Financial Services and Markets Act 2000, section 61

Determination of applications

Part V Performance of Regulated Activities

[F368 (1)The regulator to which an application for approval is made under section 60 may grant the application only if—

(a) it is satisfied that the person in respect of whom the application is made (“the candidate”) is a fit and proper person to perform the function to which the application relates, or

(b) in a case where the application is for approval to perform a designated senior management function F369 ... [F370 (a “senior F370] management application”), it is satisfied that the condition in paragraph (a) will be met if the application is granted subject to one or more conditions (as to which, see subsection (2B)). F368]

(2)In [F371determining the applicationF371] , [F372the regulatorF372] may have regard (among other things) to whether the candidate, or any person who may perform a function on his behalf—

(a)has obtained a qualification,

(b)F373has undergone, or is undergoing, training, ...

(c)possesses a level of competence, [F374or

(d)has the personal characteristics,F374]

required by general rules[F375 made by that regulatorF375] in relation to persons performing functions of the kind to which the application relates.

[F376 (2A)Subsections (1) and (2) apply in relation to the giving by the FCA of any required consent as they apply in relation to the grant of the application.F376]

[F377 (2B)The regulator to which a F378... senior management application is made under section 60 may in particular—

(a)grant the application subject to any conditions that the regulator considers appropriate, and

(b)grant the application so as to give approval only for a limited period.

(2C)A regulator may exercise the power under paragraph (a) or (b) of subsection (2B) only if—

(a)where the regulator is the FCA, it appears to the FCA that it is desirable to do so in order to advance one or more of its operational objectives, and

(b)where the regulator is the PRA, it appears to the PRA that it is desirable to do so in order to advance any of its objectives.

(2D)Consent given by the FCA for the granting of the application may be conditional on the manner in which the PRA exercises its power under subsection (2B).F377]

(3)[F379 The regulator to which an application is made under section 60 must, before the end of the period for consideration, determineF379] whether—

(a)to grant the application; or

(b)to give a warning notice under section 62(2).

[F380 (3ZA)In the case of a F381... senior management application, the reference in subsection (3)(a) to granting the application is a reference to granting it without imposing conditions or limiting the period for which the approval has effect.F380]

[F382 (3A)The period for consideration”—

(a)in any case where the application under section 60 is made by a person applying for permission under Part 4A (see section 60(6)), means whichever ends last of—

(i)the period within which the application for that permission must be determined under section 55V(1) or (2), and

(ii)the period of 3 months beginning with the date on which the regulator receives the application under section 60, and

(b)in any other case, means the period of 3 months beginning with the date on which the regulator receives the application under section 60.F382]

(4)If [F383a regulatorF383] imposes a requirement under section 60(3), the period for consideration stops running on the day on which the requirement is imposed but starts running again—

(a)on the day on which the required information is received by [F383a regulatorF383] ; or

(b)if the information is not provided on a single day, on the last of the days on which it is received by [F383a regulatorF383] .

(5)A person who makes an application under section 60 may withdraw his application by giving written notice to the [F384regulator to which the application was madeF384] at any time before the [F385regulatorF385] determines it, but only with the consent of—

(a)the candidate; and

(b)the person by whom the candidate is to be retained to perform the function concerned, if not the applicant.

F386 (6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F386 (7). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Read section 61 in the full Act → Definitions (6) Cases (3)

Definitions used in section 61

regulator

“regulator” has the meaning given in section 3A(2);

Defined in s.417(1) · see it in the full Act
functions

(4) Neither section 2AB(3)(d) nor the definition of “functions” in paragraph 1 applies for the purposes of sub-paragraph (2).

Defined in Sch.1ZB para.31(4) · see it in the full Act

(2A) The functions referred to in sub-paragraph (1)(a) include functions of the FCA under the Competition Act 1998 or the Enterprise Act 2002 as a result of Part 16A of this Act ; but this sub-paragraph is not to be regarded as limiting the effect of the definition of “functions” in paragraph 1.

Defined in Sch.1ZA para.23(2A) · see it in the full Act

(4) Neither section 1A(6)(d) nor the definition of “functions” in paragraph 1 applies for the purposes of sub-paragraph (2).

Defined in Sch.1ZA para.23(4) · see it in the full Act
designated senior management functions

For the purposes of this Part the following are “designated senior management functions”—

(a)a function of a description specified in rules made by the FCA under section 59(3)(a) or (b) which is designated as a senior management function by the FCA under section 59(6A);

(b)a function of a description specified in rules made by the PRA under section 59(3)(a).

Defined in s.59ZB · see it in the full Act
general rules

“general rules”—

(a)

in relation to the FCA, has the meaning given in section 137A(2), and

(b)

in relation to the PRA, has the meaning given in section 137G(2);

Defined in s.417(1) · see it in the full Act
the FCA

(2) The Financial Conduct Authority is in this Act referred to as “the FCA”.

Defined in s.1A(2) · see it in the full Act

“the FCA” means the Financial Conduct Authority;

Defined in s.417(1) · see it in the full Act
the PRA

“the PRA” means the Prudential Regulation Authority;

Defined in s.417(1) · see it in the full Act

Cases considering section 61 (3)

Saranac Partners Limited v The Financial Conduct Authority

[2024] UKUT 254 (TCC) · 27 August 2024

Section 61 permits approval only where the Authority is satisfied that the candidate is fit and proper. The Tribunal applied that standard and held that dishonesty and lack of candour reasonably supported the Authority’s lack of satisfaction. (see paras [30]-[31]; [280]-[286])

Emptage v Financial Services Compensation Scheme Ltd

[2012] EWHC 2708 (Admin) · 11 October 2012Defines

The judgment sets out the definition of a regulated mortgage contract, including secured credit and residential use of at least 40 per cent of the land (see para [34]).

