Financial services providers, investment firms and consumer credit firms have to be authorised by us. Here’s a summary of what you need to know.
According to provisions made under the Financial Services and Markets Act (FSMA) 2000, financial activities have to be regulated by the FCA. Any firm (whether a business, a not-for-profit or a sole trader) carrying out a regulated activity must be authorised or registered by us, unless they are exempt.
Banks, credit unions and insurance companies are regulated by us and the Bank of England’s Prudential Regulation Authority (PRA).
Applications for authorisation
You’ll have to apply to us (or, if you’re dual-regulated, to the PRA) for authorisation. This takes up to 6 months if your application is complete but could take up to 12 months if your application is not complete. You will also have to pay an application fee.
When we receive your application and throughout our assessment of it, we will consider whether you are ready, willing and organised to comply, on a continuing basis, with the requirements and standards under the regulatory system. This is important: authorised firms must be ready, willing and organised to comply with our rules and requirements at all times.
What being ready, willing and organised means
We expect firms to take regulation seriously and plan how they will meet the standards of the regulatory system before they apply. When we consider the extent to which a firm has planned ahead we ask ourselves whether the applicant is:
Authorisations will consider what the applicant has done when preparing to submit their application. Positive indicators can include:
- reading information on our website
- making enquiries of the contact centre
- seeking legal/compliance advice
- being able to clearly articulate their regulatory obligations
Authorisations will consider the attitude of the applicant during the authorisations process. Positive indicators include:
- being open and honest in all their dealings with us
- being proactive about getting information to us
- demonstrating initiative to understand their regulatory duties
- timeliness and availability of staff to deal with queries about the application
Authorisations are aware that whilst an applicant may be willing to correct mistakes or gaps in their application, they must also have satisfied the readiness question.
Authorisations do not believe it is sufficient for an applicant to submit a poor application but show they are willing, with help from Authorisations, to address any deficiencies.
You should ensure that you have all the supporting documentation prepared and have the necessary arrangements in place to comply with regulations from the day you are authorised. Authorisations will consider the following:
- why the applicant applied now
- what is left outstanding that would prevent them from carrying on the activity they have applied for
- if the applicant were authorised today, would they be able to carry out the activity they have applied for
That said we appreciate some investments, purchases or recruitment can only take place once you know you will be authorised. If you think this might affect your application do not hesitate to call our Contact Centre, we are more than happy to help.
After your application is submitted
Your application should provide sufficient information to enable us to determine whether you meet the requirements for authorisation namely that you are ready, willing and organised to comply with the standards of the regulatory system. We expect you to provide such further information as we reasonably consider necessary to enable us to determine the application or, to decide whether to give consent to the PRA (where you have applied to the PRA). If substantive changes are made to an application after it has been submitted which indicate that you are not ready, willing and organised, Authorisations may ask you to consider withdrawing the application and re-applying to provide you with an opportunity to address the issues raised.
Appointed Representatives (ARs)
An authorised firm may appoint another firm or person to carry on regulated activities on its behalf. When this happens, the authorised firm or ‘principal’ takes full responsibility for making sure its agent or ‘appointed representative’ complies with our rules.
Responsibilities of an authorised firm
Once you’ve been authorised by us, there’s a fee to pay each year. You’ll also have to meet our minimum standards (threshold conditions) at all times, comply with the rules and principles relevant to your business and send us regular reports.
Request direct support
The Direct Support Team provides a dedicated contact for innovator businesses that are considering applying for authorisation or a variation of permission, need support when doing so, or do not need to be authorised but could benefit from our support.
- Approved persons
- Change in control
- Variation of permission
- Waivers and modifications
- Capital requirements permissions
- Change of legal status
- Firm details
Trade in Europe
- Find out more about the relationship a firm has with its AR
- See the types of reports you’ll have to send us once authorised