On 15 October 2015, HM Treasury published a policy paper, Senior Managers’ and Certification Regime: extension to all FSMA authorised persons, in which the Government announced a number of important changes to the senior managers’ and certification regimes (SM&CR). One of the announced changes was the proposed repeal of Section 64B(5) of the Financial Services and Markets Act 2000 (FSMA) which would have required relevant authorised persons to notify the regulators if they knew or suspected that an individual performing a senior management function, or otherwise subject to the regulators’ conduct rules, had failed to comply with any such rules.
Since then, HM Treasury has published the Financial Services (Banking Reform) Act 2013 (Commencement No. 9) (Amendment) Order 2015 to cancel the coming into force of section 64B(5) FSMA, which would otherwise have come into force on 7 March 2016 with the rest of the SM&CR. The proposed repeal of Section 64B(5), alongside 66B(5) and 66B(6) dealing with the presumption of responsibility, is subject to Parliamentary debate, the outcome of which will become clear later this year.
The FCA and PRA have now published the following consultation papers which set out a number of proposed technical rule changes to the SM&CR to reflect the cancellation of the coming into force of Section 64B(5) FMSA:
- FCA Consultation Paper 16/1: Consequential changes to the Senior Managers Regime (CP16/1); and
- PRA Consultation Paper 1/16: Strengthening individual accountability in banking: amendments to notification rules and forms (CP1/16).
The PRA has additionally published an updated version of its December 2015 Supervisory Statement 28/15: Strengthening accountability in banking which has been updated to take into account the proposed repeals.
The deadline for comments on CP16/1 is 5 February 2016. The FCA intends to publish a policy statement containing its final rules in March 2016.
The deadline for comments on CP1/16 is 8 February 2016.
View CP16/1: Consequential changes to the Senior Managers Regime, 6 January 2016
View Strengthening individual accountability in banking: amendments to notification rules and forms – CP1/16, 6 January 2016
View Strengthening individual accountability in banking – SS28/15 UPDATE, 6 January 2016