FCA Consultation paper: CRD IV for investment firms
10 October 2013
This Consultation Paper sets out the FCA's proposed changes to its Handbook as a result of the transposition of CRD IV in relation to reporting, remuneration policies and the interaction between CRD IV and AIFMD/UCITS. Deadline for comments is 10 November, 2013.
This CP sets out the proposals for implementing further changes brought about by CRD IV which can be done through the the Handbook of rules and guidance under existing FSMA powers. The Treasury intends to publish further consultations for those aspects of the Directive and the CRR that require either new, or amendments to existing, legislation in a number of areas to enable the FCA to operate provisions in CRD IV effectively. Where relevant, the FCA will take account of the Treasury’s developing work on implementation of CRD IV in deciding how to finalise the rules.
The proposals for consultation in this CP are in line with the FCA‘s approach to CRD IV transposition – that is guided by the following principles:
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‘legal minimum’: to ensure that the FCA's CP delivers the minimum Handbook rules and guidance that must be put in place for the UK to discharge its legal duty to transpose CRD IV;
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‘intelligent or even strict copy-out’: to avoid placing any additional burdens upon firms;
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'pragmatic and proportionate’: in general and in respect to current standards, using the more favourable, or least unfavourable, treatment for firms available under national discretions and relief under transitional provisions – where allowed by CRD IV and in accordance with the FCA’s objectives;
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‘minimise the need for changes’ (including systems): and hence minimise the (non-capital) costs for firms; and
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‘forward looking’: FCA is mindful that CRD IV requires the EU Commission to undertake,by the end of 2015, a review of what should be an appropriate prudential regime for investment sector firms. So, it provides a suitable opportunity to address any fundamental issues for such firms arising from CRD IV, which was designed more with banks in mind.
The proposals in this paper apply principally to the following FCA-authorised firms:
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investment firms that are currently subject to the CRD, including firms that benefit from the current exemptions on capital requirements and large exposures for specialist commodities derivatives firms;
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management companies – as defined under the UCITS Directive – and Alternative Investment Fund Managers (AIFMs)
The proposals in this paper do not apply to credit institutions (banks and building societies) or investment firms supervised by the PRA.
The deadline for comments and/or responses to the questions on the proposals is 10 November, 2013. The FCA will assess the feedback and publish a policy statement later in 2013 so that firms have the final rules available before 1 January, 2014.
Full Consultation Paper
Full press release
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