We will track here amendments to this resource that reflect changes in law and practice.
This practice note acts as an index to PLC's resources on the reforms to the UK financial services regulatory structure that took place on 1 April 2013.
On 1 April 2013, the FSA was abolished and the majority of its functions transferred to two new regulators: the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA). On the same date, the Bank of England (BoE) took over the FSA's responsibilities for financial market infrastructures (FMIs) and the Financial Policy Committee (FPC) will be established on a statutory basis. The government has also made other significant changes to aspects of financial services regulation as part of the reform process.
This practice note lists and provides links to Practical Law's resources on the reforms to the regulatory structure.
The following practice notes provide overviews of the reforms:
Quick guide, New UK financial services regulatory structure (www.practicallaw.com/7-503-5430). This note provides an overview of the reforms.
Practice note, New UK financial services regulatory structure: how the reforms developed (www.practicallaw.com/8-503-6293). This note tracks the various strands of work relating to the reforms, including papers published by HM Treasury, the FSA and the BoE, and inquiries and reports by the House of Commons Treasury Select Committee. The note also examines those aspects of the reforms as originally proposed that were abandoned or deferred and the events that led to the government's decision to reform the UK financial services regulatory structure.
Practice note, New UK financial services regulatory structure: key regulatory developments tracker (www.practicallaw.com/5-502-5489). This note provides links to the key primary sources on the reforms and related Practical Law legal updates between September 2009 and April 2013.
The Financial Services Act 2012 (FS Act) is the primary legislation used by the government has enacted reforms to the UK financial services regulatory structure. Its main role was to amend the Financial Services and Markets Act 2000 (FSMA) to establish the new regulators and to set out their additional powers.
Practice note, Financial Services Act 2012 (www.practicallaw.com/0-504-4659). This note provides an overview of the FS Act and secondary legislation made under it. The note sets out a clause-by-clause explanation of the contents of the FS Act, with links to relevant Practical Law content. It also contains destination tables for Parts 1, 4 and 10 of FSMA.
Legislation tracker: Financial Services Act 2012 (www.practicallaw.com/4-504-4657). This tracker monitors the progress of the FS Act through both Houses of Parliament, with links to relevant Parliamentary webpages on debates, proposed amendments and reports, with links to related legal updates.
The FCA is the UK financial services regulator responsible for the conduct of all firms that were regulated by the FSA, including firms authorised and subject to prudential supervision by the PRA (PRA-authorised firms or dual-regulated firms). It also acts as the prudential regulator for all firms other than dual-regulated firms (FCA-authorised firms) and regulates firms providing market services and market conduct more generally.
Practical Law has the following notes on the FCA:
Practice note, FCA: role, governance and powers (www.practicallaw.com/6-504-5439). This note provides an overview of the FCA, including the scope of its regulatory powers, its roles and responsibilities and the different roles that it performs.
Practice note, FCA statutory objectives (www.practicallaw.com/6-518-2285). This note sets out an overview of the statutory objectives of the FCA and considers the other factors that the FCA will be required to consider when performing its functions.
Practice note, FCA and PRA regulatory principles (www.practicallaw.com/8-504-8861). This note sets out details of the regulatory principles that apply to both the PRA and the FCA, and the government's comments on the purpose underlying each of the principles.
Practice note, FCA supervisory model (www.practicallaw.com/9-518-0911). This note sets out details of the approach that the FCA will take to the supervision of the firms that it regulates.
Practice note, FCA and PRA rule-making powers (www.practicallaw.com/7-518-2039). This note provides an overview of the rule-making powers of the PRA and the FCA.
Practice note, FCA and PRA Handbooks (www.practicallaw.com/2-525-0988). This note provides an overview of the FCA Handbook and the PRA Handbook. The note considers the structure of the new Handbooks and the process involved in dividing the FSA Handbook between the FCA and the PRA.
Practice note, FCA product intervention powers (www.practicallaw.com/5-518-1026). This note sets out an overview of the framework introduced by the FS Act under which the FCA may make temporary product intervention rules and the circumstances in which the FCA may deploy these powers.
Practice note, FCA, PRA and BoE powers over unregulated holding companies (www.practicallaw.com/4-522-1792). This note provides an overview of the framework new Part 12A of FSMA under which the FCA, the PRA and the BoE have the power to impose requirements on UK parent undertakings of certain regulated firms.
