Business Model Analysis
Obtaining FCA authorisation requires a business to demonstrate to the FCA that the firm’s business model is one which meets the FCA’s requirements, that the firm’s activities will be compliant, that the firm’s controllers are fit and proper, and that the firm has appropriate systems and controls in place. FCA authorisation can only be obtained if all the requirements are met.
FCA Authorisation Case Study
The client is a UK-based Alternative investment fund manager that manages funds on behalf of its clients.
Why did they need FCA authorisation support?
It was a newly established business and needed expert guidance on the process and practicalities of seeking authorisation from the FCA to carry out its regulated activities.
What were MCM engaged to do?
Advise on the various options for seeking authorisation to carry on the regulated activities; and advise and assist the client with the process of obtaining authorisation including completion of the formal application forms and the preparation of the Regulatory Business Plan.
MCM provided advice to the client on the authorisation options suitable for the nature of business they wished to carry out. We supported the client with the process of preparing the applications required and securing permission to commence trading.
MCM deployed a director to provide the advice and a senior compliance consultant to offer compliance support.
The client has the necessary authorisations to undertake the retail financial services activities it wishes to carry on and has been successfully trading since launch.
Fast Tracked Authorisation
Our FCA authorisation service has been recognised for its efficiency, effectiveness, and quality. We know the process and what the FCA is looking for – minimising the time you spend and getting you authorised in the quickest possible time.
We can either draft the entire pack for the relevant permissions required or provide support and guidance at various points along the way. We don’t just fill in forms, we understand the FCA’s expectations of systems and controls and compliance procedures, helping you develop and improve documentation to make sure it meets FCA standards.
Above all, we make sure you have a robust business plan to support your application that sets out how you will effectively manage your consumer and conduct risk.
FCA Authorisation Frequently Asked Questions
What is FCA authorisation?
Firms and individuals must be authorised by the Financial Conduct Authority ( https://www.fca.org.uk ) to carry out regulated financial service activities and offer credit to consumers.
How do I get FCA authorised?
Whether you’re a consumer credit firm, investment firm or other financial services provider, you should prepare your application well in advance. It may take you some time to gather all the information needed for your application. Before getting started, Let us check that the services you intend to carry on are regulated activities that require our authorisation. You’ll need to submit your application through the FCA online system Connect. Don’t worry if you’re not sure which firm type you are – we can do this for you when assessing your Connect application.
What are the FCA Threshold Conditions for authorisation?
The FCA has 5 threshold conditions firms must meet to apply for authorisation being;
- Location of office – The firms head office/registered office must be in the United Kingdom.
- Effective Supervision – The firm must be capable of being effectively supervised by the FCA having regard to all circumstances.
- Appropriate Services – The resources of the firm must be appropriate in relation to the regulated activities that it carries on or seeks to carry on.
- Suitability – The firm must be a fit and proper person having regard to all the circumstances.
- Business Model – The firms business model (that is, it’s strategy for doing business) must be suitable for a person carrying on the regulated activities that it carries on or seeks to carry on.
How much does FCA authorisation cost?
The initial application filing fee that firms will have to pay to the FCA depends on whether the firm’s application is straightforward (advisors/arrangers/corporate finance £2,500), moderately complex (investment managers/fund managers/dealing as principal firms £10,000) or complex (MTF/OTF, Custodians £50,000).
The applicant firms will also have to pay an annual FCA fee which is calculated based on the firms’ regulated activities, volume of business and how expensive the firm’s business is to regulate. As an example, the annual fee for an investment management firm could be based on the number of funds it manages and the expected annual income for the firm.
How long does FCA authorisation take?
The FCA will make a decision on complete applications within 6 months. If your application is incomplete, we must make a decision within 12 months.