FCA Consulting on Extending Deadlines for the Certification Regime and Conduct Rules

The FCA has published a consultation paper on making changes to its rules following the extension to the deadline by which FCA solo-regulated firms need to have implemented the Certification Regime.

It was announced in June that the deadline by which firms must have first assessed the fitness and propriety of their Certified Staff will be delayed until 31 March 2021.

In order to ensure the consistency of SM&CR deadlines and to provide extra time where firms need it, the regulator is now consulting on extending the deadline for:

  • the date the Conduct Rules come into force;
  • the deadline for submission of information about Directory Persons to the Register;
  • references in our rules to the deadline for assessing Certified Persons as fit and proper (which has been agreed by the Treasury);

from 9 December 2020 to 31 March 2021.

FCA Executive Director of Supervision, Retail and Authorisations, Jonathan Davidson, said: “These proposed changes recognise the exceptional stress placed on financial services firms by the Covid-19 pandemic and the importance for firms to fully and properly implement the Certification Regime and to train staff effectively in the Conduct Rules.”

He also stated that the FCA “continue to place great importance on the Certification Regime and the Conduct Rules and see this as an opportunity to raise the bar permanently around conduct, competence and culture in the financial services industry.”

Firms are expected to use the extra time, if they need it, “to implement Certification and Conduct Rules training to the highest standards.”

Senior Managers are expected to ensure that all Certified Persons are fit and proper, and firms should not wait to remove staff who are not fit and proper from certified roles.

Senior Managers must also ensure that Conduct Rules training is effective – i.e. staff should be aware of the Conduct Rules and understand how they apply to them in their roles. Such training programmes will require planning, time and effort to deliver effectively and the FCA has said that further communications will follow regarding its expectations.

Who does the consultation apply to?

  • All FCA solo-regulated firms authorised to provide financial services under Financial Services and Markets Act 2000 (FSMA).
  • Appointed Representatives (ARs) would also be in scope of the proposed extension to the reporting deadline for Directory Persons.
  • These proposals do not apply to benchmark administrators.

Comments on this consultation are expected by 14 August 2020.

About the author

Kirk joined RWA in 2015, having worked in the financial services sector for many years. He started out in both the general insurance and mortgage advice arms of HSBC, before becoming the Compliance Officer at Go Compare and Training & Competence Manager at Optimum Credit. 

At RWA, Kirk is Deputy Head of Compliance. He supports RWA clients by looking after their compliance, training and competence needs and keeping them up to date with regulatory changes. He promotes the achievement of fair customer outcomes and specialises in designing and implementing T&C schemes for firms of all sizes.

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