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This guide summarises the changes to the FSA Handbook that will come into effect when the two new regulatory bodies, the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA), acquire their legal powers.
At legal cutover, the FSA Handbook will be split between the FCA and the PRA to form two new Handbooks, one for the PRA and one for the FCA. Most provisions in the FSA Handbook will be incorporated into the PRA’s Handbook, the FCA’s Handbook, or both, in line with each new regulator’s set of responsibilities and objectives.
Users of the Handbook will be able to access the following online:
The new Handbooks will reflect the new regulatory regime (for example, references to the FSA will be replaced with the appropriate regulator), and in some areas more substantive changes will be made to reflect the existence of the two regulators, their roles and powers. This includes such aspects as the future processes for permissions, passporting, controlled functions, threshold conditions and enforcement powers. The more substantive changes are being consulted on before the PRA and the FCA acquire their legal powers.
Changes to the FSA Handbook as a result of EU legislation and FSA policy initiatives will continue throughout this work. After acquiring their powers, the FCA and the PRA will amend their own suites of policy material as independent bodies in accordance with the processes laid down in the Financial Services Bill, including cooperation between them and external consultation. As set out in the PRA Approach Documents, the PRA will, over time, replace the Handbook with a PRA rulebook.
This approach to the Handbooks for the FCA and the PRA has been planned to ensure a safe transition for firms and the new regulators as the new regime is introduced.
Firms will have a new regulator or regulators, and will consequently need to assess how the new Handbooks of these bodies will apply to them. Dual regulated firms will need to look to both the PRA and the FCA Handbooks, and FCA-only regulated firms to the FCA Handbook.
We plan to publish the new FCA and PRA Handbooks online in the month ahead of 1 April, to give firms time to familiarise themselves with the new Handbooks. We expect to publish the designation and editorial changes online in early March. Later in March we will publish the remaining substantive changes we have consulted on, together with the relevant FCA and PRA Policy Statements.
Alongside the publication, we will publish material on how to interpret the application of the Handbooks, where this is not dealt with in the Handbooks themselves. The FSA Handbook will remain in force until 1 April.
The Tailored, Focus-On and Personalised Handbooks will be removed from the website when the FCA and PRA Handbooks are published. The facility for creating your own Personalised Handbook was removed from the FSA website in December.
We will publish further communications in March to help firms prepare for regulation by the FCA and PRA.