Chapter 1 Application and purpose - Home - FCA Handbook

Senior management arrangements, Systems and Controls

Chapter 1

Application and purpose

■ Release 14 ● Dec 2021 www.handbook.fca.org.uk SYSC 1/2

SYSC 1 : Application and Annex 1purpose

1Detailed application of SYSC

Application of SYSC 2 and SYSC 3 to an insurer, a UK ISPV, a managing agent and thePart 1 Society

Who?

1.1 R SYSC 2 and SYSC 3 only apply to an insurer, a UK ISPV, a managing agent andthe Society except that:

(1) [deleted]

(2) [deleted]

(3) [deleted]

(4) for a sole trader:

(a) SYSC 2 applies but only if he employs any person whois required to be approved under section 59 of theAct (Approval for particular arrangements);

(b) SYSC 3.2.6I R does not apply if he has no employees;and

(5) [deleted]

(6) Except as provided for in (7), SYSC 2 and SYSC 3 do not apply to afirm in relation to benchmark activities.

(7) SYSC 2 and SYSC 3 continue to apply to a person with permissionto carry on the regulated activity of administering a specifiedbenchmark acting as such.

1.1A G (1) As a consequence of the benchmarks regulation, the regulatedactivity referred to in SYSC 1 Annex 1 1.1R(7) will cease to apply incertain circumstances (see SUP TP 10 for an explanation of thosecircumstances).

(2) The effect of SYSC 1 Annex 1 1.1R(7) is that SYSC 2 and SYSC 3 con-tinue to apply to firms which still have permission to carry on theregulated activity in SYSC 1 Annex 1 1.1R(7) when carrying on thatactivity.

1.2 G [deleted]

What?

1.3 R SYSC 2 and SYSC 3 apply with respect to the carrying on of:

(1) regulated activities;

(2) activities that constitute dealing in investments as principal, dis-regarding the exclusion in article 15 of the Regulated ActivitiesOrder (Absence of holding out etc);

(3) ancillary activities in relation to designated investment business,home finance activity and insurance distribution activity; and

(4) activities directly arising from insurance risk transformation;

except that SYSC 3.3 applies as described in SYSC 1 Annex 1 1.3AR and SYSC3.2.6A R to SYSC 3.2.6J G do not apply as described in SYSC 1 Annex 1.1.4R.

■ Release 14 ● Dec 2021 www.handbook.fca.org.uk SYSC 1 Annex 1/1

https://www.legislation.gov.uk/ukpga/2000/8/section/59/2009-04-01

https://www.legislation.gov.uk/uksi/2001/544/article/15/2009-04-01


1Application of SYSC 2 and SYSC 3 to an insurer, a UK ISPV, a managing agent and the

Part 1 Society

1.3A R SYSC 3.3 only applies in relation to the carrying on of insurance distribution ac-tivities.

1.4 R SYSC 3.2.6A R to SYSC 3.2.6J G do not apply:

(1) with respect to the activities described in SYSC 1 Annex 1.1.3R(2)and SYSC 1 Annex 1.1.3R(3); or

(2) in relation to the following regulated activities:

(a) general insurance business;

(aa) insurance risk transformation;

(b) insurance distribution activity in relation to a gen-eral insurance contract or pure protection contract;

(c) long-term insurance business which is outside thescope of the Solvency II Directive (unless it is other-wise one of the regulated activities specified in thisrule);

(d) business relating to contracts which are within theRegulated Activities Order only because they fallwithin paragraph (e) of the definition of "contractof insurance" in article 3 of that Order;

(e) (i) arranging, by the Society, of deals in gen-eral insurance contracts written atLloyd's; and

(ii) managing the underwriting capacity ofa Lloyd's syndicate as a managing agentat Lloyd's;

(f) home finance mediation activity and administering ahome finance transaction; and

(g) reversion activity; or

(3) to a pure reinsurer; or

(4) in relation to activities directly arising from insurance risk trans-formation.

1.5 R SYSC 2 and SYSC 3, except SYSC 3.2.6A R to SYSC 3.2.6J G, also apply with respectto the communication and approval of financial promotions which:

(1) if communicated by an unauthorised person without approvalwould contravene section 21(1) of the Act (Restrictions on finan-cial promotion); and

(2) may be communicated by a firm without contravening section238(1) of the Act (Restrictions on promotion of collective invest-ment schemes).

1.6 R SYSC 2 and SYSC 3, except SYSC 3.2.6A R to SYSC 3.2.6J G, also:

(1) apply with respect to the carrying on of unregulated activities ina prudential context; and

(2) take into account any activity of other members of a group ofwhich the firm is a member.

1.7 G SYSC 1 Annex 1.1.6R(2) does not mean that inadequacy of a group member'ssystems and controls will automatically lead to a firm contravening, for ex-ample, SYSC 3.1.1 R. Rather, the potential impact of a group member's activit-ies, including its systems and controls, and any systems and controls that op-erate on a group basis, will be relevant in determining the appropriatenessof the firm's own systems and controls.

Where?

■ Release 14 ● Dec 2021www.handbook.fca.org.ukSYSC 1 Annex 1/2

https://www.legislation.gov.uk/ukpga/2000/8/section/21/2009-04-01#section-21-1




1Application of SYSC 2 and SYSC 3 to an insurer, a UK ISPV, a managing agent and the

Part 1 Society

1.8 R SYSC 2 and SYSC 3 apply with respect to activities carried on from an establish-ment maintained by the firm (or its appointed representative or, where ap-plicable, its tied agent) in the United Kingdom unless another applicablerule which is relevant to the activity has a wider territorial scope, in whichcase SYSC 2 and SYSC 3 apply with that wider scope in relation to the activitydescribed in that rule.

1.8A R (1) SYSC 3, except SYSC 3.2.6AR to SYSC 3.2.6JG, and

(2) for a UK domestic firm, SYSC 2;

also apply in a prudential context with respect to activities wherever theyare carried on.

1.9 R SYSC 2 and SYSC 3, except SYSC 3.2.6A R to SYSC 3.2.6J G, also apply in a pruden-tial context to a UK domestic firm with respect to activities wherever theyare carried on.

1.10 R SYSC 3, except SYSC 3.2.6A R to SYSC 3.2.6J G, also applies in a prudential con-text to an overseas firm with respect to activities wherever they are carriedon.

1.11 G (1) In considering whether to take regulatory action under SYSC 2 orSYSC 3 in relation to activities carried on outside the United King-dom, the appropriate regulator will take into account the stand-ards expected in the market in which the firm is operating.

(2) Most of the rules in SYSC 3 are linked to other requirements andstandards under the regulatory system which have their own ter-ritorial limitations so that those SYSC rules are similarly limitedin scope.

Actions for damages

1.12 R A contravention of the rules in SYSC 2 and SYSC 3 does not give rise to a rightof action by a private person under section 138D of the Act (and each ofthose rules is specified under section 138D(3) of the Act as a provision givingrise to no such right of action).

Part 2 Application of the common platform requirements

Who?

2.1 R The common platform requirements apply to every firm apart from an in-surer, a UK ISPV, a managing agent and the Society unless provided other-wise in a specific rule.

2.2 R [deleted]

2.3 R For a sole trader:

(1) SYSC 4.3 does not apply as long as they do not employ any per-son who is required to be approved under section 59 of the Act(Approval for particular arrangements);

(2) SYSC 4.1.4 R and SYSC 6.3.9 R do not apply if he has no employees.

2.4 R For a UCITS qualifier:

(1) the rule on responsibility of senior personnel (SYSC 4.3) does notapply; and

(2) the common platform requirements apply in relation to the com-munication and approval of financial promotions only as set outin SYSC 1 Annex 1.2.12R.

[Note: section 266 of the Act.]

2.4A R For an AIFM qualifier:





1Part 2 Application of the common platform requirements

(1) the rule on responsibility of senior personnel (SYSC 4.3) does notapply; and

(2) the common platform requirements apply in relation to the com-munication and approval of financial promotions only as set outin SYSC 1 Annex 1, 2.12R.

2.5 R For an authorised professional firm when carrying on non-mainstream regu-lated activities, the common platform requirements on financial crime, con-flicts of interest and Chinese walls do not apply.

2.5A R The common platform requirements on financial crime do not apply to a firmfor which a professional body listed in Schedule 1 to the Money LaunderingRegulations, and not the FCA, acts as the supervisory authority for the pur-poses of those regulations.

2.6 R [deleted]

2.6A R [deleted]

2.6B R Subject to SYSC 1 Annex 1 2.6CR, the common platform requirements do notapply to a full-scope UK AIFM of an unauthorised AIF except for:

(1) SYSC 4.1.1 R to SYSC 4.1.2 R and SYSC 4.1.2B R to SYSC 4.1.2D R;

(2) SYSC 4.2.1 R, SYSC 4.2.1B R, SYSC 4.2.2 R to SYSC 4.2.5 G, SYSC 4.2.7 Rand SYSC 4.2.8 G;

(3) SYSC 6.1.1 R, which only applies to the extent that it relates to theobligation to establish, implement and maintain adequate pol-icies and procedures for countering the risk that the firm (includ-ing its managers and employees) might be used to further finan-cial crime;

(4) SYSC 6.1.4B G

(5) SYSC 6.3;

(6) SYSC 7.1.7BA G

(7) SYSC 10.1.1 R and SYSC 10.1.22 R to SYSC 10.1.26 R; and

(8) SYSC 10.2.

2.6C R The common platform requirements apply to an AIFM investment firm whichis a full-scope UK AIFM in respect of its MiFID business in line with Column Ain Table A of Part 3.

2.6D R The common platform requirements apply to a full-scope UK AIFM of an au-thorised AIF in line with Column A++ in Table A of Part 3.

