FEES Fees Manual

Part

FEES Fees Manual

Printed on: 09/12/2024

Rulebook at: 23/07/2013

Chapters

FEES 1 Fees Manual
FEES 2 General Provisions
FEES 3 Application, Notification and Vetting Fees
FEES 4 Periodic fees
FEES 5 Financial Ombudsman Service Funding
FEES 6 Financial Services Compensation Scheme Funding
Transitional Provisions and Schedules

FEES 1

Fees Manual

FEES 1.1

Application and Purpose

01/01/2006

FEES 1.1.1

FEES applies to all persons required to pay a fee or levy under a provision of the Handbook. The purpose of this chapter is to set out to whom the rules and guidance in FEES apply. FEES 2 (General Provisions) contains general provisions which may apply to any type of fee payer. FEES 3 (Application, Notification and Vetting Fees) covers one-off fees payable on a particular event for example various application fees (including those in relation to authorisation, variation of Part 4A permission, listing and the Basel Capital Accord) and fees relating to certain notifications and document vetting requests. FEES 4 (Periodic fees) covers all periodic fees and transaction reporting fees. FEES 5 (Financial Ombudsman Service Funding) relates to FOS levies and case fees (in FEES 5.5A). FEES 6 (Financial Services Compensation Scheme Funding) relates to the FSCS levy. FEES 7 relates to the CFEB levy.

01/04/2013

Application

FEES 1.1.2

This manual applies in the following way:

(1) FEES 1, 2 and 3 apply to the fee payers listed in column 1 of the Table of application, notification and vetting fees in FEES 3.2.7 R and FEES 3.2.7A R.

(a) [deleted]
(b) [deleted]
(c) [deleted]
(d) [deleted]
(e) [deleted]
(f) [deleted]
(g) [deleted]
(h) [deleted]
(i) [deleted]
(j) [deleted]
(k) [deleted]
(l) [deleted]
(m) [deleted]
(n) [deleted]
(o) [deleted]
(p) [deleted]
(q) [deleted]
(r) [deleted]
(s) [deleted]

(2) FEES 1, 2 and 4 apply to:

(a) every firm (except an AIFM qualifier, ICVC or UCITS qualifier);
(b) every authorised fund manager of an authorised unit trust or authorised contractual scheme;
(c) every ACD of an ICVC;
(d) every person who, under the constitution or founding arrangements of a recognised scheme, is responsible for the management of the property held for or within the scheme;
(e) every designated professional body;
(f) every recognised body;
(g) under the Listing Rules every issuer of shares, depositary receipts and securitised derivatives;
(h) under the Listing Rules (LR) every sponsor;
(i) under the Disclosure Rules and Transparency Rules (DTR) every issuer of shares, depositary receipts and securitised derivatives;
(j) every fee-paying payment service provider;
(k) every fee-paying electronic money issuer;
(l) every issuer of a regulated covered bond; and
(m) every person making a notification to the FCA under regulation 57, 58 and 59 of the AIFMD UK regulation.

(3) FEES 1, 2 and 5 apply to:

(a) every firm (except to the extent it is bidding in emissions auctions), fee-paying payment service provider and fee-paying electronic money issuer which is subject to the Compulsory Jurisdiction of the Financial Ombudsman Service; and
(b) every other person who is subject to the Compulsory Jurisdiction in relation to relevant complaints.

(4) FEES 1, 2 and 6 apply to:

(a) every participant firm;
(b) the FSCS; and
(c) the Society.

(5) FEES 1, 2 and 7 apply to:

(a) every person having a Part 4A permission;
(b) an incoming EEA firm;
(c) an incoming Treaty firm;
(d) the Society;
(e) every fee-paying payment service provider except the Bank of England, government departments and local authorities;
(f) every fee-paying electronic money issuer except the Bank of England, government departments, local authorities, municipal banks and the National Savings Bank.

(6) FEES App 1 Annex 1 applies to every:

(a) registered society; or
(b) sponsoring body; or
(c) person who submits a proposal for the registration of a registered society;

each as defined in FEES Appendix 1.

FEES 1, 2 and 7 do not apply to an incoming EEA firm or an incoming Treaty firm that has not established a branch in the United Kingdom.
The application statement at FEES 1.1.2R (3) does not apply to FEES 5.5A, FEES 5 Annex 2R or FEES 5 Annex 3R.

23/07/2013

FEES 1.1.3A

The rules in FEES should be read in conjunction with GEN 2.2.23 R to GEN 2.2.25 G. In relation to FEES, some rules are made by both the FCA and PRA. Those rules may contain obligations for or references to FCA-authorised persons (for example payment service providers and electronic money issuers) notwithstanding that they also are made by the PRA in order to apply them to PRA-authorised persons. GEN 2.2.23 R limits the application of those rules so that the PRA will only apply them in respect of PRA-authorised persons and not to such FCA-authorised persons as are specifically included within the rule.

01/04/2013

Purpose

FEES 1.1.4

The purpose of this manual is to set out the fees applying to the persons set out in FEES 1.

01/04/2013

FEES 2

General Provisions

FEES 2.1

Introduction

01/01/2006

Application

FEES 2.1.1

Except to the extent referred to in FEES 2.1.1A R, this chapter applies to every person who is required to pay a fee or share of a levy to the appropriate regulator, FOS Ltd or FSCS, as the case may be, by a provision of the Handbook.

01/04/2013

FEES 2.1.2

FEES 2.2.1R does not apply in respect of any fee payable under FEES 3 (Application, notification and vetting fees).

01/04/2013

FEES 2.1.3

The provisions for late payments in FEES 2.2.1R do not apply to fees payable under FEES 3 as applications, notifications and requests for vetting are generally regarded as incomplete until the relevant fee is paid.

01/04/2013

Purpose

FEES 2.1.4

The purpose of this chapter is to set out the general provisions applicable to those who are required to pay fees or levies to the appropriate regulator or a share of the FSCS levy.

01/04/2013

FEES 2.1.5-A

Paragraph 31 of Schedule 1ZB of the Act enables the PRA to charge fees to cover its costs and expenses in carrying out its functions. The corresponding provisions for the FSCS levy are set out in FEES 6.1.

01/04/2013

FEES 2.1.6

The appropriate regulator fees payable will vary from one fee year to another, and will reflect the appropriate regulator's funding requirement for that period and the other key components, as described in FEES 2.1.7G. Periodic fees, which will normally be payable on an annual basis, will provide the majority of the funding required to enable the appropriate regulator to undertake its statutory functions.

01/04/2013

FEES 2.1.7

The key components of the appropriate regulator fee mechanism (excluding the FSCS levy, the FOS levy and case fees, and the CFEB levy which are dealt with in FEES 5, FEES 6 and FEES 7) are:

(1) a funding requirement derived from:

(a) the appropriate regulator's financial management and reporting framework;
(b) the appropriate regulator's budget; and
(c) adjustments for audited variances between budgeted and actual expenditure in the previous accounting year, and reserves movements (in accordance with the appropriate regulator's reserves policy);

(2) mechanisms for applying penalties received during previous financial years for the benefit of fee payers;
(3) fee-blocks, which are broad groupings of fee payers offering similar products and services and presenting broadly similar risks to the appropriate regulator's regulatory objectives;
(4) a costing system to allocate an appropriate part of the funding requirement to each fee-block; and
(5) tariff bases, which, when combined with fee tariffs, allow the calculation of fees.

01/04/2013

FEES 2.1.8

The amount payable by each fee payer will depend upon the category (or categories) of regulated activity or exemption, or other relevant activity applicable to that person (fee-blocks). It will, in most cases, also depend on the amount of the business that person conducts in each category (fee tariffs).

01/04/2013

FEES 2.1.9

By basing fee-blocks on categories of business, the appropriate regulator aims to minimise cross-sector subsidies. The membership of the fee-blocks is identified in the FEES provisions relating to the type of fees concerned.

01/04/2013

FEES 2.1.9A

PRA-authorised persons and persons seeking to become PRA-authorised persons should note that the FCA and the PRA have agreed for the FCA to act as the PRA's agent in relation to the collection of PRA fees. Where applicable, both PRA and FCA fees should be paid as a single payment to the FCA, which will receive the payment in its own capacity in respect of FCA fees and in its capacity as agent for the PRA in respect of the PRA fees. References to this arrangement will be referred to in FEES where applicable.

01/04/2013

FEES 2.2

Late Payments and Recovery of Unpaid Fees

01/01/2006

Late Payments

FEES 2.2.1

If a person does not pay the total amount of a periodic fee, FOS levy, or share of the FSCS levy or CFEB levy, before the end of the date on which it is due, under the relevant provision in FEES 4, 5, 6 or 7, that person must pay an additional amount as follows:

(1) if the fee was not paid in full before the end of the due date, an administrative fee of £250; plus
(2) interest on any unpaid part of the fee at the rate of 5% per annum above the Official Bank Rate from time to time in force, accruing on a daily basis from the date on which the amount concerned became due.

01/04/2013

FEES 2.2.2

The FCA, (for FCA and PRA periodic fees, FOS and FSCS levies and CFEB levies), expect to issue invoices at least 30 days before the date on which the relevant amounts fall due. Accordingly it will generally be the case that a person will have at least 30 days from the issue of the invoice before an administrative fee becomes payable.

01/04/2013

Recovery of Fees

FEES 2.2.3

Paragraphs 23(8) and 27 of Schedule 1ZA and paragraphs 31(7) and 35 of Schedule 1ZB of the Act permit the FCA and PRA respectively to recover fees (including fees relating to payment services, the issuance of electronic money and, where relevant, FOS levies and CFEB levies), and section 213(6) permits the FSCS to recover shares of the FSCS levy payable, as a debt owed to the FCA, PRA and FSCS respectively, and the FCA, PRA and FSCS, as relevant, will consider taking action for recovery (including interest) through the civil courts.

01/04/2013

FEES 2.2.4

In addition, the appropriate regulator may be entitled to take regulatory action in relation to the non-payment of fees, FOS levies and CFEB levies. The appropriate regulator may also take regulatory action in relation to the non-payment of a share of the FSCS levy, after reference of the matter to the appropriate regulator by the FSCS. What action (if any) that is taken by the appropriate regulator will be decided upon in the light of the particular circumstances of the case.

01/04/2013

FEES 2.3

Relieving Provisions

01/01/2006

Remission of Fees and levies

FEES 2.3.1

If it appears to the appropriate regulator or the FSCS (in relation to any FSCS levy only) that in the exceptional circumstances of a particular case, the payment of any fee, FSCS levy, FOS levy or CFEB levy would be inequitable, the appropriate regulator or the FSCS as relevant, may (unless FEES 2.3.2B R applies) reduce or remit all or part of the fee or levy in question which would otherwise be payable.

01/04/2013

FEES 2.3.2

If it appears to the appropriate regulator or the FSCS (in relation to any FSCS levy only) that in the exceptional circumstances of a particular case to which FEES 2.3.1R does not apply, the retention by the appropriate regulator, the FSCS, or the CFEB, as relevant, of a fee, FSCS levy, FOS levy or CFEB levy which has been paid would be inequitable, the appropriate regulator, the FSCS or the CFEB, may (unless FEES 2.3.2B R applies) refund all or part of that fee or levy.

01/04/2013

FEES 2.3.2A

A poor estimate or forecast by a fee or levy payer, when providing information relevant to an applicable tariff base, is unlikely, of itself, to amount to an exceptional circumstance for the purposes of FEES 2.3.1 R or FEES 2.3.2 R. By contrast, a mistake of fact or law by a fee or levy payer may give rise to such a claim.

01/04/2013

FEES 2.3.2B

The appropriate regulator or the FSCS may not consider a claim under FEES 2.3.1 R and/or FEES 2.3.2 R to reduce, remit or refund any overpaid amounts paid by a fee or levy payer in respect of a particular period, due to a mistake of fact or law by the fee or levy payer, if the claim is made by the fee or levy payer more than 2 years after the beginning of the period to which the overpayment relates.

01/04/2013

FEES 2.4

VAT

01/04/2009

FEES 2.4.1

All fees payable or any stated hourly rate under FEES 3 (Application, notification and vetting fees), FEES 4 (Periodic fees) and FEES 7 (The CFEB levy) are stated net of VAT. Where VAT is applicable this must also be included.

01/04/2013

FEES 3

Application, Notification and Vetting Fees

FEES 3.1

Introduction

01/01/2006

Application

FEES 3.1.1

This chapter applies to every person set out in column 1 of the Table of application, notification and vetting fees in FEES 3.2.7 R and FEES 3.2.7A R.

01/04/2013

FEES 3.1.2

This chapter does not apply to:

(1) an EEA firm that wishes to exercise an EEA right; or
(2) an EEA authorised payment institution; or
(3) an EEA authorised electronic money institution.

01/04/2013

Purpose

FEES 3.1.3

The purpose of this chapter is to set out the appropriate regulator fee paying requirements on the persons set out in FEES 1.1.2R (1).

01/04/2013

FEES 3.1.4

Most of the detail of what fees are payable by the persons referred to in FEES 3.1.3 G is set out in FEES 3 Annex 1 - FEES 3 Annex 10 R.

01/04/2013

FEES 3.1.5

(1) The rates set for authorisation fees represent an appropriate proportion of the costs of the appropriate regulator in processing the application or exercise of Treaty rights.
(2) [deleted]
(3) [deleted]

01/04/2013

FEES 3.1.6

Applications for Part 4A permission (and exercises of Treaty rights) are categorised by the appropriate regulator for the purpose of fee raising as complex, moderately complex and straightforward as identified in FEES 3 Annex 1. This differentiation is based on the permitted activities sought and does not reflect the appropriate regulator's risk assessment of the applicant (or Treaty firm).

01/04/2013

FEES 3.1.7

A potential applicant for Part 4A permission (or Treaty firm) has the opportunity to discuss its proposed application (or exercise of Treaty rights) with the appropriate regulator before submitting it formally. If an applicant for Part 4A permission (or Treaty firm) does so, the appropriate regulator will be able to use that dialogue to make an initial assessment of the fee categorisation and therefore indicate the authorisation fee that should be paid.

01/04/2013

FEES 3.2

Obligation to pay fees

01/01/2006

General

FEES 3.2.1

A person in column (1) of the table in FEES 3.2.7 R and, if applicable, FEES 3.2.7A R as the relevant fee payer for a particular activity must pay to the FCA (in its own capacity or, if the fee is payable to the PRA, in its capacity as collection agent for the PRA) a fee for each application or request for vetting, or request for support relating to compatibility of its systems with appropriate regulator systems, or admission approval made, or notification or notice of exercise of a Treaty right given, or other matter as is applicable to it, as set out or calculated in accordance with the provisions referred to in column (2) of the appropriate table:

(1) in full and without deduction; and
(2) on or before the date given in column (3) of that table.

01/04/2013

FEES 3.2.2

If an application for a Part 4A permission (or exercise of a Treaty right) falls within more than one category set out in FEES 3 Annex 1, only one fee is payable. That fee is the one for the category to which the highest fee tariff applies.

01/04/2013

Method of payment

FEES 3.2.3

(1) Unless (2) or (3) applies, the sum payable under FEES 3.2.1 R must be paid by bankers draft, cheque or other payable order.
(2) The FCA does not specify a method of payment for a person seeking to:

(a) become a recognised body or a designated professional body; or
(b) be added to the list of designated investment exchanges or accredited bodies.

(3) The sum payable under FEES 3.2.1 R by a firm applying for a variation of its Part 4A permission (FEES 3.2.7 R(p) and, if applicable, FEES 3.2.7A R (c)) must be paid by any of the methods described in (1) or by Maestro, Visa Debit or credit card (Visa/Mastercard only). Any payment by a permitted credit card must include an additional 2% of the sum paid.

01/07/2013

FEES 3.2.5

(1) The appropriate authorisation or registration fee is an integral part of an application for, or an application for a variation of, a Part 4A permission, authorisation, registration or variation under the Payment Services Regulations or the Electronic Money Regulations, or notification or registration under the AIFMD UK regulation. Any application or notification received by the appropriate regulator without the accompanying appropriate fee, in full and without deduction (see FEES 3.2.1 R), will not be treated as an application or notification made, incomplete or otherwise, in accordance with section 55U(4), or section 55H or 55I (as the case may be), of the Act or regulation 5(3) or 12(3) of the Payment Services Regulations or regulation 5 or 12 of the Electronic Money Regulations or regulation 11(1) and 60(a) of the AIFMD UK regulation. Where this is the case, the appropriate regulator will contact the applicant to point out that the application cannot be progressed until the appropriate fee has been received. In the event that the appropriate authorisation fee, in full and without deduction, is not forthcoming, the application will be returned to the applicant and no application will have been made.
(2) With the exception of persons seeking to become a designated professional body, all applications, notifications, requests for vetting or admission approval will be treated as incomplete until the relevant fee is fully paid and the appropriate regulator will not consider an application, notification, request for vetting or admission approval until the relevant fee is fully paid. Persons seeking to become a designated professional body have 30 days after the designation order is made to pay the relevant fee.

23/07/2013

FEES 3.2.6

Fees paid under this chapter are not refundable.

01/04/2013

FEES 3.2.7A

Table of application, notification and vetting fees payable to the PRA

(1) Fee payer

(2) Fee payable

Due date

(a)

Any applicant for Part 4A permission (including an incoming firm applying for top-up permission) which includes a PRA-regulated activity

(1)

Unless (2) applies, in respect of a particular application, the highest of the tariffs set out in FEES 3 Annex 1 R part 1 which apply to that application.

On or before the application is made

(2)

In respect of a particular application which is:

(i)

a straightforward or moderately complex case for the purposes of FEES 3 Annex 1 R part 1, and

(ii)

only involves a simple change of legal status as set out in FEES 3 Annex 1 part 6,

the fee payable is 50% of the tariff that would otherwise be payable in FEES 3 Annex 1 part 1.

(b)

Any Treaty firm that wishes to exercise a Treaty right to qualify for authorisation under Schedule 4 to the Act (Treaty rights) in respect of regulated activities for which it does not have an EEA right, except for a firm providing cross border services only

(1)

Where no certificate has been issued under paragraph 3(4) of Schedule 4 to the Act the fee payable is, in respect of a particular exercise, set out in FEES 3 Annex 1 R, part 4.

On or before the notice of exercise is given

(2)

Where a certificate in (1) has been issued no fee is payable.

(c)

A firm applying for a variation of its Part 4A permission or an FCA-authorised person applying to carry on a PRA-regulated activity

(1)

Unless (2) or (3) applies, if the proposed new business of the firm would fall within one or more activity groups specified in Part 1 of FEES 4 Annex 1A or Part 1 of FEES 4 Annex 1B not applicable before the application, the fee is 50% of the highest of the tariffs set out in FEES 3 Annex 1 R which apply to that application.

On or before the date the application is made

(2)

If the only change is that the A.12 activity group tariff applied to the firm's business before the variation and the A.13 activity group will apply after variation, no fee is payable.

(3)

If the firm is in the A.1 fee-block at the date of the application and the variation involves adding any of the regulated activities of meeting of repayment claims or managing dormant account funds (including the investment of such funds), the fee is 50% of the fee in FEES 3 Annex 1 R that applies to that application.

(4)

In all other cases, other than applications by credit unions, the fee payable is 125, unless the variation involves only the reduction (and no other increases) in the scope of a Part 4A permission in which case no fee is payable.

(d)

Any person to which the Special Project Fee for restructuring applies under FEES 3 Annex 9.

Special Project Fee for restructuring in accordance with FEES 3 Annex 9 .

30 days of the date of the invoice.

