ensure that rights and liabilities between the defaulter and any counterparty to an unsettled market contract are discharged, and for there to be paid between the defaulter and each counterparty one net sum. The Companies Act 1989 contains provisions which protect action taken under default rules from the normal operation of insolvency law which might otherwise leave this action open to challenge by a relevant office-holder.
REC 4.5.3GRP
The Companies Act 1989 also gives the FCA1 powers to supervise the taking of action under default rules. Under section 166 of the Companies Act 1989 (Powers of the appropriate regulator1 to give directions) (see REC 4.5.4 G), the FCA1 may direct a UK RIE1to take, or not to take, action under its default rules. Before exercising these powers the FCA1 must consult the UK RIE.1 The FCA1 may also exercise these powers if a relevant office-holder applies to it under section 167 of
REC 4.5.4GRP

The Companies Act 1989: section 166

The FCA1 may issue a "positive" direction (to take action) under section 166(2)(a) of the Companies Act 1989:

1

Where in any case a [UK RIE] has not taken action under its default rules- if it appears to [the FCA] that it could take action, [the FCA may direct it to do so,1

1

but under section 166(3)(a) of the Companies Act 1989:

Before giving such a direction the [FCA] shall consult the [UK RIE] in question; and [the FCA] shall not give a direction unless [the FCA] is satisfied, in the light of that consultation that failure to take action would involve undue risk to investors or other participants in the market, or that the direction is necessary having regard to the public interest in the financial stability of the United Kingdom, or that the direction is necessary to facilitate a proposed or possible use of a power under Part 1 of the Banking Act 2009 or in connection with a particular exercise of a power under that Part.1

1

The FCA1 may issue a "negative" direction (not to take action) under section 166(2)(b) of the Companies Act 1989:

1

Where in any case a [UK RIE] has not taken action under its default rules - if it appears to the [FCA] that it is proposing to take or may take action, [the FCA] may direct it not to do so.1

1

but under section 166(3)(b) of the Companies Act 1989:

Before giving such a direction the [FCA] shall consult the [UK RIE] in question; and the [FCA] shall not give a direction unless [the FCA] is satisfied, in the light of that consultation that the taking of action would be premature or otherwise undesirable in the interests of investors or other participants in the market, or that the direction is necessary having regard to the public interest in the financial stability of the United Kingdom, or that the direction is necessary to facilitate a proposed or possible use of a power under Part 1 of the Banking Act 2009 or in connection with a particular exercise of a power under that Part.1