2.6E G The common platform requirements apply to a small authorised UK AIFM inline with Column B in Table A of Part 3 (unless such a firm is also a commonplatform firm, in which case they must comply with Column A).

2.6F R [deleted]

2.6G R (1) Except as provided for in (2), the common platform requirementsdo not apply to a firm in relation to benchmark activities.

(2) The common platform requirements continue to apply to a per-son with permission to carry on the regulated activity of adminis-tering a specified benchmark acting as such.

2.6H G (1) As a consequence of the benchmarks regulation, the regulatedactivity referred to in SYSC 1 Annex 1 2.6GR(2) will cease to applyin certain circumstances (see SUP TP 10 for an explanation ofthose circumstances).




(2) The effect of SYSC 1 Annex 1 2.6GR(2) is that the common plat-form requirements continue to apply to firms which still havepermission to carry on the regulated activity in SYSC 1 Annex 12.6GR(2) when carrying on that activity.

2.7 G [deleted]

2.7A G [deleted]

What?

2.8 R The common platform organisational requirements apply with respect to thecarrying on of the following (unless provided otherwise within a specificrule):

(1) regulated activities;

(2) activities that constitute dealing in investments as principal, dis-regarding the exclusion in article 15 of the Regulated ActivitiesOrder (Absence of holding out etc);

(3) ancillary activities;

(4) in relation to MiFID business, ancillary services; and

(5) collective portfolio management.

2.8A R (1) Subject to (2), (3) and (5), in SYSC 1 Annex 1 2.8R, articles 1(2), 21to 25, 30 to 32 and 72 of the MiFID Org Regulation (includingany relevant definitions in the Glossary, MiFIR and the MiFID OrgRegulation) apply as if they were rules or guidance in accordancewith Part 3 (Tables summarising the application of the commonplatform requirements to different types of firm) to a firm’s carry-ing on of the business set out in SYSC 1 Annex 1 2.8R which is notMiFID business or a structured deposits regulated activity.

(1A) Subject to (2), (3) and (6), articles 33 to 35 of the MiFID Org Regu-lation (including any relevant definitions in the Glossary, MiFIRand the MiFID Org Regulation) apply as if they were rules orguidance in accordance with Part 3 (Tables summarising the ap-plication of the common platform requirements to differenttypes of firm) to a firm’s carrying on of the business set out inSYSC 10.1.1R which is not MiFID business or a structured depositsregulated activity.

(2) References in Column (1) to a word or phrase used in the MiFIDOrg Regulation for the purpose of (1) have the meaning indic-ated in Column (2) of the table below:

(1) (2)

“ancillary services” ancillary services or ancillary activities as-sociated with the firm’s regulated ac-tivities

“client” and “poten- clienttial client”

“competent FCAauthority”

“investment firm” firmand “firm”

“investment service” designated investment businessand “investment ser-vices and activities”





“portfolio manage- managing investmentsment” and “portfoliomanagement service”

“shall” must

(3) [deleted]

(4) This rule does not apply to a collective portfolio management in-vestment firm in relation to the firm’s business other than its Mi-FID business.

(5) The requirements in article 72 of the MiFID Org Regulation donot apply to a firm to the extent that article 19 of the IDD Regu-lation applies to the firm.

(6) SYSC 1 Annex 1 2.8R(1A) does not apply to a firm to the extent thatarticles 3 – 7 of the IDD Regulation apply to the firm (see SYSC 1Annex 1 3.1AG).

2.8B G The purpose of SYSC 1 Annex 1 2.8R and SYSC 1 Annex 1 2.8AR is that the com-mon platform organisational requirements and the common platform require-ments on conflicts of interest also apply when carrying on any of the activit-ies listed in SYSC 1 Annex 1 2.8R or SYSC 10.1.1R respectively even where theydo not involve investment services and/or activities and, where relevant, ancil-lary services (unless provided otherwise within a specific rule).

2.8C G SYSC 1 Annex 1 2.8AR(3) has the effect that, where the requirement in the Mi-FID Org Regulation that is a common platform organisational requirement ora common platform requirement on conflicts of interest includes a referenceor cross reference to another part of the MiFID Org Regulation, that refer-ence or cross reference is given the same meaning as for the purposes ofSYSC 1 Annex 1 2.8AR.

2.8D G For the purpose of SYSC 1 Annex 1 2.8AR, a firm should apply any guidancepublished by the FCA that assists with interpreting the definitions in MiFID,MiFIR and the MiFID Org Regulation.

2.9 G The application of the provisions on the conflicts of interest in SYSC 10 is setout in SYSC 10.1.-4G to SYSC 10.1.1AR and SYSC 10.2.1 R

2.10 R The provisions on record-keeping in SYSC 9 and articles 21 and 72 of the Mi-FID Org Regulation apply as set out in SYSC 1 Annex 1.2.8R and SYSC 1 Annex1.2.8AR, except that they only apply to the carrying on of ancillary activitiesthat are performed in relation to:

(1) designated investment business;

(2) home finance activity;

(3) insurance distribution activity;

(4) credit-related regulated activity.

2.11 R The common platform requirements on financial crime apply as set out inSYSC 1 Annex 1 2.8R, except that they do not apply:

(1) with respect to:

(a) activities that constitute dealing in investments asprincipal, disregarding the exclusion in article 15 ofthe Regulated Activities Order (Absence of holdingout etc); and

(b) ancillary activities; or

(2) in relation to the following regulated activities:

(a) general insurance business;

(b) insurance distribution activity in relation to a generalinsurance contract or pure protection contract;





(c) long-term insurance business which is outside theSolv-ency II Directive (unless it is otherwise one of theregulated activities specified in this rule);

(d) business relating to contracts which are within theRegulated Activities Order only because they fallwithin paragraph (e) of the definition of "contract ofinsurance" in article 3 of that Order;

(e) (i) arranging by the Society of deals in gen-eral insurance contracts written atLloyd's; and

(ii) managing the underwriting capacity of aLloyd's syndicate as a managing agent atLloyd's;

(f) home finance mediation activity and administering ahome finance transaction;

(g) reversion activity; and

(h) meeting of repayment claims and managing dormantaccount funds (including the investment of suchfunds)managing dormant account funds (includingthe investment of such funds).

2.12 R The common platform organisational requirements, except the common plat-form requirements on financial crime, also apply with respect to the commun-ication and approval of financial promotions which:

(1) if communicated by an unauthorised person without approvalwould contravene section 21(1) of the Act (Restrictions on finan-cial promotion); and

(2) may be communicated by a firm without contravening section238(1) of the Act (Restrictions on promotion of collective invest-ment schemes).

2.13 R The common platform organisational requirements, except the common plat-form requirements on financial crime, also:

(1) apply with respect to the carrying on of unregulated activities ina prudential context; and

(2) take into account any activity of other members of a group ofwhich the firm is a member.

2.13A R SYSC 6.3 only applies to a firm in relation to carrying on a credit-related regu-lated activity or regulated claims management activity, or operating an elec-tronic system in relation to lending, to which the Money Laundering Regula-tions also apply.

2.13B R SYSC 6.3.8 R and SYSC 6.3.9 R do not apply to a firm with a limited permissionfor entering into a regulated credit agreement as lender.

2.13C G The persons to whom the Money Laundering Regulations apply are set out inregulation 10 of the Money Laundering Regulations. The persons includecredit institutions (for example, banks) and financial institutions (for ex-ample, persons who carry on regulated activities which consist of or includeentering into regulated credit agreements as lender). These expressions aredefined in regulation 10 of those Regulations.

2.14 G SYSC 1 Annex 1.2.13R(2) does not mean that inadequacy of a group member'ssystems and controls will automatically lead to a firm contravening any ofthe common platform organisational requirements. Rather, the potential im-pact of a group member's activities, including its systems and controls, andany systems and controls that operate on a group basis, will be relevant in de-termining the appropriateness of the firm's own systems and controls.






2.14A G The systems and control requirements in article 17 of MiFID for the followingare in chapter 7A of the Market Conduct sourcebook (MAR):

(1) algorithmic trading;

(2) direct electronic access to a tradingvenue; and

(3) acting as a general clearing member of atrading venue.

2.14B G Firms should refer to articles 38 to 42 of the MiFID Org Regulation for addi-tional organisational requirements for underwriting and placing.

Where?

2.15 R The common platform requirements, except the common platform record-keeping requirements, apply to a firm in relation to activities which:

(1) (except for regulated claims management activities and ancillaryactivities) are carried on by it from an establishment in theUnited Kingdom; or

(2) are, or are ancillary to, regulated claims management activities.

2.16 R [deleted]

2.16A R [deleted]

2.16B G [deleted]

2.16C R The common platform requirements apply to a full-scope UK AIFM in respectof its management of an AIF where carried on from an establishment in theUK.

2.16D R [deleted]

2.16E R The common platform requirements apply to an AIFM investment firm whichis a full-scope UK AIFM in respect of its MiFID business where carried on froman establishment in the UK.

2.16F R [deleted]

2.17 R The common platform record-keeping requirements apply to activities which:

(1) (except for regulated claims management activities and ancillaryactivities) are carried on by it from an establishment in theUnited Kingdom; or

(2) are, or are ancillary to, regulated claims management activities.

If, however, another applicable rule which is relevant to the activity has awider territorial scope, the common platform record-keeping requirementsapply with that wider scope in relation to the activity described in that rule.

[Note: article16(11) first paragraph of MiFID]

2.17A G For an activity to amount to a regulated claims management activity it mustbe carried on in Great Britain (see PERG 2.4A). Subject to the exception forcommon platform record-keeping requirements in paragraph 2.17R of thisAnnex, the application of the common platform requirements to firms whichcarry on regulated claims management activities (and ancillary activities) de-pends on whether the activity is carried on in Great Britain rather thanwhether it is carried on from an establishment maintained in the UnitedKingdom.