(e)

In the case of an insurance business transfer scheme, a transferor.
Note - for the purpose of this paragraph an insurance business transfer scheme consists of a single transferor and a single transferee. Where however such a scheme is part of a single larger scheme, that larger scheme is treated as a single insurance business transfer scheme. If an insurance business transfer scheme includes more than one transferor in accordance with this paragraph, the transferors are liable to pay the fee under column (2) jointly.

Either (1) or (2) as set out below:

On or before any application is made to the PRA for the appointment of a person as an independent expert.

(1)

In the case of an insurance business transfer scheme involving long term insurance business, 9,250 is payable to the PRA; or

(2)

in the case of an insurance business transfer scheme not involving long term insurance business, 5,000 is payable to the PRA.

The amount payable to the PRA above is collected by the FCA as agent of the PRA.

(f)

Either:

(a))

Unless (2) applies, FEES 3 Annex 6 R.

Where the firm has made an application directly to the appropriate regulator, on or before the date the application is made, otherwise within 30 days after the appropriate regulator notifies the firm that its EEA parent's Home State regulator has requested assistance.

(i)

a firm applying to the appropriate regulator for permission to use one of the advanced prudential calculation approaches listed in FEES 3 Annex 6 R (or guidance on its availability), including any future proposed amendments to those approaches or (in the case of any application being made for such permission to the appropriate regulator as EEA consolidated supervisor under the Capital Requirements Regulations 2006) any firm making such an application; or

(2)

(a)

Unless (b) applies a firm submitting a second application for the permission or guidance described in column (1) within 12 months of the first application (where the fee was paid in accordance with (1)) must pay 50% of the fee applicable to it under FEES 3 Annex 6 R, but only in respect of that second application.

(ii)

in the case of an application to a Home State regulator other than the appropriate regulator for the use of the Internal Ratings Based approach and the Home State regulator requesting the appropriate regulator's assistance in accordance with the Capital Requirements Regulations 2006, any firm to which the appropriate regulator would have to apply any decision to permit the use of that approach.

(b)

No fee is payable by a firm in relation to a successful application for a permission based on a minded to grant decision in respect of the same matter following a complete application for guidance in accordance with prescribed submission requirements.

(c)

No fee is payable where the Home State regulator has requested the assistance described in paragraph (o)(ii)of column 1 except in the cases specified in FEES 3 Annex 6 R.

(g)

An applicant for a ceding insurer's waiver.

20,000

On or before the date the application is made.

(h)

A person in respect of which the appropriate regulator has given notice of its intention to itself appoint a skilled person to provide it with a report pursuant to section 166(3)(b) of the Act and SUP 5.2.

Any amount invoiced to the appropriate regulator by a skilled person in relation to any work carried out by that skilled person in connection with its appointment by the appropriate regulator pursuant to section 166(3)(b) of the Act.

Within 30 days of the date of the invoice.

(i)

A person in respect of which the appropriate regulator has given notice of its intention to itself appoint a skilled person to collect or update information pursuant to section 166A(2)(b) of the Act.

(Within 30 days of the date of the invoice.

01/04/2013

FEES 3 Annex 1

Authorisation fees payable

01/01/2006

Part 1 - Authorisation fees payable
For PRA-authorised persons and persons seeking to become PRA-authorised persons, the amount payable to the PRA is 50% of the amount payable under Part 1 and the amount payable to the FCA is 50% of the amount payable under Part 1. The amount payable to the PRA above is collected by the FCA as agent of the PRA.

For FCA-authorised persons and persons seeking to become FCA-authorised persons, the amount payable to the FCA is the amount payable under Part 1, No amount is payable to the PRA.

Application type (see Part 2)

Amount payable

(a)

Credit unions - registration of common bond

200

(b)

Version 1 credit unions - authorisation

300

(c)

Version 2 credit unions - authorisation

1,800

(d)

Straightforward

1,500 (unless otherwise specified in Part 2)

(e)

Moderately complex

5,000 (unless otherwise specified in Part 2)

(f)

Complex

25,000

Part 2 - Complexity Groupings Straightforward Cases

Straightforward cases

Activity grouping

Description

A.3

Friendly societies only

A.4

Friendly societies only

A.10

A firm to the extent it is bidding in emissions auctions

A.12

Advisory arrangers, dealers or brokers (holding or controlling client money and/or assets)

A.13

Advisory only firms and advisory arrangers, dealers or brokers (not holding or controlling client money and/or assets)

A.14

Corporate finance advisers

A.18

Home finance providers, advisers and arrangers (excluding home finance providers).

A.19

General insurance mediation

Moderately Complex Cases

Moderately complex cases

Activity grouping

Description

[deleted]

A.2

Home finance providers and administrators.

A.3

UK ISPVs

[deleted]

A.5

Managing agents at Lloyd's

A.7

Portfolio managers

A.9

Managers and depositaries of investment funds, and operators of collective investment schemes or pension schemes

A.10

Firms dealing as principal, except to the extent the firm is bidding in emissions auctions

Service companies

Complex Cases R

Complex cases

Activity grouping

Description

A.1

Deposit acceptors (excluding e-money issuers and credit unions) and dormant account fund operators

A.3

Insurers - general (excluding friendly societies and UK ISPVs)

A.4

Insurers - life (excluding friendly societies)

MTF operators

Part 4 - Authorisation Fees for Treaty Firms R

If the Treaty firm wishes to undertake the permitted activities in question through its branch in the United Kingdom, the fee is 50% of the fee that would be payable under FEES 3.2.7 R and/or FEES 3.2.7A R for an applicant for Part 4A permission.

If the Treaty firm wishes to undertake the permitted activities in question by providing services in the United Kingdom, the fee is 25% of the fee which would be payable under FEES 3.2.7 R and/or FEES 3.2.7A R for an applicant for Part 4A permission.

Part 5 - Activity Groupings R

The activity group definitions are set out in FEES 4 Annex 1A and FEES 4 Annex 1B.

Part 6 - Change of legal status

An application involving only a simple change of legal status for the purposes of FEES 3.2.7 R, FEES 3.2.7A R (a), FEES 3.2.7R (y), FEES 3.2.7R (za), FEES 3.2.7 R (zg) and FEES 3.2.7 R (zh) is from an applicant:

(1)

which is a new legal entity intending to carry on the business, using the same business plan, of an existing firm with no outstanding regulatory obligations cancelling its Part 4A permission or authorisation or registration under the Payment Services Regulations or the Electronic Money Regulations, and

(2)

which is to:

(a)

have the same or narrower permission, scope of authorisation or registration under the Payment Services Regulations or Electronic Money Regulations and the same branches (if any), as the firm;

(b)

assume all of the rights and obligations in connection with any of the regulated activities, payment services and electronic money issuance carried on by the firm;

(c)

continue the same compliance arrangements and compliant client asset and client money procedures, as the firm, subject to any changes required only as a result of the change of legal status;

(d)

continue with a risk profile and arrangements for controlling and monitoring risk which will not be materially different from those of the firm; and

(e)

have the individuals within the firm that are responsible for insurance mediation activity perform the same role for the applicant.

Part 7 - Change of legal status - sponsors fees

An application involving only a simple change of legal status for the purposes of FEES 3.2.7 R(j) is from an applicant:

(1)

which is a new legal entity intending to carry on the business of an existing sponsor (as defined in the listing rules) in respect of which the FCA does not currently require, and is not proposing to require, remedial action relating to any aspect of its provision of sponsor services); and

(2)

which (subject to any changes required only as a result of the change in legal status) is to:

(a)

assume all of the rights and obligations in connection with any of the sponsor activities of the existing sponsor under the listing rules;

(b)

make no changes to the systems and controls of the existing sponsor which ensure that the existing sponsor can carry out its role as sponsor in accordance with LR 8 (Sponsors: Premium listing);

(c)

have the individuals within the existing sponsor that are engaged in the provision of sponsor services engaged in the same role for the applicant; and

(d)

otherwise continue to comply in all respects with the criteria for approval as a sponsor set out in LR 8.6.5 R.

23/07/2013

FEES 3 Annex 6

Fees payable for a permission or guidance on its availability in connection with the Basel Capital Accord

01/06/2008

Part 1 Fees payable other than in relation to the counterparty credit risk internal model method.

(1)

Paragraphs (2) and (3) deal with an application made to the appropriate regulator rather than a request for assistance under the Capital Requirements Regulations 2006.

(2)

For firms falling into a group (Group 1) in which there are five or more significant overseas entities to which the application relates and the application is for permission to use one of the advanced prudential calculation approaches listed in Tables 1 or 2 or guidance on the availability of such a permission the fees in Table 1 are applicable.

(3)

For all other firms the fees in Table 2 are applicable.

(4)

Where a request for assistance regarding an Advanced or Foundation IRB application under the Capital Requirements Regulations 2006 has been made to the appropriate regulator as detailed in FEES 3.2.7 R (o) or FEES 3.2.7A R (f), the fees in Table 1 and Table 2 are applicable if any firm referred to in FEES 3.2.7 R (o)(ii) and FEES 3.2.7A R (f)(ii) meets the following conditions:

(i)

it is a UK domestic firm and has permission to accept deposits; and

(ii)

the firm does not fall within Group 4 as defined in Table 2.

(5)

If however the application or request is in relation to the use of the advanced IRB approach and the appropriate regulator (in the case of (2) or (3)) or the relevant Home State regulator (in the case of (4)) has already granted permission for the use of the foundation IRB approach at the time of the application then Table 3 applies.

Table 1

Application group

Description of group

Application fee

Advanced IRB ('000)

Foundation IRB ('000)

AMA ('000)

Group 1

Five or more significant overseas entities as described in more detail in the definition of Group 1 in the introduction to Part 1 of this Annex

268

232

181

Table 2

Application group

Description of group

Application fee

Modified eligible liabilities (m)

Number of traders as at the 31 December prior to the appropriate regulator fee year in which the fee is payable

Advanced IRB ('000)

Foundation IRB ('000)

AMA ('000)

Group 2

>40,000

>200

232

198

146

Group 3

>5,000 - 40,000

26 - 200

Group 4

0 - 5,000

0 - 25

(1)

[Deleted]

(2)

For the purposes of Table 2, a firm's A.1 or A10 tariff data for the relevant period will be used to provide the value of modified eligible liabilities or number of traders.

Table 3 (Advanced IRB approach where the appropriate regulator or Home State regulator has already given permission to use the foundation IRB approach)

Application group

Advanced IRB Application fee ()

Group 1

67,000

Group 2

58,000

Group 3

23,500

Group 4

10,500

The four application groups have the same meaning as they do in Tables 1 and 2.

Part 2
Fees payable in relation to the counterparty credit risk internal model method.
54,000

01/04/2013

FEES 3 Annex 9

Special Project Fee for restructuring

01/06/2009

(1) R

The Special Project Fee for restructuring (the SPFR) is only payable by a person in one of the following categories:

(a)

if it is in any of the A fee-blocks (as defined in Part 1 of FEES 4 Annex 1A in respect of the FCA and Part 1 of FEES 4 Annex 1B in respect of the PRA); or

(b)

if it is in fee-block G.3 (as defined in FEES 4 Annex 11); or

(c)

if it is a recognised investment exchange; or

(d)

[deleted]

(e)

if it is in any of the B fee-blocks (as defined in Part 1 of FEES 4 Annex 1A and FEES 4 Annex 1B).

(2) R

The SPFR becomes payable by a person falling into (1)(a) or (b) if it engages in, or prepares to engage in, activity which involves it undertaking or making arrangements with a view to any of the following:

(a)

raising additional capital; or

(b)

a significant restructuring of the firm or the group to which it belongs, including:

(i) mergers or acquisitions;

(ii) reorganising the firm's group structure; and

(iii) reattribution.

(3) R

No SPFR is payable under (2) if the transaction only involves the firm seeking to raise capital within the group to which it belongs.

(4) R

Where the transaction in (2) involves raising capital outside the group to which the firm belongs, any SPFR in relation to that transaction is only payable by the largest firm in that group. The largest firm is the one that pays the highest periodic fee in the appropriate regulator fee year in which the bill is raised. For the purpose of the calculation in (9), all time spent and fees and disbursements incurred in relation to the group are added together.

(5) R

The definition of group is limited for the purposes of calculating the SPFR to parent undertakings and their subsidiary undertakings.

(6) R

The SPFR also becomes payable by any person falling into (1) if any of the following circumstances apply to it:

(a)

an insolvency order is in effect as respects the person or the person is being voluntarily wound up or steps are being taken for the making of an insolvency order or voluntary winding up of, or with respect to, the person by someone entitled to take such steps; or

(b)

the Bank of England or the Treasury have exercised a stabilisation power in respect of the person under the Banking Act 2009.

(7) R

In (6):

(a)

references to an insolvency order or winding up include the equivalent process in any jurisdiction outside the United Kingdom; and

(b)

references to an insolvency order include such an order made under the Banking Act 2009.

(7A)R

The FCA and the PRA will levy separate SPFRs. The use of the term "appropriate regulator" in FEES 3 Annex 9R refers to the regulator levying the SPFR.

(8) R

No SPFR is payable to an appropriate regulator:

(a)

if the amount calculated in accordance with (9) in relation to the regulatory work conducted by the appropriate regulator totals less than 50,000; or

(b)

for time spent giving guidance to the person in relation to the same matter if the appropriate regulator has charged that person for that guidance.

(9) R

The SPFR for the appropriate regulator is calculated as follows:

(a)

Determine the number of hours, or part of an hour, taken by the appropriate regulator, or, if applicable, both the FCA and PRA in relation to regulatory work conducted as a consequence of the activities referred to in (2) or (6).

(b)

Next, multiply the applicable rate in the table at (11) by the number of hours or part hours obtained under (a).

(c)

Then add any fees and disbursements invoiced to the appropriate regulator by any person in respect of services performed by that person for the appropriate regulator in relation to assisting the appropriate regulator in performing the regulatory work referred to in (a).

(d)

The resulting figure is the fee.

(e)

The number of hours or part hours referred to in (a) are the number of hours or part hours as recorded on the appropriate regulator's systems in relation to the regulatory work referred to in (a).

(10) R

The first column in the table at (11) sets out the relevant pay grades of those employed by the appropriate regulator and the second column sets out the hourly rates chargeable in respect of those pay grades.

(11) R

Table of FCA hourly rates:

FCA pay grade

Hourly rate ()

Administrator

Associate

Technical Specialist

100

Manager

110

Any other person employed by the FCA

160

(11)AR

Table of PRA hourly rates:

PRA pay grade

Hourly rate (£)

Administrator

Associate

Technical Specialist

100

Manager

110

Any other person employed by the PRA

160

(12) G

The obligation to pay the SPFR is ongoing. Accordingly, there is no limitation on the number of times that the appropriate regulator may invoice a person for the SPFR in relation to the same events or circumstances referred to in (2) or (6). If the appropriate regulator does so, there is a single floor under (8)(a) and not a separate one for each instalment. Therefore, for example, if a person is subject to an administration order, the appropriate regulator may invoice the person on a periodic basis for all the related regulatory work, but may only do so once the total fee (including disbursements) equals 50,000.

(13) G

If the SPFR is payable, the full amount calculated under (9) is payable not just the excess over 50,000.

(14) G

The SPFR is a single fee. Therefore the SPFR may be payable under both (2) and (6). If it is payable under both, there is only a single floor under (8)(a), not two separate ones.

01/04/2013

FEES 3 Annex 10

Fees payable for authorisation as an authorised electronic money institution or registration as a small electronic money institution or variation thereof, including notification fees, in accordance with the Electronic Money Regulations

01/06/2012

Authorisation, registration and variation fees payable

Application type for authorisation, registration, variation or notification under Part 2 of the Electronic Money Regulations

Amount payable

(1)

small electronic money institution

1,000

(2)

authorised electronic money institution

5,000

(3)

electronic money institution - where, at the time the application is made, the applicant intends to use agents

3 for each agent registered with the FCA at the time of application.
This fee is in addition to any fees due under paragraph (1) or (2) of this table.

(4)

electronic money institution - where, during the course of the FCA financial year (12 months ending 31 March), the firm notifies the FCA of any changes to the list of agents it has registered since its authorisation

3 for each change notified to the FCA during the FCA financial year.
No fee is due under paragraph (4) if the total number of notifications to the FCA during the FCA financial year numbers 100 or less.

01/04/2013

FEES 3 Annex 11

Guidance on fees due under FEES 3.2.7R and FEES 3.2.7AR

01/04/2013

The following table sets out guidance on how a firm liable to pay a fee under both FEES 3.2.7 R (s) and FEES 3.2.7 R (ze) in respect of fees payable to the FCA and FEES 3.2.7AR(e) and FEES 3.2.7AR(d) in respect of fees payable to the PRA for the same transaction should expect to be treated.

Firms liable under both FEES 3.2.7R(s) and FEES 3.2.7R(ze) in respect of fees payable to the FCA and FEES 3.2.7AR (e) and FEES 3.2.7AR(d) in respect of fees payable to the PRA

(1)

The transferor in insurance business transfer schemes is liable to pay the fee set out in FEES 3.2.7 R (s) and/or FEES 3.2.7AR(e). However, it may also be liable to pay the Special Project Fee for restructuring set out in FEES 3.2.7 R (ze) and/or FEES 3.2.7AR(d), calculated in accordance with FEES 3 Annex 9. It is possible then for a firm to have to pay two types of fees in respect of the same insurance business transfer scheme.

(2)

Where the situation described in (1) arises, the appropriate regulator will consider whether to reduce or remit a fee under FEES 2.3 (Relieving Provisions).

01/04/2013

FEES 4

Periodic fees

FEES 4.1

Introduction

01/01/2006

Application

FEES 4.1.1

This chapter applies to every person set out in FEES 1.1.2R (2).

01/04/2013

Purpose

FEES 4.1.2

The purpose of this chapter is to set out the requirements on firms and others to pay periodic fees and transaction reporting fees in certain circumstances.

01/04/2013

Background

FEES 4.1.3

Most of the detail of the periodic fees that are payable by firms is set out in FEES 4 Annexes 1A to 11. FEES 4 Annex 12 G provides guidance on the calculation of certain tariffs. Most of the provisions of the Annexes will vary from one fee year to another. Accordingly fresh FEES 4 Annexes will come into force, following consultation, for each fee year.

01/07/2013

FEES 4.1.5

The Society of Lloyd's, which has permission, has its own fee block.

01/04/2013

FEES 4.1.7

In the case of periodic fees for firms, fees are calculated individually for each firm, but they may be paid on a group basis, if the group so wishes.

01/04/2013

FEES 4.2

Obligation to pay periodic fees

01/01/2006

General

FEES 4.2.1

A person shown in column (1) of the table in FEES 4.2.11 R and, if applicable, FEES 4.2.11AR as the relevant fee payer must pay each periodic fee applicable to it, calculated in accordance with the provisions referred to in column (2) of the applicable table, as adjusted by any relevant provision in this chapter:

(1) in full and without deduction (unless permitted or required by a provision in FEES); and
(2) on or before the date given in column (3) of that table, unless FEES 4.2.10 R applies.

01/04/2013

FEES 4.2.2

(1) A relevant fee payer will be required to pay a periodic fee for every year during which they have the status in column 1 of the table in FEES 4.2.11 R and/or FEES 4.2.11AR (or in relation to collective investment schemes, for every year during which it is a regulated collective investment scheme) subject to any reductions or exemptions applicable under this chapter. If a person is the relevant fee payer for more than one status listed in column 1 of the table in FEES 4.2.11 R and/or FEES 4.2.11AR (or in relation to collective investment schemes, the relevant fee payer for more than one regulated collective investment scheme) he will be required to pay a fee in relation to each.
(2) [deleted]

01/04/2013

FEES 4.2.3

The FCA will issue invoices in respect of the FCA and PRA to firms and other fee payers and expects to do so at least 30 days before the dates on which payments fall due under FEES 4.2.1 R.

