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FCA publishes two new web pages in relation to Appointed Representatives (ARs)

Jul 12, 2023 | FCA

Link(s):Regulatory hosting services | FCA How to report Appointed Representatives data – information for principal firms | FCA

Context

The FCA has published two new web pages in relation to ARs, one of which provides information for Principal firms operating as regulatory hosts, the other reminding Principal firms about the data they must report to the FCA on their ARs.  A ‘regulatory host’ is a Principal firm that typically carries out little or no regulated activity.  Instead, it oversees the use of its Permissions by ARs.  This service is commonly marketed as an additional service alongside other compliance support services.  Regulatory host firms can oversee a wide variety of AR business models and may not share common commercial objectives with their ARs.

Key points to note

In relation to regulatory hosting services:

  • The web page provides some brief information on having systems and controls to effectively monitor ARs, on applying sufficient resource to monitoring ARs, and on keeping records and evidence.
  • The FCA continues to scrutinise Principal firms to ensure the regulatory hosting model operates well.  The FCA has written to Principal firms to clarify its expectations, has intervened where it has uncovered harm, and refused authorisation where firms haven’t met its requirements.

In relation to reporting to the FCA:

  • The web page includes information on why the FCA is collecting the data and the information that firms need to provide.
  • Principal firms must report AR complaints and revenue data once a year in RegData using the REP025 form. This return will appear on the Principal firms’ RegData reporting schedules by 1st December 2023 in line with the Principal’s Accounting Reference Date (ARD). The data must be submitted within 60 business days of the ARD. 
  • All firms must check, amend and confirm (as part of their Firm Details Attestation) their details annually using Connect. From December 2023, Principal firms will also need to confirm details for their ARs and IARs, within 60 business days of their ARD. 
  • Firms must tell the FCA if they recruit a new AR at least 30 calendar days before the appointment starts. They must also tell the FCA if their AR’s activities change at least 10 days before they take effect.
  • The FCA may also contact Principal firms for ad-hoc data requests, for example under S165 rules, as part of its supervisory work.

Next actions

None – for information and awareness.