FCA releases details of consultations on the extension of SM&CR to all firms

The long-awaited consultations on the extension of the SM&CR have been released:

  • CP17/25 – Individual accountability – extending the Senior Managers and Certification Regime to all FCA firms. Banks are told to read Chapters 9 and 10 in the CP about the extra SM&CR regulations that will affect the banking sector.
  • CP17/26 – Individual accountability – extending the Senior Managers and Certification Regime to insurers

On proportionality, FCA is proposing under the extended SM&CR that FCA solo-regulated firms will be broken into three categories:

  • FCA is proposing to apply a baseline of requirements to many FCA solo-regulated firms. This will be the ‘core regime’
  • FCA is proposing that a small number of firms whose size, complexity and potential impact on consumers or markets warrant more attention will have extra requirements. This will be the ‘enhanced regime’

In addition, FCA is proposing that for firms who already have exemptions under the Approved Persons Regime, we will maintain these exemptions. These firms are known as ‘limited scope firms’, and will typically have fewer senior management functions for example. This mirrors how the Approved Persons Regime applies to these firms at the moment.

FCA asks for comments by 3 November 2017.