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FCA reminder: first SM&CR annual reporting due soon

FCA reminder: first SM&CR annual reporting due soon

Background

  • The Senior Managers & Certification Regime (SM&CR) among its many complex details introduces a new annual reporting requirement that all firms must complete and submit using the existing GABRIEL reporting tool
  • The report is called REP008 and firms need to tell the FCA whether they have taken disciplinary action against individuals who are not Senior Managers for breaches of the Conduct Rules
  • A nil return is required if there have been no breaches resulting in disciplinary action
  • The first REP008 is due on 02/11/20 for the period 09/12/19-31/08/20 except for “limited permission consumer credit firms” and, for the first return, only certain individuals will be in scope
  • The FCA has published detailed guidance on its website

Impacts

The Senior Managers and Certification Regime (SM&CR) has applied to most solo-regulated firms since 9 December 2019.  There are 3 components to the SM&CR:

  • the Senior Managers Regime
  • the Certification Regime
  • the Conduct Rules

The Conduct Rules set standards of personal conduct against which the FCA can hold people to account.  Firms need to report whether they have taken disciplinary action against individuals who are not Senior Managers for breaches of the Conduct Rules and, if so, the breach details including:

  • details about the individual who has committed the breach
  • details about what Conduct Rules have been breached
  • details about the disciplinary action taken

Disciplinary action means: issuing of a formal written warning; suspension or dismissal of a person; and reduction or recovery of remuneration (clawback).

Firms must submit REP008 annually even if there have not been any Conduct Rule breaches resulting in disciplinary action. Firms that do not submit REP008 by the reporting deadline will be charged a late return fee of £250.

Timeline with relevant dates to be logged on regulatory calendar

  • First REP008 report is due on 2 November 2020

Next steps

Firms need to file their regulatory reports promptly using GABRIEL.