01/04/2013

Method of payment

FEES 4.2.4

(1) A periodic fee must be paid using either direct debit, credit transfer (BACS/CHAPS), cheque, Maestro, Visa Debit or by credit card (Visa/Mastercard only). Any payment by permitted credit card must include an additional 2% of the sum paid.
(2) [deleted]

01/07/2013

Modifications for persons becoming subject to periodic fees during the course of a fee year

FEES 4.2.6

(1) Unless (2) applies, if the event, as described in column 4 of the table in FEES 4.2.11 R and/or FEES 4.2.11AR, giving rise to, or giving rise to an increase in, the fee payable in FEES 4.2.1 R, occurs on or after 1 July of the relevant fee year, the periodic fee required under FEES 4.2.1 R is modified for:

(a) firms (other than AIFM qualifiers, ICVCs and UCITS qualifiers) in accordance with FEES 4.2.7 R and FEES 4.2.8 R;
(b) for all other fee payers in column (1) of the table in FEES 4.2.11 R or FEES 4.2.11A R, in accordance with the table below.

Period in which event (in column 4 of the table in FEES 4.2.11 R or FEES 4.2.11AR) occurs

Proportion of periodic fee payable

Fees payable to the FCA

1 April to 30 June inclusive

100%

1 July to 30 September inclusive

75%

1 October to 31 December inclusive

50%

1 January to 31 March inclusive

25%

Fees payable to the PRA for fee year 2013/14

1 April to 30 June inclusive

100%

1 July to 30 September inclusive

75%

1 October to 31 December inclusive

50%

1 January to 28 February inclusive

25%

(2) For recognised bodies, if the recognition order is made during the course of the relevant fee year, the periodic fee required is set out in Column (4) of the table in FEES 4.2.11 R.

23/07/2013

FEES 4.2.7

A firm (other than an AIFM qualifier, ICVC or UCITS qualifier) which becomes authorised or registered, or whose permission and/or payment service activities are extended, during the course of the fee year must pay a fee which is calculated by:

(1) identifying each of the tariffs set out in Part 1 of FEES 4 Annex 2AR, Part 1 of FEES 4 Annex 2BR and/or Part 1 of FEES 4 Annex 11 as appropriate for the relevant fee year that apply to the firm only after the permission is received or extended or payment service activities are authorised or registered or extended or electronic money issuance activities are authorised or registered under the Electronic Money Regulations, but ignoring:

(a) the A.13 activity group if, before the variation, the A.12 activity group applied to the firm's business; or
(b) the A.12 activity group if, before the variation, the A.13 activity group applied to the firm's business;

(2) calculating the amount for each of the applicable tariffs which is the higher of:

(a) any applicable minimum fee specified in relation a particular tariff in FEES 4 Annex 2AR or FEES 4 Annex 2BR (but note, for the avoidance of doubt, that these are not the A.0 or PA.0 minimum fees set out under Part 2 of FEES 4 Annex 2AR and Part 2 of FEES 4 Annex 2BR); and
(b) the result of applying the tariff to the projected valuation, for its first year (as provided in the course of the firm's application), of the business to which the tariff relates;

(3) adding together the amounts calculated under (2) in relation to fees payable to the FCA and, if applicable, separately adding together the amounts calculated under (2) in relation to the fees payable to the PRA;;
(4) working out whether an A.0 or a PA.0 minimum fee is payable under Part 2 of FEES 4 Annex 2AR or Part 2 of FEES 4 Annex 2BR (except that that minimum fee is not payable again by a firm whose permission is extended if the fee was already payable before the extension);
(4A) working out whether an AP.0 FCA prudential fee is payable under Part 2 of FEES 4 Annex 2AR and if so how much;
(4B) working out whether a PT.1 PRA transitional fee is payable under Part 2 of FEES 4 Annex 2BR and if so how much;
(5) adding together the amounts calculated under (3), (4) and (4A) that relate to fees payable to the FCA and then adding this sum to any applicable flat rate fee, and, if applicable, separately adding together the amounts calculated under (3), (4) and (4B) that relate to fees payable to the PRA and then adding this sum to any applicable flat rate fee; and
(6) modifying the result for the FCA and, if applicable, the PRA as indicated by the table in FEES 4.2.6 R (except that FEES 4 Annex 10 (Periodic fees for MTF operators) deals with a firm that receives permission for operating a multilateral trading facility or has its permission extended to include this activity during the course of the relevant fee year and FEES 4.2.6 R does not apply).

23/07/2013

FEES 4.2.7A

Projected valuations for a firm's first year will be collected for the 12 month period beginning with the date a firm becomes authorised or registered, or the date its permission and/or payment service activities are extended. That information will be used to calculate the periodic fee for the remainder of the fee year in which the firm was authorised or registered or its permission and/or payment service activities were extended (adjusted in accordance with FEES 4.2.7 R) and to calculate the periodic fee for the following fee year. Projected valuations are not relevant for those fee payers that are only required to pay fixed fees.

01/04/2013

FEES 4.2.7B

(1) This rule deals with the calculation of:

(a) a firm's fees for its second and subsequent fee year. These are the fee years years following the fee year in which it was given permission and/or was authorised or registered under the Payment Services Regulations or the Electronic Money Regulations or had its permission and/or payment services activities extended (the relevant permissions); and
(b) the tariff base for the fee block or fee blocks that relate to each of the relevant permissions.

(2) The starting point for calculating the fees referred to in (1)(a) is determining whether or not the firm's tariff base for the relevant fee year can be calculated using data from a complete period (as specified in Part 5 of FEES 4 Annex 1AR, Part 5 of FEES 4 Annex 1BR or Part 4 of FEES 4 Annex 11 R) that begins on or after the date that the firm obtained the relevant permission to which that tariff base relates.

(a) If it can, the firm must use that data for calculating its tariff base.
(b) If it cannot, the tariff base must be calculated using the projected valuations for its first year of the business to which the tariff relates (as provided in the course of the firm's application), unless (5)(b) or 5(c) applies.

(3) This rule does not apply to a firm with a permission for operating a multilateral trading facility.
(4) [deleted]
(5)

(a) [deleted]
(b) If a firm:

(i) receives a relevant permission between 1 April and 31 December inclusive; and
(ii) is, but for this rule, required to calculate its tariff base for that relevant permission by reference to the average of its modified eligible liabilities for October, November and December;

it must calculate that tariff base as at the December before the start of the fee year.
(c) If a firm:

(i) is, but for this rule, required to calculate its tariff base for the relevant permission by reference to the firm's financial year ended in the calendar year ending on the 31 December before the start of the fee year and, since obtaining the relevant permission, the firm has yet to complete a full financial year ended in the calendar year ending on the 31 December before the start of the fee year; or
(ii) is, but for this rule, required to calculate its tariff base by reference to the twelve months ending on the 31 December before the start of the fee year and, since obtaining the relevant permission, the firm has yet to complete a full twelve months ending on the 31 December before the start of the fee year;

it must calculate the tariff base under (d) below unless it is in its second fee year and was authorised between 1 January and 1 April (in which case it must use the projected valuations provided for in (2)(b) above).
(d) If a firm satisfies either of the conditions in (c) it must calculate its tariff base as follows:

(i) it must use actual data in relation to the business to which the tariff relates rather than projected valuations;
(ii) in respect of firms satisfying condition (5)(c)(i), the tariff is calculated by reference to the period beginning on the date it acquired the relevant permission relating to the tariff, and ending on either the 31 December before the start of the fee year or, if earlier, the start date of the firm's financial year; and
in respect of firms satisfying condition (5)(c)(ii), the tariff is calculated by reference to the period beginning on the date on which it acquired the relevant permission, and ending on the 31 December before the start of the fee year
(iii) the figures are annualised by increasing them by the same proportion as the period of 12 months bears to the period starting from when the firm received its relevant permission to to the relevant period end date specified in (ii).

(e) Where a firm is required to use the method in (d) it must notify the FCA (in its own capacity and, if applicable, in its capacity as collection agent for the PRA) of this by the date specified in FEES 4.4 (Information on which Fees are calculated).
(f) Where a firm is required to use actual data under this rule FEES 4 Annex 1AR Part 5, FEES 4 Annex 1BR Part 5 and FEES 4 Annex 11 Part 4, are modified, where applicable, in relation to the calculation of that firm's valuation date in the fee years to which this rule applies.

01/04/2013

Application of FEES 4.2.7BR

FEES 4.2.7C

The table below sets out the period within which a firm's tariff base is calculated (the data period) for second year fees calculated under FEES 4.2.7B R. The example is based on a firm that acquires permission on 1 November 2009 and has a financial year ending 31 March. Where valuation dates fall before the firm receives permission it should use projected valuations in calculating its fees.

References in this table to dates or months are references to the latest one occurring before the start of the appropriate regulator's fee year unless otherwise stated.

Type of permission acquired on 1 November

Tariff base

Valuation date but for FEES 4.2.7BR

Data period under FEES 4.2.7BR

Accepting deposits (monthly reporting firms)

Modified eligible liabilities (MELs)

Average of the MELs for October, November, December - so projected valuations will be used

MELs for December 2009.

Accepting deposits (quarterly reporting firms)

MELs

December 2009

December 2009.

Entering into a home finance transaction

Number of mortgages, home purchase plans or home reversion plans entered into

12 months ending 31 December 2009 - so projected valuations will be used

1 November to 31 December 2009.

Effecting contracts of insurance
(Insurers - general)

Gross premium income and gross technical liabilities

31 March 2009 - so projected valuations will be used

1 November to 31 December 2009.

01/04/2013

FEES 4.2.8

In relation to an incoming EEA firm or an incoming Treaty firm the modification provisions of FEES 4.2.7 R apply only in relation to the relevant regulated activities of the firm, which are passported activities or Treaty activities and which are carried on in the United Kingdom, and which are not provided on a cross border services basis. For payment services and electronic money issuance, the adjustment only applies to the business to which the calculation made in FEES 4.3.12A R relates.

01/04/2013

Fee payers ceasing to hold relevant status or reducing the scope of their permission after start of relevant period

FEES 4.2.9

The appropriate regulator will not refund periodic fees if, after the start of the period to which they relate:

(1) a fee payer ceases to have the status set out in column (1) of the table in FEES 4.2.11 R or FEES 4.2.11AR; or
(2) a firm reduces its permission or payment services activities so that it then falls out of the fee-block previously applied to it;

(but see FEES 2.3 (Relieving Provisions) and FEES 4.3.13 R (Firms Applying to Cancel or Vary Permission Before Start of Period)).

01/04/2013

Extension of Time

FEES 4.2.10

A person need not pay a periodic fee on the date on which it is due under the relevant provision in FEES 4.2.1 R, if:

(1) that date falls during a period during which circumstances of the sort set out in GEN 1.3.2 R (Emergencies) exist, and that person has reasonable grounds to believe that those circumstances impair its ability to pay the fee, in which case he must pay it on or before the fifth business day after the end of that period; or
(2) unless FEES 4.3.6R (3), FEES 4.3.6R (4) or FEES 4.3.6R (4A) (Time and method for payment) applies, that date would otherwise fall on or before the 30th day after the date on which the FCA (in its own capacity or in its capacity as agent for the PRA) has sent written notification to that person of the fee payable on that date, in which case he must pay on or before the 30th day after the date on which the FCA sends the notification.

01/04/2013

FEES 4.2.11A

Table of periodic fees payable to the PRA

1 Fee payer

2 Fee payable

3 Due date

4 Events occurring during the period leading to modified periodic fee

Any firm

As specified in FEES 4.3.1 R in relation to FEES 4 Annex 2BR

(1)

Unless (2) applies, on or before the relevant dates specified in FEES 4.3.6 R.

Firm receives permission; or firm extends permission

(2)

if an event specified in column 4 occurs during the course of a fee year, 30 days after the occurrence of that event, or if later the dates specified in FEES 4.3.6 R.

01/04/2013

FEES 4.3

Periodic fee payable by firms (other than AIFM qualifiers, ICVCs and UCITS qualifiers)

23/07/2013

FEES 4.3.1

The periodic fee payable by a firm (except an AIFM qualifier, ICVC or a UCITS qualifier) is:

(1) each periodic fee applicable to it calculated in accordance with FEES 4.3.3 R, using information obtained in accordance with FEES 4.4; plus
(1A) any periodic fee applicable to it calculated in accordance with FEES 4.3.3A R using information relating to its UK business obtained in accordance with FEES 4.4 (or by other means in the case of the Bank of England); less
(2) any deductions from the periodic fee specified in Part 2 of FEES 4 Annex 2AR, FEES 4 Annex 2BR or Part 7 of FEES 4 Annex 11.

23/07/2013

FEES 4.3.2

(1) The amount payable by each firm will depend upon the category (or categories) of regulated activities or payment services it is engaged in (fee-blocks) and whether it is issuing electronic money, and on the amount of business it conducts in each category (tariff base). The fee-blocks and tariffs are identified in FEES 4 Annex 1AR in respect of the FCA and FEES 4 Annex 1BR in respect of the PRA (and guidance on calculating certain of the tariffs is at FEES 4 Annex 12 G), while FEES 4 Annex 2AR in respect of the FCA and FEES 4 Annex 2BR in respect of the PRA set out the tariff rates for the relevant fee year. In the case of firms that provide payment services and/or issue electronic money, the relevant fee blocks, tariffs and rates are set out in FEES 4 Annex 11.
(2) Incoming EEA firms, incoming Treaty firms, EEA authorised payment institutions and EEA authorised electronic money institutions receive a discount to reflect the reduced scope of the appropriate regulator's responsibilities in respect of them. The level of the discount varies from fee-block to fee-block, according to the division of responsibilities between the appropriate regulator and Home state regulators for firms in each fee-block (see FEES 4.3.11 G, FEES 4.3.12 R and FEES 4.3.12A R).

01/04/2013

Calculation of periodic fee (excluding fee-paying payment service providers and fee-paying electronic money issuers)

FEES 4.3.3

The periodic fee referred to in FEES 4.3.1 R is (except in relation to the Society, fee-paying payment service providers and fee-paying electronic money issuers) calculated as follows:

(1) identify each of the tariffs set out in Part 1 of FEES 4 Annex 2AR and Part 1 of FEES 4 Annex 2BR which apply to the business of the firm for the period specified in that annex;
(2) for each of the applicable tariffs, calculate the sum payable in relation to the business of the firm for that period;
(3) add together the amounts calculated under (2) in relation to fees payable to the FCA and, if applicable, separately add together the amounts calculated under (2) in relation to the fees payable to the PRA;
(4) work out whether an A.0 or a PA.0 minimum fee is payable under Part 2 of FEES 4 Annex 2AR and Part 2 of FEES 4 Annex 2BR and if so how much (except that that minimum fee is not payable again by a firm whose permission is extended if the fee was already payable before the extension);
(4A) work out whether an AP.0 FCA prudential fee is payable under Part 2 of FEES 4 Annex 2AR and if so how much;
(4B) work out whether a PT.1 PRA transitional fee is payable under Part 2 of FEES 4 Annex 2BR and if so how much;
(5) add together the amounts calculated under (3), (4) and (4A) that relate to fees payable to the FCA and, if applicable, separately adding together the amounts calculated under (3), (4) and (4B) that relate to fees payable to the PRA; and
(6) apply any applicable payment charge specified in FEES 4.2.4 R, provided that:

(a) for payment by direct debit, successful collection of the amount due is made at the first attempt by the FCA (in its own capacity and, if applicable, in its capacity as agent for the PRA); or
(b) for payment by credit transfer, the amount due is received by the FCA (in its own capacity and, if applicable, in its capacity as agent for the PRA) on or before the due date.

01/04/2013

Modification for firms with new or extended permissions

FEES 4.3.4

(1) A firm which becomes authorised or registered during the course of a fee year will be required to pay a proportion of the periodic fee which reflects the proportion of the year for which it will have a permission or the right to provide particular payment services or the right to issue electronic money - see FEES 4.2.5 G and FEES 4.2.6 R.
(2) Similarly a firm which extends its permission or its right to provide particular payment services so that its business then falls within additional fee blocks will be required to pay a further periodic fee under this section for those additional fee blocks, but discounted to reflect the proportion of the year for which the firm has the extended permission or payment services activity - see FEES 4.2.6 R and FEES 4.2.7 R.
(3) These provisions apply (with some changes) to incoming EEA firms, incoming Treaty firms, EEA authorised payment institutions and EEA authorised electronic money institutions.
(4) These provisions do not apply to a firm's periodic fees in relation to its permission for operating a multilateral trading facility obtained from the FCA during the course of a fee year.

01/04/2013

Amount payable by the Society of Lloyd's

FEES 4.3.5

The periodic fee referred to in FEES 4.3.1 R in relation to the Society is specified against its name in FEES 4 Annex 2AR and FEES 4 Annex 2BR.

01/04/2013

Time of payment

FEES 4.3.6

(1) Subject to FEES TP 8, if the firm's, designated professional body's, recognised investment exchange's, or regulated covered bond issuer's periodic fee for the previous fee year was at least £50,000, it must pay the FCA:

(a) an amount equal to 50% of the FCA periodic fee payable for the previous fee year, by 30 April or, if later, within 30 days of the date of the invoice, in the fee year to which the sum due under FEES 4.2.1 R relates; and
(b) the balance of the FCA periodic fee due for the current fee year by 1 September or, if later, within 30 days of the date of the invoice, in the fee year to which that sum relates.

(1A) Subject to FEES TP 8, if the firm is also a PRA-authorised person and its periodic fee for the previous fee year was at least 50,000, it must pay the PRA (through the FCA acting as its collection agent):

(a) an amount equal to 50% of the PRA periodic fee payable for the previous fee year, by 30 April in the fee year to which the sum due under FEES 4.2.1 R relates; and
(b) the balance of the PRA periodic fee due for the current fee year by 1 September or, if later, within 30 days of the date of the invoice, in the fee year to which that sum relates.

(1B) If the firm paid periodic fees to both the FCA and the PRA in the previous fee year, FEES 4.3.6R (1) and (1A) only apply if the firm's combined FCA and PRA periodic fees for that fee year were at least £50,000.
(2) If the firm's, designated professional body's, recognised investment exchange's, or regulated covered bond issuer's periodic fee for the previous fee year was less than £50,000, it must pay the periodic fee due in full by 1 August or, if later, within 30 days of the date of the invoice in the fee year to which that sum relates.
(3) If a firm has applied to cancel its Part 4A permission in the way set out in SUP 6.4.5 D (Cancellation of permission), or its status as a payment institution under regulation 10 of the Payment Services Regulations (Cancellation of authorisation) or as regulation 10 is applied by regulation 14 of the Payment Services Regulations (Supplementary provisions), or its status as an electronic money issuer under regulation 10 of the Electronic Money Regulations (Cancellation of authorisation) or as regulation 10 is applied by regulation 15 of the Electronic Money Regulations (Supplementary provisions), then (1) and (2) do not apply but it must pay the total amount due when the application is made.
(4) If the appropriate regulator has exercised its own-initiative powers to cancel a firm's Part 4A permission, then (1) and (2) do not apply but the firm must pay the total amount due immediately before the cancellation becomes effective.
(4A) If the FCA has cancelled a firm's authorisation or registration under regulation 10 of the Payment Services Regulations or regulation 10 of the Electronic Money Regulations or its registration under regulation 10 as applied by regulation 14 of the Payment Services Regulations or its registration under regulation 10 as applied by regulation 15 of the Electronic Money Regulations, then (1) and (2) do not apply but the firm must pay the total amount due immediately before the cancellation becomes effective.
(5) [deleted]
(5A) (In relation to PRA-authorised persons only) paragraphs (1A) and (2) do not apply to any Solvency 2 Special Project fee or Solvency 2 Implementation fee (as defined in FEES 4 Annex 2B) and such fees are not taken into account for the purposes of the split in (1A). Instead any Solvency 2 Special Project fee or Solvency 2 Implementation fee is payable on the date specified in (1A)(b) or (2) (depending on which applies to the rest of its periodic fee) or any earlier date required by (3) or (4).
(6) Paragraphs (1) and (2) do not apply to any periodic fee in relation to a firm's permission for operating a multilateral trading facility and such a fee is not taken into account for the purposes of the split in (1). Instead any fee for this permission is payable on the date specified in FEES 4 Annex 10 (Periodic fees for MTF operators).