The common platform organisational requirements, except the common plat-form requirements on financial crime, also apply in a prudential context to aUK domestic firm and to an overseas firm with respect to activities whereverthey are carried on.

2.18A G SYSC 6.1.1R on systems and controls for countering the risk that a firm mightbe used to further financial crime is:




(1) a common platform organisational re-quirement, not a common platform re-quirement on financial crime; and

(2) subject to the application, amongst otherprovisions, of SYSC 1 Annex 1 2.13R, SYSC 1Annex 1 2.16R and SYSC 1 Annex 1 2.18R.

Actions for damages

2.19 R A contravention of a rule in the common platform requirements does notgive rise to a right of action by a private person under section 138D of theAct (and each of those rules is specified under section 138D(3) of the Act as aprovision giving rise to no such right of action).

Tables summarising the application of the common platform requirements to differentPart 3 types of firm

3.1 G The common platform requirements apply as described in the following table(subject to the provisions in Part 2 of this Annex (Application of the commonplatform requirements)).

Type of firm Common plat-form re-

quirements

Common platform firm SYSC 1 Annex 13.2G, SYSC 1 Annex1 3.2-AR and SYSC1 Annex 1 3.2-BR

Management company SYSC 1 Annex 13.2AG

Full-scope UK AIFM of an authorised AIF SYSC 1 Annex 13.2BR

MiFID optional exemption firm SYSC 1 Annex 13.2CR

Third country firm SYSC 1 Annex 13.2CR

All other firms (apart from insurers, managing agents, SYSC 1 Annexthe Society, full-scope UK AIFMs of unauthorised AIFs, Mi- 1.3.3RFID optional exemption firms and third country firms)

3.1A G The IDD Regulation applies to a firm when carrying on insurance distributionin relation to insurance-based investment products. Articles 3 to 7 of the IDDRegulation are reproduced in SYSC 10.1A for information for these firms.

Common platform firm

3.2 G For a common platform firm (other than a dormant account fund operatornot subject to MiFID):

(1) SYSC 4 to SYSC 10 apply in accordance with Column A inTable A below; and

(2) articles 1(2), 21 to 25, 30 to 35 and 72 of the MiFID OrgRegulation are directly applicable to the firm.

3.2-A R For a common platform firm (other than a dormant account fund operatornot subject to MiFID), articles 1(2), 21 to 25, 30 to 35 and 72 of the MiFIDOrg Regulation apply to the firm’s business other than MiFID business orstructured deposits regulated activities as if the MiFID Org Regulation ap-plied to the firm as rules in accordance with SYSC 1 Annex 1 2.8R and SYSC 1 An-nex 1 2.8AR.

3.2-B R For a common platform firm that is a dormant account fund operator and isnot subject to MiFID:



1Tables summarising the application of the common platform requirements to different

Part 3 types of firm

(1) SYSC 4 to SYSC 10 apply in accordance with Column A inTable A below; and

(2) articles 1(2), 21 to 25, 30 to 35 and 72 of the MiFID OrgRegulation apply as if the MiFID Org Regulation appliedto the firm as rules in accordance with SYSC 1 Annex 1 2.8Rand SYSC 1 Annex 1 2.8AR.

Management company

3.2A G For a management company, the common platform requirements in SYSC 4 toSYSC 10 apply in accordance with Column A+ in Table A below.

Full-scope UK AIFM of an authorised AIF

3.2B R For a full-scope UK AIFM of an authorised AIF, the common platform require-ments in SYSC 4 to SYSC 10 apply in accordance with Column A++ in Table Abelow.

MiFID optional exemption firm and a third country firm

3.2C R For a MiFID optional exemption firm and a third country firm:

(1) SYSC 4 to SYSC 10 apply as rules or as guidance in accord-ance with Table B below in the following way:

(a) where a rule is shown modified as'Guidance', it should be read as guid-ance (as if "should" appeared in thatrule instead of "must"); and

(b) the provision should be applied in aproportionate manner, taking into ac-count the nature, scale and complex-ity of the firm’s business; and

(2) articles 1(2), 21 to 25, 30 to 32 and 72 of the MiFID OrgRegulation apply as if the MiFID Org Regulation appliedto the firm as rules (in accordance with SYSC 1 Annex 12.8R and SYSC 1 Annex 1 2.8AR) or as guidance in accord-ance with Part 1 of Table C below. Part 2 of Table C setsout those articles of the MiFID Org Regulation.

3.2D R (1) Subject to (2), SYSC 4.3A.6R, SYSC 4.3A.8R and SYSC 7.1.18Rapply to a MiFID optional exemption firm that is ‘signific-ant’ as a rule or as guidance in accordance with SYSC 1 An-nex 1 3.2CR.

(2) In (1), ‘significant’ means a MiFID optional exemptionfirm that meets one of more of the conditions in para-graphs (1) to (5) of IFPRU 1.2.3R and related rules andguidance.

Other firms

3.2E R SYSC 1 Annex 1 3.3R does not apply to the following:

(1) insurers and UK ISPVs;

(2) managing agents;

(3) the Society;

(4) full-scope UK AIFMs of unauthorised AIFs;

(5) MiFID optional exemption firms; and

(6) third country firms.



1Tables summarising the application of the common platform requirements to different

Part 3 types of firm

3.3 R For all other firms:

(1) SYSC 4 to SYSC 10 apply as rules or as guidance in accord-ance with Column B in Table A below in the followingway:

(a) where a rule is shown modified inColumn B as 'Guidance', it should beread as guidance (as if "should" ap-peared in that rule instead of"must"); and

(b) the provision should be applied in aproportionate manner, taking into ac-count the nature, scale and complex-ity of the firm’s business; and

(2) articles 1(2), 21 to 25, 30 to 35 and 72 of the MiFID OrgRegulation do not apply.

3.3A R

Table A: Application of the common platform requirements in SYSC 4 to SYSC 10

COLUMN B

Application to allother firms apartfrom insurers, UKISPVs, managingagents, the Soci-ety, full-scope UKCOLUMN AAIFMs of unau-COLUMN A++

Application to a thorised AIFs, Mi-COLUMN A+common platform Application to a FID optional ex-firm other than to Application to a full-scope UK emption firmsProvisiona UCITS invest- UCITS manage- AIFM of an au- and third country

SYSC 4 ment firm ment company thorised AIF firms

SYSC 4.1.-2G Guidance Not applicable Not applicable Not applicablesave in relation toa UCITS invest-ment firm and itsMiFID business

SYSC 4.1.-1G Not applicable Not applicable Not applicable Not applicable

SYSC 4.1.1R Rule Rule Rule Rule

SYSC 4.1.1AR Not applicable Not applicable Rule Not applicable

SYSC 4.1.1BR Not applicable Not applicable Rule Not applicable

SYSC 4.1.1CR Rule for a BIPRU Rule for a BIPRU Not applicable Third country BI-firm firm that is a UC- PRU firms: Rule

ITS investmentOther firms: Notfirmapplicable

SYSC 4.1.1DR Not applicable Rule Not applicable Not applicable

SYSC 4.1.1ER Not applicable Rule Not applicable Not applicable

SYSC 4.1.1FG Not applicable Guidance Not applicable Not applicable

SYSC 4.1.2R Rule Rule for a UCITS Rule Guidanceinvestment firm;otherwiseguidance



1COLUMN B




SYSC 4.1.2AG Not applicable Guidance for a Not applicable GuidanceUCITS firm; notapplicable to aUCITS investmentfirm

SYSC 4.1.2AAR Rule for a BIPRU Rule for a BIPRU Not applicable Not applicablefirm firm that is a UC-

ITS investmentfirm

SYSC 4.1.2BR Not applicable Rule Rule Not applicable

SYSC 4.1.2CR Not applicable Rule Not applicable

SYSC 4.1.2DR Not applicable Not applicable Rule Not applicable

SYSC 4.1.3R [deleted] [deleted] [deleted] [deleted]

SYSC 4.1.4R Not applicable Rule Not applicable (1) and (3): Guid-ance; (2): Rule

SYSC 4.1.4AG Not applicable Not applicable Not applicable Guidance

SYSC 4.1.5R Not applicable Rule Not applicable Not applicable

SYSC 4.1.6R Rule Rule for a UCITS Not applicable Guidanceinvestment firm;otherwiseguidance

SYSC 4.1.7R Rule CRR firm for Rule Not applicable Guidancea only


SYSC 4.1.8G Guidance Guidance Guidance Guidance

SYSC 4.1.8AR Applies as a rule Not applicable Not applicable Applies as a ruleonly to an oper- only to an oper-ator of an elec- ator of an elec-tronic system in tronic system inrelation to relation tolending lending

SYSC 4.1.8CG Applies as guid- Not applicable Not applicable Applies as guid-ance only to an ance only to anoperator of an operator of anelectronic system electronic systemin relation to in relation tolending lending

SYSC 4.1.8DG Applies as guid- Not applicable Not applicable Applies as guid-ance only to an ance only to anoperator of an operator of anelectronic system electronic system



1COLUMN B




in relation to in relation tolending lending

SYSC 4.1.8DAG Applies as guid- Not applicable Not applicable Applies as guid-ance only to an ance only to anoperator of an operator of anelectronic system electronic systemin relation to in relation tolending lending

SYSC 4.1.8DBR Applies as a rule Not applicable Not applicable Applies as a ruleonly to an oper- only to an oper-ator of an elec- ator of an elec-tronic system in tronic system inrelation to relation tolending lending

SYSC 4.1.8DCR Applies as a rule Not applicable Not applicable Applies as a ruleonly to an Applies only to an oper-as a rule only to ator of an elec-an operator of an tronic system inelectronic system relation toin relation to lendinglending

