The FCA is consulting on moving some decision-making from its Regulatory Decisions Committee (RDC) to its Authorisations, Supervision and Enforcement Divisions. This will give greater responsibility for decisions to senior members of FCA staff close to the matters.
The consultation (CP21/25) has been published and will close on 17 September.
In particular, the FCA is proposing a change in who decides to issue a statutory notice in some cases. Statutory notices are required where the FCA is proposing to exercise, or has already exercised, enforcement and supervisory powers. For example, where a firm’s permission is being varied or cancelled, cancelling an individual’s approvals, or imposing requirements on a firm. Statutory notices are also required where authorisation for a firm or approval of an individual is being refused.
Decisions to issue a statutory notice are currently made by the RDC and under Executive Procedures but the FCA wants more decisions to be made under Executive Procedures. This will mean more decisions are taken within the Divisions with responsibility for the issue and those decisions should be made faster than at present.
The decisions currently made at the RDC are:
- when the FCA makes a decision to use its own-initiative intervention powers to impose a fundamental variation of permission or requirement in relation to a firm
- when the FCA makes a decision in relation to a firm’s authorisation or an individual’s approval that is contested
- when the FCA decides to take action in straightforward cancellation cases because a firm does not meet regulatory requirements, and that action is contested
The RDC also makes decisions on matters that do not require the issue of a statutory notice. These are approvals to commence civil or criminal proceedings, which include:
- decisions to commence civil proceedings, such as seeking an injunction
- decisions to commence criminal proceedings, such as a prosecution for insider dealing
The FCA is proposing that these decisions would be made through Executive Procedures rather than the RDC.
The RDC will continue to decide cases where the FCA is enforcing the Principles and Rules for Businesses and seeking a resolution that involves a disciplinary or similar sanction, such as a financial penalty, a prohibition order or restitution.
The proposed changes will not compromise the rights and protections that firms and individuals who are subject to these processes have.