Financial Conduct Authority—imposition and variation of requirements
Financial Conduct Authority—imposition and variation of requirements

The following Financial Services guidance note provides comprehensive and up to date legal information covering:

  • Financial Conduct Authority—imposition and variation of requirements
  • What is different under the new regime?
  • What does a requirement mean for a firm?
  • Relevant regulator
  • Form of variation
  • Requirements at the request of an authorised person
  • The FCA's own-initiative powers to vary
  • The FCA's own-initiative powers—what to expect
  • Duty of the FCA and the PRA to cooperate
  • Minimum regulatory requirements—the threshold conditions

This Practice Note looks at the powers of the Financial Conduct Authority (FCA) to impose and vary requirements. For guidance on the cancellation of requirements, see Practice Note: Financial Conduct Authority—cancelling permission and requirements. A 'requirement' is a condition imposed on an authorised person by the regulator where that person has applied for:

  1. Part 4A permission, or

  2. the variation of a Part 4A permission.

The FCA can impose requirements on people regardless of whether they have applied to the Prudential Regulation Authority (PRA) or FCA for permission or a variation of permission, in accordance with sections 55L(2)(a)–(c) of the Financial Services and Markets Act 2000 (FSMA 2000).

For guidance on obtaining authorisation see Obtaining authorisation—overview; for guidance on variation of permission see Practice Note: Financial Conduct Authority—varying permission and for guidance on cancellation of permission, see Practice Note: Financial Conduct Authority—cancelling permission and requirements.

What is different under the new regime?

Although the way in which requirements are treated has changed under the new regulatory structure, the status quo remains much the same. The power to impose requirements existed under the Financial Services Authority (FSA) regime, but in a different format. Under the FSA regime, imposing, varying or cancelling a requirement formed part of the 'permission' procedure—a permission could include any requirement the FSA deemed appropriate. This is no longer the case.