FSA/PN/157/2000
11/12/2000

The Financial Services Authority today issued briefing notes on how authorised firms, individuals, products and waivers will be transferred from the existing regulatory regimes to the new single FSA regime next year.

FSA Director David Kenmir said:

Achieving a smooth transfer to the new regime is vitally important and publication of this briefing will help to get firms and other parties engaged at an early stage of the process. We aim to achieve maximum continuity with minimum disruption and cost to firms.
The key features of the process, which is known as grandfathering, are:

  • Firms, individuals and products which are authorised under existing legislation will be grandfathered by law. This means they can continue to provide the same financial services after the Financial Services and Markets Act is implemented without having to re-apply for permission or approval;

  • The FSA will not use the transition to modify current authorisations;

  • Although the process is automatic in law, the FSA and firms will need to check that authorisations have been correctly transferred across to the new regime;

  • Waivers will also be grandfathered under transitional rules which the FSA will publish for consultation in due course;

  • The FSA will work co-operatively and flexibly with firms to resolve any uncertainties that may arise in the exercise.

Notes for editors

  1. The FSA today issued two Grandfathering Briefing Notes:

    A) Grandfathering of Firms, Individuals and Products. Products are principally regulated Collective Investment Schemes.

    B) Grandfathering of Waivers. Waivers are where a particular firm is allowed to modify or disapply a regulatory Rule.

  2. The Briefing Notes are available on the FSA Website (www.fsa.gov.uk).

  3. The grandfathering process will involve around 9,000 firms, 180,000 individuals, 2000 products and 1,000 waivers.

  4. The FSA will issue a further more detailed statement on the grandfathering process early in 2001 after the Treasury has published the necessary secondary legislation in final form.

  5. The FSA regulates the financial services industry and has four objectives under the Financial Services and Markets Act 2000: maintaining market confidence; promoting public understanding of the financial system; the protection of consumers; and fighting financial crime.

  6. The FSA aims to maintain efficient, orderly and clean financial markets and help retail consumers achieve a fair deal.

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