Context
The FCA has published a blog by Sarah Pritchard, FCA Deputy Chief Executive, exploring the importance of reviewing whether existing rules and requirements are working, and not just on whether new rules are required.
Key points to note and next actions
- The FCA reviews its Rules because markets evolve, consumer behaviour changes, and technology creates new opportunities and risks. Rules that were appropriate when they were introduced may need to be updated, simplified or, in some cases, removed altogether.
- The blog explores how the FCA reviews its rules, sometimes under its formal Rule Review Framework. The blog explores the FCA’s methodology and how reviews how rules are affecting firms, consumers and markets through its ongoing supervisory activities, data monitoring, market studies and calls for evidence.
- The blog includes some examples of Rule reviews including in the mortgage market, and in relation to the Senior Managers and Certification Regime.
- The FCA explains that it uses external input from firms and consumers.
- The article sets out three key reasons why Rule review matters:
- Effectiveness – reviewing the FCA’s work helps keep regulation effective and proportionate.
- Learning – it helps the FCA become a smarter regulator.
- Accountability – stakeholders rightly expect regulators to act where there are potential harms or opportunities to make markets work better.