FCA Extension of the Senior Managers & Certification Regime (SM&CR) implementation periods for solo-regulated firms

02 July 2020

The deadline for solo-regulated firms to have undertaken the first assessment of the fitness and propriety of their Certified Persons has been extended from 9 December 2020 to 31 March 2021. To ensure consistency, the FCA is set to consult on the delay of further SM&CR requirements.

Background

On 30 June 2020, the FCA and HM Treasury agreed to delay the deadline for solo-regulated firms to have undertaken the first assessment of the fitness and propriety of their Certified Persons from 9 December 2020 to 31 March 2021. This extension has been put in place to assist significantly affected firms address issues caused by the coronavirus pandemic.

Consultation on further extensions

To ensure consistency, the FCA intends to also consult on extending the deadlines of further SM&CR requirements for solo-regulated firms. Notably, the FCA will consult on extending the deadline from 9 December 2020 to 31 March 2021 for the following:

  • the date the Conduct Rules come into force
  • the deadline for submission of information about Directory Persons to the Financial Services Register
  • references in the FCA rules to the deadline for assessing Certified Persons as fit and proper (which has been agreed by the Treasury) 

Given the tight timescale, and to finalise policy as soon as possible, the FCA intends to consult alongside parliamentary process. Details of the consultation are yet to be announced.

Next steps

On the training for staff on the Conduct Rules, the FCA is clear that Senior Managers must ensure this is effective. Staff must be aware of the Conduct Rules and be clear on how they will apply to them in their roles. Firms should be aware that such training programmes will require significant time and planning for effective delivery. The FCA will produce further information on relevant expectations in due course.

The FCA reminds firms that they should continue with programmes of work in the above areas. If firms can certify staff earlier that March 2021, they should do so. Firms should also not wait until March 2021 to remove any individuals from certified roles who are deemed not to be fit and proper.

The FCA has confirmed that for solo-regulated firms it will still publish details on the Financial Services Register of certified persons from 9 December 2020. Again, where firms can provide this information for inclusion on the Financial Services Register before March 2021, they should do so.

Note that benchmark administrators will have until December 2021 to train non-Senior Manager staff in the Conduct Rules. The FCA does not intend to consult on extending this deadline.

Co-authored by Oliver Bridal

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