Senior Managers and Certification Regime: Client Dealing Function

On this page we provide more information on the scope of the Client Dealing Function under the Senior Managers and Certification Regime (SM&CR).

The Senior Managers and Certification Regime (SM&CR) commenced for banking firms in March 2016 and commences on 10 December 2018 for insurers, and on 9 December 2019 for solo-regulated firms.

Since we published the policy statement to extend the SM&CR to insurers, we understand that uncertainty exists on whether administrative functions would be in scope of the Client Dealing Function in the certification regime.

The Client Dealing Function covers roles that include dealing in, or arranging investments with, retail and professional clients. It also includes individuals giving financial advice in relation to designated investment business, or acting in the capacity of an investment manager.

We have listened to the feedback we have received on this issue and in response we are consulting on clarifying the scope and will make final rules before December 2019, ahead of commencement for solo-regulated firms.

Interim arrangements

In the interim period between 15 November 2018 and the commencement date for the rules clarifying the scope of the Client Dealing Function, we will accept that the following parts of the Client Dealing Function do not include employees who perform solely administrative functions.

Those parts are rows (1)(b), (2)(b), (3) and (4) of the table in our Handbook defining the activities falling into the Client Dealing Function. That table is currently to be found in rule 5.2.45 in chapter 5 of the Senior Management Arrangements, Systems and Controls Sourcebook and, from 10 December 2018, rule 27.8.19 of that Manual

This will apply to banks’ current implementation of the certification regime and to insurers’ implementation of it after 10 December 2018. It will also be relevant to solo-regulated firms’ preparations for the certification regime.

After our consultation

Once our consultation is complete, we will:

  • clarify what is required of firms in this area, and
  • provide information on any transitional measures that may be needed for firms to adjust their approach to roles that are relevant to the Client Dealing Function