The Senior Managers and Certification Regime (SMCR) will affect all FSMA authorised firms, including branches of non-UK firms passporting into the UK. It replaces the current Approved Persons Regime so will apply to all firms who are currently subject to this regime.

The regulation is being introduced in a way that is proportionate to the size of the firm, with three tiers applying that will dictate the steps that need to be taken to comply and meet the obligations: 

  • Core: firms in this tier will have to comply with the baseline requirements.

  • Enhanced: this will apply to a small number of firms whose size, complexity and potential impact on consumers or markets warrant more attention. These firms will have extra requirements.

  • Limited scope: this will apply to firms who already have exemptions under the Approved Persons Regime. These firms will be exempt from some baseline requirements and will typically have fewer senior management functions.

The FCA offer a useful Firm Checker Tool to enable firms to see which tier applies to them. Find out more about steps for implementing SMCR here.

SMCR has three key parts:

  1. The Conduct Rules - set minimum standard of individual behaviour and aim to improve individual accountability and awareness of conduct issues across firms. These will apply to almost all employees involved with financial services activities, with some of the rules just applying to senior managers.

  2. The Senior Managers Regime - the most senior people who perform key roles will need FCA approval before starting their roles and each will have have a 'statement of responsibilities' clearly setting out their responsibilities and accountibilities.

  3. The Certification Regime - this relates to roles that are called 'certification functions' and are essentially all those that employees whose role could cause significant harm to the firm or its customers. They don't have to be approved but firms need to check and confirm they are fit and proper to perform their role at least once annually.

Compliancy Services has a range of bespoke services to support firms with the implementation and ongoing management of SMCR. Our online SMCR Toolkit provides you with advisory guides and a full suite of templated policies, registers and other documents that can be easily adapted for your firm, available free of charge until 10th April 2019. 

Explore our SMCR services  Explore SMCR Toolkit

 

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