SYSC 4.1.8DDR Applies as a rule Not applicable Not applicable Applies as a ruleonly to an oper- only to an oper-ator of an elec- ator of an elec-tronic system in tronic system inrelation to relation tolending lending


SYSC 4.1.10R Not applicable Rule Not applicable Guidance - exceptreference to SYSC4.1.9 R which doesnot apply tothese firms





SYSC 4.2.1R Rule Rule RuleGuidance


SYSC 4.2.2R Rule Rule Rule Not applicable

SYSC 4.2.3G - 4.2.5G Guidance Guidance Guidance Not applicable



1COLUMN B




SYSC 4.2.6R Rule Rule for a UCITS Not applicable Not applicableinvestment firm;otherwise not ap-plicable

SYSC 4.2.7R Not applicable Not applicable Rule Not applicable

SYSC 4.2.8G Not applicable Not applicable Rule Not applicable

SYSC 4.2.9G [deleted] [deleted] [deleted] [deleted]

SYSC 4.3.1R Not applicable Rule Not applicable Rule

SYSC 4.3.2R Not applicable Rule Not applicable Guidance but ap-plies as a rule toan operator of anelectronic systemin relation tolending

SYSC 4.3.2AG Not applicable Not applicable Not applicable Guidance (butnot applicable toan operator of anelectronic systemin relation tolending)

SYSC 4.3.3G Guidance Guidance Not applicable Guidance

SYSC 4.3A.-1R Rule (except for Rule for a CRR Not applicable Not applicablean AIFM invest- firm that is a UC-ment firm that is ITS investmentnot a CRR firm) firm

SYSC 4.3A.1R Rule (except for Rule for a CRR Not applicableNot applicablean AIFM invest- firm that is a UC-

ment firm that is ITS investmentnot a CRR firm) firm

SYSC 4.3A.1AR Rule (except for Rule for a CRR Not applicable Not applicablean AIFM invest- firm that is a UC-ment firm that is ITS investmentnot a CRR firm) firm

SYSC 4.3A.2RRule Rule for a CRR Not applicable Not applicable

firm that is a UC-(except for an ITS investmentAIFM investment firmfirm that is not aCRR firm)



1COLUMN B




SYSC 4.3A.2AG Guidance (except Guidance for a Not applicable Not applicablefor an AIFM in- CRR firm that is avestment firm UCITS investmentthat is not a CRR firmfirm)

SYSC 4.3A.3R Rule (except for Rule for a CRR Not applicable Not applicablean AIFM invest- firm that is a UC-ment firm that is ITS investmentnot a CRR firm) firm

SYSC 4.3A.3AG Guidance Guidance for a Not applicable Not applicableCRR firm that is aUCITS investmentfirm

SYSC 4.3A.4RRule (except for Rule for a CRR Not applicable Not applicablean AIFM invest- firm that is a UC-ment firm that is ITS investmentnot a CRR firm) firm

SYSC 4.3A.5R Rule (except for Not applicable Not applicableRule for a CRRan AIFM invest-firm that is a UC-ment firm that isITS investmentnot a CRR firm)firm








1COLUMN B




SYSC 4.3A.11R Rule applicable to Rule for a CRR Not applicable Not applicableCRR firms firm that is a UC-

ITS investmentfirm


SYSC 4.4.1AR Not applicable Not applicable Not applicable As specified inSYSC 4.4.1AR

SYSC 4.4.2G Not applicable Not applicable Not applicable Guidance only ap-plying to thefirms specified inSYSC 4.4.1A R

SYSC 4.4.3R Not applicable Not applicable Not applicable Rule only apply-ing to the firmsspecified in SYSC4.4.1A R


SYSC 4.4.5R Not applicable Not applicable Not applicable Rule only apply-ing to the firmsspecified in SYSC4.4.1A R




1COLUMN B









SYSC 5.1.3AG Guidance Guidance Guidance Guidance



Guidance Guidance Guidance Guidance


SYSC 5.1.5AAR Rule Not applicable Not applicablesave in relation to Not applicablea UCITS invest-ment firm and itsMiFID business

SYSC 5.1.5ABR Rule Not applicable Not applicablesave in relation to Not applicablea UCITS invest-ment firm and itsMiFID business

SYSC 5.1.5ACG Guidance Not applicable Not applicablesave in relation to Not applicablea UCITS invest-ment firm and itsMiFID business

SYSC 5.1.5ADG[deleted]

SYSC 5.1.5AEG[deleted]

SYSC 5.1.5BR Rule Rule Rule Rule

SYSC 5.1.6R Not applicable Rule Guidance Guidance

SYSC 5.1.7R Rule Rule for a UCITS Guidance Guidanceinvestment firm;otherwiseguidance



1COLUMN B




SYSC 5.1.7AG Not applicable Not applicable to Guidance Guidancea UCITS invest-ment firm; other-wise guidance



SYSC 5.1.10G Guidance Guidance Guidance, but not Guidanceapplicable for thesegregation ofrisk managementfunctions


SYSC 5.1.12R Not applicable Rule Not applicable Guidance



SYSC 5.1.14R Not applicable Rule Not applicable Guidance

SYSC 5.1.15G Not applicable Not applicable Not applicable Guidance

.

COLUMN B






SYSC 6.1.1R Rule Rule Rule but only re- Rulegarding the ob-ligation to estab-lish, implement



1COLUMN B




and maintain ad-equate policiesand proceduresfor counteringthe risk that thefirm (including itsmanagers and em-ployees) might beused to furtherfinancial crime


SYSC 6.1.2R Not applicable Rule Not applicable Guidance, but ap-plies as a rule toan operator of anelectronic systemin relation tolending

SYSC 6.1.2AG Not applicable Not applicable Not applicable Guidance, but ap-plies as a rule toan operator of anelectronic systemin relation tolending

SYSC 6.1.3R Not applicable Rule Not applicable Guidance, but ap-plies as a rule toan operator of anelectronic systemin relation tolending.

For firms otherthan an operatorof an electronicsystem in relationto lending, thisprovision shall beread with the fol-lowing additionalsentence at thestart. "Dependingon the nature,scale and com-plexity of its busi-ness, it may be ap-propriate for afirm to have a sep-arate compliancefunction. Where a



1COLUMN B




firm has a separ-ate compliancefunction, the firmshould also takeinto account SYSC6.1.3R and SYSC6.1.4R asguidance."

SYSC 6.1.3AG Not applicable Not applicable Not applicable Guidance, butdoes not apply toan operator of anelectronic systemin relation tolending

SYSC 6.1.4R Not applicable Rule Not applicable (1), (3) and (4):Guidance;

(2):

- Rule for firmswhich carry ondesignated in-vestment businesswith or for retailclients or profes-sional clients.

- Guidance for allother firms.

Applies as a ruleto an operator ofan electronic sys-tem in relation tolending.

SYSC 6.1.4-AG Guidance Not applicable Rule Guidance

SYSC 6.1.4AR Not applicable Not applicable Not applicable Rule for firmswhich carry ondesignated in-vestment businesswith or for retailclients or profes-sional clients.

SYSC 6.1.4BG Not applicable Not applicable Guidance Not applicable

SYSC 6.1.4-CG Guidance applies Not applicable Not applicable Not applicableto relevant au-thorised personsonly



1COLUMN B




SYSC 6.1.4CR Not applicable Not applicable Not applicable As specified inSYSC 6.1.4CR.

SYSC 6.1.5R Not applicable Rule Not applicable - Guidance, butapplies as a ruleto an operator ofan electronic sys-tem in relation tolending

- "investment ser-vices andactivities" shall beread as "financialservices andactivities"

SYSC 6.1.6G Not applicable Not applicable Not applicable Guidance, butdoes not apply toan operator of anelectronic systemin relation tolending

SYSC 6.1.7R Rule Rule for a UCITS Not applicable Guidanceinvestment firm;otherwise not ap-plicable

SYSC 6.1.8G Not applicable Not applicable Not applicable Only applies to anoperator of anelectronic systemin relation tolending

SYSC 6.2.1R Not applicable Rule Not applicable Guidance, but ap-plies as a rule toan operator of anelectronic systemin relation tolending

SYSC 6.2.1AG Not applicable Not applicable Not applicable Guidance, butdoes not apply toan operator of anelectronic systemin relation tolending

SYSC 6.2.1BG Guidance applies Not applicable Not applicable Not applicableto relevant au-thorised personsonly



1COLUMN B






For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Ruledoes not apply toa firm for which aprofessional bodylisted in Schedule1 to the MoneyLaundering Re-gulations, and notthe FCA, acts asthe supervisoryauthority for thepurposes of thoseregulations.(FCAHandbook only)


For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Guid-ance does not ap-ply to a firm for



1COLUMN B




which a profes-sional body listedin Schedule 1 tothe Money Laun-dering Regula-tions, and not theFCA, acts as thesupervisory au-thority for thepurposes of thoseregulations.(FCAHandbook only)


For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Ruledoes not apply toa firm for which aprofessional bodylisted in Schedule1 to the MoneyLaundering Re-gulations, and notthe FCA, acts asthe supervisoryauthority for thepurposes of thoseregulations.(FCAHandbook only)


For firms carryingon a credit-re-lated regulated



1COLUMN B




activity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Guid-ance does not ap-ply to a firm forwhich a profes-sional body listedin Schedule 1 tothe Money Laun-dering Regula-tions, and not theFCA, acts as thesupervisory au-thority for thepurposes of thoseregulations. (FCAHandbook only)


For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Guid-ance does not ap-ply to a firm forwhich a profes-sional body listedin Schedule 1 to



1COLUMN B




the Money Laun-dering Regula-tions, and not theFCA, acts as thesupervisory au-thority for thepurposes of thoseregulations. (FCAHandbook only)


For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Guid-ance does not ap-ply to a firm forwhich a profes-sional body listedin Schedule 1 tothe Money Laun-dering Regula-tions, and not theFCA, acts as thesupervisory au-thority for thepurposes of thoseregulations. (FCAHandbook only)