1
REC 4.5.8GRP
Under section 166(7) of the Companies Act 1989, where a UK RIE has taken action either of its own accord or in response to a direction, the FCA may direct it to do or not to do specific things subject to these being within the powers of the UK RIE under its default rules. However,11(1) 1where the UK RIE is acting in accordance with a direction given by the FCA to take action under section 166(2)(a) of the Act on the basis that failure to take action would involve undue risk to
REC 4.5.9GRP
Where, in relation to a member (or designated non-member) of a UK RIE :1(1) a bankruptcy order; or(2) an award of sequestration of his estate; or(3) an order appointing an interim receiver of his property; or(4) an administration or winding-up order; or(5) a resolution for a voluntary winding-up; or(6) an order appointing a provisional liquidator; has been made or passed and the UK RIE1 has not taken action under its default rules as a result of this event or of the matters giving
REC 4.5.10GRP
The effect of an application under section 167 of the Companies Act 1989 is to require the UK recognised body concerned to take action under its default rules or to require the FCA1 to take action under section 166 of the Companies Act 1989 (see REC 4.5.4G).1
REC 4.5.11GRP
The procedure is that the FCA1 must notify the UK recognised body of the application and, unless within three business days after receipt of that notice, the UK recognised body: 1(1) takes action under its default rules; or(2) notifies the FCA1 that it proposes to take action forthwith; or1(3) is directed to take action by the FCA1 under section 166(2)(a) of the Companies Act 1989; 1the provisions of sections 158 to 165 of the Companies Act 1989 do not apply in relation to market
SUP 4.5.1RRP
An actuary2 appointed under PRA rules made under section 340 of the Act, or for the purposes of PRA Rulebook: Solvency II firms: Conditions Governing Business, 6,6 must be objective in performing his duties.225
SUP 4.5.3RRP
An actuary appointed under firms PRA rules made under section 340 of the Act, or for the purposes of PRA Rulebook: Solvency II firms: Conditions Governing Business, 6,6 must take reasonable steps to satisfy himself that he is free from bias, or from any conflict of interest from which bias may reasonably be inferred. He must take appropriate action where this is not the case.225
SUP 4.5.7GRP
(1) Actuaries appointed under PRA rules made under section 340 of the Act, or for the purposes of PRA Rulebook: Solvency II firms: Conditions Governing Business, 6,6 are subject to regulations5 made by the Treasury under sections 342(5) and 343(5) of the Act (Information given by auditor or actuary to a regulator7). Section 343 and the regulations also apply to an actuary of an authorised person in his capacity as an actuary of a person with close links with the authorised person.47(2)
SUP 4.5.8GRP
SUP 4.5.9 R to SUP 4.5.11 G apply to a person who is or has been an actuary appointed under PRA rules made under section 340 of the Act, or for the purposes of PRA Rulebook: Solvency II firms: Conditions Governing Business, 66.225
SUP 4.5.10RRP
An actuary2 who has ceased to be appointed under PRA rules made under section 340 of the Act, or for the purposes of PRA Rulebook: Solvency II firms: Conditions Governing Business, 66 or who has been formally notified that he will cease to be so 2appointed, must notify the appropriate regulator5 without delay:222525(1) of any matter connected with the cessation which he thinks ought to be drawn to the appropriate regulator's attention; or(2) that there is no such matter.
SUP 4.5.13RRP
2When carrying out his duties, an actuary appointed under PRA rules made under section 340 of the Act, or for the purposes of PRA Rulebook: Solvency II firms: Conditions Governing Business, 6,6 must pay due regard to generally accepted actuarial practice.35
REC 6.7.1RRP
The notification rules in this chapter, which are made under sections 293 (Notification requirements) and 295 of the Act (Notification: overseas investment exchanges and overseas clearing houses), apply to all ROIEs1.1
REC 6.7.2GRP
The notification rules in this chapter are made by the FCA1 in order to ensure that it is provided with notice of events and information which it reasonably requires for the exercise of its functions under the Act. 1
REC 6.7.8RRP
Where an ROIE1 has notice that any licence, permission or authorisation which it requires to conduct any regulated activity in its home territory has been or is about to be:1(1) revoked; or(2) modified in any way which would materially restrict the ROIE1 in performing any regulated activity in its home territory or in the United Kingdom;1it must immediately notify the FCA1 of that fact and must give the FCA1 the information specified for the purposes of this rule in REC 6.7.9
REC 6.7.10RRP
Any notice to be given or information to be supplied under these notification rules must be supplied in English, and any document to be provided must be accompanied, if not in English, by an accurate English translation.
REC 6.7.12RRP
The rules relating to the form and method of notification in REC 3.2 also apply to ROIEs1.1
REC 6.7.13GRP
ROIEs 1may apply to the FCA1 for a waiver of any of the notification rules. The procedure is the same as that for applications from UK recognised bodies. Guidance on the procedure is given in REC 3.3.1
SYSC 10.1.-2GRP

9For a common platform firm:

  1. (1)

    the MiFID Org Regulation applies, as summarised in SYSC 1 Annex 1 3.2G, SYSC 1 Annex 1 3.2-AR and SYSC 1 Annex 1 3.2-BR; and

  2. (2)

    the rules and guidance in the table below apply:

    Subject

    Applicable rule or guidance

    Provision of services

    SYSC 10.1.2G

    Identifying conflicts

    SYSC 10.1.3R

    Types of conflicts

    SYSC 10.1.5G

    Managing conflicts

    SYSC 10.1.7R

    Conflicts policy

    SYSC 10.1.12G

  3. (3)

    SYSC 10.1.7AR (Proportionality – insurance distribution activities), SYSC 10.1.8R (Disclosure of conflicts) and SYSC 10.1.11ABR (Contents of policy) also apply in relation to the carrying on of insurance distribution activities.12

