Related provisions for MCOB 4.1.3

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SUP 16.23.2RRP

Unless a firm is listed in the table below, this section does not apply to it where both of the following conditions are satisfied:

  1. (1)

    the firm has reported total revenue of less than £5 million as at its last accounting reference date; and

  2. (2)

    the firm only has permission to carry on one or more of the following activities:

    1. (a)

      advising on investments;

    2. (b)

      dealing in investments as agent;

    3. (c)

      dealing in investments as principal;

    4. (d)

      arranging (bringing about deals) in investments;

    5. (e)

      making arrangements with a view to transactions in investments;

    6. (f)

      assisting in the administration and performance of a contract of insurance in relation to non-investment insurance contracts;

    7. (g)

      agreeing to carry on a regulated activity;

    8. (h)

      advising on pension transfers and pension opt-outs;

    9. (i)

      credit-related regulated activity;

    10. (j)

      home finance mediation activity;

    11. (k)

      managing investments;

    12. (l)

      establishing, operating or winding up a collective investment scheme;

    13. (m)

      establishing, operating or winding up a personal pension scheme;

    14. (n)

      establishing, operating or winding up a stakeholder pension scheme;

    15. (o)

      managing a UCITS;

    16. (p)

      managing an AIF;

    17. (q)

      safeguarding and administering investments;

    18. (r)

      acting as trustee or depositary of a UCITS;

    19. (s)

      acting as trustee or depositary of an AIF; and/or

    20. (t)

      operating a multilateral trading facility.

Table: Firms to which the exclusion in SUP 16.23.2R does not apply

a UK bank;

a building society;

a EEA bank;

a non-EEA bank;

a mortgage lender;

a mortgage administrator; or

a firm offering life and annuity insurance products.
PERG 7.1.1GRP
This chapter applies to anyone involved in publishing periodicals, or in providing news services or broadcasts, who gives (or proposes to give) advice about securities, structured deposits,4relevant investments, P2P agreements,4home finance transactions1or certain pension transfers or conversions4 and who wishes to determine whether he will be carrying on the regulated activities of advising on investments, advising on regulated credit agreements for the acquisition of land2 oradvising
PERG 7.1.2GRP
The purpose of this chapter is to provide guidance as to:(1) when a person involved in publishing periodicals, or in providing news services or broadcasts, requires authorisation to carry on the regulated activities of advising on investments, advising on regulated credit agreements for the acquisition of land,4advising on a home finance transaction1or advising on conversion or transfer of pension benefits4 (see PERG 7.3 (Does the activity require authorisation));21(2) if he does,
MCOB 7.1.3RRP
This chapter applies if a firm:(1) enters into a home finance transaction2 with a customer; or2(2) administers a home finance transaction2which was entered into with a customer; or2(3) arranges or advises on or makes a further advance or other variation to the terms of a home finance transaction2entered into with a customer.2
MCOB 7.1.4RRP
This chapter applies in relation to further advances and other variations (as specified in MCOB 7.6.7 R - MCOB 7.7.4 R in relation to a regulated mortgage contract2) regardless of whether they are variations to an existing home finance transaction2or are such that they involve the customer entering into a new home finance transaction2.22
FEES 6.7.6RRP
If a firm ceases to be a participant firm or carry out activities within one or more classes54 part way through a financial year6 of the compensation scheme:44(1) it will remain liable for any unpaid levies which the FSCS has already made on the firm; and41(2) the FSCS may make one or more levies4 upon it (which may be before or after the firm5 has ceased to be a participant firm or carry out activities within one or more classes5,4 but must be before it ceases to be an authorised
PERG 4.1.1GRP
This chapter applies to any person who needs to know whether the activities he conducts in relation to mortgages are subject to FCA regulation.
PERG 4.1.2GRP
Certain4 activities relating to mortgages are regulated by the FCA4. The purpose of this guidance is to help persons decide whether they need authorisation and, if they do, to determine the scope of the Part 4A permission4 for which they will need to apply.444
MIPRU 5.1.1RRP
2This chapter applies to a firm with a Part 4A permission to carry on:(1) insurance business; or(1A) insurance distribution activity; or4(2) home financing;111(3) [deleted]4
MIPRU 5.1.2GRP
The purpose of this chapter is to implement article 164 of the IDD4 in relation to insurance undertakings and insurance intermediaries. The provisions of this chapter have been extended to home finance providers1 in relation to insurance distribution activity4, and to insurance undertakings and home finance providers in relation to home finance mediation activity1, to ensure that firms using these services are treated in the same way and to ensure that clients have the same protection.
PERG 4.15.1GRP
The term 'packagers' is used variously to describe a range of intermediaries and their different activities in the mortgage process. Depending on the nature of their activities, these intermediaries may carry on regulated mortgage activities. The regulated activities likely to be of most relevance are arranging (bringing about) or making arrangements with a view to regulated mortgage contracts (described in more detail at PERG 4.5) and advising on regulated mortgage contracts
PERG 4.15.2GRP
So-called 'mortgage clubs' or 'wholesalers' essentially act as a distribution function for lenders, providing information to intermediaries about current deals available from a range of lenders. They provide information (often through an electronic sourcing system) in a way that helps intermediaries search the market effectively and, as such, do not deal directly with individual borrowers. If only engaged in these activities and without direct contact with individual borrowers,
IPRU-INV 13.13.3RRP
  1. (1)

