Here we set out some considerations that will be relevant for firms when leaving the temporary permissions regime (TPR).
Firms passporting into the UK under Schedule 3 to FSMA and Treaty firms under Schedule 4 to FSMA
Once in the TPR, we will allocate firms that will be solo-regulated by us a period (a ‘landing slot’) within which they will need to submit their application for UK authorisation, if required.
In your application for authorisation you will need to demonstrate:
- how you will meet our threshold conditions
- how your UK business will be structured, including whether to apply for authorisation through a branch or as a UK-incorporated subsidiary
Firms with top-up permissions will need to submit a Variation of Permissions (VoP) application rather than an application for authorisation.
If your firm changes its plans, you will be able to apply to cancel your temporary permission once you have ceased all UK business.
Firms that are unsuccessful in securing authorisation when leaving the TPR but that still have regulated business in the UK to run off, will enter the financial services contracts regime (FSCR) from where they can wind down their UK business.
Payments and e-money firms
The process of leaving the TPR is different for payments and e-money firms because they have different authorisation and registration conditions.
EEA payment institutions will have to establish an authorised or registered UK subsidiary to provide services in the UK when the EEA firm’s temporary permission ends. This will also apply to e-money institutions which provide payment services that are unrelated to e-money issuance.
EEA e-money institutions which only provide payment services related to e-money issuance, and EEA registered account information service providers will have to become authorised or registered to continue providing services in the UK when their temporary permission ends.
Rather than being allocated a landing slot, payments and e-money firms must send us a ‘notice of intention’ within 1 year of the end of the transition period. In this notice, a firm must tell us whether it or a UK subsidiary (whichever is applicable) intends to apply for authorisation or, in the case of a RAISP, whether it intends to apply for registration or whether it is intending to cease providing payment services in the UK.
Please bear in mind the statutory deadlines for us to determine authorisation or registration applications.
The maximum duration of temporary permission is 3 years. Make sure you allow enough time for us to consider your application and you can operationalise the new entity where this is required so that you can continue providing payment or e-money services when the regime ends.
Payments and e-money firms firm that are unsuccessful in securing authorisation or registration when leaving the TPR but that still have regulated business in the UK to run off, will enter the financial services contracts regime (FSCR) from where they can wind down their UK business.
Our approach to international firms
We are currently reviewing our approach to the authorisation and supervision of international firms (which will include firms from both EEA and non-EEA jurisdictions).
We intend to consult on how we assess applications for the authorisation of branches of international firms. This will supplement our existing Approach to Authorisation and Approach to Supervision documents and, for dual regulated firms, it will sit alongside the PRA’s Supervisory Statements for International Banks (SS1/18) and International Insurers (SS2/18).
Our consultation paper will:
- set out where we see the potential for harm in different scenarios
- seek views on ways potential harms can be mitigated
- outline our expectations around firms seeking authorisation, including:
- when firms should have a physical presence in the UK
- having personnel and adequate systems in the UK so that firms can be effectively supervised
Firms should also consider our guide to the Senior Managers and Certification Regime to understand how it will apply to FCA solo-regulated firms.