Practice note, FCA super-complaints and mass detriment references (www.practicallaw.com/7-520-5173). This note sets out an overview of the regime set out in new Part 16A of FSMA under which super-complaints and mass detriment references may be made to the FCA. The aim of the regime is to establish a framework under which the FCA can be alerted to competition issues, or matters that adversely affect the interests of consumers, and then be held accountable for its response.
Practice note, Co-ordination between FCA, PRA and BoE (www.practicallaw.com/2-504-5441). This note provides an overview of the mechanisms for co-operation and co-ordination between the FCA and the PRA. It also considers the interaction of the BoE and the FPC with the PRA and the FCA.
Practice note, Registration and regulation of mutuals (www.practicallaw.com/2-517-9992). This note provides an overview of how the reforms to the UK financial services regulatory structure affected the regulation and registration of mutual societies (that is, building societies, credit unions, friendly societies and industrial and provident societies), following the transfer of the FSA's responsibilities for mutuals to the PRA and the FCA.
Practice note, Inquiries and investigations into regulatory failure (www.practicallaw.com/3-523-4988). This note provides an overview of Part 5 of the FS Act, which contains provisions relating to new obligations on the FCA or the PRA to carry out investigations into specific regulatory failures. Part 5 also included the pre-1 April 2013 powers of HM Treasury to arrange independent inquiries into failures in the regulatory regime.
Practice note, Government plans to transfer consumer credit responsibility from OFT to FCA (www.practicallaw.com/5-506-0185). This note provides an overview of the government's proposals for transferring the OFT's responsibility for the regulation of consumer credit under the Consumer Credit Act 1974 (CCA) to the FCA.
Practice note, Transfer of second charge mortgage regulation from OFT to FCA (www.practicallaw.com/2-505-9895). This note outlines the government's plan to transfer the regulation of second charge mortgages from the OFT to the FCA.
The PRA is responsible for micro-prudential regulation, concerned with the supervision of systemically important firms, including banks and insurers. It is a subsidiary of the BoE.
Practical Law has the following notes on the PRA:
Practice note, PRA: role, governance and powers (www.practicallaw.com/0-504-5437). This note provides an overview of the PRA, including its roles and responsibilities and the different roles that it performs.
Practice note, Scope of PRA regulation (www.practicallaw.com/0-504-5791). This note provides an overview of the scope of PRA regulation. Firms with permission to carry out PRA-regulated activities (PRA-authorised firms) are subject to dual-regulation by the PRA and the FCA. The note considers which regulated activities are PRA-regulated activities and the process the PRA will follow for designating systemically important investment firms for regulation by the PRA.
Practice note, PRA and FCA regulatory principles (www.practicallaw.com/8-504-8861). This note sets out details of the regulatory principles that apply to both the PRA and the FCA, and the government's comments on the purpose underlying each of the principles.
Practice note, PRA enforcement: issuing and publishing statutory notices (www.practicallaw.com/2-526-5485). This note gives an overview of the PRA's statements of policy and procedure on decision making for issuing statutory notices (warning, decision and supervisory notices), and the publication of disciplinary and other enforcement action.
Practice note, PRA enforcement: financial penalties, restrictions and suspensions, and settlement decision making procedures (www.practicallaw.com/7-527-5585). This note provides an overview of the PRA's statements of policy and procedures on the imposition of financial penalties, restrictions and suspensions, and settlement of cases.
Practice note, PRA supervisory model (www.practicallaw.com/7-518-0870). This note provides an overview of the approach that the PRA will take to the supervision of PRA-authorised firms including the differences in the supervisory approach for banks, insurers and systemically important investment firms.
Practice note, FCA and PRA rule-making powers (www.practicallaw.com/7-518-2039). This note provides an overview of the rule-making powers of the PRA and the FCA.
Practice note, FCA and PRA Handbooks (www.practicallaw.com/2-525-0988). This note provides an overview of the FCA Handbook and the PRA Handbook. The note considers the structure of the new Handbooks and the process involved in dividing the FSA Handbook between the FCA and the PRA.
Practice note, FCA, PRA and BoE powers over unregulated holding companies (www.practicallaw.com/4-522-1792). This note provides an overview of the framework new Part 12A of FSMA under which the FCA, the PRA and the BoE have the power to impose requirements on UK parent undertakings of certain regulated firms.
Practice note, Co-ordination between FCA, PRA and BoE (www.practicallaw.com/2-504-5441). This note provides an overview of the mechanisms for co-operation and co-ordination between the FCA and the PRA. It also considers the interaction of the BoE and the FPC with the PRA and the FCA.