SYSC 10.1.-1GRP
9For a MiFID optional exemption firm and a third country firm, the rules and guidance in this chapter apply to them as if they were rules or as guidance in accordance with SYSC 1 Annex 1 3.2CR(1).11
SYSC 10.1.4AGRP
3Other firms (except common platform firms, UCITS management companies and insurance intermediaries12) should take account of the rule on the types of conflicts (see SYSC 10.1.4 R) in accordance with11SYSC 1 Annex 1 3.3R9. 94
SYSC 10.1.6AGRP
3Other firms (other than common platform firms and insurance intermediaries12)9 should also9 take account of the rule on records of conflicts (see SYSC 10.1.6 R) in accordance with SYSC 1 Annex 1 3.2BR, SYSC 1 Annex 1 3.2CR and SYSC 1 Annex 1 3.3R)9.4
SYSC 10.1.8RRP
(1) If arrangements made by a firm under SYSC 10.1.7 R9 are not sufficient to ensure, with reasonable confidence, that risks of damage to the interests of a client will be prevented, the firm must clearly disclose the following9 to the client before undertaking business for the client:93(a) the general nature or sources of conflicts of interest, or both; and9(b) the steps taken to mitigate those risks.9(2) The disclosure must:(a) be made in a durable medium; 9(b) clearly state
SYSC 10.1.11AGRP
3Other firms (except common platform firms, UCITS management companies and insurance intermediaries12 )9 should take account of the rules relating to conflicts of interest policies (see SYSC 10.1.10 R and SYSC 10.1.11 R) in accordance with SYSC 1 Annex 1.3.2BR, SYSC 1 Annex 1 3.2CR and SYSC 1 Annex 1 3.3R9.4
SYSC 10.1.16RRP
3The rules relating to:(1) types of conflict (see SYSC 10.1.4 R);(2) records of conflicts (see SYSC 10.1.6 R); and(3) conflicts of interest policies (see SYSC 10.1.10 R and SYSC 10.1.11 R);also apply to a firm which is not a common platform firm when it produces, or arranges for the production of, investment research that is intended or likely to be subsequently disseminated to clients of the firm or to the public10, and when it produces or disseminates non-independent research,10
SYSC 10.1.18GRP
5For a management company, references to client in SYSC 10.1.4 R and in the other rules in this section should be construed as referring to any UCITS scheme or EEA UCITS scheme managed by that firm or which it intends to manage, and with or for the benefit of which the relevant activity is to be carried on.
SYSC 10.1.27GRP
6Articles 30 to 37 of the AIFMD level 2 regulation provide detailed rules supplementing the provisions of article 14 of AIFMD.
CREDS 2.2.15GRP
In accordance with rule SC 2 in COCON 2.2.1R5, it is the responsibility of each individual member of the governing body5 who is a senior conduct rules staff member5to understand, and ensure that the credit union complies with, the requirements of all the relevant Acts, secondary legislation and rules.
CREDS 2.2.24GRP
SYSC 9.1.1 R requires that a credit union takes reasonable care to make and retain adequate records of all matters governed by the Act or the CCA, 4 secondary legislation under the Act or the CCA, 4 or rules (including accounting records). These records should be capable of being reproduced in the English language and on paper.
CREDS 2.2.30GRP
Guidance on compliance is located in SYSC 6.1.3 R.[Note: As explained in SYSC 1 Annex 1.3.3G, SYSC 6.1.3 R is to be read as guidance rather than as a rule, and as if "should" appeared in that provision instead of "must".]
CREDS 2.2.32GRP
Guidance on management information is located in SYSC 7.1.4 R.[Note: As explained in SYSC 1 Annex 1.3.3G, SYSC 7.1.4 R is to be read as guidance rather than as a rule, and as if "should" appeared in that provision instead of "must".]
CREDS 2.2.43GRP
The purposes of an internal audit are:(1) to ensure that the policies and procedures of the credit union are followed;(2) to provide the governing body5 with a continuous appraisal of the overall effectiveness of the control systems, including proposed changes;(3) to recommend improvements where desirable or necessary;(4) to determine whether the internal controls established by the governing body5 are being maintained properly and operated as laid down in the policy, and comply
CREDS 2.2.45GRP
The internal audit work programme should include items such as:(1) verification of cash (counting and reconciliation) without prior notification;(2) bank reconciliation (checking records against bank statements);(3) verification of passbooks or account statements;(4) checking for compliance with policies and procedures;(5) checking for compliance with relevant Acts, secondary legislation and rules;(6) checking minutes and reports of the governing body5 and other sub-committees
CREDS 2.2.53GRP
Guidance on business strategy is located in SYSC 6.1.2 R and SYSC 7.1.2 R.[Note: As explained in SYSC 1 Annex 1.3.3G, SYSC 6.1.2 R and SYSC 7.1.2 R are to be read as guidance rather than as rules, and as if "should" appeared in those provisions instead of "must".]
CREDS 2.2.62GRP