C, R (on the application of) v Financial Services Authority (FSA)

[2012] EWHC 1417 (Admin) · 25 May 2012

Confirms that approval to perform a controlled function depends on the FSA being satisfied that the person is fit and proper. (see para [6])

What each judgment says about section 61 is in the case-law panel in the full Act.

Explanatory note

142.This section sets out the basis on which the Authority is to assess the suitability of a candidate for approval, whether they are an individual or a body corporate.  Subsection (1) requires the Authority to be satisfied that a candidate is fit and proper to perform the functions in question before it is able to give its approval.  Where the Authority proposes to refuse an application, section 62 requires it to give a warning and decision notice.  Notice must be given to the authorised person, the candidate and, where relevant, a contractor.

All the explanatory notes for the Act

Amendments and notes

27 notes from legislation.gov.uk

Amendments

  1. F368S. 61(1) substituted (7.3.2016) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 23(2), 148(5); S.I. 2015/490, art. 2(1)(c) (with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660)) this amendment is subject to savings and/or transitional provisions, see the commentary.
  2. F369Words in s. 61(1)(b) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 6(2); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)
  3. F370Words in s. 61(1)(b) inserted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 6(2); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)
  4. F371Words in s. 61(2) substituted (7.3.2016) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 23(3), 148(5); S.I. 2015/490, art. 2(1)(c) (with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660)) this amendment is subject to savings and/or transitional provisions, see the commentary.
  5. F372Words in s. 61(2) substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 5 para. 5(3)(a) (with Sch. 20); S.I. 2013/423, art. 3, Sch.
  6. F373Word in s. 61(2)(b) omitted (7.3.2016) by virtue of Financial Services (Banking Reform) Act 2013 (c. 33), ss. 22(a), 148(5); S.I. 2015/490, art. 2(1)(c) (with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660)) this amendment is subject to savings and/or transitional provisions, see the commentary.
  7. F374S. 61(2)(d) and word inserted (7.3.2016) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 22(b), 148(5); S.I. 2015/490, art. 2(1)(c) (with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660)) this amendment is subject to savings and/or transitional provisions, see the commentary.
  8. F375Words in s. 61(2) inserted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 5 para. 5(3)(b) (with Sch. 20); S.I. 2013/423, art. 3, Sch.
  9. F376S. 61(2A) inserted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 5 para. 5(4) (with Sch. 20); S.I. 2013/423, art. 3, Sch.
  10. F377S. 61(2B)-(2D) inserted (7.3.2016) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 23(4), 148(5); S.I. 2015/490, art. 2(1)(c) (with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660)) this amendment is subject to savings and/or transitional provisions, see the commentary.
  11. F378Word in s. 61(2B) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 6(3); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)
  12. F379Words in s. 61(3) substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 5 para. 5(5) (with Sch. 20); S.I. 2013/423, art. 3, Sch.
  13. F380S. 61(3ZA) inserted (7.3.2016) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 23(5), 148(5); S.I. 2015/490, art. 2(1)(c) (with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660)) this amendment is subject to savings and/or transitional provisions, see the commentary.
  14. F381Word in s. 61(3ZA) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 6(3); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)
  15. F382S. 61(3A) inserted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 5 para. 5(6) (with Sch. 20); S.I. 2013/423, art. 3, Sch.
  16. F383Words in s. 61(4) substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 5 para. 5(7) (with Sch. 20); S.I. 2013/423, art. 3, Sch.
  17. F384Words in s. 61(5) substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 5 para. 5(8)(a) (with Sch. 20); S.I. 2013/423, art. 3, Sch.
  18. F385Word in s. 61(5) substituted (1.4.2013) by Financial Services Act 2012 (c. 21), s. 122(3), Sch. 5 para. 5(8)(b) (with Sch. 20); S.I. 2013/423, art. 3, Sch.
  19. F386S. 61(6)(7) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 6(4); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)

Modifications

  1. C240S. 61 modified (1.7.2009 for certain purposes, otherwise 30.6.2010) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2009 (S.I. 2009/1342), arts. 1(2), 34, {Sch. paras. 1, 3}
  2. C241Ss. 60-63 applied (with modifications) (31.12.2011) by The Financial Services and Markets Act 2000 (Permissions, Transitional Provisions and Consequential Amendments) (Northern Ireland Credit Unions) Order 2011 (S.I. 2011/2832), art. 8
  3. C242S. 61(3) modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 49(3), 53(2) (with art. 23(2))
  4. C243S. 61(3) excluded (1.1.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 1) Order 2003 (S.I. 2003/1475), arts. 1(2), 28(2)
  5. C244S. 61(3) excluded (1.1.2004) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2003 (S.I. 2003/1476), arts. 1(2), 24(2), 26(2)
  6. C245S. 61(3) excluded (1.4.2017 for specified purposes) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 15(2) (with art. 16)
  7. C246S. 61(3) excluded (1.4.2017 for specified purposes, 3.1.2018 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2017 (S.I. 2017/488), arts. 1(2), 15(2) (with art. 16)

Commencement

  1. I10S. 61 wholly in force at 1.12.2001; s. 61 not in force at Royal Assent see s. 431(2); s. 61 in force for specified purposes at 3.9.2001 by S.I. 2001/2632, art. 2(2), Sch. Pt. 2; s. 61 in force in so far as not already in force at 1.12.2001 by S.I. 2001/3538, art. 2(1)