For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating an



1COLUMN B




electronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Guid-ance does not ap-ply to a firm forwhich a profes-sional body listedin Schedule 1 tothe Money Laun-dering Regula-tions, and not theFCA, acts as thesupervisory au-thority for thepurposes of thoseregulations. (FCAHandbook only)


For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Ruledoes not apply toa firm with a lim-ited permissionfor entering intoa regulated creditagreement aslender. Rule doesnot apply to afirm for which aprofessional bodylisted in Schedule



1COLUMN B




1 to the MoneyLaundering Re-gulations, and notthe FCA, acts asthe supervisoryauthority for thepurposes of thoseregulations. (FCAHandbook only)


For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Ruledoes not apply toa firm with a lim-ited permissionfor entering intoa regulated creditagreement aslender. Rule doesnot apply to afirm for which aprofessional bodylisted in Schedule1 to the MoneyLaundering Re-gulations, and notthe FCA, acts asthe supervisoryauthority for thepurposes of thoseregulations. (FCAHandbook only)



1COLUMN B





For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm. Guid-ance does not ap-ply to a firm forwhich a profes-sional body listedin Schedule 1 tothe Money Laun-dering Regula-tions, and not theFCA, acts as thesupervisory au-thority for thepurposes of thoseregulations. (FCAHandbook only)


For firms carryingon a credit-re-lated regulatedactivity or regu-lated claims man-agement activity,or operating anelectronic systemin relation to lend-ing, applies onlywhere the MoneyLaundering Re-gulations apply tothe firm.Guidancedoes not apply toa firm for which aprofessional body



1COLUMN B




listed in Schedule1 to the MoneyLaundering Re-gulations, and notthe FCA, acts asthe supervisoryauthority for thepurposes of thoseregulations. (FCAHandbook only)

COLUMN B






SYSC 7.1.1G Guidance Guidance Not applicableGuidance

SYSC 7.1.2R Not applicable Rule for a UCITS Not applicable Guidance, but ap-investment firm in plies as a rule torelation to its an operator of annon-MiFID busi- electronic systemness; otherwise in relation toguidance lending

SYSC 7.1.2AG Not applicable Not applicable to Not applicable Guidance, buta UCITS invest- does not apply toment firm; other- an operator of anwise guidance electronic system

in relation tolending

SYSC 7.1.2BG Not applicable Guidance Not applicable Not applicable



1COLUMN B




SYSC 7.1.3R Not applicable Rule for a UCITS Not applicable Guidance, but ap-investment firm in plies as a rule forrelation to its an operator of annon-MiFID busi- electronic systemness; otherwise in relation toguidance lending

SYSC 7.1.4R Rule Rule for a UCITS Not applicable Guidance, but ap-investment firm; plies as a rule tootherwise an operator of anguidance electronic system


SYSC 7.1.4AG Guidance Rule for a UCITS Not applicable Guidanceinvestment firm;otherwiseguidance

SYSC 7.1.4BG Not applicable Rule for a UCITS Not applicable Guidanceinvestment firm;otherwiseguidance




SYSC 7.1.7AG Not applicable Rule for a UCITS Not applicable Guidance, butinvestment firm; does not apply tootherwise an operator of anguidance electronic system




1COLUMN B




SYSC 7.1.7BG Guidance applies Rule for a UCITS Guidance Guidanceonly to a BIPRU investment firm;firm otherwise

guidance

SYSC 7.1.7BAG Not applicable Not applicable Guidance Not applicable

SYSC 7.1.7BBG Guidance applies Guidance applies Not applicable Not applicableonly to a BIPRU only to a BIPRUfirm firm that is a UC-

ITS investmentfirm

SYSC 7.1.7CG Guidance Guidance Guidance Guidance


SYSC 7.1.9R Rule applies to a Rule for a UCITS Not applicable Not applicableBIPRU firm investment firm;

otherwise not ap-plicable





SYSC 7.1.12G Guidance applies Rule for a UCITS Not applicable Not applicableto a BIPRU firm investment firm;


SYSC 7.1.13R - Rule applies to a Rule for a UCITS Not applicable Not applicableBIPRU firm investment firm;

7.1.16R otherwise not ap-plicable

SYSC 7.1.16AG [deleted] [deleted] [deleted] [deleted]

SYSC 7.1.16BG [deleted] [deleted] [deleted] [deleted]

SYSC 7.1.16CR Rule applies to a Not applicable Not applicable Not applicableCRR firm

SYSC 7.1.17R Rule applies to a Rule for a UCITS Not applicable Not applicableCRR firm investment firm

that is a CRR firm,otherwise not ap-plicable



1COLUMN B






SYSC 7.1.18AAG Guidance applies Guidance for a Not applicable Not applicableto a CRR firm UCITS investment

firm that is a CRRfirm, otherwisenot applicable

SYSC 7.1.18BR Rule applies to a Rule for a UCITS Not applicable Not applicableCRR firm investment firm










SYSC 7.1.23G Guidance applies Not applicable Not applicable Not applicableto UK relevant au-thorised personsand third countryrelevant au-thorised personsonly



1COLUMN B






SYSC 8.1.1R Rule Rule for a UCITS Not applicable Guidanceinvestment firm;otherwiseguidance

SYSC 8.1.1AG Not applicable Not applicable to Not applicable Guidancea UCITS invest-ment firm; other-wise guidance



SYSC 8.1.4R Not applicable Rule for a UCITS Not applicable Guidanceinvestment firm;otherwiseguidance

SYSC 8.1.5R Not applicable Rule for a UCITS Not applicable Guidanceinvestment firm;otherwiseguidance

SYSC 8.1.5AG Not applicable Rule for a UCITS Not applicable Guidanceinvestment firm;otherwiseguidance

SYSC 8.1.6R Not applicable Rule for a UCITS Not applicable Ruleinvestment firm inrelation to itsnon-MiFID busi-ness; otherwiseguidance

SYSC 8.1.6AG Guidance for a Not applicable Not applicable Not applicableUCITS investmentfirm in relation toits MiFID business

SYSC 8.1.7R Not applicable Rule for a UCITS Not applicable Guidanceinvestment firm inrelation to itsnon-MiFID busi-ness; otherwiseguidance



1COLUMN B








SYSC 8.1.11AG Not applicable Not applicable to Not applicable Guidancea UCITS invest-ment firm; other-wise guidance



SYSC 8.1.14G Not applicable Guidance Not applicable Not applicable

SYSC 8.2 [deleted] [deleted] [deleted] [deleted]

SYSC 8.3 [deleted] [deleted] [deleted] [deleted]



1COLUMN B






SYSC 9.1.1R Not applicable Rule Rule but only for Rulethe requirementto arrange for or-derly records tobe kept of its busi-ness and internalorganisationwhich do not re-late to portfoliotransactions andsubscription andredemptionsorders

SYSC 9.1.1AR Rule Not applicable Not applicable Not applicable

SYSC 9.1.2R Rule applies only Rule applies only Rule but only for Not applicablein relation to Mi- in relation to Mi- records specifiedFID business FID business of a by the modified

UCITS investment application offirm SYSC 9.1.1 R

SYSC 9.1.2AR Rule Rule Rule Rule

SYSC 9.1.2BG Guidance Guidance Guidance Guidance

SYSC 9.1.2CUKApplicable to a Applicable to a Applicable to a Applicable to afirm carrying on firm carrying on firm carrying on firm carrying oninsurance distri- insurance distri- insurance distri- insurance distri-bution in relation bution in relation bution in relation bution in relationto insurance- to insurance- to insurance- to insurance-based investment based investment based investment based investmentproducts products products products

SYSC 9.1.2DR Rule Rule Rule Rule





SYSC 9.1.6A Guidance Guidance Guidance Guidance

[deleted] [deleted] [deleted] [deleted]



1COLUMN B




SYSC 9.2G Not applicable Not applicable Not applicable Applicable tocredit institutionsonly

Column B

Application to allother firms apartfrom insurers, UKISPVs, managingagents, the Soci-ety, full-scope UKColumn AAIFMs of unau-COLUMN A++



SYSC 10.1.-4G Guidance in rela- Guidance in rela- Guidance in rela- Guidance in rela-tion to insurance tion to insurance tion to insurance tion to insurancedistribution ac- distribution ac- distribution ac- distribution ac-tivities tivities tivities tivities

SYSC 10.1.-3R Rule in relation to Rule in relation to Rule in relation to Rule in relation toinsurance distri- insurance distri- insurance distri- insurance distri-bution activities bution activities bution activities bution activities

SYSC 10.1.-2G Guidance Guidance in rela- Not applicable Not applicabletion to relation toa UCITS invest-ment firm in rela-tion to its MiFIDbusiness; other-wise not ap-plicable


SYSC 10.1.1R Rule Rule Not applicable Rule

SYSC 10.1.1AR Not applicable Not applicable Rule Not applicable

SYSC 10.1.2G Guidance Guidance Guidance in rela- Guidancetion to insurancedistribution ac-tivities. Other-wise, not ap-plicable

SYSC 10.1.3R Rule Rule Rule in relation to Ruleinsurance distri-bution activities.