Practice note, Financial crisis management arrangements (www.practicallaw.com/8-504-5141). This note provides an overview of the overview of the arrangements set out in Part 4 of the FS Act on the roles of the UK authorities, and particularly the BoE and HM Treasury, should take to address emerging crisis situations relating to the financial services sector. The note considers the role of the PRA in the new crisis management framework.
Practice note, Registration and regulation of mutuals (www.practicallaw.com/2-517-9992). This note provides an overview of how the reforms to the UK financial services regulatory structure affected the regulation and registration of mutual societies (that is, building societies, credit unions, friendly societies and industrial and provident societies), following the transfer of the FSA's responsibilities for mutuals to the PRA and the FCA.
Practice note, Inquiries and investigations into regulatory failure (www.practicallaw.com/3-523-4988). This note provides an overview of Part 5 of the FS Act, which contains provisions relating to new obligations on the FCA or the PRA to carry out investigations into specific regulatory failures. Part 5 also includes the pre-1 April 2013 powers of HM Treasury to arrange independent inquiries into failures in the regulatory regime.
The FS Act transferred regulatory responsibility for UK FMIs to the BoE and formally established the FPC, a committee of the BoE responsible for monitoring the stability and resilience of the UK financial system as a whole.
Practical Law has the following notes on the roles of the BoE and the FPC
Practice note, Bank of England: role, governance and financial stability powers (www.practicallaw.com/1-521-0610). As well as providing an overview of the BoE's financial stability powers, this note considers the governance reforms to the BoE introduced by the FS Act.
Practice note, FPC: role, governance and powers (www.practicallaw.com/2-504-5436). This note provides an overview of the FPC, including the "macro-prudential" toolkit that it will have at its disposal.
Practice note, Bank of England regulation of FMIs (www.practicallaw.com/4-504-8896). This note sets out the BoE's responsibilities for financial markets infrastructures (FMIs), including the transfer of regulatory responsibility for settlement systems and recognised clearing houses (RCHs) to the BoE.
Practice note, Co-ordination between FCA, PRA and BoE (www.practicallaw.com/2-504-5441). This note provides an overview of the mechanisms for co-operation and co-ordination between the FCA and the PRA. It also considers the interaction of the BoE and the FPC with the PRA and the FCA.
Practice note, Financial crisis management arrangements (www.practicallaw.com/8-504-5141). This note provides an overview of the overview of the arrangements set out in Part 4 of the FS Act on the roles of the UK authorities, and particularly the BoE) and HM Treasury, should take to address emerging crisis situations relating to the financial services sector.
Practice note, FCA, PRA and BoE powers over unregulated holding companies (www.practicallaw.com/4-522-1792). This note provides an overview of the framework new Part 12A of FSMA under which the FCA, the PRA and the BoE have the power to impose requirements on UK parent undertakings of certain regulated firms.
Practice note, Inquiries and investigations into regulatory failure (www.practicallaw.com/3-523-4988). This note provides an overview of Part 5 of the FS Act, which contains provisions relating to new obligations on the FCA or the PRA to carry out investigations into specific regulatory failures. Part 5 also includes the pre-1 April 2013 powers of HM Treasury to arrange independent inquiries into failures in the regulatory regime.
The new regulatory structure has affected all the existing public bodies concerned with the financial services sector.
Practice note, New UK regulatory structure: related reforms (www.practicallaw.com/6-504-5444). This note considers reforms to the Financial Services Compensation Scheme (FSCS), the Financial Ombudsman Service (FOS), the Money Advice Service (MAS), the Upper Tribunal, and the Financial Services Complaints Commissioner arising from the restructure of financial services regulation.
Practical Law has published a number of articles on the reforms:
Article, Fixing the system: analysing the UK's new financial services regulatory framework (www.practicallaw.com/8-503-0012) (August 2010).
Article, Financial regulation reform: too many cooks? (www.practicallaw.com/9-503-1544) (September 2010).
Article, Financial services: looking ahead to 2011 (www.practicallaw.com/6-504-7711) (February 2011).
Article, Financial regulation reform: the role of competition (www.practicallaw.com/0-511-1842) (December 2011).
Article, Financial Services Bill: new regime gets closer (www.practicallaw.com/8-518-2005) (March 2012).
Article, Financial Conduct Authority: a journey's end? (www.practicallaw.com/8-522-6189) (November 2012).
Financial services regulation: changing the guard (www.practicallaw.com/9-525-1852) (March 2013).