Committee waivers

Which firms this applies to

Under the Investment Firm Prudential Regime (IFPR), the largest non-SNI (small and non-interconnected) firms must have risk, remuneration and nomination committees.

This apples to your firm if:

• the value of your on‑balance sheet assets and off-balance sheet items over the preceding 4‑year period is a rolling average of a £100 million or more, or
• the value of your on‑balance sheet assets and off-balance sheet items over the preceding 4‑year period is a rolling average of £300 million or more, and the exposure value of the firm’s on- and off-balance sheet trading book business is equal or more than £150 million and that the exposure value of the firm’s on-and-off-balance sheet derivatives business is equal or more than £100 million

To see these rules, refer to MIFIDPRU 7.1.4R in the MIFIDPRU sourcebook.​​​​

When to apply for a waiver

If you're a non-SNI firm that meets the thresholds above, you can apply to us to waive one or more of the committee requirements, subject to satisfying the statutory test (see section 138A of the Financial Services and Markets Act).

You should consider the guidance on applying for committee waivers at MIFIDPRU 7.3.7G, and on the same page read the sections on risk committee, remuneration committee and nomination committee.

Please note:

• even if we grant your firm this waiver, you'll still need to comply with all the other rules applicable to a non-SNI firm in our Handbook – apart from where we've granted your firm any other waivers or modifications
• we're unlikely to approve a waiver unless your firm can demonstrate that the group committee can operate as effectively as one established at the individual entity level

When submitting your application

If your firm is relying on risk, remuneration or nomination committees constituted at group level, please explain or confirm:

• where these committees sit, and which entities in the group they cover
• how the group committees comply with MIFIDPRU 7.3.7G (3) – this includes:
  • whether it meets the composition requirements in MIFIDPRU 7.3.1R(2) or MIFIDPRU 7.3.5R(2), as applicable, and
  • whether it has members with the appropriate knowledge, skills and expertise in relation to the firm subject to the requirement to establish a committee
• how frequently the committees meet
• the committee Terms of Reference with explicit mention of the FCA investment firm

If your firm is relying on alternative governance arrangements either at individual entity level or elsewhere in the group, please explain:

• how the alternative governance arrangement functions, including frequency of meetings
• details of the members involved in the decisions/considerations, and
• details of how the alternative governance arrangement complies with MIFIDPRU 7.3.7G (3) (a) and (b)

This list is not exhaustive and you should submit any information you feel is relevant to your application bearing in mind the statutory tests we will apply.