Modification by consent: SUP 10A.5.6

This modification by consent is available to benchmark administrators and firms using Appointed Representative arrangements.

Purpose of the modification

This modification is intended to accommodate firms that are managing their governance arrangements in a period of uncertainty. The modification aims to provide flexibility to firms at this time. Firms can use this modification if they think they may need to make or extend temporary arrangements to cover absences, as a result of the coronavirus (Covid-19) crisis.

This modification by consent extends the period in which an individual can cover for an Approved Person without being approved (known as the '12-week rule' and detailed in SUP 10A.5.6) from a maximum of 12 weeks in a consecutive 12-month period to a maximum of 36 weeks in a consecutive 12-month period.

Details of the modification can be found in the Direction.

We explain how firms should document these arrangements in our public statement.

It does not identify if individuals have been ill with the coronavirus, as:

  • consequential issues, such as delays to recruitment, are included as reasons firms may need to use this waiver
  • firms can consent to this waiver as a cautionary measure, even if they do not utilise the modifications in practice

What this means for firms

A benchmark administrator or an appointed representative can use this modification if, for example:

  • an Approved Person is absent because of Covid-19
  • recruitment to replace an Approved Person is delayed due to the coronavirus pandemic

Appointed Representatives

Appointed Representatives will not be able to apply for the modification directly. Instead, the principal firm will need to submit the application for any Approved Persons in Appointed Representatives that wish to take advantage of the modification.

There may be instances where an Appointed Representative has multiple principals and wishes to use the modification for its Approved Persons. In these cases each principal firm will need to submit its consent to the modification individually. However a principal will not need to do this if the principal did not (and did need to) apply for the approval of the absent approved person.

Appointed Representatives wishing to take advantage of this should ask their principal firm(s) to email [email protected]

Benchmark administrators

The direction explains the effect on the direction of benchmark administrators  moving to the Senior Managers Regime (SMR) on 7 December 2020.

Benchmark administrators wishing to take advantage of the modification by consent under SUP 10A.5.6 should email [email protected]