01/07/2013

Groups of firms

FEES 4.3.7

A firm which is a member of a group may pay all of the amounts due from other firms in the same group under FEES 4.2.1 R, if:

(1) it notifies the FCA (in its own capacity and, if applicable, in its capacity as agent for the PRA) in writing of the name of each other firm within the group for which it will pay; and
(2) it pays the fees, in accordance with this chapter, as a single amount as if that were the amount required from the firm under FEES 4.2.1 R.

01/04/2013

FEES 4.3.8

A notification under FEES 4.3.7R (1) should be made in accordance with SUP 15.7 (Form and method of notification).

01/04/2013

FEES 4.3.9

If the payment made does not satisfy in full the periodic fees payable by all of the members of the group notified to the FCA under FEES 4.3.7 R, the FCA (in its own capacity and, if applicable, in its capacity as agent for the PRA) will apply the sum received among the firms which have been identified in the notification given under FEES 4.3.7R (1) in proportion to the amounts due from them. Each firm will remain responsible for the payment of the outstanding balance attributable to it.

01/04/2013

FEES 4.3.10

If a firm pays its fees through an agent outside the scope of FEES 4.3.7 R, the firm is responsible for ensuring that the FCA (in its own capacity and, if applicable, in its capacity as agent for the PRA) is informed that the sum being paid is for that firm's periodic fees.

01/04/2013

Incoming EEA firms, incoming Treaty firms, EEA authorised payment institutions and EEA authorised electronic money institutions

FEES 4.3.11

The appropriate regulator recognises that its responsibilities in respect of an incoming EEA firm, an incoming Treaty firm, an EEA authorised payment institution or an EEA authorised electronic money institution are reduced compared with a firm which is incorporated in the United Kingdom. Accordingly the periodic fees which would otherwise be applicable to incoming EEA firms, incoming Treaty firms, EEA authorised payment institutions and EEA authorised electronic money institutions are reduced.

01/04/2013

FEES 4.3.12

For an incoming EEA firm, (excluding MTF operators), or an incoming Treaty firm, the calculation required by FEES 4.3.3 R is modified as follows:

(1) the tariffs set out in Part 1 of FEES 4 Annex 2AR and, if applicable, Part 1 of FEES 4 Annex 2BR are applied only to the regulated activities of the firm which are carried on in the United Kingdom; and
(2) those tariffs are modified in accordance with Part 3 of FEES 4 Annex 2AR and, if applicable, Part 3 of FEES 4 Annex 2BR.

01/04/2013

Firms Applying to Cancel or Vary Permission Before Start of Period

FEES 4.3.13

(1) If:

(a) a firm makes an application to vary its permission (by reducing its scope), or cancel it, in the way set out in SUP 6.3.15 D (3) (Variation of permission) and SUP 6.4.5 D (Cancellation of permission), or applies to vary (by reducing its scope) or cancel its authorisation or registration (regulation 8 and 10(1) of the Payment Services Regulations including as applied by regulation 14 of the Payment Services Regulations) or applies to cancel its authorisation or registration (regulation 10 and 12 of the Electronic Money Regulations including as applied by regulation 15 of the Electronic Money Regulations); an issuer makes an application for de-listing; or a sponsor notifies the FCA of its intention to be removed from the list of approved sponsors; and
(b) the firm, issuer or sponsor makes the application or notification referred to in (a) before the start of the fee year to which the fee relates;

FEES 4.2.1 R applies to the firm as if the relevant variation or cancellation of the firm's permission or authorisation or registration under the Payment Services Regulations or the Electronic Money Regulations, de-listing or removal from the list of approved sponsors, took effect immediately before the start of the fee year to which the fee relates.
(2) But (1) does not apply if, due to the continuing nature of the business, the variation, cancellation, de-listing or removal is not to take effect on or before 30 June of the fee year to which the fee relates.

01/04/2013

FEES 4.3.14

Where a firm has applied to cancel its Part 4A permission, or its authorisation or registration under the Payment Services Regulations or the Electronic Money Regulations, or the appropriate regulator has exercised its own-initiative powers to cancel a firm's Part 4A permission or the appropriate regulator has exercised its powers under regulation 10 (Cancellation of authorisation), including as applied by regulation 14 (Supplementary provisions) of the Payment Services Regulations to cancel a firm's authorisation or registration under the Payment Services Regulations or the appropriate regulator has exercised its powers under regulation 10 (Cancellation of authorisation), including as applied by regulation 15 (Supplementary provisions) of the Electronic Money Regulations, the due dates for payment of periodic fees are modified by FEES 4.3.6R (3), FEES 4.3.6R (4) and FEES 4.3.6R (4A) respectively.

01/04/2013

Firms acquiring businesses from other firms

FEES 4.3.15

(1) This rule applies if:

(a) a firm (A) acquires all or a part of the business of another firm (B), whether by merger, acquisition of goodwill or otherwise, in relation to which a periodic fee would have been payable by B, unless no periodic fee was payable by A in the financial year that the business was acquired from B; or
(b) A became authorised or registered as a result of B's simple change of legal status (as defined in FEES 3 Annex 1 Part 6).

(2) If, before the date on which A acquires the business, B had paid any periodic fee payable for the period in which the acquisition occurred, FEES 4.2.6 R to FEES 4.2.7 R do not apply to A in relation to the business acquired from B.
(3) If the acquisition occurs after the valuation date applicable to the business (as set out in FEES 4 Annex 1AR, FEES 4 Annex 1BR and FEES 4 Annex 11) which A acquired from B, for the period following that in which the acquisition occurred, FEES 4.2.1 R applies to A, in relation to that following period, as if the acquisition had occurred immediately before the relevant valuation date.

01/04/2013

FEES 4.4

Information on which Fees are calculated

01/01/2006

FEES 4.4.1

A firm (other than the Society) must notify to the FCA (in its own capacity and, if applicable, in its capacity as collection agent for the PRA) the value (as at the valuation date specified in Part 5 of FEES 4 Annex 1AR in relation to fees payable to the FCA or Part 5 of FEES 4 Annex 1BR in relation to fees payable to the PRA) of each element of business on which the periodic fee payable by the firm is to be calculated.

01/04/2013

FEES 4.4.2

A firm (other than the Society) must send to the FCA (in its own capacity and, if applicable, in its capacity as collection agent for the PRA) in writing the information required under FEES 4.4.1 R as soon as reasonably practicable, and in any event within two months, after the date specified as the valuation date in Part 5 of FEES 4 Annex 1AR in relation of fees payable to the FCA or Part 5 of FEES 4 Annex 1B R in relation to fees payable to the PRA (or FEES 4.2.7B R where applicable).

01/04/2013

FEES 4.4.3

To the extent that a firm has provided the information required by this section to the appropriate regulator as part of its compliance with another provision of the Handbook, it is deemed to have complied with the provisions of this section.

01/04/2013

FEES 4.4.4

In most cases a firm will provide the information required by this section as part of its compliance with the provisions of SUP. To the extent that the FCA (in its own capacity and, if applicable, in its capacity as collection agent for the PRA), does not obtain sufficient, or sufficiently detailed, information the FCA or the PRA, as appropriate, may seek this by using the general information gathering powers (see SUP 2 (Information gathering by the appropriate regulator on its own initiative)).

01/04/2013

FEES 4.4.5

For an incoming EEA firm or an incoming Treaty firm, the information required under FEES 4.4 is limited to the regulated activities of the firm which are carried on in the United Kingdom, except those provided on a cross border services basis.

01/04/2013

Information relating to payment services and the issuance of electronic money

FEES 4.4.9

To the extent that a firm has provided the information required by FEES 4.4.7 D to the FCA as part of its compliance with another provision of the Handbook, it is deemed to have complied with the provisions of that direction.

01/04/2013

FEES 4 Annex 1B

PRA activity groups, tariff bases and valuation dates

01/04/2013

Part 1
This table shows how the PRA links the PRA-regulated activities for which a PRA-authorised person has permission to activity groups (fee-blocks). A PRA-authorised person can use the table to identify which fee-blocks it falls into based on its permission.

Activity group

Fee payer falls in the activity group if

A.1 Deposit acceptors

its permission includes accepting deposits BUT DOES NOT include either of the following:
effecting contracts of insurance;
carrying out contracts of insurance.

A.3 Insurers - general

its permission includes one or more of the following:
- effecting contracts of insurance;
- carrying out contracts of insurance;
in respect of specified investments that are:
- general insurance contracts; or
- long-term insurance contracts other than life policies.

A.4 Insurers - life

its permission includes one or more of the following:
- effecting contracts of insurance;
- carrying out contracts of insurance;
in respect of specified investments including life policies;
- entering as provider into a funeral plan contract.

A.5 Managing agents at Lloyd's

its permission includes managing the underwriting capacity of a Lloyd's syndicate as a managing agent at Lloyd's.

A.6 The Society of Lloyd's

it is the Society of Lloyd's.

A.10 Firms dealing as principal

its permission includes dealing in investments as principal; and
the PRA has designated dealing in investments as principal a PRA-regulated activity in respect of the firm.

Part 2
This table sets out the activity groups (fee blocks) in relation to (i) the minimum fee payable to the PRA and (ii) the transitional fee payable to the PRA.

Activity group

Fee payer falls into the fee-block if

PA.0 PRA minimum fee

(1) it is in at least one of the fee blocks under Part 1; and
(2) it is not a UK ISPV.

PT.1 PRA transitional fee

(1) it is in at least one of the fee blocks under Part 1; and
(2) it is not:
(a) a firm whose only fee payable to the PRA is the PA.0 PRA minimum fee; and/or
(b) a UK ISPV.

Part 3
This table indicates the tariff base for each fee-block set out in Part 1.
The tariff base in this Part is the means by which the PRA measures the amount of business conducted by a PRA-authorised person for the purposes of calculating the annual periodic fees payable to the PRA by that PRA-authorised person.

Activity Group

Tariff base

A.1

MODIFIED ELIGIBLE LIABILITIES
For banks and building societies:
Item B of Form ELS (Note (1)):
(1 + 2 + 3 + 4 + 0.6*5 + 6 - 8 - 9A - 9B - 10A - 10B - 10C - 11A - 11B - 0.6*12) + (1/3)*(F1 + F2 + F3 + F4 + 0.6*F5 + F6 - F8 - F9A - F9B - F10A - F10B - F10C - F11A - F11B - 0.6*F12)
- 13M
Notes:
(1) All references in the above formula are to entries on Form ELS (that is, the Eligible Liabilities Return completed to provide information by banks and building societies to the Bank of England as required by the Bank of England Act 1998).
(2) The figures reported on the Form ELS relate to business conducted out of offices in the United Kingdom

For credit unions:
Deposits with the credit union (share capital)
LESS
the credit union's bank deposits (investments + cash at bank)
Note:
Only United Kingdom business is relevant for calculating credit unions' MELs.

A.3

GROSS PREMIUM INCOME AND GROSS TECHNICAL LIABILITIES
For insurers:
The amount of premium receivable which must be included in the documents required to be deposited under IPRU(INS) 9.6 in relation to the financial year to which the documents relate but disregarding for this purpose such amounts as are not included in the document by reason of a waiver or an order under section 68 of the Insurance Companies Act 1982 carried forward as an amendment to IPRU(INS) under transitional provisions relating to written concessions in SUP;
AND the amount of gross technical liabilities (IPRU(INS) Appendix 9.1 - Form 15, line 19) which must be included in the documents required to be deposited under IPRU(INS) 9.6R in relation to the financial year to which the documents relate but disregarding for this purpose such amounts as are not included in the document by reason of a waiver or an order under section 68 of the Insurance Companies Act 1982 carried forward as an amendment to IPRU(INS) under transitional provisions relating to written concessions in SUP.
Notes:
1) in the case of either:
(a) a pure reinsurer carrying on general insurance business through a branch in the United Kingdom; or
(b) an insurer whose head office is not in an EEA State carrying on general insurance business through a branch in the United Kingdom; or
(c) an EEA-deposit insurer;
the amount only includes premiums received and gross technical liabilities held in respect of its United Kingdom business;
(2) for a Swiss general insurance company, premiums and gross technical liabilities include those relevant to the operations of the company's United Kingdom branch; and
(3) a firm need not include premiums and gross technical liabilities relating to pure protection contracts which it reports, and pays a fee on, in the A.4 activity group.
For friendly societies:
Either:
(a) the value of contributions as income under Schedule 7: Part I item 1(a) to the Friendly Societies (Accounts and Related Provisions) Regulations 1994 (SI 1994/1983) (the regulations) for a non-directive friendly society, included within the income and expenditure account; or
(b) the value of gross premiums written under Schedule 1: Part I items I.1(a) and II.1.(a) of the regulations for a directive friendly society included within the income and expenditure account.
Notes:
(1) In both (a) and (b) above only premium receivable in respect of United Kingdom business are relevant.
(2) For UK ISPVs the tariff base is not relevant and a flat fee set out in FEES 4 Annex 2BR is payable.

A.4

ADJUSTED GROSS PREMIUM INCOME AND MATHEMATICAL RESERVES (see FEES 4 Annex 12 G)
Amount of new regular premium business (yearly premiums including reassurances ceded but excluding cancellations and reassurances accepted), times ten;
Plus
amounts of new single premium business (total including reassurances ceded but excluding cancellations and reassurances accepted). Group protection business (life and private health insurance) must be included;
Less
premiums relating to pension fund management;
Less
premiums relating to Trustee Investment Plans.
For each of the above, business transacted through independent practitioners or tied agents (either single or multi-tie) will be divided by two in calculating the adjusted gross premium income;
AND
the amount of mathematical reserves (IPRU(INS) Appendix 9.1R - Form 14, Line 11) which must be included in the documents required to be deposited under IPRU(INS) 9.6R in relation to the financial year to which the documents relate but disregarding for this purpose such amounts as are not included in the document by reason of a waiver or an order under section 68 of the Insurance Companies Act 1982 carried forward as an amendment to IPRU(INS) under transitional provisions relating to written concessions in SUP;
Less
mathematical reserves relating to pension fund management.
Less
mathematical reserves relating to Trustee Investment Plans.
Notes: (1) Only premiums receivable and mathematical reserves held in respect of United Kingdom business are relevant.
(2) An insurer must include in its calculation of adjusted gross premium income (AGPI) and mathematical reserves (MR) the value of MR and AGPI relating to all risks ceded to ISPVs.
(3) Trustee Investment Plans are the class of contract of insurance specified in Class III of Part II of Schedule 1 to the Regulated Activities Order (Contracts of long-term insurance) and which are invested in pooled funds beneficially owned by the insurer and not earmarked to individual beneficiaries by that insurer.

A.5

ACTIVE CAPACITY
The capacity of the syndicate(s) under management in the year in question. This includes the capacity for syndicate(s) that are not writing new business, but have not been closed off in the year in question.

A.6

Not applicable

A.10 (only to the extent that the PRA has designated dealing in investments as principal to be a PRA-regulated activity in respect of the firm)

NUMBER OF TRADERS
Any employee or agent, who:
ordinarily acts within the United Kingdom on behalf of an authorised person liable to pay fees to the PRA in its fee-block A.10 (firms dealing as principal); and who, as part of their duties in relation to those activities of the authorised person, commits the firm in market dealings or in transactions in securities or in other specified investments in the course of regulated activities.
But not any employees or agents who work solely in the firm's MTF operation.
A firm may, as an option, report employees or agents as full-time equivalents (FTE), taking account of any part-time staff. In calculating the FTE, firms must take into account the total hours employees or agents have contracted to work for the firm and not the time employees or agents devote to the dealing in investments as principal functions set out in fee-block A.10. Any figures using the FTE calculation to be recorded to one decimal place, rounded down to the nearest decimal place.

Part 4
This table indicates the tariff base for each fee block set out in Part 2 above
The tariff base in this Part is the means by which the PRA measures the amount of business conducted by a firm for the purposes of calculating the annual periodic fees payable to the PRA by that firm.

Activity Group

Tariff base

PA.0

Not applicable because the minimum fee is a specified amount.

PT.1

The total periodic fees payable as a result of Part 1 of FEES 4 Annex 2B R.

Part 5
This table indicates the valuation date for each fee-block. A PRA-authorised person can calculate its tariff data in respect of fees payable to the PRA by applying the tariff bases set out in Part 3 with reference to the valuation dates shown in this table.

IN THIS TABLE, REFERENCES TO SPECIFIC DATES OR MONTHS ARE REFERENCES TO THE LATEST ONE OCCURRING BEFORE THE START OF THE PERIOD TO WHICH THE FEE APPLIES, UNLESS OTHERWISE SPECIFIED - E.G. FOR 13/14 FEES (1 APRIL 2013 TO 31 MARCH 2014), A REFERENCE TO DECEMBER MEANS DECEMBER 2012.

Where a firm's tariff data is in a currency other than sterling, it should be converted into sterling at the exchange rate prevailing on the relevant valuation date.

A.1

For banks:
Modified eligible liabilities (MELs), valued at:
for a firm which reports monthly, the average of the MELs for October, November and December;
for a firm which reports quarterly, the MELs for December.
For credit unions:
MELs, valued at December or as disclosed by the most recent annual return made prior to that date.
For building societies:
MELs, valued at the average of the MELs for October, November and December.

A.3

Annual gross premium income (GPI), for the financial year ended in the calendar year ending 31 December. AND
Gross technical liabilities (GTL) valued at the end of the financial year ended in the calendar year ending 31 December.

A.4

Adjusted annual gross premium income (AGPI) for the financial year ended in the calendar year ending 31 December.
AND
Mathematical reserves (MR) valued at the end of the financial year ended in the calendar year ending 31 December.

A.5

Active capacity (AC), in respect of the Underwriting Year (as reported to the Society of Lloyd's) which is current at the beginning of the period to which the fee relates.
[Note: this is the Underwriting Year which is already in progress at the start of the fee period - e.g. for 2004/05 fees, the fee period will begin on 1 April 2004, which is in the 2004 Underwriting Year, so the AC for that Underwriting Year is the relevant measure.]

A.6

Not applicable.

A.10

Number of traders as at 31 December.

01/04/2013

FEES 4 Annex 2B

PRA fee rates and EEA/Treaty firm modifications for the period from 1 April 2013 to 28 February 2014

01/04/2013

Part 1
This table shows the tariff rates applicable to each of the fee blocks set out in Part 1 of FEES 4 Annex 1B R.

(1)

For each activity group specified in the table below, the fee is the total of the sums payable for each of the tariff bands applicable to the firm's business, calculated by multiplying the value of the firm's tariff base by the rate applicable to each tranche of the tariff base, as indicated.

(2)

A firm may apply the relevant tariff bases and rates to non-UK business, as well as to its UK business, if:

(a)

it has reasonable grounds for believing that the costs of identifying the firm's UK business separately from its non-UK business in the way described in Part 3 of FEES 4 Annex 1B R are disproportionate to the difference in fees payable; and

(b)

it notifies the FCA (acting as the collecting agent of the PRA) in writing at the same time as it provides the information concerned under FEES 4.4 (Information on which fees are calculated), or, if earlier, at the time it pays the fees concerned.

