Published: 19th November 2009

This month the FSA published “Close links – feedback on CP07/21” (PS09/17) which contains the new draft rules governing close links reporting. It must qualify as one of the slower feedback Policy Statements given that the original Consultation Paper (CP07/21) was published in December 2007, with the consultation period ending on 14 March 2008 (the financial crisis, resource and workloads were given as reasons).

As you will know, under the current regime firms have an obligation to notify changes in close links to the FSA (SUP 11.9) as well as providing an annual close links report (SUP 16.5)

The original intention of CP07/21 included the removal of the annual close links reporting requirement. However it seems that the biggest objection to this proposal came from FSA supervisors (“we previously underestimated the benefits to supervisors the annual report provides”). So, after two years the only changes that the majority of firms will notice is that they will have to comply with SUP 11.9 and SUP 16.5 using a ‘Close Links Notification Form’ and, in respect of the latter rule, will need to supply a group organisation chart.

The amended rules – which will not come into force until 1 June 2010 – can be reviewed in Appendix 1 of PS09/17. A copy of Close Links Notification Forms, or at least as they stood in 2007, can be found in the appendices of CP07/21.

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