On October 5, the UK Financial Services Authority (FSA) published its latest quarterly consultation paper, which sets out proposals to amend various sections of its handbook including:

  • Amendments to the FSA’s Collective Investment Schemes handbook that include changes as a result of the EU Eligible Assets Directive clarifying the types of instruments and techniques that may be eligible for use in an undertakings for collective investment in transferable securities fund, such as transferable securities, money market instruments, derivatives, efficient portfolio management, indices and other collective investment schemes. 
  • Amendments to the General Prudential sourcebook to allow substitution into directly issued preferential non-cumulative preference shares with a step-up as well as directly issued non-innovative tier one capital instruments and clarifications on the rules for coupon payments. 
  • Various amendments and clarifications in respect of mortgage and insurance business including the treatment of lifetime mortgages for the calculation of capital adequacy requirements, the use of intermediaries for mortgage and home finance firms, and the FSA’s permitted links rules. 
  • Consequential amendments as a result of the Regulatory Reform (Financial Services and Markets Act 2000) Order 2007 which came into effect on July 12, as described in the July 20, 2007 edition of Corporate and Financial Weekly Digest.

The deadline for comments on the proposals is FSA December 5.  www.fsa.gov.uk/pubs/cp/cp07_18.pdf