A firm authorised under Part 4A of the Financial Services and Markets Act 2000 (FSMA) has a single Part 4A permission granted by the PRA or the Financial Conduct Authority (FCA). This permission includes a description of the activities the firm may carry on (including any limitations), the specified investments involved, and, if relevant, any requirements. A firm is prohibited from carrying on a regulated activity in the UK (or purporting to do so) otherwise than in accordance with its permission.
If a firm decides to do any of the following, it should review its Part 4A permission and decide whether it needs to vary it:
- start a new line of business
- undertake a new regulated activity
- extend a business line into a new product or to a new class of people.
All regulated activities are defined in the Regulated Activities Order.
Part 4A of FSMA sets out the requirements of variations of permissions and the Threshold Conditions which must be met at authorisation of the activity and on an ongoing basis. Our approach to banking supervision and approach to insurance supervision set out our policy on the matters that we will consider in respect of the Threshold Conditions when we decide to grant permissions.
How to apply for a variation of permission
Dual-regulated firms must apply to the PRA to vary their permission.
Firms must complete and submit their variation of permission application using the Connect system. This system is owned and maintained by the FCA, but all relevant applications will be directed to the PRA. There may be a fee payable for the application, details are included within the Connect system.
Credit unions may apply to amend their permission via paper application form. Credit unions may wish to engage with their supervisory contact to discuss the application before submitting the form.
Firms increasing the scope of their permissions will be charged a non-refundable application fee, which must be paid before we can process the application. We charge a fee of £250 is for applications that will increase a firm's permitted business activities but which will not change a firm's fee blocks. Firms lessening the scope will not be charged.
If a firm’s application means that it moves into a new fee block, the relevant fee for that block must be paid on submission. The relevant fee is 50% of the authorisation fees set out in FEES 3 Annex 1. If a firm moves into more than one new fee block, it will pay the highest of any relevant fees.
You can pay the application fee by sending a cheque to the PRA made payable to the Financial Conduct Authority (as the fee administrator) to PRA Authorisations, Authorisations Division, Prudential Regulation Authority, 20 Moorgate, London EC2R 6DA.
The PRA and FCA will determine all applications within the earlier of six months of receiving a complete application or twelve months of receiving an incomplete application.
If the application is granted, we will send a written notice to the firm. If the application is not successful and the PRA and/or the FCA propose to refuse it, the PRA will inform the applicant about the various options for contesting the decision.
If at any time during the authorisation process the applicant wishes to withdraw its application, it may do so. The application fee is not refundable.
MiFID II implementation - structured deposits
MiFID II is part of a legislative package comprising the Directive, MiFID II (2014/65/EU), and the Markets in Financial Instruments Regulation (2014/600/EU) (MiFIR).
MiFID II applies from Wednesday 3 January 2018 when it replaces the current MIFID I regime.
The PRA consulted and published its final policy in Policy Statement (PS) 29/16 ‘Implementation of MiFID II: Part 1’ and PS9/17 ‘Implementation of MiFID II: Part 2’. Solo regulated Financial Conduct Authority (FCA) firms should refer to the FCA’s website.
Activities in relation to structured deposits
Following amendments made by the Financial Services and Markets Act 2000 (Markets in Financial Instruments) (No.2) Regulations 2017 the transitional measures relating to structured deposits have been amended by extending the date for notification.
Firms that immediately before Wednesday 3 January 2018 held permissions to deal, manage, arrange or advise on investments and who wish perform the activity in relation to structured deposits have until Saturday 31 March 2018 to notify the PRA of their intention to do so (previously they were required to notify before Wednesday 3 January 2018).
Firms should complete the Notification and email it to the PRA at:
Once the PRA acknowledges the Notification, the activities will be included in the firm’s Part 4A permission from Wednesday 3 January 2018 (or the date of acknowledgement of receipt, if later) without the firm having to apply for a variation of permission.
From 1 April 2018, dual regulated firms wishing to perform regulated activities in respect of structured deposits must follow the variation of permission application process and apply through the Connect system.
The above transitional provision also applies to an EEA firm that immediately before Wednesday 3 January 2018 had permission under paragraph 15 of Schedule 3 (EEA passport rights) to deal, manage, arrange or advise on investments but whose permission does not extend to that activity being carried on in relation to structured deposits. EEA firms wishing to carry on any of these activities in relation to structured deposits should complete the Notification and email it to the PRA at:
The EEA firm will be treated, from Wednesday 3 January 2018 (or the date of acknowledgement of receipt, if later), as having a Part 4A permission to carry on any permitted activity to which the Notification relates in relation to structured deposits.
EEA firms have until 31 March 2018 to notify the PRA of their intention to carry on the permitted activity in relation to structured deposits without having to apply for a ‘top-up’ Permission.
From 1 April 2018, EEA firms wishing to perform regulated activities in respect of structured deposits must follow the variation of permission application process for a ‘top-up’ Permission. Please see the Passporting FAQ for more information on the process.