FCA has updated its website to state that from 1 June 2021 firms will no longer be able to apply to change their legal status. Instead, they will need to submit a new authorisation application for the new entity and cancel the permissions of the previous one.
FCA says it has done this because it was increasingly receiving incomplete applications for change of legal status, and it will be more efficient for firms to submit entire new applications.
However, as part of the change, firms wanting to change legal status will need to:
- sign a deed poll declaration to confirm they will deal with complaints from customers of the old entity in the same way they would treat customers of the new one; and
- agree either to amend existing customer contracts, or terminate them and agree new contracts.
However, FCA notes that for some types of entity, it won’t be necessary to submit a whole new application, but will suffice to make a notification under SUP 15. This will be the case for private limited companies becoming PLCs and vice versa, partnerships becoming limited partnerships and vice versa and sole traders becoming unincorporated bodies.