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UK Regulator to Consult on Application of the Senior Manager Regime to a Firm's Legal Function
01/27/2016
The Financial Conduct Authority published a statement on the application of the Senior Manager Regime to a firm's legal function. The SMR will come into effect on March 7, 2016. Firms are required, by February 8, 2016, to notify the FCA and the Prudential Regulation Authority of the individuals, currently Approved Persons, that will be transitioning to the new regime as Senior Managers. The FCA has become aware of significant uncertainty amongst firms as to whether an individual responsible for the firm's legal function would need to be approved as a Senior Manager. Where heads of legal are responsible for compliance, there is a clear need to register, but the position is less clear for heads of legal who do not hold this additional function. The FCA intends to consult further on this issue. In the interim, the FCA advises that firms that have sought to make decisions in good faith about whether an individual needs approval in their firm for this responsibility, based on the current rules and guidance, should not need to change their approach.
The PRA is encouraging firms to submit their grandfathering notifications in advance of the February 8 deadline on the basis that some firms that have already submitted the forms have had to re-submit their applications.
View the FCA statement.
View the PRA website.
Financial Regulatory Developments Focus