Guidance on business continuity is located in SYSC 4.1.6R to SYSC 4.1.8 G.[Note: As explained in SYSC 1 Annex 1.3.3G, SYSC 4.1.6R is to be read as guidance rather than as a rule, and as if "should" appeared in that provision instead of "must".]
CREDS 2.2.72GRP
5SYSC 5.2 gives details about the certification requirement described in CREDS 2.2.71G and sets out rules and guidance about it, including a list of FCA certification function6.
COLL 5.6.1RRP
(1) Subject to (3), this22 section applies to the authorised fund manager and the depositary of a non-UCITS retail scheme and to an ICVC which is a non-UCITS retail scheme.(2) Where this section contains a reference to a rule in any of COLL 5.1 to COLL 5.5 , these rules and any rules to which they refer or any relevant guidance should be read as if any reference to a UCITS scheme is to a non-UCITS retail scheme.(3) Other than COLL 5.6.3R(1), 5.6.4AG, 5.6.14R, 5.6.15R, 5.6.22R(2),
COLL 5.6.2GRP
(1) This section contains rules on the types of permitted investments and any relevant limits with which non-UCITS retail schemes must comply. These rules allow for the relaxation of certain investment and borrowing powers from the requirements of the UCITS Directive. Consequently, a scheme authorised as a non-UCITS retail schemewill not qualify for the cross border passporting rights conferred by the UCITS Directive on a UCITS scheme.(2) Some examples of the different investment
COLL 5.6.3RRP
(1) An authorised fund manager must ensure that, taking account of the investment objectives and policy of the non-UCITS retail scheme as stated in its most recently published prospectus, the scheme property of the non-UCITS retail scheme aims to provide a prudent spread of risk(1A) For a feeder NURS, (1) applies only to the extent that the feeder NURS invests in assets other than units of its qualifying master scheme.17(2) Subject to (3) and (4), the 10rules in this section relating
COLL 5.6.4RRP
(1) The scheme property of a non-UCITS retail scheme may, subject to the rules in this section, comprise any assets or investments to which it is dedicated.(2) For an ICVC, the scheme property may also include movable or immovable property that is necessary for the direct pursuit of the ICVC's business of investing in those assets or investments.(3) The scheme property must be invested only in accordance with the relevant provisions in this section that are applicable to that
COLL 5.6.7RRP
(1) This rule does not apply in respect of a transferable security or an approved money-market instrument to which COLL 5.6.8R (Spread: government and public securities) applies21. (2) Not more than 20% in value of the scheme property is to consist of deposits with a single body.(3) Not more than 10% in value of the scheme property is to consist of transferable securities or money-market instruments issued by any single body subject to COLL 5.6.23 R (Schemes replicating an index).(3A)
COLL 5.6.8RRP
(1) This rule applies in respect of a transferable security or an approved money-market instrument (“such securities”) that is issued or guaranteed by:21(a) 21an EEA State; or(b) 21a local authority of an EEA State; or(c) 21a non-EEA State; or(d) 21a public international body to which one or more EEA States belong.(2) The requirements in COLL 5.2.12 R (Spread: government and public securities) apply to investment in such securities21by a non-UCITS retail scheme, except for COLL
COLL 5.6.10ARRP
(1) 21A non-UCITS retail scheme that is not a feeder NURS may, if the conditions in (2) to (5) are met, invest in units of:(a) a feeder UCITS; or(b) a feeder NURS; or(c) a schemededicated to units in a single property authorised investment fund; or(d) a schemededicated to units in a recognised scheme.(2) (a) The relevant master UCITS must comply with COLL 5.2.13R(2), (3) and (4) as if it were the second scheme for the purpose of that rule.(b) The relevant qualifying master scheme,
COLL 5.6.18RRP
(1) Any investment in land or a building held within the scheme property of a non-UCITS retail scheme must be an immovable within (2) to (5).(2) An immovable must:(a) be situated in a country or territory identified in the prospectus for the purpose of this rule; and(b) if situated in:(i) England and Wales or Northern Ireland, be a freehold or leasehold interest; or(ii) Scotland, be any interest or estate in or over land or heritable right including a long lease; or(c) if not
COLL 5.6.20RRP
(1) The following requirements apply in relation to the appointment of a valuer:(a) the authorised fund manager must ensure that any immovables in the scheme property are valued by an appropriate valuer (standing independent valuer) appointed by the authorised fund manager; and(b) the appointment must be made with the approval of the depositary at the outset and upon any vacancy.18(2) The standing independent valuer in (1) must be:(a) for an AUT or ACS18, independent of the authorised
COLL 5.6.22RRP
