FCA Handbook - SUP 10C.1 Application

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SUP 10C.1 Application

This chapter applies to every SMCR firm.

This chapter is also relevant to FCA-approved SMF managers of an SMCR firm.

SUP 10C Annex 1 (What functions apply to what type of firm) sets out:

This chapter does not apply to an overseas SMCR firm other than in relation to an establishment maintained by it or its appointed representative in the United Kingdom.

(1)
Generally, where an overseas manager of an overseas SMCR firm has responsibilities in relation to its branch in the United Kingdom that are strategic only, they will not need to be an FCA-approved SMF manager.
(2)
However, where an overseas manager is responsible for implementing that strategy for its branch in the United Kingdom, and has not delegated that responsibility to an SMF manager in the United Kingdom, they will potentially be performing an FCA controlled function if the detailed conditions in this chapter defining the relevant FCA controlled function are met.

There are no territorial limitations to SUP 10C for:

(1)
overseas branches of UK firms; or
(2)
UK firms providing services into or out of the United Kingdom on a cross-border basis.

This chapter does not deal with an approved person who is approved under SUP 10A (FCA Approved Persons in Appointed Representatives).

(1)
SUP 10A (FCA Approved Persons in Appointed Representatives) deals with the approved persons regime for appointed representatives of SMCR firms.
(2)
In general this chapter does not apply to appointed representatives of SMCR firms. SUP 10A applies instead.
(3)
In theory, a person employed by an appointed representative of an SMCR firm could come within one of the controlled functions in this chapter. If so, that person will be performing a senior management function and this chapter would apply. However, the FCA thinks that such a situation should rarely arise unless the person is seconded to the firm.
(4)
If a person is an approved person under this chapter and under SUP 10A for the same firm, this chapter applies to FCA-designated senior management functions under this chapter and SUP 10A applies to controlled functions under SUP 10A. It is unlikely that such a scenario would normally arise in practice.
(5)
Both this chapter and SUP 10A deal with an appointed representative that has a limited permission to carry on a regulated activity prescribed for the purposes of section 39(1E)(a) of the Act.

This chapter does not apply to a function performed by a person acting as:

(1) an insolvency practitioner within the meaning of section 388 of the Insolvency Act 1986;
(2) a nominee in relation to a voluntary arrangement under Parts I (Company Voluntary Arrangements) and VIII (Individual Voluntary Arrangements) of the Insolvency Act 1986;
(3) an insolvency practitioner within the meaning of article 3 of the Insolvency (Northern Ireland) Order 1989; or
(4) a nominee in relation to a voluntary arrangement under Parts II (Company Voluntary Arrangements) and VIII (Individual Voluntary Arrangements) of the Insolvency (Northern Ireland) Order 1989;
(5) a person acting as a resolution administrator appointed by the Bank of England in accordance with section 62B of the Banking Act 2009;
(6) a person appointed by the Bank of England as a director or senior manager to a bank, building society, stabilisation vehicle or banking group company for any purpose in connection with the exercise of a stabilisation option or a stabilisation power; or
(7) a person appointed by the Treasury as a director or a senior manager to a bank, building society or banking group company for any purpose in connection with the exercise of the temporary public ownership stabilisation option, throughout the period of 2 years beginning with the date of that appointment.

The following terms as used in SUP 10C.1.9R and in this rule have the following meanings:

(1) ‘banking group company’ has the meaning in section 81D of the Banking Act 2009;
(2) ‘senior manager’ means a person who exercises executive functions and is responsible, and directly accountable to the directors, for the day-to-day management of a bank, building society, stabilisation vehicle or banking group company;
(3) ‘stabilisation option’ means any of the stabilisation options listed in section 1(3) of the Banking Act 2009;
(4) ‘stabilisation power’ means any of the stabilisation powers listed in section 1(4) of the Banking Act 2009;
(5) ‘stabilisation vehicle’ means a bridge bank as defined in section 12(1) of the Banking Act 2009 or an asset management vehicle as defined in section 12ZA(2) of the Banking Act 2009; and
(6) ‘temporary public ownership stabilisation option’ means the transfer to temporary public ownership in accordance with section 13 of the Banking Act 2009.

For Swiss general insurers, references in this chapter to parts of the PRA Rulebook for ‘Solvency II firms’ are to be read as references to the corresponding parts of the PRA Rulebook applying to large non-directive insurers.

Swiss general insurers are in the large non-directive insurers sector of the PRA Rulebook and the PRA applies to them, in relation to their controlled functions, provisions equivalent to those applying to third country branches in the Solvency II firms sector of the PRA Rulebook. The FCA includes them as third country undertakings of Solvency II firms and so they must follow the requirements for Solvency II firms set out in this chapter.

See MIPRU 2.2 (Allocation of the responsibility for insurance distribution activity or MCD credit intermediation activity) for how the FCA’s senior managers regime for SMCR firms is adjusted for a firm carrying on insurance distribution activity or MCD credit intermediation activity.