1Column B




Otherwise not ap-plicable

SYSC 10.1.4R Not applicable Rule, but not ap- Not applicable Guidance - but ap-plicable in rela- plies as a rule intion to insurance relation to thedistribution ac- production or ar-tivities rangement of in-

vestment re-search, or the pro-duction or dissem-ination of non-independent re-search, in accord-ance with COBS12.2

Not applicable inrelation to insur-ance distributionactivities

SYSC 10.1.4AG Not applicable Not applicable Not applicable Guidance -but notapplicable in rela-tion to insurancedistribution ac-tivities

SYSC 10.1.4BR Not applicable Rule in relation to Rule in relation to Rule in relation toinsurance distri- insurance distri- insurance distri-bution activities bution activities bution activities

SYSC 10.1.4CR Not applicable Rule in relation to Rule in relation to Rule in relation toinsurance distri- insurance distri- insurance distri-bution activities bution activities bution activities


SYSC 10.1.6R Not applicable Rule Rule in relation to Guidance - but ap-insurance distri- plies as a rule: (a)bution activities. in relation to theOtherwise, not ap- production or ar-plicable rangement of in-

vestment re-search, or the pro-duction or dissem-ination of non-independent re-search, in accord-ance with COBS



1Column B




12.2; and (b) in re-lation to insur-ance distributionactivities

SYSC 10.1.6AG Not applicable Not applicable Guidance - but Guidance - butnot applicable in not applicable inrelation to insur- relation to insur-ance distribution ance distributionactivities activities

SYSC 10.1.6AAR Not applicable Rule in relation to Rule in relation to Rule in relation toinsurance distri- insurance distri- insurance distri-bution activities bution activities bution activities

SYSC 10.1.6BG Not applicable Guidance Guidance Guidance

SYSC 10.1.7R Rule Rule Rule in relation to Ruleinsurance distri-bution activities.Otherwise not ap-plicable

SYSC 10.1.7AR Rule Rule Rule Rule

SYSC 10.1.8R Rule in relation to Rule Rule in relation to Ruleinsurance distri- insurance distri-bution activities. bution activities.Otherwise, not ap- Otherwise, not ap-plicable plicable

SYSC 10.1.9G Not applicable Guidance Not applicable Guidance

SYSC 10.1.9AR Not applicable Rule in relation to Rule in relation to Guidance - but ap-insurance distri- insurance distri- plies as a rule inbution activities. bution activities. relation to insur-Otherwise, not ap- Otherwise, not ap- ance distributionplicable plicable activities


vestment re-search, or the pro-duction or dissem-ination of non-independent re-search, in accord-ance with COBS



1Column B




12.2; and (b) in re-lation to insur-ance distributionactivities


vestment re-search, or the pro-duction or dissem-ination of non-independent re-search, in accord-ance with COBS12.2; and (b) in re-lation to insur-ance distributionactivities

SYSC 10.1.11AG Not applicable Not applicable Guidance - but Guidance - butnot applicable in not applicable inrelation to insur- relation to insur-ance distribution ance distributionactivities activities

SYSC 10.1.11AAR Not applicable Rule in relation to Rule in relation to Rule in relation toinsurance distri- insurance distri- insurance distri-bution activities bution activities bution activities

SYSC 10.1.11ABR Rule in relation to Not applicable Not applicable Not applicableinsurance distri-bution activities

SYSC 10.1.11BG Not applicable Guidance Guidance Guidance


SYSC 10.1.13- [deleted] [deleted] [deleted] [deleted]10.1.15G

SYSC 10.1.16R Not applicable Not applicable Not applicable Rule


SYSC 10.1.18G Not applicable Guidance Not applicable Not applicable

[FCA]






1Column B




SYSC 10.1.22R Not applicable Rule Rule Not applicable

SYSC 10.1.23R to Not applicable Not applicable Rule Not applicableSYSC 10.1.26R

SYSC 10.1A UK UK UK UK

Applicable to a Applicable to a Applicable to a Applicable to afirm carrying on firm carrying on firm carrying on firm carrying oninsurance distri- insurance distri- insurance distri- insurance distri-bution in relation bution in relation bution in relation bution in relationto insurance- to insurance- to insurance- to insurance-based investment based investment based investment based investmentproducts products products products






Table B: Application of the common platform requirements in SYSC 4 to 10 to MiFID optional exemptionfirms and third country firms

COLUMN A COLUMN B

Provision MiFID optional exemption firms Third country firms

SYSC 4

SYSC 4.1.-2G Not applicable Not applicable

SYSC 4.1.-1G Guidance Guidance

SYSC 4.1.1R Rule Rule

SYSC 4.1.1AR Not applicable Not applicable

SYSC 4.1.1BR Not applicable Not applicable

SYSC 4.1.1CR Not applicable Rule

SYSC 4.1.1DR Not applicable Not applicable

SYSC 4.1.1ER Not applicable Not applicable

SYSC 4.1.1FG Not applicable Not applicable

SYSC 4.1.2R Rule Guidance

SYSC 4.1.2AG Not applicable Not applicable

SYSC 4.1.2AAR Not applicable Not applicable

SYSC 4.1.2BR Not applicable Not applicable

SYSC 4.1.2CR Not applicable Not applicable

SYSC 4.1.2DR Not applicable Not applicable



1COLUMN A COLUMN B


SYSC 4

SYSC 4.1.4R Not applicable Not applicable






SYSC 4.1.8G Guidance Guidance

SYSC 4.1.8AR Rule Rule

SYSC 4.1.8CG Guidance Guidance

SYSC 4.1.8DG Guidance Guidance

SYSC 4.1.8DAG Guidance Guidance

SYSC 4.1.8DBR Rule Rule

SYSC 4.1.8DCR Rule Rule

SYSC 4.1.8DDR Rule Rule










SYSC 4.2.3G - 4.2.5G Guidance Guidance



SYSC 4.2.8G Not applicable Not applicable





SYSC 4.3A.-1R Rule Not applicable

SYSC 4.3A.1R Rule Not applicable

SYSC 4.3A.1AR Rule Not applicable


SYSC 4.3A.2AG Guidance Not applicable


SYSC 4.3A.3AG Guidance Not applicable





1COLUMN A COLUMN B


SYSC 4






SYSC 4.3A.11R Not applicable Not applicable

SYSC 4.4.1AR As specified in SYSC 4.4.1AR As specified in SYSC 4.4.1AR

SYSC 4.4.2G As specified in SYSC 4.4.1AR As specified in SYSC 4.4.1AR

SYSC 4.4.3R As specified in SYSC 4.4.1AR As specified in SYSC 4.4.1AR

SYSC 4.4.5R As specified in SYSC 4.4.1AR As specified in SYSC 4.4.1AR

SYSC 4.4.6G As specified in SYSC 4.4.1AR As specified in SYSC 4.4.1AR

Note = SYSC 4.1.8AR to SYSC 4.1.8DDR apply as a rule or guidance, as indicated above, only to an oper-ator of an electronic system in relation to lending.

SYSC 5







SYSC 5.1.4AG Guidance Guidance


SYSC 5.1.5AAR Not applicable Rule

SYSC 5.1.5ABR Not applicable Rule

SYSC 5.1.5ACG Not applicable Guidance

SYSC 5.1.5ADG Not applicable Guidance

SYSC 5.1.5AEG Not applicable Guidance















1SYSC 5


SYSC 6










SYSC 6.1.4-AG Guidance Guidance


SYSC 6.1.4-BG Not applicable Not applicable

SYSC 6.1.4CR SYSC 6.1.4CR(3) applies as speci- SYSC 6.1.4CR(3) applies as speci-fied in that rule fied in that rule

Otherwise not applicable Otherwise not applicable

SYSC 6.1.4-CG Not applicable Guidance for a third country rel-evant authorised person






SYSC 6.2.1BG Not applicable Guidance for a third country rel-evant authorised person













SYSC 7






1SYSC 7



SYSC 7.1.2BG Not applicable Not applicable










SYSC 7.1.7BAG Not applicable Not applicable

SYSC 7.1.7BBG Not applicable Not applicable

SYSC 7.1.7CG Guidance Guidance






SYSC 7.1.13R - 7.1.16R Not applicable Not applicable



SYSC 7.1.16CR Not applicable Not applicable

SYSC 7.1.17R Guidance Not applicable


SYSC 7.1.18AAG Guidance Not applicable

SYSC 7.1.18BR Guidance Not applicable





SYSC 7.1.23G Not applicable Guidance for a third country rel-evant authorised person

SYSC 8










1SYSC 8














SYSC 9




SYSC 9.1.1AR Rule Rule

SYSC 9.1.2R Rule Not applicable

SYSC 9.1.2AR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities

SYSC 9.1.2BG Guidance in relation to insur- Guidance in relation to insur-ance distribution activities ance distribution activities

SYSC 9.1.2CUK UK UK

Applicable to a firm carrying on Applicable to a firm carrying oninsurance distribution in rela- insurance distribution in rela-tion to insurance-based invest- tion to insurance-based invest-ment products ment products

SYSC 9.1.2DR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities




SYSC 9.1.6AG Guidance in relation to insur- Guidance in relation to insur-ance distribution activities ance distribution activities

SYSC 10

SYSC 10.1.-4G Guidance in relation to insur- Guidance in relation to insur-ance distribution activities ance distribution activities

SYSC 10.1.-3G Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities







1SYSC 10



SYSC 10.1.4R Rule Guidance – but applies as a rulein relation to the production orarrangement of investment re-search, or the production or dis-semination of non-independentresearch, in accordance withCOBS 12.2

SYSC 10.1.4AG Not applicable Guidance

SYSC 10.1.4BR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities

SYSC 10.1.4CR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities


SYSC 10.1.6R Rule Guidance – but applies as a rulein relation to: (a) the productionor arrangement of investmentresearch, or the production ordissemination of non-independ-ent research, in accordance withCOBS 12.2; and (b) insurance dis-tribution activities


SYSC 10.1.6AAR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities

SYSC 10.1.6BG Not applicable Guidance


SYSC 10.1.7AR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities



SYSC 10.1.9AR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities. Otherwise tribution activities. Otherwisenot applicable not applicable

SYSC 10.1.10R Rule Guidance – but applies as a rulein relation to: (a) the productionor arrangement of investmentresearch, or the production ordissemination of non-independ-ent research, in accordance withCOBS 12.2; and (b) insurance dis-tribution activities