    A firm to which MIPRU also applies must calculate its capital resources requirement as in (2).

  2. (2)

    The firm must calculate its capital resources requirement as the higher of:

    1. (a)

      £20,000; and

    2. (b)

      the sum of:

      1. (i)

        the amount that would have applied to it under IPRU-INV 13.13.2R(2)(b) if it were a firm of the type in column (B) of table 13.13.2(2)(b); and

      2. (ii)

        the capital resources requirement in MIPRU 4.2. (Capital resources requirements), after excluding the fixed amounts specified in table 13.13.3(2)(b)(ii).

Table 13.13.3(2)(b)(ii)

This table forms part of IPRU-INV 13.13.3R.

Activity

Provision

Fixed amount

Insurance distribution activity2 or home finance mediation activity

MIPRU 4.2.11R(1)(a) (firm not holding client money or assets)

£5,000

MIPRU 4.2.11R(2)(a) (firm holding client money or assets)

£10,000

Home financing and home finance administration (not connected to regulated mortgage contracts)

MIPRU 4.2.12R(1)(a)

£100,000

Home finance administration (with all assets off balance sheet)

MIPRU 4.2.19R(1)

£100,000

Home financing and home finance administration (connected to regulated mortgage contracts)

MIPRU 4.2.23R(1)

£100,000
IPRU-INV 13.13.4GRP
  1. (1)

    IPRU-INV 13.13.4G(2) illustrates how a firm that is subject to this section and MIPRU calculates its capital resources requirement under IPRU-INV 13.13.3R.

  2. (2)

    Example: A category B3 firm with annual income of £300,000 under this section and £100,000 from its home finance mediation activity (without holding client money) should calculate capital resources requirement as specified in table 13.13.4G(2).

Table 13.13.4G(2)

This table forms part of IPRU-INV 13.13.4G.

Requirement

Calculation

Amount

The capital resources requirement is the higher of:

(1) £20,000; and

£20,000

£20,000

(2) The sum of:

(a) the amount that would have applied to it under IPRU-INV 13.13.2R(2)(b) if it were a firm of the type in column (B) of table 13.13.2(2)(b); and

As this is a category B3 firm, the applicable calculation is 5% of £300,000.

£15,000

(b) the capital resources requirement in MIPRU 4.2. (Capital resources requirements), after excluding the fixed amounts specified in table 13.13.3(2)(b)(ii).

For a firm carrying on home finance mediation activity without holding client money, MIPRU 4.2.11R(1) specifies a requirement of 2.5% of £100,000 (excluding the amount of £5,000 in MIPRU 4.2.11R(1)(a)).

£2,500

Total of part (2) of the capital resources requirement, which is £15,000 plus £2,500.

£17,500

The capital resources requirement is the higher of part (1), which is £20,000, and part (2), which is £17,500.

