FCA Threshold Conditions

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FCA Thresholds Conditions

Firms that apply for FCA authorisation have to meet the Financial Conduct Authority's minimum standards to become authorised – known as the “Threshold Conditions”.

In this article, we put on the FCA's hat and ask the questions the regulator thinks regarding your firm's application and whether it can meet the Threshold Conditions.

Location of Offices

• Where are senior management based?
• Is your firm suitably independent from its parent, where the parent firm is based abroad?

Effective Supervision

• Can your firm show how it will follow all the applicable FCA rules in place?
• How will you ensure that the firm is meeting all of its regulatory reporting requirements?

Appropriate Resources

• Does your firm internally have the right fit of resources for the controls required for the services it is intending to offer and what is the financial situation of your firm?
• Will/Can you abide by the relevant client handling rules?

Suitability

• Does your firm have fit and proper individuals?
• Can they conduct or will conduct business with integrity & in compliance with proper standards?
• Does the firm have competent and prudent management?
• Can the firm demonstrate that it conducts or will conduct its affairs with due skill, care and diligence?

Business Model

• Are your proposed plans in the business model conducted in a sound and prudent manner?
• Does your firm care solely about the profits or has it considered the interests of consumers?
• Extreme to state, but does your proposed model and being authorised affect the integrity of the UK financial system?

Feel free to reach out to hear about how we can assist your firm.