(3)

For a firm which has not complied with FEES 4.4.2 R (Information on which fees are calculated) for this period:

(a)

the fee is calculated using (where relevant) the valuation or valuations of business applicable to the previous period, multiplied by the factor of 1.10;

(b)

an additional administrative fee of 125 is payable; and

(c)

the minimum total fee (including the administrative fee in (b)) is 215.

Note

In the case of activity groups A.3 and A.4 there are three tariff rates. The rate in column 1 applies to all firms in their respective fee-blocks. The rate in column 2 relates to the Solvency 2 Implementation fee and firms must determine their obligation to pay this fee by reference to Part 5 of this Annex. The rate in Column 3 relates to the Solvency 2 Special Project fee and firms must determine their obligation to pay this fee by reference to Part 4 of this annex. The total periodic fee for each of these fee-blocks is determined by adding the amounts obtained under all three columns, as applicable.

Activity group

Fee payable

A.1

Band width (£ million of Modified Eligible Liabilities (MELs))

Fee (£/£m or part £m of MELs)

General Periodic fee

>10 - 140

33.38

>140 - 630

33.38

>630 - 1,580

33.38

>1,580 - 13,400

41.73

>13,400

55.08

A.3

Gross premium income (GPI)

Column 1
General periodic fee

Column 2
Solvency 2 implementation fee

Column 3
Solvency 2 special project fee

Minimum fee (£)

Not applicable

25.00

Band Width (£ million of GPI)

Fee (£/£m or part £m of GPI)

>0.5 - 10.5

370.25

-27.03

20.84

>10.5 - 30

370.25

-27.03

20.84

>30 - 245

370.25

-27.03

20.84

>245 - 1,900

370.25

-27.03

20.84

>1,900

370.25

-27.03

20.84

Plus

Gross technical liabilities (GTL)

Column 1
General periodic fee

Column 2
Solvency 2 implementation fee

Column 3
Solvency 2 special project fee

Band Width (£ million of GTL)

Fee (£/£m or part £m of GTL)

>1 - 12.5

19.93

-1.41

1.22

>12.5 - 70

19.93

-1.41

1.22

>70 - 384

19.93

-1.41

1.22

>384 - 3,750

19.93

-1.41

1.22

>3,750

19.93

-1.41

1.22

For UK ISPVs the tariff rates are not relevant and a flat fee of £430.00 is payable in respect of each fee year.

A.4

Adjusted annual gross premium income (AGPI)

Column 1
General periodic fee

Column 2
Solvency 2 implementation fee

Column 3
Solvency 2 special project fee

Minimum fee (£)

Not applicable

25.00

Band Width (£ million of AGPI)

Fee (£/£m or part £m of AGPI)

>1 - 5

360.32

-38.31

20.39

>5 - 40

360.32

-38.31

20.39

>40 - 260

360.32

-38.31

20.39

>260 - 4,000

360.32

-38.31

20.39

>4,000

360.32

-38.31

20.39

PLUS

A.4

Mathematical reserves (MR)

Column 1
General periodic fee

Column 2
Solvency 2 implementation fee

Column 3
Solvency 2 special project fee

Minimum fee (£)

Not applicable

25.00

Band Width (£ million of MR)

Fee (£/£m or part £m of MR)

>1 - 20

8.06

-0.86

0.44

>20 - 270

8.06

-0.86

0.44

>270 - 7,000

8.06

-0.86

0.44

>7,000 - 45,000

8.06

-0.86

0.44

>45,000

8.06

-0.86

0.44

A.5

Band Width (£ million of Active Capacity (AC))

Fee (£/£m or part £m of AC)

>50 - 150

54.36

>150 - 250

54.36

>250 - 500

54.36

>500 - 1,000

54.36

>1,000

54.36

A.6

Flat fee
Solvency 2 Special Project Flat Fee (£)
Solvency 2 Implementation Flat Fee (£)

1,394,436.00
272,293.06
-92,775.96

A.10

Band Width (No. of traders)

Fee (£/trader)

2 - 3

4,507.98

4 - 5

4,507.98

6 - 30

4,507.98

31 - 180

4,507.98

>180

4,507.98

Part 2
This table sets out the tariff rate applicable to each of the fee blocks set out in Part 2 of FEES 4 Annex 1B R

PA.0

(1)

The minimum fee payable by any firm referred to in (3) is 500 unless:

(a)

it is a credit union that meets the conditions in (2), in which case the minimum fee payable is as set out in (2); or

(b)

it is a non-directive friendly society that falls into the A.3 activity group but not the A.4 activity group and meets the conditions set out in (3)(a), in which case the minimum fee payable is 215; or.

(c)

it is a non-directive friendly society that falls into the A.4 activity group but not the A.3 activity group and meets the conditions in (3)(b), in which case the minimum fee payable is 215;or

(d)

it is a non-directive friendly society that falls into the A.3 and A.4 activity groups and meets the conditions in (3)(a) and (3)(b), in which case the minimum fee payable is 215;

(2)

The conditions referred to in (1)(a) are that the credit union has a tariff base (Modified Eligible Liabilities) of:

(a)

0 to 0.5million, in which case a minimum fee of 80 is payable; or

(b)

greater than 0.5millon but less than 2.0million, in which case a minimum fee of 270 is payable.

(3)

The conditions referred to in (1) are that:

(a)

the non-directive friendly society falls into the A.3 activity group and has, for that activity, 0.5 million or less in gross premium income and holds gross technical liabilities of 1.0 million or less;

(b)

the non-directive friendly society falls into the A.4 activity group and has, for that activity, written 1.0 million or less in adjusted gross premium income and holds mathematical reserves of 1.0 million or less.

The figures for gross premium income, gross technical liabilities, adjusted gross premium income and mathematical reserves are the same as used for Part 1 of this Annex.

PT.1

Periodic fees payable under Part 1 multiplied by rate £0.0745

Part 3
This table shows the modifications to fee tariffs that apply to incoming EEA firms and incoming Treaty firms which have established branches in the UK.

Activity Group

Percentage deducted from the tariff payable under Part 1 applicable to the firm

A.1

50%

A.3

90%

A.4

90%

PT.1

100%

Note 1

The modifications to fee tariffs payable by an incoming EEA firm or an incoming Treaty firm which has established a branch in the UK apply only in relation to the relevant regulated activities of the firm which are passported activities or Treaty activities and which are carried on in the UK.

Note 2

The PRA minimum fee described in Part 2 of FEES 4 Annex 2B R applies in full and the modifications in this Part do not apply to it.

Part 4

This part sets out when a Solvency 2 Special Project fee is due for firms falling into fee block A.3 or A.4.

(1)

The Solvency 2 Special Project fee forms part of the periodic fee payable under fee blocks A.3 and A.4.

(2)

The Solvency 2 Special Project fee is only payable by a firm if it meets the conditions in Part 5 and the condition set out in paragraph (3) of this Part.

(3)

The condition is that before 1 June 2013 the firm, or a member of the group of which the firm is also a member (in either case, the recipient), received a written communication from the FSA or, on or after 1 April 2013, the PRA that it has met the criteria for entry into pre-Internal Model Approval Process status (pre-IMAP) and the recipient remains in pre-IMAP status on 1 June 2013.

(4)

For the purposes of (3), the recipient will be deemed to remain in pre-IMAP status unless, before 1 June 2013:

(a)

the recipient informs the FSA or, on or after 1 April 2013, the PRA in writing that it wishes to withdraw from pre-IMAP status; or

(b)

the recipient has been informed by the FSA or, on or after the 1 April 2013, the PRA in writing that it is no longer in pre-IMAP status.

(5)

For the purposes of this Part, a reference to pre-IMAP means the status achieved by the recipient by joining the process established by the FSA whereby the FSA or, on or after 1 April 2013, the PRA and the recipient engage with a view to the FSA or, on or after 1 April 2013, the PRA establishing whether an internal model developed by the recipient is likely to meet the tests and standards specified in the Solvency 2 Directive.

(6)

FEES 4.2.6 R and FEES 4.2.7 R do not apply to the Solvency 2 Special Project Fee.

Part 5

This Part sets out when a Solvency 2 Implementation fee is due for firms in the A.3 and A.4 fee blocks.

(1)

The Solvency 2 Implementation fee is only payable by a firm if it meets all the conditions in (2) and neither of the conditions in (3).

(2)

The conditions in this paragraph are:

(a)

FEES 4.3.13 R (Firms Applying to Cancel or Vary Permission Before Start of Period) does not apply with respect to the relevant fee blocks;

(b)

the firm has not notified the FSA before the start of the 2013/2014 fee year that it intends to migrate out of the United Kingdom for regulatory purposes before the Solvency 2 Directive is implemented;

(c)

it meets either of the following conditions:

(i)

its gross premium income or adjusted gross premium income, as appropriate, referred to in FEES 4 Annex 1 Part 2, exceeds EUR 5 million at the end of the financial year ended in the calendar year ending 31 December prior to the 2013/2014 fee year; or

(ii)

its gross technical liabilities or mathematic reserves, as appropriate, referred to in FEES 4 Annex 1 Part 2, exceed EUR 25 million at the end of the financial year ended in the calendar year ending 31 December prior to the 2013/2014 fee year;

(d)

it was in one or both of the insurance fee blocks at the start of the 2013/2014 fee year;

(e)

it is not an incoming EEA firm or an incoming Treaty firm;

(3)

The conditions in this paragraph are:

(a)

the firm is a reinsurance undertaking that has, by 10 December 2007, ceased to conduct a new insurance business and only administers its existing portfolio in order to terminate its activity as a reinsurance undertaking;

(b)

it is a reinsurance undertaking whose insurance business is conducted or fully guaranteed by the United Kingdom government for reasons of substantial public interest in the capacity of the reinsurer of last resort.

(4)

Where a firm has notified the FSA or, on or after 1 April 2013, the PRA that it intends to migrate out of the United Kingdom for regulatory purposes before the Solvency 2 Directive is implemented in the United Kingdom but when the Solvency 2 Directive is implemented that firm remains in the United Kingdom for regulatory purposes, it must pay the Solvency 2 Implementation fee for each FSA financial year and each PRA fee year commencing 1 April 2013 for which the Solvency 2 Implementation fee would have applied to the firm but for the firm notifying the FSA or the PRA of its intention to migrate.

(5)

Where a firm is required to pay a Solvency 2 Implementation fee because of the circumstances described in (4) it must pay this fee within 30 days of the date of the invoice.

(6)

For the purposes of this Part, the exchange rate from the Euro to the pound sterling is calculated as at the last day of October preceding the financial year of the FSA or, on or after 1 April 2013, the PRA fee year in question for which the exchange rates for the currencies of all European Union member states were published in the Official Journal of the European Union.

(7)

FEES 4.2.6 R and FEES 4.2.7 R do not apply to the Solvency 2 Implementation fee.

01/07/2013

FEES 4 Annex 12

Guidance on the calculation of tariffs set out in FEES 4 Annex 1AR Part 3

01/04/2013

The following tables set out guidance on how a firm should calculate relevant tariffs.
Table 1: Fee block A.4

Adjusted Gross Premium Income and Mathematical reserves - calculation of new regular premium business

(1) In calculating the new regular premium business element of its Adjusted Gross Premium Income, a firm (A) should not include business transferred from another firm (B) under the procedure set out at Part VII of the Act, during the relevant financial year, provided that that transfer did not involve the creation of new contracts between the policy holders subject to the transfer and A. This is because that business is existing business even though it is new from the point of view of A. This means that if new contracts are created as part of the transfer, that business should be included in the calculation of As new regular premium income business.
(2) If any business is transferred to a firm (A) from another firm (B) under the procedure set out at Part VII of the Act and that business would have been included in Bs tariff base as new regular premium business in the absence of such a transfer, this business should be included in either As or Bs tariff base, depending on the date of transfer. FEES 4.3.15R explains in whose tariff base it should be included.
(3) Mathematical reserves should take account of all of As business, including all new business transferred from B.

Table 2: Fee-blocks A.12, A.13 and A.14

Calculating and apportioning annual income - FEES 4 Annex 11A R

Calculating annual income

(1) Annual income should include all amounts due to the firm arising out of the regulated activities referred to in fee-blocks A.12, A.13 and A.14 for which the firm holds permission, including regular charges and instalments due to the firm during the reporting year.
The firm should refer to the fee-block definitions in FEES 4 Annex 1A R, Part 1 to decide which particular income streams should be taken into account when calculating its annual income for the purposes of fee-blocks A.12, A.13 and A.14.
(2) To avoid any doubt, the firm should exclude from the calculation of its annual income any regulated activities belonging to fee-blocks A.12, A.13 and A.14 where the performance of such regulated activities is entirely incidental to the carrying out by the firm of the regulated activity of managing investments belonging to fee-block A.7.
(3) To avoid double-counting, amounts which have been passed on to other firms may be excluded from the calculation of annual income. Transfers of income to other firms may be especially common within groups where, to present a single interface to clients, all amounts due to the group may be collected by one firm for subsequent redistribution to other firms within the group. It is for groups themselves to decide the most convenient way to report such annual income - i.e. whether the firm which receives the full amount should declare that full amount, or whether each firm in the group should report its separate distribution.
(4) The firm should include earnings from those who will become its appointed representatives immediately after authorisation.
(5) If any fee payable by the firm to another party for arranging a transaction with a client exceeds the amount payable by the end client, the firm may not take that excess into account in calculating the net amount retained but must instead net the sum payable by the end client to zero.
(6) The total should include administration charges and any interest from income related to the regulated activities.
(7) Items such as general business expenses (e.g. employees' salaries and overheads) should not be deducted, nor any penalties or fines that have been levied against the firm.
(8) Rebates to clients should be excluded and also fees or commission passed to other authorised firms.
(9) Authorised professional firms should exclude income from non-mainstream regulated activities. They may estimate the proportion of their business that is derived from those activities and split the income from individual invoices accordingly.

Apportioning income

Where a firm cannot separate its income on the basis of activities, it may apportion the income on the basis of the proportionate split of business that the firm otherwise undertakes. For instance:
(1) If a firm receives annual income from a platform-based business it may report this in line with a wider breakdown of its activities.
(2) A firm providing corporate finance advice which does not maintain records of the split between regulated activities and non-regulated activities for individual cases may calculate that regulated business accounts for a certain proportion of its business overall and apply that as a multiplier across its income.
(3) A firm may allocate ongoing commission from previous business on the basis of the type of firm it receives the commission from. This avoids tracking back legacy business which may no longer match the provider's current business model.
(4) An authorised professional firm may estimate the proportion of its business that is derived from regulated activity and split its income for individual invoices accordingly.
(5) If a firm has invested income from regulated activities, then any interest received should be reported as income, in proportion to the volume of regulated business it undertakes to avoid tracking back old payments.
(6) Firms' systems ought to be able to distinguish UK from non-UK business to establish which conduct of business regime it was conducted under. If, however, they do not relate the figures back to income streams for the specific regulated activities in a particular fee-block then the firm may make a proportionate split as described above, calculating its regulated UK income on the basis of the overall split between UK and overseas income.
(7) It is for individual firms to determine how they should calculate the appropriate split of income. The FCA is not prescriptive about the methodology. It requires only that:
(a) the approach should be proportionate - the FCA is looking for firms to make their best efforts to estimate the split;
(b) the firm must be able on request to provide a sound and clearly expressed rationale for its approach - for example, if all invoices were analysed over a particular period, the firm should be able to justify the period as representative of its business across the year;
(c) the methodology should be objective - for example, based on random sampling of invoices or random stratified sampling;
(d) the firm must on request be able to provide an audit trail which demonstrates that the choice of methodology was properly considered at an appropriate level or in the appropriate forums within the firm, and the decision periodically reviewed at the same level or in an equivalent forum.

01/04/2013

FEES 5

Financial Ombudsman Service Funding

FEES 6

Financial Services Compensation Scheme Funding

FEES 6.1

Application

01/01/2006

FEES 6.1.1

This chapter applies to:

(1) every participant firm;

(2) the FSCS; and

(3) the Society.

01/04/2013

FEES 6.1.2

(1) Firms which are not participant firms (such as certain types of incoming EEA firms, service companies and ICVCs) are not required to contribute towards the funding of the compensation scheme.

(2) Although a member is a participant firm for the purposes of most provisions of COMP, a member is excluded from the definition of participant firm for the purposes of FEES 6 (see definition of participant firm in Glossary). This is because the fees levied in relation to the carrying on of insurance market activities by members will be imposed on Society rather than individually on each member (see FEES 6.3.24 R).

01/04/2013

Purpose

FEES 6.1.3

The purpose of this chapter is to set out the requirements on participant firms to pay levies imposed by the FSCS to provide funding for its functions.

01/04/2013

General structure

FEES 6.1.4

Section 213(3)(b) of the Act requires the appropriate regulator to make rules to enable the FSCS to impose levies on authorised persons in order to meet its expenses. These expenses include in particular expenses incurred, or expected to be incurred, in paying compensation, borrowing or insuring risks.

01/04/2013

FEES 6.1.4A

Section 224F of the Act enables the appropriate regulator to make rules to enable the FSCS to impose levies on authorised persons (or any class of authorised persons) in order to meet its management expenses incurred if, under Part 15A of the Act, it is required by HM Treasury to act in relation to relevant schemes. But those rules must provide that the FSCS can impose a levy only if the FSCS has tried its best to obtain reimbursement of those expenses from the manager of the relevant scheme.

01/04/2013

FEES 6.1.5

The FSCS may impose three types of levy: a management expenses levy (consisting of a base costs levy and a specific costs levy), a compensation costs levy and a MERS levy. The FSCS has discretion as to the amount and timing of the levies imposed.

01/04/2013

FEES 6.1.6

In calculating a compensation costs levy, the FSCS may include compensation costs expected in the 12-month period following the date of the levy. The total amount of all management expenses levies attributable to a financial year may not exceed the amount set out on an annual basis in FEES 6 Annex 1.

01/04/2013

FEES 6.1.7

In order to allocate a share of the amount of specific costs and compensation costs to be funded by an individual participant firm, the funding arrangements are split into eight classes: the deposits class; the life and pensions provision class; the general insurance provision class; the investment provision class; the life and pensions intermediation class; the home finance intermediation class; the investment intermediation class and the general insurance intermediation class. The permissions held by a participant firm determine into which class, or classes, it falls.

01/04/2013

FEES 6.1.8

The provisions on the allocation of levies to classes up to their levy limits meet a requirement of section 213(5) of the Act that the appropriate regulator, in making rules to enable the FSCS to impose levies, must take account of the desirability of ensuring that the amount of the levies imposed on a particular class of authorised person reflects, so far as practicable, the amount of claims made, or likely to be made, in respect of that class of person.

01/04/2013

The management expenses levy

FEES 6.1.9

Section 223 of the Act (Management expenses) prevents the FSCS from recovering, through a levy, any management expenses attributable to a particular period in excess of the limit set in COMP as applicable to that period. 'Management expenses' are defined in section 223(3) to mean expenses incurred or expected to be incurred by the FSCS in connection with its functions under the Act, except:

(1) expenses incurred in paying compensation;

(2) expenses incurred as a result of the FSCS making the arrangements to secure continuity of insurance set out in COMP 3.3.1 R and COMP 3.3.2 R or taking the measures set out in COMP 3.3.3 R and COMP 3.3.4 R when a relevant person is an insurer in financial difficulties;

(3) expenses incurred under section 214B or section 214D of the Act as a result of the FSCS being required by HM Treasury to make payments in connection with the exercise of the stabilisation power under Part 1 of the Banking Act 2009; and

(4) expenses incurred under Part XVA of the Act as a result of the FSCS being required by HM Treasury to act in relation to a relevant scheme.