SYSC 10.1.11R Rule Guidance – but applies as a rulein relation to: (i) the productionor arrangement of investmentresearch, or the production ordissemination of non-independ-ent research, in accordance withCOBS 12.2; and (ii) insurance dis-tribution activities




1SYSC 10

SYSC 10.1.11AAR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities

SYSC 10.1.11ABR Rule in relation to insurance dis- Rule in relation to insurance dis-tribution activities tribution activities

SYSC 10.1.11BG Not applicable Guidance














SYSC 10.1A UK UK

Applicableto a firm carrying on Applicableto a firm carrying oninsurance distribution in rela- insurance distribution in rela-tion to insurance-based invest- tion to insurance-based invest-ment products ment products






Table C:

Part 1: Application of the requirements in articles 1(2), 21 to 25, 30 to 32 and 72 of the MiFID OrgRegulation to MiFID optional exemption firms and third country firms

MiFID optional ex-Provision MiFID Org Regulation emption firm Third country firm

Article 1 – Subject- (2) Not applicable Not applicablematter and scope

Article 21 – Gen- (1) Rule (a), (b) and (g):eral organisational Guidance;requirements

(c), (d), (e), (f) andfinal paragraph:Rule

(2) Rule Rule

(3) Rule Guidance

(4) Rule Guidance

(5) Rule Guidance



1MiFID optional ex-

Provision MiFID Org Regulation emption firm Third country firm

Article 22 – (1) Guidance GuidanceCompliance (2) Guidance Guidance

(3) Guidance (a), (c), (d) and(e): Guidance;

(b): Rule

(4) Guidance Guidance

Article 23 – Risk management Guidance Guidance

Article 24 – Internal audit Guidance Guidance

Article 25 – Responsibility of senior Guidance (1): Rule;management

(2), (3) and (4):Guidance

Article 30 – Scope of critical and im- Guidance Guidanceportant operational functions

Article 31 – Outsourcing critical or im- (1): Rule; (1): Rule;portant operational functions

(2), (3), (4) and (2), (3), (4) and(5): Guidance (5): Guidance

Article 32(1) and (2) – Service providers Rule Guidancelocated in third countries

Article 72 – Retention of records Rule Guidance

Part 2: Articles 1(2), 21 to 25, 30 to 32 and 72 of the MiFID Org Regulation

UK Article 1 - Subject-matter and scope

2 References to investment firms shall encompass credit insti-tutions and references to financial instruments shall encom-pass structured deposits in relation to all the requirements(so far as relevant) in Chapters II to IV of this Regulation.

UK Article 21 - General organisational requirements

1 Investment firms shall comply with the following organis-ational requirements:

(a) establish, implement and maintain de-cision-making procedures and an organ-isational structure which clearly and indocumented manner specifies re-porting lines and allocates functionsand responsibilities;

(b) ensure that their relevant persons areaware of the procedures which mustbe followed for the proper dischargeof their responsibilities;

(c) establish, implement and maintain ad-equate internal control mechanisms de-signed to secure compliance with de-cisions and procedures at all levels ofthe investment firm;

(d) employ personnel with the skills, know-ledge and expertise necessary for thedischarge of the responsibilities alloc-ated to them;



1(e) establish, implement and maintain ef-

fective internal reporting and commun-ication of information at all relevantlevels of the investment firm;

(f) maintain adequate and orderly recordsof their business and internal or-ganisation;

(g) ensure that the performance of mul-tiple functions by their relevant per-sons does not and is not likely to pre-vent those persons from dischargingany particular function soundly, hon-estly, and professionally.

When complying with the requirements set out in the thisparagraph, investment firms shall take into account the na-ture, scale and complexity of the business of the firm, andthe nature and range of investment services and activitiesundertaken in the course of that business.

2 Investment firms shall establish, implement and maintainsystems and procedures that are adequate to safeguard thesecurity, integrity and confidentiality of information, takinginto account the nature of the information in question.

3 Investment firms shall establish, implement and maintain anadequate business continuity policy aimed at ensuring, inthe case of an interruption to their systems and procedures,the preservation of essential data and functions, and themaintenance of investment services and activities, or, wherethat is not possible, the timely recovery of such data andfunctions and the timely resumption of their investment ser-vices and activities.

4 Investment firms shall establish, implement and maintain ac-counting policies and procedures that enable them, at therequest of the competent authority, to deliver in a timelymanner to the competent authority financial reports whichreflect a true and fair view of their financial position andwhich comply with all applicable accounting standards andrules.

5 Investment firms shall monitor and, on a regular basis,evaluate the adequacy and effectiveness of their systems, in-ternal control mechanisms and arrangements established inaccordance with paragraphs 1 to 4, and take appropriatemeasures to address any deficiencies.

UK Article 22 - Compliance

1 Investment firms shall establish, implement and maintain ad-equate policies and procedures designed to detect any riskof failure by the firm to comply with its obligations underUK law on markets in financial instruments (“UK obliga-tions”), as well as the associated risks, and put in place ad-equate measures and procedures designed to minimise suchrisk and to enable the competent authorities to exercisetheir powers effectively under UK law on markets in finan-cial instruments.

Investment firms shall take into account the nature, scaleand complexity of the business of the firm, and the natureand range of investment services and activities undertakenin the course of that business.



12 Investment firms shall establish and maintain a permanent

and effective compliance function which operates inde-pendently and which has the following responsibilities:

(a) to monitor on a permanent basis andto assess, on a regular basis, the ad-equacy and effectiveness of the meas-ures, policies and procedures put inplace in accordance with the first sub-paragraph of paragraph 1, and the ac-tions taken to address any deficienciesin the firm's compliance with its ob-ligations;

(b) to advise and assist the relevant per-sons responsible for carrying out invest-ment services and activities to complywith the firm's UK obligations;

(c) to report to the management body, onat least an annual basis, on the imple-mentation and effectiveness of theoverall control environment for invest-ment services and activities, on therisks that have been identified and onthe complaints-handling reporting aswell as remedies undertaken or to beundertaken;

(d) to monitor the operations of the com-plaints-handling process and considercomplaints as a source of relevant in-formation in the context of its generalmonitoring responsibilities.

In order to comply with points (a) and (b) of this para-graph, the compliance function shall conduct an assess-ment on the basis of which it shall establish a risk-basedmonitoring programme that takes into consideration allareas of the investment firm’s investment services, activitiesand any relevant ancillary services, including relevant in-formation gathered in relation to the monitoring of com-plaints handling. The monitoring programme shall establishpriorities determined by the compliance risk assessment en-suring that compliance risk is comprehensively monitored.

3 In order to enable the compliance function referred to inparagraph 2 to discharge its responsibilities properly and in-dependently, investment firms shall ensure that the follow-ing conditions are satisfied:

(a) the compliance function has the neces-sary authority, resources, expertise andaccess to all relevant information;

(b) a compliance officer is appointed andreplaced by the management bodyand is responsible for the compliancefunction and for any reporting as tocompliance required in relation to itsUK obligations and by Article 25(2) ofthis Regulation;

(c) the compliance function reports on anad-hoc basis directly to the manage-ment body where it detects a signific-ant risk of failure by the firm to com-ply with its UK obligations;



1(d) the relevant persons involved in the

compliance function are not involvedin the performance of services or activ-ities they monitor;

(e) the method of determining the remu-neration of the relevant persons in-volved in the compliance functiondoes not compromise their objectivityand is not likely to do so.

4 An investment firm shall not be required to comply withpoint (d) or point (e) of paragraph 3 where it is able todemonstrate that in view of the nature, scale and complex-ity of its business, and the nature and range of investmentservices and activities, the requirements under point (d) or(e) are not proportionate and that its compliance functioncontinues to be effective. In that case, the investment firmshall assess whether the effectiveness of the compliancefunction is compromised. The assessment shall be reviewedon a regular basis.

UK Article 23 - Risk management

1 Investment firms shall take the following actions relatingto risk management:

(a) establish, implement and maintain ad-equate risk management policies andprocedures which identify the risks re-lating to the firm's activities, processesand systems, and where appropriate,set the level of risk tolerated by thefirm;

(b) adopt effective arrangements, pro-cesses and mechanisms to manage therisks relating to the firm's activities,processes and systems, in light of thatlevel of risk tolerance;

(c) monitor the following:

(i) the adequacy andeffectiveness ofthe investmentfirm's risk man-agement policiesand procedures;

(ii) the level of com-pliance by the in-vestment firm andits relevant per-sons with the ar-rangements,processes andmechanisms ad-opted in accord-ance with point(b);

(iii) the adequacy andeffectiveness ofmeasures taken toaddress any defi-ciencies in those



1policies, proced-ures, arrange-ments, processesand mechanisms,including failuresby the relevantpersons to complywith such arrange-ments, processesand mechanismsor follow such pol-icies andprocedures.

2 Investment firms shall, where appropriate and proportion-ate in view of the nature, scale and complexity of theirbusiness and the nature and range of the investment ser-vices and activities undertaken in the course of that busi-ness, establish and maintain a risk management functionthat operates independently and carries out the followingtasks:

(a) implementation of the policy and pro-cedures referred to in paragraph 1;

(b) provision of reports and advice tosenior management in accordancewith Article 25(2).

Where an investment firm does not establish and maintaina risk management function under the first sub-paragraph,it shall be able to demonstrate upon request that the pol-icies and procedures which it is has adopted in accordancewith paragraph 1 satisfy the requirements therein.

