Related provisions for FEES 6.1.13

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The FSCS may at any time impose a management expenses levy or a compensation costs levy, provided that the FSCS has reasonable grounds for believing that the funds available to it to meet relevant expenses are, or will be, insufficient, taking into account:(1) in the case of a management expenses levy, the level of the FSCS's anticipatedexpenditure in respect of those expenses in the financial year of the compensation scheme in relation to which the levy is imposed; and(2) in
The maximum amount of compensation costs for which the FSCS can levy each sub-class and class in any one financial year of the compensation scheme is limited to the amounts set out in the table in FEES 6 Annex 2 R.22
FEES 6.3.11RRP
The FSCS must hold any amount collected from a specific costs levy or compensation costs levy to the credit of the classes2 and relevant sub-classes,2 in accordance with the allocation established under FEES 6.4.6 R and FEES 6.5.2 R.22
FEES 6.3.13RRP
Interest earned by the FSCS in the management of funds held to the credit of a sub-class2 must be credited to that sub-class2, and must be set off against the management expenses or compensation costs2allocated to that sub-class.2222
FEES 6.3.17RRP
(1) The FSCS may use any money held to the credit of one class2(the creditor class)2 to pay compensation costsin respect of or allocated to 2another class2(the debtor class)2 if the FSCS has reasonable grounds to believe that this would be more economical than borrowing funds from a third party or raising a levy.2222(2) Where the FSCS acts in accordance with (1), it must ensure that:(a) the creditor class2 is reimbursed by the debtor class2 as soon as possible;22(b) the debtor
FEES 6.3.19RRP
Unless FEES 6.3.20 R applies, any recoveries made by the FSCS in relation to protected claims must be credited to the sub-classes2 to which the related compensation costs were allocated.2
FEES 6.3.22RRP
The FSCS may adjust the calculation of a participant firm's share of any levy to take proper account of:(1) any excess, not already taken into account, between previous levies of that type imposed in relation to previous periods and the relevant costs actually incurred in that period; or(2) participant firms that are exempt from the levy under FEES 6.2; or(3) amounts that the FSCS has not been able to recover from participant firms as a result of FEES 6.3.5 R ; or2(4) amounts
Section 213(3)(b) of the Act requires the FSA to make rules to enable the FSCS to impose levies on authorised persons in order to meet its expenses. These expenses include in particular expenses incurred, or expected to be incurred, in paying compensation, borrowing or insuring risks.
The FSCS may impose twotypes of levy: a management expenses levy, and a compensation costs levy. The FSCS has discretion as to the timing of the levies imposed.2
Section 223 of the Act (Management expenses) prevents the FSCS from recovering, through a levy, any management expenses attributable to a particular period in excess of the limit set in COMP as applicable to that period. 'Management expenses' are defined in section 223(3) to mean expenses incurred or expected to be incurred by the FSCS in connection with its functions under the Act, except:(1) expenses incurred in paying compensation; and(2) expenses incurred as a result of the
FEES 6.1.10GRP
A management expenses levy under COMP may consist of two 2elements. The first is a base costs levy, for the base costs of running the compensation scheme in a financial year, that is, costs which are not dependent upon the level of activity of the compensation scheme and which therefore are not referable to any specific default. Included in this category are items such as the salary of the members of the board of the FSCS, the costs of the premises which the FSCS occupies, and
A participant firm must pay to the FSCS a share of each management expenses levy.
The total of all management expenses levies attributable to a particular period of the compensation scheme may not exceed the limit applicable to that period set out in FEES 6 Annex 1 R.
The FSCS must ensure that each participant firm's share of a management expenses levy separately identifies the firm's share of the base costs levy and1specific costs levy .11
Unless FEES 6.3.22 R applies, the FSCS must calculate a participant firm's share of a base costs levy by:(1) identifying the base costs which the FSCS has incurred, or expects to incur, in the relevant financial year of the compensation scheme, but has not yet levied;(2) calculating the amount of the participant firm's regulatory costs as a proportion of the total regulatory costs relating to all participant firms for the relevant financial year; and(3) applying the proportion
A firm which becomes a participant firm part way through a financial year of the compensation scheme will not be liable to pay a share of a specific costs levy made in that year.
FEES 6.4.10GRP
Since a firm that becomes a participant firm in the course of a financial year of the compensation scheme will already be obtaining a discount in relation to the base costs levy through the modified fee provisions of FEES 4.2.6 R, no rule is necessary in COMP for discounts on the base costs levy.11
If a participant firm which is in default has carried on a regulated activity other than in accordance with a permission, the FSCS must allocateany compensation costs or specific costs arising out of that activity to the relevant sub-class4 which covers that activity or if a levy limit of the relevant sub-class or class has been exceeded, FSCS must allocate any compensation costs levy on the same basis as set out in FEES 6.5.2 R4.4
If the relevant person in default is an appointed representative, the FSCS must allocateany compensation costs or specific costs arising out of a regulated activity for which his principal has not accepted responsibility to the relevant sub-class4 for that activity or if a levy limit of the relevant sub-class or class has been exceeded, FSCS must allocate any compensation costs levy on the same basis as set out in FEES 6.5.2 R.44
If a firm ceases to be a participant firm part way through a financial year of the compensation scheme:(1) it will remain liable for any unpaid levies which the FSCS has already made on the firm;1(2) the FSCS may make a levy upon it (which may be before or after the firmhas ceased to be a participant firm, but must be before it ceases to be an authorised person) for the costs which it would have been liable to pay had the FSCS made a levy on all participant firms at the time
Paragraph 17 of Schedule 1 and section 99 to the Act enable the FSA to charge fees to cover its costs and expenses in carrying out its functions. The corresponding provisions for the FSCS levy and FOS levies and case fees are set out in FEES 6.1, and FEES 5.2 respectively.
The key components of the FSA fee mechanism (excluding the FSCSlevy and FOS levy and case fees, which are dealt with in FEES 5 and FEES 6) are:(1) a funding requirement derived from:(a) the FSA's financial management and reporting framework;(b) the FSA's budget; and(c) adjustments for audited variances between budgeted and actual expenditure in the previous accounting year, and reserves movements (in accordance with the FSA's reserves policy);(2) mechanisms for applying penalties