01/04/2013

FEES 6.1.10

A management expenses levy may consist of two elements. The first is a base costs levy, for the base costs of running the compensation scheme in a financial year, that is, costs which are not dependent upon the level of activity of the compensation scheme and which therefore are not attributable to any specific class. Included in this category are items such as the salary of the members of the board of the FSCS, the costs of the premises which the FSCS occupies, and its audit fees. It would also likely include the cost of any insurance cover secured by FSCS against the risk of it paying claims out in circumstances where the levy limit of the particular class to which the claim would otherwise be attributable has exceeded its levy limit for the year, as the insurance cover is likely to benefit all classes which may have costs allocated to them if the levy limit of another class is breached. The amount that each participant firm pays towards a base costs levy is calculated by reference to the regulatory costs paid by the firm. All participant firms are liable to contribute towards a base costs levy.

01/04/2013

FEES 6.1.11

The second element of a management expenses levy is a specific costs levy for the "specific costs" of running the compensation scheme in a financial year. These costs are attributable to a class, and include the salary costs of certain staff of the FSCS and claims handling and legal and other professional fees. It also may include the cost of any insurance cover that FSCS secures against the risk of FSCS paying out claims above a given level in any particular class (but below the levy limit for that class for the year). The specific costs are attributed to the class which is responsible for those costs. When the FSCS imposes a specific costs levy, the levy is allocated to the class which is responsible for those costs up to the relevant levy limits. The FSCS may include in a specific costs levy the specific costs that the FSCS expects to incur (including in respect of defaults not yet declared at the date of the levy) during the financial year of the compensation scheme to which the levy relates. The amount that each participant firm pays towards the specific costs levy is calculated by reference to the amount of business conducted by the firm in each of the classes to which the FSCS has allocated specific costs. Each class has a separate "tariff base" for this purpose, set out in FEES 6 Annex 3 R. Participant firms may be exempt from contributing to the specific costs levy.

01/04/2013

FEES 6.1.13

The limit on the management expenses attributable to the forthcoming financial year of the FSCS. will be consulted on in January each year.

01/04/2013

The compensation costs levy

FEES 6.1.14

In imposing a compensation costs levy in each financial year of the compensation scheme the FSCS will take into account the compensation costs which the FSCS has incurred and has not yet raised through levies, any recoveries it has had made using the rights that have been assigned to it or to which it is subrogated and those compensation costs it expects to incur (including in respect of defaults yet to be declared) over the 12 months following the date of the levy.

01/04/2013

FEES 6.1.15

Compensation costs are principally the costs incurred in paying compensation. Costs incurred:

(1) in securing continuity of long-term insurance; or
(2) in safeguarding eligible claimants when insurers are in financial difficulties; or
(3) in making payments or giving indemnities under COMP 11.2.3 R; or
(4) as a result of the FSCS being required by HM Treasury to make payments in connection with the exercise of the stabilisation power under Part 1 of the Banking Act 2009; or
(5) in paying interest, principal and other costs from borrowing to allow the FSCS to pay claims attributable to a particular class;

are also treated as compensation costs. Compensation costs are attributed to the class which is responsible for the costs. When the FSCS imposes a compensation costs levy the levy is allocated to the class which is responsible for the costs up to relevant levy limits. Certain classes may be funded, for compensation costs levies beyond the class levy limit, by the retail pool.

01/04/2013

Participant firms that are members of more than one class

FEES 6.1.16

If a participant firm is a member of more than one class, the total compensation costs levy and specific costs levy for that firm in a particular year will be the aggregate of the individual levies calculated for the firm in respect of each of the classes for that year. Each class has a levy limit which is the maximum amount of compensation costs and specific costs which may be allocated to a particular class in a financial year for the purposes of a levy.

01/04/2013

Incoming EEA firms

FEES 6.1.17

Incoming EEA firms which obtain cover or 'top up' under the provisions of COMP 14 are firms whose Home State scheme provides no or limited compensation cover in the event that they are determined to be in default. Under FEES 6.6, the FSCS is required to consider whether incoming EEA firm's should receive a discount on the amount that they would otherwise pay as their share of the levy, to take account of the availability of their Home State cover. The amount of any discount is recoverable from the other members of the incoming EEA firm's class.

01/04/2013

FEES 6.2

Exemption

01/01/2006

FEES 6.2.1

(1) A participant firm which does not conduct business that could give rise to a protected claim by an eligible claimant and has no reasonable likelihood of doing so is exempt from a specific costs levy, or a compensation costs levy, or both, provided that:

(a) it has notified the FSCS in writing that those conditions apply; and

(b) the conditions in fact continue to apply.

(2) The exemption takes effect from the date on which the notice was received by the FSCS, subject to FEES 6.2.6 R.

01/04/2013

FEES 6.2.4

A participant firm which is exempt under FEES 6.2.1 R must notify the FSCS in writing as soon as reasonably practicable if the conditions in FEES 6.2.1 R no longer apply.

01/04/2013

FEES 6.2.5

A participant firm to which the conditions in FEES 6.2.1 R no longer apply will then become subject to FEES 6.3.

01/04/2013

FEES 6.2.6

If a participant firm ceases to conduct business that could give rise to a protected claim by an eligible claimant and notifies the FSCS of this under FEES 6.2.1R (1), it will be treated as a participant firm to which FEES 6.7.6 R applies until the end of the financial year of the compensation scheme in which the notice was given.

01/04/2013

FEES 6.2.7

The financial year of the compensation scheme is the twelve months ending on 31 March. The effect of FEES 6.2.6 R and FEES 6.2.1R (2) is that if a firm fails to notify FSCS of an exemption under FEES 6.2.1 R by 31 March it will be treated as non-exempt for the whole of the next financial year.

01/04/2013

FEES 6.2.8

For the purposes of FEES 6.2.1 R a participant firm will only be exempt from a specific costs levy or compensation costs levy for any given financial year if it met the conditions in FEES 6.2.1 R on 31 March of the immediately preceding financial year.

01/04/2013

FEES 6.3

The FSCS's power to impose levies

01/01/2006

Imposing management expenses and compensation costs levies

FEES 6.3.1

The FSCS may at any time impose a management expenses levy or a compensation costs levy, provided that the FSCS has reasonable grounds for believing that the funds available to it to meet relevant expenses are, or will be, insufficient, taking into account expenditure already incurred, actual and expected recoveries and:

(1) in the case of a management expenses levy, the level of the FSCS's expected expenditure in respect of those expenses in the financial year of the compensation scheme in relation to which the levy is imposed;

(2) in the case of a compensation costs levy, the level of the FSCS's expected expenditure in respect of compensation costs in the 12 months immediately following the levy.

01/04/2013

FEES 6.3.2

The calculation of levies will also take into account previous levies, where funds raised in anticipation of meeting liabilities prove either more or less than the amount actually required.

01/04/2013

FEES 6.3.2A

The FSCS will usually levy once in each financial year (and in respect of compensation costs, for expenditure expected in the period of 12 months following 1 July in that year). However, if the compensation costs or specific costs incurred, or expected to be incurred, exceed the amounts held, or reasonably expected to be held, to meet those costs, the FSCS may, at any time during the financial year, do one or more of the following:

(1) impose an interim compensation costs levy or management expenses levy; or

(2) utilise other sources of funding such as commercial borrowing or other borrowing including from the National Loans Fund; or

(3) utilise money collected from firms as set out in, and subject to, FEES 6.3.17 R (Management of funds).

The FSCS will generally impose a levy rather than borrow or utilise funds as described in (3), unless the latter options appear to it to be preferable in the specific circumstances prevailing at the relevant time; for example, to address short-term liquidity issues, or in order to deal with a significant failure without having to wait for a levy to be imposed or collected.

01/04/2013

FEES 6.3.3

The FSCS has committed itself in Memorandum of Understanding with each of the FCA and the PRA to publish its policy in respect of levying.

01/04/2013

FEES 6.3.4

The discretion over levying in FEES 6 also gives the FSCS, if it thinks this appropriate, the ability to use third parties as its agents in raising and collecting the levies.

01/04/2013

Imposing a MERS levy

FEES 6.3.4A

The FSCS may at any time impose a MERS levy provided that the FSCS has reasonable grounds for believing that the funds available to it to meet relevant expenses are or will be insufficient, taking into account relevant expenses incurred or expected to be incurred in the 12 months following the date of the levy.

01/04/2013

Limits on compensation costs and specific costs levies on classes

FEES 6.3.5

The maximum aggregate amount of compensation costs and specific costs for which the FSCS can levy each class in any one financial year of the compensation scheme is limited to the amounts set out in the table in FEES 6 Annex 2.

01/04/2013

Levy for compensation costs paid in error

FEES 6.3.10

The FSCS may include in a compensation costs levy the costs of compensation paid by the FSCS in error, provided that the payment was not made in bad faith.

01/04/2013

Management of funds

FEES 6.3.11

The FSCS must hold any amount collected from a specific costs levy or compensation costs levy to the credit of the classes in accordance with the allocation established under FEES 6.4.6 R and FEES 6.5.2 R.

01/04/2013

FEES 6.3.12

Any funds received by the FSCS by way of levy or otherwise for the purposes of the compensation scheme are to be managed as the FSCS considers appropriate, and in doing this the FSCS must act prudently.

01/04/2013

FEES 6.3.13

Interest earned by the FSCS in the management of funds held to the credit of a class must be credited to that class, and must be set off against the management expenses or compensation costs allocated to that class.

01/04/2013

FEES 6.3.14

The FSCS must keep accounts which include:

(1) the funds held to the credit of each class; and

(2) the liabilities of that class.

01/04/2013

FEES 6.3.17

(1) The FSCS may use any money held to the credit of one class (the creditor class) to pay compensation costs or specific costs attributable or allocated by way of levy to another class (the debtor class) if the FSCS has reasonable grounds to believe that this would be more economical than borrowing funds from a third party or raising a levy.

(2) Where the FSCS acts in accordance with (1), it must ensure that:

(a) the creditor class is reimbursed by the debtor class as soon as possible;

(b) the debtor class pays interest at a rate equivalent to the Bank of England's repo rate from time to time in force; and

(c) the amount lent by the creditor class to the debtor class is taken into account by the FSCS when considering whether to impose a compensation costs levy on the creditor class under FEES 6.3.1 R.

01/04/2013

FEES 6.3.18

FEES 6.3.17 R deals with how FSCS may use money available to it and does not affect the rules on levy allocation in FEES 6.4, 6.5 and 6.5A.

01/04/2013

FEES 6.3.19

Unless FEES 6.3.20 R applies, any recoveries made by the FSCS in relation to protected claims must be credited to the classes to which the related compensation costs was attributable.

01/04/2013

FEES 6.3.20

(1) Where the FSCS makes recoveries in relation to protected claims where a related compensation costs levy would have been allocated to a class (class A) had the levy limit for class A not been reached and has been allocated to another class or classes in the retail pool, the recoveries must be applied:

(a) first, to the classes to which the costs levied were allocated in accordance with FEES 6.5A in the same proportion as those classes contributed, up to the total amount of that allocation plus interest at a rate equivalent to the Bank of England's Official Bank Rate from time to time in force; and
(b) thereafter, to class A.

(2) This rule applies even though the recovery is made in a subsequent financial year.
(3) [deleted]

01/04/2013

FEES 6.3.20A

Recoveries under FEES 6.3.20 R are net of the costs of recovery.

01/04/2013

FEES 6.3.21

If the FSCS has more funds (whether from levies, recoveries or otherwise) to the credit of a class than the FSCS believes will be required to meet levies on that class for the next 12 months, it may refund the surplus to members or former members of the class on any reasonable basis.

01/04/2013

Adjustments to calculation of levy shares

FEES 6.3.22

The FSCS may adjust the calculation of a participant firm's share of any levy to take proper account of:

(1) any excess, not already taken into account, between previous levies of that type imposed in relation to previous periods and the relevant costs actually incurred in that period; or

(2) participant firms that are exempt from the levy under FEES 6.2; or

(3) amounts that the FSCS has not been able to recover from participant firms as a result of FEES 6.3.5 R; or

(4) amounts that the FSCS has not been able to recover from participant firms after having taken reasonable steps; or

(5) FEES 2.3 (Relieving Provisions), FEES 6.4.8 R (New participant firms), FEES 6.5.9 R (New participant firms), FEES 6.3.23 R (Remission of levy or additional administrative fee) or FEES 6.6 (Incoming EEA firms); or

(6) anything else that the FSCS believes on reasonable grounds should be taken into account.

01/04/2013

FEES 6.3.22A

The FSCS may not adjust the calculation of a participant firm's share of any levy under FEES 6.3.22 R on the grounds that it would be inequitable for that firm to pay that share or part of it or on the grounds that it would be inequitable for the FSCS to retain that share or part of it.

01/04/2013

FEES 6.3.22B

The reason for FEES 6.3.22A R is that any such claim should be dealt with under FEES 2.3 (Relieving Provisions).

01/04/2013

Firms acquiring businesses from other firms

FEES 6.3.22C

(1) This rule applies to the calculation of the levies of a firm (A) if:

(a) either:

(i) A acquires all or a part of the business of another firm (B), whether by merger, acquisition of goodwill or otherwise; or

(ii) A became authorised as a result of B's simple change of legal status (as defined in FEES 3 Annex 1 Part 6);

(b) B is no longer liable to pay a levy; and

(c) that acquisition or change takes place after the date to which, or as of which, A's most recent statement of business under FEES 6.5.13 R is drawn up so far as concerns the classes covered by B's business.

(2) A must pay an additional amount equal to the levy that would have been payable by B in relation to the relevant business and relevant classes if the acquisition or change in status had not taken place and B had remained liable to pay levies. The amount is based on the most recent information supplied by B under FEES 6.5.13 R. A is included in the classes applicable to the relevant business.

(3) This rule only applies with respect to those financial years of the FSCS for which A's levies are calculated on the basis of a statement of business under FEES 6.5.13 R drawn up to a date, or as of a date, before the acquisition or change in legal status took place.

01/04/2013

Remission of levy or additional administrative fee

FEES 6.3.23

If a participant firm's share of a levy or an additional administrative fee under FEES 6.7.4 R would be so small that, in the opinion of the FSCS, the costs of collection would be disproportionate to the amount payable, the FSCS may treat the participant firm as if its share of the levy or additional administrative fee amounted to zero.

01/04/2013

Levies on the Society of Lloyd's

FEES 6.3.24

The FSCS may impose a levy on the Society to be calculated as the aggregate of the levies that would be imposed on each member if this chapter applied to members, as follows:

(1) a proportionate share of a base costs levy in respect of the compensation scheme's costs for the period from 1 January 2004 to the end of the compensation scheme's financial year and a share of such levies for all subsequent financial years; and

(2) a specific costs levy and a compensation costs levy in respect of costs arising out of a relevant person being in default, arrangements made under COMP 3.3.1 R or measures taken under COMP 3.3.3 R where:

(a) the default occurs or the circumstances giving rise to the arrangements being made or the measures being taken, as the case may be, occur; and

(b) the protected contracts of insurance in connection with which the costs arise were entered into;

on or after 1 January 2004.

01/04/2013

FEES 6.4

Management expenses

01/01/2006

Obligation on participant firm to pay

FEES 6.4.1

A participant firm must pay to the FSCS a share of each management expenses levy.

01/04/2013

Limit on management expenses

FEES 6.4.2

The total of all management expenses levies attributable to a particular period of the compensation scheme may not exceed the limit applicable to that period set out in FEES 6 Annex 1.

01/04/2013

Participant firm's share

FEES 6.4.3

A participant firm's share of a management expenses levy consists of one or more of: (1) a share of a base costs levy and (2) a share of a specific costs levy.

01/04/2013

FEES 6.4.4

The FSCS must ensure that each participant firm's share of a management expenses levy separately identifies the firm's share of the base costs levy and specific costs levy.

01/04/2013

Base costs levy

FEES 6.4.5

Subject to FEES 6.3.22 R, the FSCS must calculate a participant firm's share of a base costs levy by:

(1) identifying the base costs which the FSCS has incurred, or expects to incur, in the relevant financial year of the compensation scheme, but has not yet levied and:

(a) allocating 50% of those base costs as the sum to be levied on participants in activity groups A.1, A.3, A.4, A.5 and A.6 (as listed in FEES 4 Annex 1B); and
(b) allocating 50% of those base costs as the sum to be levied on participants in all the activity groups listed in FEES 4 Annex 1A;

(2) calculating the amount of the participant firm's regulatory costs as a proportion of the total regulatory costs relating to all participant firms for the relevant financial year:

(a) if the participant firm belongs to any of the activity groups in (1)(a), imposed by the PRA in respect of those groups; and
(b) if the participant firm belongs to any of the activity groups in (1)(b), imposed by the FCA in respect of those groups; and

(3) applying the proportion calculated in (2)(a), if any to the sum in (1)(a), and the proportion calculated in (2)(b) (if any) to the sum in (1)(b).

01/04/2013

FEES 6.4.5A

The effect of FEES 6.4.5 R is that if a participant firm belongs to activity groups in both (1)(a) and (1)(b) of that rule, it will be required to pay a share of the base costs levy in respect of both sets of activity groups.

01/04/2013

Specific costs levy

FEES 6.4.6

The FSCS must allocate any specific costs levy amongst the relevant classes in proportion to the amount of relevant costs arising from the different activities for which firms in those classes have permission up to the levy limit of each relevant class.

01/04/2013

FEES 6.4.7

The FSCS must calculate a participant firm's share of a specific costs levy (subject to FEES 6.3.22 R (Adjustments to calculation of levy shares) by:

(1) identifying each of the relevant classes to which the participant firm belongs, using the statement of business most recently supplied under FEES 6.5.13 R;

(2) identifying the management expenses other than base costs which the FSCS has incurred, or expects to incur, in the relevant financial year of the compensation scheme, allocated to the classes identified in (1), but not yet levied;

(3) calculating, in relation to each relevant class FF, the participant firm's tariff base as a proportion of the total tariff base of all participant firms in the class, using the statement of business most recently supplied under FEES 6.5.13 R;

(4) applying the proportion calculated in (3) to the figure in (2); and

(5) if more than one class is relevant, adding together the figure in (4) for each class.

01/04/2013

New participant firms

FEES 6.4.8

A firm which becomes a participant firm part way through a financial year of the compensation scheme will not be liable to pay a share of a specific costs levy made in that year.

01/04/2013

FEES 6.4.10

Since a firm that becomes a participant firm in the course of a financial year of the compensation scheme will already be obtaining a discount in relation to the base costs levy through the modified fee provisions of FEES 4.2.6 R, no rule is necessary in FEES 6 for discounts on the base costs levy.

01/04/2013

Specific costs levy for newly authorised firms

FEES 6.4.10A

(1) This rule deals with the calculation of:

(a) a participant firm's specific costs levy in the financial year of the FSCS following the FSCS financial year in which it became a participant firm; or

(b) a participant firm's specific costs levy in the financial year of the FSCS in which it had its permission extended, and the following FSCS financial year; and

(2) Unless this rule says otherwise the tariff base is calculated, where necessary, using the projected valuation of the business to which the tariff relates.

(3) The rest of this rule only applies to a firm that becomes a participant firm, or extends its permission, on or after 1 April 2009.

(a) If a participant firm's tariff base is calculated using data from a period that begins on or after it became a participant firm or on or after the date that the participant firm receives its extension of permission, as the case may be, the participant firm must use that data.

(b) If a participant firm satisfies the following conditions it must calculate its tariff base under (c) for the FSCS financial year following the FSCS financial year it became a participant firm:

(i) it became a participant firm or receives its extension of permission, as the case may be, between 1 April and 31 December inclusive; and

(ii) its tariff base, but for this rule, is calculated by reference to the financial year ended in the calendar year ending 31 December or the twelve months ending 31 December before the FSCS financial year.