UK Article 24 - Internal audit

Investment firms shall, where appropriate and proportionate in view of the na-ture, scale and complexity of their business and the nature and range of invest-ment services and activities undertaken in the course of that business, establishand maintain an internal audit function which is separate and independentfrom the other functions and activities of the investment firm and which hasthe following responsibilities:

(a) establish, implement and maintain anaudit plan to examine and evaluatethe adequacy and effectiveness of theinvestment firm's systems, internal con-trol mechanisms and arrangements;

(b) issue recommendations based on theresult of work carried out in accord-ance with point (a) and verify compli-ance with those recommendations;

(c) report in relation to internal audit mat-ters in accordance with Article 25(2).

UK Article 25 - Responsibility of senior management

1 Investment firms shall, when allocating functions internally,ensure that senior management, and, where applicable,the supervisory function, are responsible for ensuring thatthe firm complies with its obligations under UK law on mar-kets in financial instruments (“UK obligations”). In particu-lar, senior management and, where applicable, the supervis-ory function shall be required to assess and periodically re-view the effectiveness of the policies, arrangements andprocedures put in place to comply with the UK obligations



1and to take appropriate measures to address any defi-ciencies.

The allocation of significant functions among senior man-agers shall clearly establish who is responsible for over-seeing and maintaining the firm’s organisational require-ments. Records of the allocation of significant functionsshall be kept up-to-date.

2 Investment firms shall ensure that their senior manage-ment receive on a frequent basis, and at least annually,written reports on the matters covered by Articles 22, 23and 24 indicating in particular whether the appropriate re-medial measures have been taken in the event of any defi-ciencies.

3 Investment firms shall ensure that where there is a supervis-ory function, it receives written reports on the matters co-vered by Articles 22, 23 and 24 on a regular basis.

4 For the purposes of this Article, the supervisory functionshall be the function within an investment firm responsiblefor the supervision of its senior management.

UK Article 30 - Scope of critical and important operational functions

1 For the purposes of [SYSC 8.1.1R] and rule 2.1 of the Out-sourcing Part of the PRA Rulebook, an operational functionshall be regarded as critical or important where a defect orfailure in its performance would materially impair the con-tinuing compliance of an investment firm with the condi-tions and obligations of its authorisation or its other obliga-tions under UK law on markets in financial instruments, orits financial performance, or the soundness or the continu-ity of its investment services and activities.

2 Without prejudice to the status of any other function, thefollowing functions shall not be considered as critical or im-portant for the purposes of paragraph 1:

(a) the provision to the firm of advisoryservices, and other services which donot form part of the investment busi-ness of the firm, including the provi-sion of legal advice to the firm, thetraining of personnel of the firm, bill-ing services and the security of thefirm's premises and personnel;

(b) the purchase of standardised services,including market information servicesand the provision of price feeds.

UK Article 31 - Outsourcing critical or important operational functions

1 Investment firms outsourcing critical or important opera-tional functions shall remain fully responsible for dischar-ging all of their obligations under UK law on markets in fin-ancial instruments and shall comply with the followingconditions:

(a) the outsourcing does not result in thedelegation by senior management ofits responsibility;

(b) the relationship and obligations of theinvestment firm towards its clients un-der the terms of UK law on markets infinancial instruments is not altered;



1(c) the conditions with which the invest-

ment firm must comply in order tohave permission under Part 4A ofFSMA to carry on a regulated activitywhich is any of the investment servicesand activities (within the meaning ofregulation 2(1) of the Markets in Finan-cial Instruments Regulations 2017),and to remain so, are not undermined;

(d) none of the other conditions subjectto which the firm's authorisation wasgranted is removed or modified.

2 Investment firms shall exercise due skill, care and diligencewhen entering into, managing or terminating any arrange-ment for the outsourcing to a service provider of critical orimportant operational functions and shall take the neces-sary steps to ensure that the following conditions aresatisfied:

(a) the service provider has the ability, ca-pacity, sufficient resources, appropri-ate organisational structure sup-porting the performance of the out-sourced functions, and any authoris-ation required by law to perform theoutsourced functions, reliably and pro-fessionally;

(b) the service provider carries out the out-sourced services effectively and in com-pliance with applicable law and regu-latory requirements, and to this endthe firm has established methods andprocedures for assessing the standardof performance of the service providerand for reviewing on an ongoing basisthe services provided by the serviceprovider;

(c) the service provider properly super-vises the carrying out of the out-sourced functions, and adequatelymanage the risks associated with theoutsourcing;

(d) appropriate action is taken where itappears that the service provider maynot be carrying out the functions effec-tively or in compliance with applicablelaws and regulatory requirements;

(e) the investment firm effectively super-vises the outsourced functions or ser-vices and manage the risks associatedwith the outsourcing and to this endthe firm retains the necessary expert-ise and resources to supervise the out-sourced functions effectively and man-age those risks;

(f) the service provider has disclosed tothe investment firm any developmentthat may have a material impact on itsability to carry out the outsourcedfunctions effectively and in compliance


https://www.legislation.gov.uk/ukpga/2000/8/part/4A/2021-01-01


1with applicable laws and regulatory re-quirements;

(g) the investment firm is able to termin-ate the arrangement for outsourcingwhere necessary, with immediate ef-fect when this is in the interests of itsclients, without detriment to the con-tinuity and quality of its provision ofservices to clients;

(h) the service provider cooperates withthe competent authorities of the in-vestment firm in connection with theoutsourced functions;

(i) the investment firm, its auditors andthe relevant competent authoritieshave effective access to data related tothe outsourced functions, as well as tothe relevant business premises of theservice provider, where necessary forthe purpose of effective oversight inaccordance with this article, and thecompetent authorities are able to exer-cise those rights of access;

(j) the service provider protects any con-fidential information relating to the in-vestment firm and its clients;

(k) the investment firm and the serviceprovider have established, imple-mented and maintained a contingencyplan for disaster recovery and periodictesting of backup facilities, where thatis necessary having regard to the func-tion, service or activity that has beenoutsourced;

(l) the investment firm has ensured thatthe continuity and quality of the out-sourced functions or services are main-tained also in the event of terminationof the outsourcing either by transfer-ring the outsourced functions or ser-vices to another third party or by per-forming them itself.

3 The respective rights and obligations of the investmentfirms and of the service provider shall be clearly allocatedand set out in a written agreement. In particular, the invest-ment firm shall keep its instruction and termination rights,its rights of information, and its right to inspections and ac-cess to books and premises. The agreement shall ensurethat outsourcing by the service provider only takes placewith the consent, in writing, of the investment firm.

4 Where the investment firm and the service provider aremembers of the same group, the investment firm may, forthe purposes of complying with this Article and Article 32,take into account the extent to which the firm controls theservice provider or has the ability to influence its actions.



15 Investment firms shall make available on request to the

competent authority all information necessary to enablethe authority to supervise the compliance of the perform-ance of the outsourced functions with the requirements ofUK law on markets in financial instruments.

UK Article 32 - Service providers located in third countries

1 In addition to the requirements set out in Article 31, wherean investment firm outsources functions related to the in-vestment service of portfolio management provided to cli-ents to a service provider located in a third country, that in-vestment firm ensures that the following conditions aresatisfied:

(a) the service provider is authorised or re-gistered in its home country to providethat service and is effectively super-vised by a competent authority in thatthird country;

(b) there is an appropriate cooperationagreement between the competent au-thority of the investment firm and thesupervisory authority of the serviceprovider.

2 The cooperation agreement referred to in point (b) of para-graph 1 shall ensure that the competent authorities of theinvestment firm are able, at least, to:

(a) obtain on request the informationnecessary to carry out their supervisorytasks pursuant to UK law on marketsin financial instruments and Regula-tion (EU) No 600/2014;

(b) obtain access to the documents relev-ant for the performance of their super-visory duties maintained in the thirdcountry;

(c) receive information from the supervis-ory authority in the third country assoon as possible for the purpose of in-vestigating apparent breaches of therequirements of UK law on markets infinancial instruments and its imple-menting measures and Regulation (EU)No 600/2014;

(d) cooperate with regard to enforce-ment, in accordance with the nationaland international law applicable tothe supervisory authority of the thirdcountry and the competent authoritiesin the United Kingdom in cases ofbreach of the requirements of UK lawon markets in financial instruments.

3 The FCA must publish on its website a list of the supervis-ory authorities in third countries with which they have acooperation agreement referred to in point (b) of para-graph 1.

UK Article 72 - Retention of records



11 The records shall be retained in a medium that allows the

storage of information in a way accessible for future refer-ence by the competent authority, and in such a form andmanner that the following conditions are met:

(a) the competent authority is able to ac-cess them readily and to reconstituteeach key stage of the processing ofeach transaction;

(b) it is possible for any corrections orother amendments, and the contentsof the records prior to such correctionsor amendments, to be easily as-certained;

(c) it is not possible for the records other-wise to be manipulated or altered;

(d) it allows IT or any other efficient ex-ploitation when the analysis of thedata cannot be easily carried out dueto the volume and the nature of thedata; and

(e) the firm’s arrangements comply withthe record keeping requirements irre-spective of the technology used.

2 Investment firms shall keep at least the records identifiedin Annex I to this Regulation depending upon the natureof their activities.

The list of records identified in Annex I to this Regulation iswithout prejudice to any other record-keeping obligationsarising from other legislation.

3 Investment firms shall also keep records of any policies andprocedures they are required to maintain pursuant to Regu-lation (EU) No 600/2014, Regulation (EU) No 596/2014 andtheir implementing measures (as amended under the Euro-pean Union (Withdrawal) Act 2018) and the law of theUnited Kingdom or any part of the United Kingdom whichwas relied on immediately before IP completion day to im-plement Directive 2014/65/EU, Directive 2014/57/EU andtheir implementing measures in writing.

Competent authorities may require investment firms tokeep additional records to the list identified in Annex I tothis Regulation.


https://www.legislation.gov.uk/ukpga/2018/16/2021-01-01

https://www.legislation.gov.uk/ukpga/2018/16/2021-01-01

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