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    FCA Policy Statements on Extension of SM&CR to Firms and Insurers

    July 04, 2018

    FCA published the policy statements PS18/14 and PS18/15 on extending the Senior Managers & Certification Regime (SM&CR) to FCA firms and insurers, respectively. PS18/14 summarizes the feedback received on consultation papers CP17/25 (Part 1) and CP17/40 (Part 2) and sets out the FCA response to this feedback. PS18/15 sets out the response to the feedback received on CP17/26 and CP17/41. Additionally, FCA published cost-benefit analysis related to PS18/14 and PS18/15, along with the guides on SM&CR for FCA solo-regulated firms and for insurers. FCA firms affected by the changes will move to the new regime on December 09, 2019, while insurers will move to the new regime on December 10, 2018.

    PS18/14—FCA received 225 responses to the proposals in CP17/25 and 47 responses to the proposals in CP17/40. FCA made minor changes to the policy proposals as a result of the feedback. The legal instrument accompanying PS18/14 contains near‑final rules. Although the rules are near‑final in most respects, they may be amended by the subsequent Handbook changes—for example, those related to Brexit or SM&CR optimizations. However, the rules are not near‑final in respect of benchmark activities, an approach to which FCA will consult on separately. These rules are subject to commencement regulations to be made by HM Treasury.  

    PS18/15—The Policy Statement sets out changes to how FCA regulates employees of insurance firms. The SM&CR replaces FCA’s revised APR and amends PRA’s Senior Insurance Managers Regime (SIMR), which currently apply to insurers. FCA received 21 responses to the proposals in CP17/26 and ten responses to the proposals in CP17/41, which includes responses from firms and trade associations. FCA will implement the proposals set out in CP17/26 and CP17/41, as proposed. The legal instrument accompanying PS18/15 contains near-final rules. Although the rules are near-final in most respects, they may be amended by the subsequent Handbook changes—for example, those related to Brexit or SM&CR optimizations. The rules are subject to commencement regulations to be made by HM Treasury. Chapter 9 of PS18/15 describes transitional arrangements for insurance firms. 

     

    Related Links (PDF)

    Effective Date: December 09, 2018 (Firms); December 10, 2018 (Insurers)

    Keywords: Europe, UK, Banking, Insurance, Solvency II, SM&CR, SIMR, PS18/14, PS18/15, FCA

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