Top 10 tips to prepare for the SM&CR extension this December

Top 10 tips to prepare for the SM&CR extension this December

You may be aware that on 9 December 2019, the Financial Conduct Authority (FCA) is extending the Senior Managers and Certification Regime (SM&CR) to FCA solo-regulated firms. With limited exceptions, the SM&CR will apply to all firms authorised under the Financial Services and Markets Act 2000 (FSMA 2000) and to branches of non-UK firms with permission to carry out regulated activities in the UK – affecting 47,000 firms within the financial services industry.

So, it’s important that you are well prepared. In our SM&CR—policy development and key dates, you can find useful materials to help you identify the key developments in this area together with key precedents and drafting notes. Use it alongside this guide to enable you to support your organisation prepare with ease and confidence.

  1. Work out your firm type. What you are required to do under the SM&CR depends on whether your organisation is classified as Limited Scope, Core or Enhanced. It’s important you know what category your firm falls under so that you can advise them.  

    Core: firms in this tier will have to comply with the baseline requirements of SM&CR.

    Enhanced: these are a small number of firms whose size, complexity and potential impact on consumers or markets warrant more attention. 

    Limited scope: firms in this tier already have exemptions under the existing Approved Persons Regime (APR). These firms will be exempt from some baseline requirements and will typically have fewer Senior Management Functions (SMFs).

    Senior Managers Regime

    Covers the top tier of management within the firm who have ultimate accountability for the actions and decisions of the firm. Senior Managers are those who hold FCA-specified SMFs, and who must be pre-approved by the FCA.

  2. Understand the SMFs relevant to your firm. An SMF is a controlled function under FSMA 2000, applicable to UK-authorised firms and solo-regulated branches of EEA and non-EEA firms. Which SMFs apply to you will depend on what SM&CR firm type you are. The

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