£20,000
MCOB 8.1.2BGRP
5MCOB 8.1.2A R means that the situations where MCOB 8.6A applies to an equity release provider include where an equity release intermediary has been involved in arranging (bringing about) an equity release transaction but is no longer involved in the transaction.
MCOB 8.1.3RRP
4(1) This chapter applies to a firm4 which5 in the course of carrying on an equity release activityenters into, advises on or arranges an equity release transaction or a variation of the terms of an equity release transaction.5445(2) In respect of arranging or advising on a home reversion plan for a customer who is acting in his capacity as an unauthorised reversion provider, only MCOB 8.1, MCOB 8.2 and MCOB 8.7 apply.44
MCOB 2.7.2GRP
For any electronic communication with a customer in relation to a home finance transaction3 a firm should: 3(1) have in place appropriate arrangements, including contingency plans, to ensure the secure transmission and receipt of the communication; it should also be able to verify the authenticity and integrity of the communication together with the date and time sent and received; the arrangements should be proportionate and take into account the different levels of risk in a
MCOB 2.7.6RRP
(1) 12A firm must not:(a) supply a service to a consumer4 without a prior request on his part, when this activity includes a request for immediate or deferred payment; or 4(b) enforce any obligations against aconsumer4 in the event of unsolicited supplies of services, the absence of a reply not constituting consent. 4(2) Paragraph (1) applies in relation to mortgage mediation activities, entering into a regulated mortgage contract, home purchase mediation activities or entering
PERG 4.14.1GRP
Professional firms (broadly, firms of solicitors, accountants and actuaries) may carry on regulated mortgage activities in the course of their usual professional activities. The regulated activities of advising on, arranging (bringing about), making arrangements with a view to and administering regulated mortgage contracts are those most likely to be relevant.
PERG 4.14.2GRP
In the FCA's view, the following exclusions are likely, in many cases, to exclude the normal activities of professional firms from amounting to regulated mortgage activities:(1) article 67 of the Regulated Activities Order (Activities carried on in the course of a profession or non-investment business), which applies in relation to the advising and arranging activities (see PERG 4.10.1 G);(2) article 66 of the Regulated Activities Order (Trustees, nominees and personal representatives)
SUP 15.13.3GRP
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) 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) it applies to cancel its Part 4A permission; or(3) it applies to vary its Part
SUP 15.13.4GRP
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) 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) it changes its registered office or place of residence as the case
MCOB 9.3.1RRP
(1) MCOB 5.1 to MCOB 5.5 (with the modifications stated in MCOB 9.3.2 R to MCOB 9.3.12 R) apply to a firm where the home finance transaction is an equity release transaction, except that those provisions that by their nature are only relevant to regulated mortgage contracts do not apply to home reversion plans (see MCOB 9.1.2A G).33(2) The table in MCOB 9.3.2 R shows how the relevant rules and guidance in MCOB 5 must be modified by replacing the cross-references with the relevant
MCOB 9.3.2RRP

Table of modified cross-references to other rules.

This table belongs to MCOB 9.3.1 R.

Subject

Rule or guidance

Reference in rule or guidance

To be read as a reference to:

Variations

MCOB 5.1.3R(2)

MCOB 7

MCOB 7 as modified by MCOB 9

Part of loan not an equity release transaction2

2

MCOB 5.1.9G

MCOB 5.6.6R(2)

MCOB 9.4.6R(2)

Waiver of provisions

MCOB 5.1.10G

MCOB 5.6

MCOB 9.4.

Purpose

MCOB 5.2.1G

MCOB 5

MCOB 5 as modified by MCOB 9

Applying for a lifetime mortgage2

2

MCOB 5.3.2G

MCOB 5.6.26R and MCOB 5.6.27R

MCOB 9.4.26R and MCOB 9.4.27R

4Messages to be given when providing information on equity release transactions

MCOB 5.4.18AR (1)

MCOB 5.4.18AR (1)(a)

MCOB 4.7A.2 R

MCOB 4.4A.1R (1), MCOB 4.4A.2 R and MCOB 4.4A.4R (1)

MCOB 8.5A.2 R

MCOB 4.4A.1R (1), MCOB 4.4A.2 R and MCOB 4.4A.4R (1), each as applied by MCOB 8.3.1 R in modified form

4Messages to be given when customer requests an execution-only sale

MCOB 5.4.18BR (1)

MCOB 4.8A.14R (1) to MCOB 4.8A.14R (3)

MCOB 8.6A.4R (2)

4Guidance relevant to messages given to customer

MCOB 5.4.18C G

MCOB 5 Annex 1

MCOB 9 Annex 1 R for a lifetime mortgage; MCOB 9 Annex 2 R for a home reversion plan.