(i) it must use actual data in relation to the business to which the tariff relates rather than projected valuations;

(ii) the tariff is calculated by reference to the period beginning on the date it became a participant firm or had its permission extended, and ending on the 31 December before the start of the FSCS financial year; and

(iii) the figures are annualised by increasing them by the same proportion as the period of 12 months bears to the period starting from when the participant firm became a participant firm or had its permission extended to the 31 December, as the case may be.

(d) Where a participant firm is required to use the method in (c) it must notify the FSCS of its intention to do so by the date specified in FEES 6.5.13 R (Reporting Requirements).

(e) Where a participant firm is required to use actual data under this rule FEES 6 Annex 3 R is disapplied, to the extent it is incompatible, in relation to the calculation of that participant firm's valuation date in its second financial year.

01/04/2013

Application of FEES 6.4.10AR

FEES 6.4.10B

The table below sets out the period within which a participant firm's tariff base is calculated ("the data period") for second year levies calculated under FEES 6.4.10B. The example is based on a participant firm that extends its permission on 1 November 2009 and has a financial year ending 31 March.

References in this table to dates or months are references to the latest one occurring before the start of the FSCS financial year unless otherwise stated.

Type of permission acquired on 1 November

Tariff base

Valuation date but for FEES 6.5.13BR

Data period under FEES 6.5.13bR

Accepting deposits

Protected deposits

As at 31 December 2009

Effecting contracts of insurance
(Insurers - general)

Relevant net premium income

The firm's tariff base calculated in the year 2009 - so projected valuation will be used.

1 November to 31 December 2009

Dealing in investments as agent in relation to General Insurance Intermediation

Annual eligible income

Financial year ended 31 March 2009 - so projected valuations will be used.

1 November to 31 December 2009

01/04/2013

FEES 6.4A

Management expenses in respect of relevant schemes

12/10/2010

Obligation on participant firm to pay

FEES 6.4A.1

A participant firm must pay to the FSCS a share of each MERS levy.

01/04/2013

Restriction on management expenses in respect of relevant schemes

FEES 6.4A.2

The FSCS can impose a MERS levy only if the FSCS has tried its best and has failed to obtain reimbursement of those expenses from the manager of the relevant compensation scheme.

01/04/2013

Management expenses in respect of relevant schemes levy

FEES 6.4A.3

The FSCS must calculate a participant firm's share of a MERS levy on a reasonable basis.

01/04/2013

FEES 6.5

Compensation costs

01/01/2006

FEES 6.5.2

The FSCS must allocate any compensation costs levy:

(1) first, to the classes in proportion to the amount of compensation costs arising from, or expected to arise from, claims in respect of the different activities for which firms in those classes have permission up to the levy limit of each relevant class; and
(2) thereafter, where the levy limit has been reached (whether as a result of compensation costs or specific costs or both) for a class whose attributable costs may be allocated to the retail pool, to the retail pool in accordance with FEES 6.5A.

01/04/2013

Allocation: all classes except A, B and C

FEES 6.5.2A

The use made by FSCS of borrowing facilities to provide liquidity until the next levy does not affect the attribution of compensation costs, nor the allocation of compensation cost levies; the allocation of a compensation costs levy occurs at the time that the FSCS imposes a levy.

01/04/2013

FEES 6.5.3

If a participant firm which is in default has carried on a regulated activity other than in accordance with a permission, the FSCS must treat any compensation costs or specific costs arising out of that activity as if the relevant permission were held by the participant firm.

01/04/2013

FEES 6.5.4

If the relevant person in default is an appointed representative, the FSCS must treat any compensation costs or specific costs arising out of a regulated activity for which his principal has not accepted responsibility to as if the principal had accepted responsibility.

01/04/2013

FEES 6.5.5

(1) A participant firm must pay to the FSCS a share of each compensation costs levy allocated to the classes of which it is a member unless either the firm is exempt under FEES 6.2 (Exemption) or the FSCS has chosen to exercise its discretion under FEES 6.3.23 R in respect of that firm.

(2) [deleted]

01/04/2013

FEES 6.5.6

The FSCS must calculate each participant firm's share of a compensation costs levy (subject to FEES 6.3.22 R (Adjustments to calculation of levy shares)) by:

(1) identifying each of the classes to which each participant firm belongs, using the statement of business most recently supplied under FEES 6.5.13R (1);

(2) identifying the compensation costs falling within FEES 6.5.1 R allocated, in accordance with FEES 6.5.2 R, to the classes identified in (1);

(3) calculating, in relation to each relevant class, the participant firm's tariff base as a proportion of the total tariff base of all participant firms in the class, using the statement of business most recently supplied under FEES 6.5.13 R;

(4) applying the proportion calculated in (3) to the figure in (2); and

(5) if more than one class is relevant, adding together the figure in (4) for each class.

01/04/2013

Classes and tariff bases for compensation cost levies and specific costs levies

FEES 6.5.7

When calculating a participant firm's share of a compensation costs levy or specific costs levy allocated to each class the FSCS must use the classes and tariff bases as set out in the table in FEES 6 Annex 3 R.

(1) [deleted]

(2) [deleted]

(3) [deleted]

(4) [deleted]

(5) [deleted]

01/04/2013

FEES 6.5.8

Guidance on parts of FEES 6 Annex 3 R can be found in FEES 6 Annex 4.

01/04/2013

New participant firms

FEES 6.5.9

A firm which becomes a participant firm part way through a financial year of the compensation scheme will not be liable to pay a share of a compensation costs levy made in that year.

01/04/2013

Compensation costs levy for newly authorised firms

FEES 6.5.9A

FEES 6.4.10AR applies to the calculation of a participant firm's compensation costs levy and its tariff base as it applies to the calculation of its specific costs levy.

01/04/2013

FEES 6.5.9B

The example table in FEES 6.4.10B G can be applied to the calculation of the tariff bases under FEES 6.5.9AR.

01/04/2013

Membership of several classes

FEES 6.5.12

A participant firm may belong to more than one class.

01/04/2013

Reporting requirements

FEES 6.5.13

(1) Unless exempt under FEES 6.2.1 R, a participant firm must provide the FSCS by the end of February each year (or, if it has become a participant firm part way through the financial year, by the date requested by the appropriate regulator) with a statement of:

(a) classes to which it belongs; and

(b) the total amount of business (measured in accordance with the appropriate tariff base or tariff bases) which it conducted, in respect of the most recent valuation period (as specified by FEES 6 Annex 3 R (Financial Services Compensation Scheme - classes)) ending before the relevant year in relation to each of those classes.

(2) In this rule the relevant year means the year in which the month of February referred to in (1) falls.

(3) [deleted]

01/04/2013

FEES 6.5.13A

For example, when the tariff base for a particular class is based on a firm's annual eligible income the valuation period for that class is the firm's last financial year ending in the year to 31 December preceding the financial year of the FSCS for which the calculation is being made. In the case of a firm in class A1 (Deposits) its valuation period will be 31 December.

01/04/2013

FEES 6.5.14

If the information in FEES 6.5.13 R has been provided to the appropriate regulator under other rule obligations, a participant firm will be deemed to have complied with FEES 6.5.13 R.

01/04/2013

FEES 6.5.15

Where a participant firm can identify that a protected deposit or a protected dormant account was made by or belonged to a person who is not an eligible claimant, it may exclude the amount of that deposit or that account from the tariff base, provided that it notifies the FSCS of the amount of the deposit or the account so excluded and provides the FSCS with such information about the deposit or account as the FSCS may reasonably require.

01/04/2013

FEES 6.5.16

If a participant firm does not submit a complete statement by the date on which it is due in accordance with FEES 6.5.13 R and any prescribed submission procedures:

(1) the firm must pay an administrative fee of £250 (but not if it is already subject to an administrative fee under FEES Annex 2A, Part 1 or FEES 5.4.1 R for the same financial year); and

(2) the compensation costs levy and any specific costs levy will be calculated using (where relevant) the valuation or valuations of business applicable to the previous period, multiplied by the factor of 1.10 (or, if it has become a participant firm part way through a financial year, on the basis of the information provided to the appropriate regulator for the purposes of FEES 4.4.2 R) or on any other reasonable basis, making such adjustments as seem appropriate in subsequent levies once the true figures are known.

01/04/2013

FEES 6.6

Incoming EEA firms

01/01/2006

FEES 6.6.1

If an incoming EEA firm, which is a BCD credit institution, an IMD insurance intermediary or MiFID investment firm, is a participant firm, the FSCS must give the firm such discount (if any) as is appropriate on the share of any levy it would otherwise be required to pay, taking account of the nature of the levy and the extent of the compensation coverage provided by the firm's Home State scheme.

01/04/2013

FEES 6.7

Payment of levies

01/01/2006

FEES 6.7.1

A participant firm must pay its share of any levy made by the FSCS:

(1) in one payment; or

(2) where the FSCS agrees, quarterly, at the beginning of each quarter, by direct debit agreement.

01/04/2013

FEES 6.7.2

The amount paid under a direct debit arrangement will be adjusted on a continuous basis to take account of interim levies and other adjustments made during the course of the financial year.

01/04/2013

FEES 6.7.3

A participant firm's share of a levy to which FEES 6.7.1R (1) applies is due on, and payable within 30 days of, the date when the invoice is issued.

01/04/2013

FEES 6.7.4

If a participant firm does not pay its share of a levy subject to a direct debit agreement as required by FEES 6.7.1R (2), the entire amount of the levy becomes due and payable to the FSCS, and additional administrative fees are payable at the rate set out in FEES 2.2.1 R.

01/04/2013

FEES 6.7.5

A participant firm liable to pay its share of the levy under FEES 6.7.1 R must do so using one of the methods set out in FEES 4.2.4 R save that no additional amount or discount is applicable.

01/04/2013

FEES 6.7.6

If a firm ceases to be a participant firm or carry out activities within one or more classes part way through a financial year of the compensation scheme:

(1) it will remain liable for any unpaid levies which the FSCS has already made on the firm; and

(2) the FSCS may make one or more levies upon it (which may be before or after the firm has ceased to be a participant firm or carry out activities within one or more classes, but must be before it ceases to be an authorised person) for the costs which it would have been liable to pay had the FSCS made a levy on all participant firms or firms carrying out activities within that class in the financial year it ceased to be a participant firm or carry out activities within that class.

(3) [deleted]

(4) [deleted]

(5) [deleted]

01/04/2013

FEES 6 Annex 1

Financial Services Compensation Scheme - Management Expenses Levy Limit

01/04/2006

This table belongs to FEES 6.4.2 R

Period

Limit on total of all management expenses levies attributable to that period (£)

1 December 2001 to 1 April 2002

£4,209,000

1 April 2002 to 31 March 2003

£13,228,000

1 April 2003 to 31 March 2004

£13,319,000

1 April 2004 to 31 March 2005

£17,590,000

1 April 2005 to 31 March 2006

£27,030,000

1 April 2006 to 31 March 2007

£37,060,000

1 April 2007 to 31 March 2008

£37,520,000

1 April 2008 to 31 March 2009

£1,000,000,000 provided that £600,000,000 may be recovered in respect of specific costs relating to the declaration by the FSA on 27 September 2008 that Bradford & Bingley plc is in default only.

1 April 2009 to 31 March 2010

£1,000,000,000

1 April 2010 to 31 March 2011

£1,000,000,000

1 April 2011 to 31 March 2012

£1,000,000,000

1 April 2012 to 31 March 2013

£1,000,000,000

1 April 2013 to 31 March 2014

£94,400,000

01/04/2013

FEES 6 Annex 2

Financial Services Compensation Scheme - annual levy limits

06/11/2007

This table belongs to FEES 6.3.5 R and FEES TP 2.5.2R

Class

Levy Limit (£ million)

A: Deposits

1,500

B1: General insurance provision

600

B2: General insurance intermediation

300

C1: Life and pensions provision

690

C2: Life and pensions intermediation

100

D1: Investment provision

200

D2: Investment intermediation

150

E2: Home finance intermediation

01/04/2013

FEES 6 Annex 3

Financial Services Compensation Scheme - classes and sub-classes

06/11/2007

This table belongs to FEES 6.5.7 R and FEES TP 2.5.2R

Class A

Deposit

Legal basis for activity in class A

accepting deposits. and/or operating a dormant account fund.
BUT does not include any fee payer who either effects or carries out contracts of insurance.

Tariff base

(1) Protected deposits and/or
(2) Protected dormant accounts multiplied by 0.2 as at 31 December Except where paragraph (4) says otherwise, protected deposits must be adjusted as follows.

(1) Only include a protected deposit to the extent that an eligible claimant would have a claim in respect of it.

(2) Exclude any amount in respect of which the FSCS would not pay compensation due to the maximum payment limits in COMP 10.2.

(3) The tariff base calculation is made on the basis of the information that the firm would have to include in the single customer views it has to be able to produce under COMP 17 (Systems requirements for firms that accept deposits). The information must be of the extent and standard required if the firm was preparing the single customer views as at the valuation date for the tariff base (31 December).

(4) (a) If this paragraph applies, the adjustments in (1) to (3) do not apply and the calculation is based on protected deposits.

(b) This paragraph applies with respect to a protected deposit to the extent that, under COMP 17, the firm does not have to identify an eligible claimant with respect to that protected deposit because the account is held by the account holder on behalf of others.

(c) This paragraph applies with respect to a protected deposit that has been excluded from the single customer view because it is an account that is not active, as defined in COMP 17.2.3R (2).

Class B

General Insurance

Sub-class B1

General Insurance Provision

Legal basis for activity in sub-class B1

effecting contracts of insurance; and/or

carrying out contracts of insurance;

that are general insurance contracts.

Sub-class B2

General Insurance Intermediation

Legal basis for activity in sub-class B2

Any of the following in respect of general insurance contracts:

dealing in investments as agent;

arranging (bringing about) deals in investments;

making arrangements with a view to transactions in investments;

assisting in the administration and performance of a contract of insurance;

advising on investments;

agreeing to carry on a regulated activity which is within any of the above.

Tariff base

Sub-class B1: Relevant net premium income and eligible gross technical liabilities. The levy is split into two in the ratio 75:25. The tariff base for the first portion (75%) is calculated by reference to relevant net premium income. The tariff base for the second portion (25%) is based on eligible gross technical liabilities.
Eligible gross technical liabilities are calculated in accordance with the method for calculating gross technical liabilities in fee block A3 in part 2 of FEES 4 Annex 1 with the following adjustments.
(1) Eligible gross technical liabilities are calculated by reference to protected contracts of insurance with eligible claimants.
(2) A firm may choose not to apply paragraph (1) and instead include all gross technical liabilities that it would be obliged to take into account for fee block A3 as long as the amount that it would include under (1) is lower.
(3) If an incoming EEA firm does not report gross technical liabilities in the way contemplated by this table, the firm's gross technical liabilities are calculated in the same way as they would be for a UK firm.
(4) None of the notes for the calculation of fees in fee block A3 in part 2 of FEES 4 Annex 1 apply except for the purposes of (2).
(5) A directive friendly society must also calculate eligible gross technical liabilities in accordance with this table.
(6) A non-directive friendly society must calculate gross technical liabilities as the amount that it is required to show in FSC 2 - Form 9 line 11 in Appendix 10 of IPRU(FSOC) (assets allocated towards the general insurance business required minimum margin) in relation to the most recent financial year of the firm (as at the applicable reporting date under FEES 6.5.13 R) for which the firm is required to have reported that information to the FSA under IPRU(FSOC). A non-directive friendly society must disregard for this purpose such amounts as are not required to be included by reason of a waiver or a written concession carried forward as an amendment to the rule to which it relates under SUP TP.

Sub-class B2: annual eligible income where annual eligible income means annual income adjusted in accordance with this table. Annual income is calculated as the sum of (a) and (b):
(a) the net amount retained by the firm of all brokerages, fees, commissions and other related income (for example, administration charges, overriders and profit shares) due to the firm in respect of or in relation to sub-class B2 activities, including any income received from an insurer; and
(b) if the firm is an insurer, in relation to sub-class B2 activities, the amount of premiums receivable on its contracts of insurance multiplied by 0.07, excluding those contracts of insurance which result from sub-class B2 activities carried out by another firm, where a payment has been made by the insurer to that other firm and that payment is of a type that falls under (a).
Notes relating to the calculation of the tariff base for sub-class B2:
(1) Exclude annual income for pure protection contracts. Only include general insurance contracts.
(2) The calculation is adjusted in accordance with the definition of annual eligible income.
(3) Net amount retained means all the commission, fees, etc. in respect of sub-class B2 activities that the firm has not rebated to customers or passed on to other firms (for example, where there is a commission chain). Items such as general business expenses (for example, employees' salaries and overheads) must not be deducted.
(4) Sub-class B2 activities mean activities that fall within sub-class B2. They also include activities that now fall within sub-class B2 but that were not regulated activities when they were carried out.
(5) A reference to a firm also includes a reference to any person who carried out activities that would now fall into sub-class B2 but which were not at the time regulated activities.

Class C

Life and Pensions

Sub-class C1

Life and Pensions Provision

Legal basis for activity in sub-class C1

effecting contracts of insurance; and/or

carrying out contracts of insurance;

that are long-term insurance contract (including pure protection contracts).

Sub-class C2

Life and Pensions Intermediation

Legal basis for activity in sub-class C2

Any of the following:

dealing in investments as agent;

arranging (bringing about) deals in investments;

making arrangements with a view to transactions in investments;

assisting in the administration and performance of a contract of insurance;

advising on investments;

advising on pension transfers and pension opt-outs;

providing basic advice on a stakeholder product;

agreeing to carry on a regulated activity which is within any of the above;

in relation to any of the following:

long-term insurance contracts (including pure protection contracts);

rights under a stakeholder pension scheme or a personal pension scheme.

Tariff base

Sub-class C1: Relevant net premium income and eligible mathematical reserves. The levy is split into two in the ratio 75:25. The tariff base for the first portion (75%) is calculated by reference to relevant net premium income. The tariff base for the second portion (25%) is based on mathematical reserves.
Eligible mathematical reserves are calculated in accordance with the method for calculating mathematical reserves in fee block A4 in part 2 of FEES 4 Annex 1 with the following adjustments.
(1) Eligible mathematical reserves are calculated by reference to protected contracts of insurance with eligible claimants.
(2) A firm may choose not to apply paragraph (1) and instead include all mathematical reserves that it would be obliged to take into account for fee block A4 as long as the amount that it would include under (1) is lower.
(3) If an incoming EEA firm does not report mathematical reserves in the way contemplated by this table, the firm's mathematical reserves are calculated in the same way as they would be for a UK firm.
(4) None of the notes for the calculation of fees in fee block A4 in part 2 of FEES 4 Annex 1 apply except for the purposes of (2).
(5) A directive friendly society must also calculate eligible mathematical reserves in accordance with this table.
(6) A non-directive friendly society must calculate mathematical reserves as the amount that it is required to show in FSC 2 - Form 9 line 23 in Appendix 10 of IPRU(FSOC) (total mathematical reserves after distribution of surplus) in relation to the most recent financial year of the firm (as at the applicable reporting date under FEES 6.5.13 R) for which the firm is required to have reported that information to the FSA under IPRU(FSOC). A non-directive friendly society must disregard for this purpose such amounts as are not required to be included by reason of a waiver or a written concession carried forward as an amendment to the rule to which it relates under SUP TP.
(7) The provisions relating to pension fund management business in Part 2 of FEES 4 Annex 1 do not apply. A firm undertaking such business that does not carry out any other activities within sub-class C1 (ignoring any activities that would have a wholly insignificant effect on the calculation of its tariff base for sub-class C1) must use its Long-term insurance capital requirement instead of gross technical liabilities. The Long-term insurance capital requirement means the amount that it is required to show as its Long-term insurance capital requirement in Form 2 Line 31 (Statement of solvency - Long-term insurance business) in relation to the most recent financial year of the firm (as at the applicable reporting date under FEES 6.5.13 R) for which the firm is required to have reported that information to the FSA.
(8) The split in the levy between relevant net premium income and eligible mathematical reserves does not apply to a partnership pension society (as defined in Chapter 7 of IPRU(FSOC) (Definitions)). Instead the levy is only calculated by reference to relevant net premium income.

