On 13 December 2017, the FCA published three consultation papers setting out a package of proposals on how firms and individuals will transition from the approved persons regime (APR) to the senior managers and certification regime (SM&CR) (CP17/40, CP17/41 and CP17/42).
These consultation papers follow the FCA's July 2017 consultation papers on extending the SM&CR to almost all regulated firms (that is, both FCA solo-regulated firms and insurers) (CP17/25 and CP17/26). Given the differences in the size and nature of firms covered by the extended SM&CR, the FCA is proposing proportionate approaches for different types of firm. The FCA is also consulting on guidance on the duty of responsibility for FCA solo-regulated firms and insurers. Currently, the duty of responsibility only applies to senior managers of banks.
Comments can be made on the proposals until 21 February 2018. The FCA intends to publish its final rules, including its final approach to transition and conversion, in a policy statement in summer 2018. For the purpose of the draft rules that form part of CP17/40 and CP17/41, the FCA has assumed that the rules will apply to insurers in late 2018, and to FCA solo-regulated firms in mid-to-late 2019. However, the date for implementing the new regime will be announced and set by HM Treasury in due course.
The SM&CR is being extended to make individuals more accountable for their conduct and competence.