Tied products

MCOB 5.4.24G

MCOB 5.6.74R

MCOB 9.4.73R or MCOB 9.4.160R3

4Provision of illustrations: timing

MCOB 5.5.1 R (2)(e)

MCOB 4.8A.14R (1), (2) or (3)

MCOB 8.6A.4R (2)

Issue of offer document in place of illustration

MCOB 5.5.3G

MCOB 6.4 and MCOB 6.6

MCOB 6.4 and MCOB 6.6 as modified by MCOB 9

Customer's credit record

MCOB 5.5.16R

MCOB 5.5.15R(4)

MCOB 9.3.12R(3)
MCOB 8.3.1RRP
(1) 3(a) 3Subject to (c),4MCOB 4.1 to MCOB 4.6A4 (with the modifications stated in MCOB 8.3.2B R to4MCOB 8.3.4 R) apply to a firm where the home finance transaction is a lifetime mortgage.343(b) MCOB 4.1 to MCOB 4.4A4 (with the modifications stated inMCOB 8.3.2B R to4MCOB 8.3.4 R) apply to a firm where the home finance transaction is a home reversion plan, except for those provisions that by their nature are only relevant to regulated mortgage contracts.34(c) MCOB 4.6A applies
MCOB 8.3.2BRRP
4For the purposes of MCOB 4.4A.2R (1) there is one relevant market for equity release transactions. Accordingly, a firm offering a customer only lifetime mortgages or only home reversion plans must include in its disclosure under MCOB 4.4A.1R (1) that it is limited in that regard in the range of products that it can offer to the customer.
MCOB 6.1.3RRP
This chapter applies with respect to an offer made by a firm to a customer with a view to the firm:(1) entering into a home finance transaction;33(2) varying the terms of a home finance transaction3 entered into by the customer in any of the following ways:3(a) adding or removing a party;(b) making a further advance; or(c) switching all or part of the regulated mortgage contract from one interest rate to another;1(whether or not the customer agrees to enter into the home finance
MCOB 6.1.5RRP
In MCOB 6, a reference to an offer to enter into a home finance transaction3 is to be read as including a reference to an offer to vary an existing home finance transaction3 in a manner specified in 3this section3 if the context so requires.33
MCOB 8.5A.3RRP
In MCOB 8.5A, a reference to advice to enter into an equity release transaction is to be read as including advice to vary an existing equity release transaction.
MCOB 8.5A.16GRP
Different considerations apply when dealing with a customer with a payment shortfall. For example, the circumstances of the customer may mean that, viewed as a new transaction, a customer should not be advised to enter into an equity release transaction. In such cases, a firm may still be able to advise the customer to enter into an equity release transaction where it is more suitable than the customer's existing home finance transaction.
MCOB 6.2.1GRP
(1) MCOB 6 amplifies Principle 6 and Principle 7. The purpose of MCOB 6 is to ensure that a customer receives a clear offer document to enable him to check the features and price of thehome finance transaction1 before he enters into it. The offer document should include an updated and suitably adapted illustration (for a regulated mortgage contract) or financial information statement (for a home purchase plan)1 so that the customer can compare it with the one1 he received before
MCOB 7.2.1GRP
(1) This chapter amplifies Principle 6 and Principle 7. 2(1A) 2This chapter requires information to be supplied to customers at the start of a2regulated mortgage contract to enable them to check that the regulated mortgage contract has been set up in accordance with their requirements and to notify them of the first and subsequent payments.2(2) Where a firm provides services to a customer in relation to a further advance, rate switch, or addition or removal of a party to a regulated
MCOB 4.2.1GRP
(1) This chapter amplifies Principle 6 (Customers' interests), Principle 7 (Communications with clients) and Principle 9 (Customers: relationships of trust). 1(2) The purpose of this chapter is to ensure that:(a) customers are adequately informed about the range2 of home finance transactions available from firms and the basis of their remuneration;21212(b) where advice is given, it is suitable for the customer.2(c) 2the firm provides advice whenever it makes a sale during which
MCOB 2.5.1GRP
Principle 2 requires a firm to conduct its business with due skill, care and diligence. MCOB 2.5 indicates the extent to which firms that carry on home finance activities1 and that communicate or approve a financial promotion1 can meet this requirement by relying on others. 11