On 29 May 2018, the Financial Conduct Authority (FCA) published finalised guidance, FG18/4, setting out its approach to reviewing insurance business transfers schemes under Part VII of the Financial Services and Markets Act 2000.
The FCA says that the guidance is not intended to explain all aspects of the FCA's role in the Part VII process or all issues that firms may need to consider. This is because each transfer has many variations. The FCA will not always insist firms take the approach set out in the guidance on any particular transfer. However, the FCA expects applicants to explain why they have diverged from the guidance where it is relevant to a particular Part VII transfer.
The purpose of the guidance is to help firms identify the areas of difference (from expectations and examples set out in the guidance) early enough in the process so they do not create problems closer to court dates and interfere with timelines. The FCA says that one specific aim of the guidance is to provide some examples of the types of comments that it has made or is likely to make to applicants and independent experts about their submissions on proposed Part VII Transfers. It hopes that this will help applicants draft their proposals in ways that minimise challenge from the FCA and lead to a more efficient review process.