Related provisions for DTR 6.2.9
Schedule to the Recognition Requirements Regulations, Paragraph 6
2(1) The [UK RIE] must be able and willing to promote and maintain high standards of integrity and fair dealing in the carrying on of regulated activities by persons in the course of using the facilities provided by the [UK RIE]. |
(2) The [UK RIE] must be able and willing to cooperate by the sharing of information or otherwise, with the [FCA].4with any other authority, body or person having responsibility in the United Kingdom for the supervision or regulation of any regulated activity or other financial service, or with an overseas regulator within the meaning of section 195 of the Act. 4 |
Schedule to the Recognition Requirements Regulations, Paragraph 2
2(1) The [UK RIE] must be a fit and properpersonto perform the [ relevant functions ] of a [ UK RIE ]. |
(2) In considering whether this requirement is satisfied, the [FCA]4 may (without prejudice to the generality of regulation 6(1)) take into account all the circumstances, including the [UK RIE's] connection with any person. 4 |
2(3) The members of the management body5 must be of sufficiently good repute and possess sufficient knowledge, skill and experience to perform their duties5. |
2(4) The persons who are in a position to exercise significant influence over the management of the [UK RIE], whether directly or indirectly must be suitable. |
Variation and cancellation of Part 4A permission and imposition, variation and cancellation of requirements. See SUP 6.2.3A G to SUP 6.2.3E G8
8Question |
Variation of Part 4A permission |
Cancellation of Part 4A permission |
Imposition, variation and cancellation of requirements |
What does the application apply to? |
Individual elements of a firm'sPart 4A permission. Variations may involve adding or removing categories of regulated activity or specified investments or varying or removing any limitations in the firm'sPart 4A permission. |
A firm's entire Part 4A permission and not individual elements within it. |
Any requirement imposed on a firm with a Part 4A permission. Requirements may involve requiring the firm concerned to take or refrain from taking a specified action. |
In what circumstances is it usually appropriate to make an application? |
If a firm: 1. wishes to change the regulated activities it carries on in the United Kingdom under a Part 4A permission (SUP 6.3); or 2. has the ultimate intention of ceasing carrying on regulated activities but due to the nature of those regulated activities (for example, accepting deposits, or insurance business) it will require a long term (normally over six months) to wind down (run off) its business (see SUP 6.2.8 G to SUP 6.2.11 G and SUP 6 Annex 4). |
If a firm: 1. has ceased to carry on all of the regulated activities for which it has Part 4A permission (SUP 6.4); or 2. wishes or expects to cease carrying on all of the regulated activities for which it has Part 4A permission in the short term (normally not more than six months). In this case, the firm may apply to cancel its Part 4A permission prior to ceasing the regulated activities (see SUP 6.4.3 G). |
If a firm: 1. wishes to have a new requirement imposed on it; or 2. wishes to vary or cancel an existing requirement imposed by the FCA or PRA (for example, if anything relating to the firm's individual circumstances change and any existing requirement should be varied or cancelled). |
Table: Examples5 of how the requirements for submitting statements of responsibilities work
1Example |
Comments |
(1) A firm applies for approval for A to perform the executive director function5 and the money laundering reporting function5. |
There should be a single statement of responsibilities document that covers the two functions. The combined document should be included with the application for approval. |
(2) Firm X applies for approval for A to perform the executive director function5. Firm Y applies for approval for A to perform the money laundering reporting function. Both firms are SMCR firms5. |
There should be separate statements of responsibilities for each firm. This is the case even if Firm X and Firm Y are in the same group. |
(3) A firm applies for approval for A to perform an FCA-designated senior management function and a PRA-designated senior management function. The arrangements in SUP 10C.9 for FCA functions to be absorbed into PRA ones do not apply and so there are separate applications to the FCA and PRA. The firm is a PRA-authorised person.6 |
The single statement of responsibilities document should cover both the FCA and the PRA functions. |
(4) A has approval to perform the executive director function5. Later, A is to be appointed to perform the money laundering reporting function5 for the same firm. This will also result in substantial changes to A’s duties as an executive director. |
The firm should not use Form J to notify the changes to A’s duties as an executive director. The firm should submit a revised single statement of responsibilities document along with the application to perform the money laundering reporting function5. The single statement of responsibilities document should cover both functions. The part relating to A’s duties as an executive director should be updated. |
(5) A has approval to perform the executive director function5. Later, A is to be appointed to perform the PRA's chief risk officer designated senior management function for the same firm. This will also result in substantial changes to A’s duties as an executive director. The firm is a PRA-authorised person.6 |
The firm should not use Form J to notify the changes to A’s duties as an executive director. The firm should submit a revised single statement of responsibilities document along with the application to perform the PRA function. The firm should not submit the revised single statement of responsibilities document separately to the FCA. Instead, it should include it as part of the application to the PRA. The single statement of responsibilities document should cover both the FCA and the PRA functions. The part relating to A’s duties as an executive director should be updated. |
(6) A has approval to perform the money laundering reporting function5. The approval to perform the money laundering reporting function5 is subject to a condition. The firm is applying to vary that condition. |
The firm should include a revised statement of responsibilities with the application. The firm should not use Form J. It should submit a revised statement of responsibilities along with the application to vary the approval. |
