| Link(s): | FCA removes further regulatory returns no longer needed | FCA CP25/16: Quarterly consultation paper No. 48 | FCA CP25/16: Quarterly Consultation Paper |
Context
The FCA has published, as part of its latest Quarterly Consultation, proposals to remove reporting requirements and notifications, including the REP022 general insurance pricing practices Attestation and the ‘nil return’ requirements for REP008 (notification of disciplinary action relating to conduct rules staff other than SMF managers).
Key points to note and next actions
REP022 general insurance pricing practices Attestation
The FCA is proposing to decommission REP022 as it is no longer an essential way to monitor firms’ compliance. The FCA is making this change as it considers there to be more proportionate ways of ensuring senior managers remain accountable for compliance with our pricing rules. The impact on the Rules will be to remove the requirements set out at ICOBS 6B.2.60 R to 6B.2.63G. REP022 is completed by some 11,200 firms.
Firms should be aware that this does not mean that the FCA’s focus will be any less of firms’ compliance with the insurance pricing Rules. The FCA has used firms’ Attestations to inform its supervision of the implementation of the pricing rules but, as the pricing rules have been in force for several years, the FCA considers that firms should have properly established their processes to comply with these requirements. As a result, the FCA considers that the Attestation reporting requirements via REP022 are no longer an essential way to monitor firms’ compliance. Firms will still need to demonstrate how they are complying with the pricing rules, which will require the relevant senior management of these firms to take accountability for ensuring their firms’ regulatory compliance with the rules.
‘Nil return’ requirement for REP008
The FCA is removing the requirement to submit nil returns for REP008, as it has determined that nil return submissions do not provide additional regulatory value to FCA supervision. If a firm has nothing to report in relation to disciplinary action relating staff subject to the conduct rues (other than SMF managers) , there is no requirement to make a nil return. Firms should not, therefore, send a notification for the relevant period. The return itself will simply have the option to make a nil return removed from it.
REP008 is complete by some 36.000 firms. A Freedom of Information request revealed that, at the time the request was answered by the FCA, 36,994 returns had been submitted. Of those, 36,166 (almost 98%) were nil returns. The other 828 returns included reports about 3,814 staff breaching COCON.