On 30 July 2014, the FCA and the PRA launched a combined consultation, “Strengthening Accountability in Banking: a new regulatory framework for individuals,” to implement changes made to the Financial Services and Markets Act 2000 by the Financial Services (Banking Reform) Act 2013. The consultation was published alongside the combined consultation on proposals to amend the UK Remuneration Code (discussed above under Compensation). The consultation on strengthening accountability, which includes proposals to implement the senior managers regime, the certification regime and the new set of conduct of rules, set out how the regulators will implement the requirements to make it easier for firms and regulators to hold individuals in relevant firms to account. Senior managers located in the UK or overseas will be affected and the conduct rules will apply to most   employees of relevant firms if they are located in the UK or deal with customers in the UK. Relevant firms are UK banks, building societies, credit unions and investment firms regulated by the PRA. The proposals do not currently include UK branches of firms headquartered outside of the UK, however, the UK Government has indicated that it intends to extend the scope (which it can only do through further legislation) to all firms that operate in the UK, including branches of foreign firms. In addition, under European law, the PRA and FCA do not assess the competence of individuals working in a UK branch of an EEA bank or investment firm. The FCA intends to consult  further on this issue in the future. The PRA and FCA intend to publish a technical consultation in due course covering forms, consequential changes and transitional arrangements. The regulators are expected to publish final rules towards the end of the year. Responses to the consultation are due by 31 October 2014.

The consultation paper is available at: http://www.fca.org.uk/news/pra-and-fca-consult-on-proposals-to-improve-responsibility-and-accountability-in-the-banking- sector.