The following rules in Chapter 5 apply to a non-UCITS retail scheme:(1) COLL 5.2.7 R (Transferable securities);(2) COLL 5.5.1 R(Application) and COLL 5.5.2 R (Table of application)2;(3) COLL 5.5.3 R (Cash and near cash);(4) COLL 5.5.4 R (1), COLL 5.5.4 R (2), COLL 5.5.4 R (3) and COLL 5.5.4R (8) (General power to borrow);(5) COLL 5.5.5 R (1) and3COLL 5.5.5 R (2) (Borrowing limits);33(6) COLL 5.5.6 R (Restrictions on lending of money) ;(7) COLL 5.5.7 R (1), (2) and (4)2 (Restrictions
COLL 5.6.24RRP
(1) In relation to a scheme which is an umbrella, the provisions in this section apply to each sub-fund as they would for a non-UCITS retail scheme.(2) A sub-fund may invest in or dispose of units of15 another sub-fund of the same umbrella (the second sub-fund) only if the following conditions are satisfied:1515(a) the second sub-fund does not hold units in any other sub-fund of the same umbrella;15(b) the conditions in COLL 5.2.16 R (Investment in other group schemes) and COLL
SYSC 19A.3.15ERP
(1) A firm's risk management and compliance functions should have appropriate input into setting the remuneration policy for other business areas. The procedures for setting remuneration should allow risk and compliance functions to have significant input into the setting of individual remuneration awards where those functions have concerns about the behaviour of the individuals concerned or the riskiness of the business undertaken.(2) Contravention of (1) may be relied on as
SYSC 19A.3.33GRP
Remuneration Principle 12 consists of a series of rules, evidential provisions and guidance relating to remuneration structures.
SYSC 19A.3.34GRP
(1) Taking account of the remuneration principles proportionality rule, the appropriate regulator8 does not generally consider it necessary for a firm to apply the rules referred to in (2) where, in relation to an individual ("X"), both the following conditions are satisfied:8(a) Condition 1 is that Xs variable remuneration is no more than 33% of total remuneration; and(b) Condition 2 is that Xs total remuneration is no more than 500,000.(2) The rules referred to in (1) are those
SYSC 19A.3.47RRP
(1) A firm must ensure that a substantial portion, which is at least 50%, of any variable remuneration consists of an appropriate balance of:(a) shares or equivalent ownership interests, subject to the legal structure of the firm concerned, or share-linked instruments or equivalent non-cash instruments in the case of a non-listed firm; and(b) 3where possible other instruments which are eligible as Additional Tier 1 instruments or are eligible as Tier 2 instruments or other instruments
SYSC 19A.3.52ERP
(1) A firm should reduce unvested deferred variable remuneration when, as a minimum:(a) there is reasonable evidence of employee misbehaviour or material error; or(b) the firm or the relevant business unit suffers a material downturn in its financial performance; or(c) the firm or the relevant business unit suffers a material failure of risk management.(2) For performance adjustment purposes, awards of deferred variable remuneration made in shares or other non-cash instruments
SYSC 19A.3.54RRP
(1) Subject to (1A) to (3), the rules1 in SYSC 19A Annex 1.1R to 1.4R1 apply in relation to the prohibitions on Remuneration Code staff being remunerated in the ways specified in:11(a) SYSC 19A.3.40 R (guaranteed variable remuneration);(b) SYSC 19A.3.49 R (6deferred variable remuneration); and(c) (replacing payments recovered or property transferred).(1A) Paragraph (1) applies only to those prohibitions as they apply in relation to a firm that satisfies at least one of the conditions
SYSC 19A.3.55GRP
(1) Sections 137H and 137I of the Act enables the FCA6 to make rules that render void any provision of an agreement that contravenes specified prohibitions in the Remuneration Code, and that provide for the recovery of any payment made, or other property transferred, in pursuance of such a provision. SYSC 19A.3.53A R and1SYSC 19A.3.54 R (together with SYSC 19A Annex 1) are such rules1 and render1 void provisions of an agreement that contravene the specified prohibitions on guaranteed
SUP 15.7.1RRP
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:237(1) the notification rule states otherwise; or(2) the notification is provided solely in compliance with Principle 11 (see SUP 15.3.7 G).
SUP 15.7.4RRP
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) given to or addressed for the attention of the firm's usual supervisory contact at the FCA4 and77(2) delivered to the FCA4 by one of the methods in SUP 15.7.5AR6.777
SUP 15.7.10RRP
If a notification rule requires notification within a specified period:(1) the firm must give the notification so as to be received by the FCA4 no later than the end of that period; and 77(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. 77
SUP 15.7.11GRP
If a notification rule does not require notification within a specified period, the firm should act reasonably in deciding when to notify.
SUP 15.7.15GRP
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.
SUP 15.7.16GRP
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.77