(7) A has approval to perform the executive director function5 and the money laundering reporting function5 for the same firm. The approval to perform the money laundering reporting function5 is subject to a condition. The firm is applying to vary that condition. As part of the same arrangements, there are to be substantial changes to A’s job as an executive director. |
The firm should not use Form J to notify the changes to A’s duties as an executive director. The firm should submit a revised single statement of responsibilities document along with the application to vary the approval for the money laundering reporting function5. The single statement of responsibilities document should be updated and should cover both functions. |
(8) A has approval to perform the executive director function5 and the PRA's chief risk officer designated senior management function for the same firm. The arrangements in SUP 10C.9 for FCA functions to be absorbed into PRA ones do not apply and so there are separate FCA and PRA approvals. The approval to perform the PRA's chief risk officer designated senior management function is subject to a condition. The firm is applying to vary that condition. As part of the same arrangements, there are to be substantial changes to A’s job as an executive director. The firm is a PRA-authorised person.6 |
The firm should not use Form J to notify the changes to A’s duties as an executive director. The firm should submit a revised single statement of responsibilities document along with the application to vary the PRA function. The firm should not submit the revised document separately to the FCA. Instead it should include it as part of the application to the PRA. The single statement of responsibilities document should cover both the FCA and the PRA functions and should be updated. |
(9) A has approval to perform the executive director function5 and the money laundering reporting function5 for the same firm. Sometime later, A is to give up the money laundering reporting function5 and take up the PRA's chief risk officer designated senior management function. This will involve major changes to A’s role as executive director. The firm is a PRA-authorised person.6 |
The answer to example (5) applies. The application to the PRA to perform the PRA function should be accompanied by a single document that: (1) contains the statement of responsibilities for the new function; (2) contains the revised statement of responsibilities for the executive director function5; and (3) reflects the fact that A is no longer performing the money laundering reporting function5. |
(10) A firm has approval for A to perform the executive director function5 and the money laundering reporting function5. A then ceases to perform the money laundering reporting function5 but continues to perform the executive director function.5 |
The firm must submit: (a) Form C for the money laundering reporting function5; (b) Form J; and (c) a single updated statement of responsibilities document that covers the executive director function and reflects the fact that A is no longer performing the money laundering reporting function5. |
(11) A has approval to perform the executive director function5 and the PRA's chief risk officer designated senior management function for the same firm. Later, A gives up his role as chief risk officer. The firm is a PRA-authorised person.6 |
The firm must submit: (a) Form C for the PRA function; (b) Form J; and (c) a single updated statement of responsibilities document that covers the executive director function5. The firm should not submit the revised single statement of responsibilities document separately to the FCA. Instead, it should include it as part of the notification to the PRA. |
(12) A has approval to perform the executive director function5. Later, A is to be appointed to perform the money laundering reporting function5 for the same firm. The application is rejected. |
The single statement of responsibilities document submitted as part of the application will no longer be correct as it reflects the proposed new approval. If the only changes to the single document in the version sent with the application are ones5 clearly and exclusively tied to the new function, the firm will not need to amend the document as the changes will automatically fall away. In any other case (for instance if the application is approved conditionally), it is likely that the firm will need to update it using Form J. In any case, the FCA may contact the firm to agree a revised single statement of responsibilities document. |
(13) A has approval to perform the money laundering reporting function5. Later, A is to be appointed as an executive director5 for the same firm. This will not result in any significant5 changes to A’s duties in the money laundering reporting function5. However, there have been some insignificant changes to A’s role in the money laundering reporting function5 since the firm submitted the most recent single statement of responsibilities document. The changes are not connected to A’s appointment as executive director5. |
The answer for example (4) applies. The single statement of responsibilities document should be updated to cover the changes to A’s duties in the money laundering role as well as covering A’s appointment to perform the executive director function. It does not matter that the changes to A’s money laundering role5 are not significant. |
(14) A has approval to perform the executive director function5. Later, A’s business unit grows in size and so the firm needs to apply for A to be approved to perform the PRA's Head of Key Business Area designated senior management function. However, A’s responsibilities do not change. The firm is a PRA-authorised person.6 |
The firm should submit a revised single statement of responsibilities document along with the application to perform the PRA function. The firm should submit a single statement of responsibilities document that covers both the FCA and the PRA functions. It should not submit the revised single statement of responsibilities document separately to the FCA. Instead, it should include it as part of the application to the PRA. |
2(15) Firm X has a branch in the United Kingdom. Firm Y is a UK authorised subsidiary3 of firm X. Firm X is an overseas SMCR firm that is not an EEA SMCR firm5 and firm3 Y is a UK SMCR firm5. Both firms apply for approval for the same individual (P) to perform the executive director function5. 3 |
There should be separate statement of responsibilities for P for each firm. |
7(16) An FCA-approved SMF manager goes on or returns from a temporary absence of longer than 12 weeks. |
The firm must submit: (a) Form D (SUP 10C Annex 6R); (b) Form J (SUP 10C Annex 9D); and (c) an updated statement of responsibilities document (SUP 10C Annex 10D). |
Note:5 The single statement of responsibilities document means the single document described in SUP 10C.11.13D.5 |