EEA Firms: When Should You Apply?

  • Posted on: 15 April 2021
  • Written by: James Borley

Offering Financial Services In The UK Series

Compliancy Services' Guide 'Offering Financial Services In The UK' has been published to help European Economic Area (EEA) firms that want to access the UK market understand the process to become authorised by the Financial Conduct Authority (FCA) and for some firms, such as banks and insurance companies, additionally the Prudential Regulation Authority (PRA). 

This series of four articles are as relevant to firms in the FCA's Temporary Permissions Regime (TPR) as they are to EEA firms that want to access the UK market for the first time, or those firms which inadvertently missed the TPR deadline and are now in the Supervised Run-Off Framework.

In this article we explain when you should apply and offer four points of note for firms in the TPR. The article is an extract from our 'Step-By-Step Guide To Obtaining Authorisation' which has been specifically published for EEA firms and it can be downloaded now free of charge.

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WHEN YOU SHOULD APPLY

Firms and funds that are newly established or in the SRO can apply for authorisation as soon as they are ready.

For firms in the TPR, the FCA and PRA have unveiled a ‘landing slot’ approach. This is designed to help the regulators work through the large number of applications expected and to ensure consistency in the treatment of similar applications.

It means that firms will be given a specific start and end date during which they must submit their application. They will not be able to apply before the start date and must make their application before the end date. These ‘landing slots’ will be determined by the type of directive they were previously passported under, and the UK legislation their activities would now fall under.

So, for example, some firms will need to seek permission to operate in the UK under Part 4A of the UK Financial Services and Markets Act
2001 (FSMA), while others will need to be authorised or registered under the Payment Services Regulations 2017 (PSRs), or the Electronic MoneyRegulations 2011 (EMRs). From the outset, firms will need to understand for which regulated activities they will need to apply for permission to conduct.

If a firm is to be authorised under FSMA, the FCA will be directing your firm to apply in one of six landing slots. The landing slots will begin in
July 2021 and each landing slot will last for three months. Where possible, firms with similar business models will be allocated the same landing slot. This will enable the FCA to allocate applications internally both effectively and efficiently and be consistent in its decision making.

FOUR POINTS OF NOTE FOR FIRMS IN THE TPR

  1. If a firm is submitting an application under the PSRs or EMRs, then by 31 December 2021 they must tell the FCA when they will be applying.

  2. Firms will need to submit their application and pay the application fee using the FCA’s Connect portal. We would encourage firms to register with the Connect portal as soon as possible.

  3. Authorisation applications submitted before the allotted landing slot start date will be disregarded and may be destroyed.

  4. If a firm fails to submit their application before their landing slot closing date, then the regulator will cancel the temporary permission status and will move the firm into the SRO.

ARTICLES IN THIS SERIES

A STEP-BY-STEP GUIDE

Applying for regulatory permission is a big step for branches and subsidiaries of EEA firms. Firms need to understand the application process and what information the regulators are asking for, as well as the impact that those demands, and how operating under a new status will affect their business goals and day-to-day operations.

Our Guide provides answers to some of the fundamental questions that firms will have as they set out on this journey. The hope is that the guide will enable EEA firms to better understand the application process, and help foster dialogue about how to proceed. Download our free guide today.

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