The FSA has issued PS10/7 – “Consolidated Policy Statement on our fee-raising arrangements and regulatory fees and levies 2010/11”. As mentioned in Regulatory Roundup #5, fees will be a combination of a basic minimum £1,000 plus a ‘straight line recovery’ which basically means the fees now increase in proportion to the amount of permitted business undertaken. The one exception to this is in respect of Fee-block A.1 (Deposit acceptors); these will have a premium applied to their tariff data of up to 65%.
The Annual Funding Requirement (AFR) – essentially how much the FSA needs to keep going for another year – for 2010/11 is £454.7m, a 9.9% increase over the previous year. The increase is in part due to the need for the FSA to recruit a further 460 staff needed to ” …deliver our intensive, integrated and high quality supervision to higher impact firms …”. Chapter 12 shows the winners and losers in the allocation of the AFR to fee blocks e.g. dealers or brokers holding client money see a 9.6% increase whilst fund managers can look forward to a 4.5% decline.
The FSA will be invoicing firms from June for their periodic fees. Failure to pay in time will result in an administration charge being levied in the firm in question plus interest at 5% above base rate. Firms can work out their indicative fees using the FSA Fee Calculator using the attached link (although at the time of this article it hadn’t been updated).