UK Plans to Accelerate Regulator’s Process for Cancelling Firm Authorization (in Certain Situations)
07/20/2020HM Treasury has published a policy statement setting out how it intends to change the Financial Conduct Authority’s cancellation of authorization process for firms that are no longer carrying out regulated activities under the FCA’s remit. The FCA’s regulatory scope has expanded since the provisions were set out in the Financial Services and Markets Act 2000. HM Treasury is concerned that the inability of the FCA to act quickly to cancel a firm’s authorization and remove details of the firms from the Financial Services register may lead to consumer harm. The Government is therefore planning to add a simpler process whereby the FCA can remove a firm’s authorization where it suspects that the firm is no longer undertaking regulated activities, such as where a firm fails to pay its fees or file a regulatory return. The existing procedure, which requires the FCA to demonstrate that a firm is failing to fulfil the threshold conditions, has failed to carry on a regulated activity or that it is advantageous for the FCA to use its powers to meet its operational objectives, will not be amended. A bill to make the changes will be laid when Parliamentary time allows.
View the policy statement on changes to the FCA’s cancellation of authorization process.
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