BBA and LIBA have responded to CP 08/25.
- On the proposal to extend the CF1 and 2 functions, while the associations understand FSA’s aims, they are concerned the proposals do not give enough guidance on which individuals outside a UK-authorised entity genuinely have significant influence. One clarification they ask for is that, if a firm can show its own governing body makes final decisions, there will be no need to change their approved persons. The response also notes that FSA cannot intend to dilute the accountability or responsibility of existing CF1 or 2 function-holders, which may happen if there are too many of them. Also, the associations are concerned FSA is creating an unlevel playing field because the proposals cannot apply to firms with EEA-regulated parent or holding companies so these companies will have an advantage over all others. Finally, the response notes the new rules may not give FSA any greater powers over non-UK individuals who do not comply with APER than it currently has.
- On NEDs, the associations agree FSA’s proposals but say it must co-ordinate its final rules with the outcome of the Walker Review.
- On the proposal to bring proprietary traders within CF29, the associations do not agree that all proprietary traders have potential to exercise significant influence on the firm and should therefore all be approved for CF29. They feel, if FSA wants to capture these traders, it should seek to do so by other means.