UK Financial Conduct Authority Publishes Proposals to Revamp its Decision-Making Process07/29/2021The U.K. Financial Conduct Authority has published a consultation paper on proposals to change its decision-making process. The objective of these proposals is to make the FCA a nimbler regulator that can make faster and more effective decisions. Responses to the consultation may be submitted until September 17, 2021. The FCA intends to publish a Policy Statement before the end of the year, likely in November, and envisages that the revised decision-making framework would start in November, too. Any cases that are being considered by the Regulatory Decisions Committee would remain with the RDC under the existing processes.
The FCA is proposing a different split between the RDC and the Executive Procedures when it comes to decisions to issue statutory notices. Statutory notices are required when the FCA exercises certain enforcement and supervisory powers, such as varying or cancelling a firm’s authorization, refusing an application for authorization or approval of an individual, and imposing requirements on firms. The FCA is proposing that the RDC focus on contentious enforcement cases where a sanction or disciplinary measure might be imposed. Decisions under the Executive Procedures would be more preventative in nature and non-contentious. If the changes come about, the FCA’s authorization division would be able to issue notices refusing an application for authorization. In addition, it is proposed that decisions on whether to start civil or criminal proceedings through the courts would be made under Executive Procedures rather than the RDC.
One of the main impacts of these changes will be the ability to make oral representations. The FCA is proposing that where a statutory notice decision is taken under the Executive Procedures, it will take account of written representations, and in exceptional cases only, of oral representations.
In addition, the FCA is proposing to amend its policy, set out in the Enforcement Guide, relating to decisions to vary or cancel a firm's permissions or to impose requirements on a firm, which the FCA can make of its own initiative when it considers it urgent to do so. The decisions can take effect immediately or on a specified date. The FCA is proposing to remove the pre-condition of urgency for it to exercise these powers.
View the FCA's consultation paper.
Financial Regulatory Developments Focus