Sub-class C2: annual eligible income where annual eligible income means annual income adjusted in accordance with this table. Annual income is calculated as the sum of (a) and (b):
(a) the net amount retained by the firm of all brokerages, fees, commissions and other related income (for example, administration charges, overriders and profit shares) due to the firm in respect of or in relation to sub-class C2 activities including any income received from an insurer; and;
(b) if the firm is a life and pensions firm, in relation to sub-class C2 activities, the amount of premiums or commission receivable on its life and pensions contracts multiplied by 0.07, excluding those life and pensions contracts which result from sub-class C2 activities carried out by another firm, where a payment has been made by the life and pensions firm to that other firm and that payment is of a type that falls under (a).
Notes relating to the calculation of the tariff base for sub-class C2:
(1) Life and pensions contracts mean long-term insurance contracts (including pure protection contracts) and rights under a stakeholder pension scheme or a personal pension scheme.
(2) Life and pensions firm means an insurer. It also means a firm that provides stakeholder pension schemes or personal pension schemes if those activities fall into sub-class D1.
(3) The calculation is adjusted in accordance with the definition of annual eligible income.
(4) Net amount retained means all the commission, fees, etc. in respect of sub-class C2 activities that the firm has not rebated to customers or passed on to other firms (for example, where there is a commission chain). Items such as general business expenses (for example, employees' salaries and overheads) must not be deducted.
(5) Sub-class C2 activities mean activities that fall within sub-class C2. They also include activities that now fall within sub-class C2 but that were not regulated activities when they were carried out.
(6) A reference to a firm also includes a reference to any person who carried out activities that would now fall into sub-class C2 but which were not at the time regulated activities.

Class D

Investment

Sub-class D1

Fund Management

Legal basis for activity in sub-class D1

Any of the following:

managing investments;

establishing, operating or winding up a regulated collective investment scheme;

establishing, operating or winding up an unregulated collective investment scheme;

acting as trustee of an authorised unit trust scheme;

acting as the depositary or sole director of an open-ended investment company;

establishing, operating or winding up a stakeholder pension scheme;

establishing, operating or winding up a personal pension scheme;

agreeing to carry on a regulated activity which is within any of the above.

Sub-class D2

Investment Intermediation

Legal basis for activity in sub-class D2

Any of the following activities in relation to designated investment business

dealing in investments as principal;

dealing in investments as agent;

MiFID business bidding;

arranging (bringing about) deals in investments;

making arrangements with a view to transactions in investments;

advising on investments;

providing basic advice on a stakeholder product;

safeguarding and administering investments;

arranging safeguarding and administering of assets;

operating a multilateral trading facility;

agreeing to carry on a regulated activity which is within any of the above;

BUT excluding activities that relate to long-term insurance contracts or rights under a stakeholder pension scheme or a personal pension scheme.

Tariff base

Sub-class D1: annual eligible income where annual eligible income means annual income adjusted in accordance with this table. Annual income is equal to the net amount retained by the firm of all income due to the firm in respect of or in relation to activities falling within sub-class D1.

Sub-class D2: annual eligible income where annual eligible income means annual income adjusted in accordance with this table. Annual income is equal to the net amount retained by the firm of all income due to the firm in respect of or in relation to activities falling within sub-class D2.

Notes on annual eligible income for sub-classes D1 and D2:

(1) For the purposes of calculating annual income, net amount retained means all the commission, fees, etc. in respect of activities falling within sub-class D1 or D2, as the case may be, that the firm has not rebated to customers or passed on to other firms (for example, where there is a commission chain). Items such as general business expenses (for example employees' salaries and overheads) must not be deducted.

(2) The calculation is adjusted in accordance with the definition of annual eligible income.

(3) Box management profits are excluded from the calculation of annual income.

Class E

Home Finance

Sub-class E1

Home Finance Provision

Legal basis for activity in sub-class E1

Any of the activities below:

entering into a home finance transaction;

administering a home finance transaction;

agreeing to carry on a regulated activity which is within any of the above.

Sub-class E2

Home Finance Intermediation

Legal basis for activity in sub-class E2

Any of the following activities:

arranging (bringing about) a home finance transaction;

making arrangements with a view to a home finance transaction;

advising on home finance transactions;

the activities of a home finance provider which would be arranging but for article 28A of the Regulated Activities Order (Arranging contracts or plans to which the arranger is party);

agreeing to carry on a regulated activity which is within any of the above.

Tariff base

Sub-class E1: FSA periodic fees

Sub-class: E2: annual eligible income where the annual income is calculated in accordance with fee-block A18 in part 2 of FEES 4 Annex 1

Notes

(1)

Any reference in this annex to a specified investment includes a reference to rights to or interests in investments in that specified investment.

(2)

In calculating annual eligible income a firm must apportion income between different sub-classes and between income that falls within the definition of annual eligible income and income that does not in a reasonable and consistent way and on the basis of clear policies.

(3)

The question of whether a person is an eligible claimant or not or whether a contract of insurance is a protected contract or not or whether business is compensatable business or not must be judged at whichever of the following dates the firm chooses:
(a) (for a person who has become a new client during the period by reference to which the firm's tariff base is being calculated) the date on which the person becomes a client;
(b) (for a person who has ceased to be a client during that period) the date on which the person ceases to be a client; or
(c) (in any other case) the date to which the most recent information supplied by the firm under FEES 6.5.13 R is prepared.
However this does not apply for the purpose of calculating the tariff base for class A (Deposits) so far as it relates to protected deposits.

27/07/2012

FEES 6 Annex 4

Guidance on the calculation of tariff bases

06/11/2007

This table belongs to FEES 6.5.8 G

Gross technical liabilities and mathematical reserves for non-directive friendly societies

5.1

The tariff base for a non-directive friendly society carrying out general insurance business is based in part on gross technical liabilities and the tariff base for a non-directive friendly society carrying out life insurance business is based in part on mathematical reserves. These concepts do not directly apply to non-directive friendly societies and so the tariff base calculation uses a corresponding concept.

5.2

The figures for gross technical liabilities and mathematical reserves of a non-directive friendly society for the purpose of calculating its tariff base in class B1 (General Insurance Provision) and C1 (Life and Pensions Provision) are based on a valuation. This valuation only has to be made every three years. FEES 6 does not require a non-directive friendly society to update that information every year. Instead the figures from a non-directive friendly society's valuation will be used on a rolling three year basis for the purposes of the levy calculations in FEES 6. The effect of this calculation is therefore to modify the normal basis on which information is supplied under FEES 6.5.13 R.

01/04/2013

Transitional Provisions and Schedules

FEES TP 2

Transitional provisions relating to changes to the FSCS levy arrangements taking effect in 2007/8 and in 2008/9

2.1

Treatment of balances as at 1 April 2008

2.1.1

FSCS must calculate a levy balance as at 31 March 2008 attributable to each participant firm to which this rule applies (see FEES TP 2.1.19R), in respect of contribution groups in place as at 31 March 2008, in the following way:

(1)

identifying each of the relevant contribution groups to which a participant firm belongs;

(2)

identifying amounts held to the credit of each such contribution group;

(3)

identifying amounts held as a debit balance to each such contribution group;

(4)

calculating the net balance for each contribution group from (2) and (3);

(5)

calculating, in relation to each relevant contribution group, that participant firm's tariff base as a proportion of the total tariff base of all participant firms in the contribution group;

(6)

for each relevant contribution group applying the proportion in (5) to the figure in (4); and

(7)

the balance for the participant firm is calculated by adding together the figure in (6) for each relevant contribution group of which the participant firm is a member.

2.1.2

This rule relates to a claim or other amount that could be the subject of a compensation costs levy or specific costs levy and is otherwise eligible for inclusion in a debit balance for a contribution group under FEES TP 2.1.1R(3). This rule deals with a case where there are insufficient funds standing to the credit of that contribution group's FSCS account to meet the claim. Such a claim may only be included in the debit balance in accordance with the requirements about the amounts that can be levied under compensation costs levies and specific costs levies under FEES 6 in the form FEES 6 was in force on 31 March 2008.

2.1.3

The credit balance referred to in FEES TP 2.1.1R(2) includes:

(1)

funds standing to the credit of the contribution group together with any interest receivable less any tax payable;

(2)

any amounts lent to another contribution group (together with any interest payable on that amount under FEES 6); and

(3)

any amount levied on or before 31 March 2008 but not received by 31 March 2008;

(all such amounts being calculated as at 31 March 2008).

2.1.4

(1)

The debit balance referred to in FEES TP 2.1.1R(3) includes:

(a)

any amounts borrowed by FSCS for the purpose of paying amounts for which a compensation costs levy may be imposed on the contribution group in question together with any interest payable;

(b)

any amounts borrowed from another contribution group (together with any interest payable on that amount under FEES 6); and

(c)

amounts that could be the subject of a compensation costs levy or specific costs levy that FSCS has not yet paid;

(all such amounts being calculated as at 31 March 2008).

(2)

If FSCS has decided to pay a claim, has decided the amount it will pay and (where applicable) has agreed the payment with the claimant it is eligible for inclusion under (1)(c). So is a claim for which FSCS has sent out a compensation cheque if the cheque has not been cleared by 31 March. A claim that has been made and settled will not be included as it will have already reduced the funds standing to the credit of the relevant contribution group. Claims made but not yet accepted or agreed by 31 March will not be included.

2.1.5

FEES TP 2.1.2R has a further limitation on what claims can be included as a debit for a contribution group under FEES TP 2.1.1R. They may be included if there are sufficient funds standing to the credit of the contribution group. Any excess can also be included but only up to the levy limit for the relevant contribution group. In calculating the amount that FSCS would have been able to levy, FSCS will take into account any levies already made in the financial year beginning on 31 March 2007 (and, if relevant, previous years). The caps for these purposes are the ones in force on 31 March 2008.

2.1.6

(1)

If a participant firm's levy balance calculated under FEES TP 2.1.1R(7) is a debit, it is to be added to the first compensation costs levy or management expenses levy made on or after 1 April 2008 in which the participant firm shares.

(2)

If a participant firm's levy balance calculated under FEES TP 2.1.1R(7) is a credit, it is to be refunded as follows:

(a)

by deduction from any compensation costs levy or management expenses levy in which the participant firm shares included in the invoice that includes the appropriate regulator's periodical fee referred to in (2)(b);

(b)

(as to any balance) by deduction from any appropriate regulator periodical fees payable under FEES 4.3 in respect of the financial year beginning on 1 April 2008 and the general levy payable in respect of the same financial year; and

(c)

(as to any balance) by payment to the participant firm.

2.1.7

Any amount that is added to a participant firm's levy under FEES TP 2.1.6R must not be taken into account for the purpose of calculating whether a levy limit of any sub-class has been exceeded and how much headroom there is between a levy limit and the amount already levied.

2.1.8

If it appears to the FSCS that in the exceptional circumstances of a particular case, refunding a participant firm's credit balance arising under FEES TP 2.1.1R by way of a deduction in accordance with FEES TP 2.1.6R would be inequitable, the FSCS may refund any part of that amount by payment to the participant firm.

2.1.9

FSCS may use the money collected from participant firms prior to 1 April 2008 in order to pay claims or management expenses after 31 March 2008 but only in so far as any such payments are treated as costs to be allocated to sub-classes in existence after 31 March 2008 and do not prejudice the calculation in FEES TP 2.1.1R.

2.1.10

Subject to FEES TP 2.1.16R, FSCS must calculate any levy after 31 March 2008 on the basis that all credit balances referred to in FEES TP 2.1R have been refunded to participant firms and all debit balances referred to in FEES TP 2.1R have been repaid and all management expenses levies made before 1 April 2008 have been spent.

2.1.11

For the purposes of the calculations in FEES TP 2.1R, FSCS may rely on information FSCS relied on in the 2007/8 financial year.

2.1.12

Subject to FEES TP 2.1.16R, if a participant firm provides, or is deemed to provide, incorrect information which is used for the purposes of FEES TP 2.1, then FSCS may take account of any resulting material overpayment or underpayment made under FEES TP 2.1 notified to it. If FSCS does take into account any such overpayment or underpayment it will be dealt with as follows:

(1)

FSCS must repay any such overpayment on or before 30 calendar days after the date when it decides to take such overpayment into account; and

(2)

the participant firm must repay such underpayment on or before 30 calendar days after the date when the invoice for it is issued by FSCS.

2.1.13

FSCS may, in its absolute discretion, refuse requests to recalculate a firm's levy balance calculated under FEES TP 2.1.1R on the basis of information corrected or re-submitted after 31 March 2009.

2.1.14

Any rebate or refund to a participant firm arising out of the recalculation of a participant firm's levy balance carried out in accordance with FEES TP 2.1.12R is to be allocated to the sub-class most closely analogous to the contribution group the firm belonged to before 1 April 2008 or, if applicable, in accordance with FEES TP 2.1.18R.

2.1.15

Any interest, arising between 31 March 2008 and the date that a credit balance is refunded to a participant firm under FEES TP 2.1.6R (including any interest attributable to the use of the funds in accordance with FEES TP 2.1.9R) is to be held for the benefit of the sub-class most closely analogous to the contribution group the firm belonged to before 1 April 2008 or, if applicable, in accordance with FEES TP 2.1.18R.

2.1.16

FEES TP 2.1 does not apply to the extent that it is inconsistent with the provisions of the compensation transitionals order.

2.1.17

If a participant firm fails to pay an amount due with respect to a debit balance under FEES TP 2.1.6R, that default is to be allocated to the sub-class most closely analogous to the contribution group the firm belonged to before 1 April 2008 for which the debit balance arises, or if applicable, in accordance with FEES TP 2.1.18R.

2.1.18

(1)

FEES TP 2.1.18R deals with a situation in which FEES TP 2.1 requires that a rebate, refund, receipt or default be allocated to the sub-class most closely analogous to the contribution group a participant firm belonged to before 1 April 2008 but where it is not possible to do this because the participant firm belonged to more than one relevant contribution group or because the contribution group maps onto more than one sub-class.

(2)

That sum will be divided between contribution groups and sub-classes in whatever way FSCS considers fair and consistent with the purpose of FEES TP 2.1.

2.1.19

FEES TP 2.1.1R does not apply to a participant firm that was not a participant firm on 1 April 2007 or that was exempt during FSCS's financial year beginning on that date. Subject to that, FEES TP 2.1.1R applies to a participant firm as at 31 March 2008 that has subsequently ceased to be a participant firm.

2.1.20

The purpose of FEES TP 2.1 is to help to ensure that there is a clean break between periods beginning on or after 1 April 2008 and periods before. The aim is to ensure that debit and credit balances for each contribution group as at 31 March 2008 are discharged and any credit balance in relation to a contribution group is returned to participant firms in that contribution group as at that date.

2.2

Split of business between life and pensions intermediation and investment intermediation

2.3

Incorrect information

2.3.1

If a participant firm provides, or is deemed to provide, information under FEES 6.5.13 R (2) which is incorrect then FSCS may take account of any material overpayment or underpayment notified to it in calculating the firm's share of the next FSCS levy in accordance with FEES 6.3.22 R. Any overpayment or overcharge will not be refunded or reduced in the year of the levy unless it appears to FSCS that in the exceptional circumstances of a particular case, the payment of, or retention by FSCS of, any such FSCS levy would be inequitable.

2.3.2

FEES TP 2.3 applies in relation to information supplied for the purpose of the FSCS's financial year beginning on 1 April 2008.

2.3.3

FEES TP 2.3.1R does not apply in relation to the calculations in FEES TP 2.1.

2.4

Allocation of recoveries

2.4.1

Any recoveries made by the FSCS after 31 March 2008 in relation to protected claims compensated prior to 1 April 2008, the costs of which were allocated to the relevant contribution group in place at the time, must be credited to the sub-class in place after 31 March 2008 to which the costs of the protected claim would have been allocated had it been compensated after that date, or if relevant, in accordance with FEES 6.3.20 R.

2.4.2

FEES TP 2.4.1R does not apply to the extent that it is inconsistent with the compensation transitionals order.

2.5

Interpretation

2.5.1

In FEES TP 2 'contribution group' means one of the groups of participant firms within a sub-scheme in existence prior to 1 April 2008 set out in FEES 6.5.7 R at the time, being groups that carried on business of a similar nature, to which compensation costs and specific costs were allocated in accordance with FEES 6.4 and FEES 6.5 in force at the time. Sub-scheme means one of the sub-schemes to which FSCS allocated liabilities for compensation costs prior to 1 April 2008, as described in FEES 6.5.7 R at the time.

2.5.2

For the purpose of FEES 6.5.13 R as it applies with respect to the FSCS's financial year beginning on 1 April 2008:

(1)

references in FEES 6.5.13 R to sub-classes must be read as references to sub-classes to which firms will belong after 31 March 2008; and

(2)

(where FEES TP provides for the tariff base for a sub-class to be calculated by reference to a contribution group prior to that date) FEES 6.5.13 R (1) must be read as also including a requirement for the supply of the necessary information in relation to that contribution group.

2.5.3

The amendments made to FEES 6.5.16 R by the Fees Manual (FSCS Funding) Instrument 2007 only have effect before 1 April 2008 for the purpose of FSCS's financial year beginning on 1 April 2008.

2.5.4

FEES 6 Annex 2 R and FEES 6 Annex 3 R (classes, sub-classes and tariff bases) are brought into force for the purpose of FEES TP and FEES 6.5.13 R in November 2007. However they do not have any other effect until 1 April 2008.

2.6

Past defaults

2.6.1

The changes made to the levy rules made by the Fees Manual (FSCS Funding) Instrument 2007 apply to any levy made after 31 March 2008. This is so even if:

(1)

the claim against the firm in default arose or relates to circumstances arising before that date;

(2)

the firm was in default before that date; or

(3)

the levy relates to arrangements or measures under COMP 3.3 made or taken before that date.

2.7

Transitional provisions for changes to relieving provisions

2.7.1

The amendments made in Part 1 of Annex B to the Financial Services Compensation Scheme (Amendment of Tariff Measures and Other Levy Rules) Instrument 2008 to FEES 2.3 and the addition of FEES 6.3.22A R (and consequential changes) (changes to Relieving Provisions) do not apply to any request made by a levy payer before 1 November 2008.

2.8

Effect of the tariff base changes for the financial year beginning on 1 April 2009 before that date

2.8.1

The amendments made to FEES 6 Annex 3 R (Financial Services Compensation Scheme - classes and sub-classes) and FEES TP 2 by Part 3 of Annex B to the Financial Services Compensation Scheme (Amendment of Tariff Measures and Other Levy Rules) Instrument 2008 have effect before 1 April 2009 for the purpose of the supply of information under FEES 6.5.13 R in relation to the FSCS's financial year beginning on 1 April 2009.

01/04/2013

FEES TP 3

Transitional provisions relating to changes to the FSCS levy arrangements taking effect in 2010/11

3.1

Effect of the tariff base changes made in 2008 in relation to the financial year 2010/11 before that date

3.1.1

The amendments made to FEES 6 and to FEES TP by Part 4 of Annex B to the Financial Services Compensation Scheme (Amendment of Tariff Measures and Other Levy Rules) Instrument 2008 have effect before 1 April 2010 for the purpose of the supply of information under FEES 6.5.13 R in relation to the FSCS's financial year beginning on 1 April 2010.

3.2

Transitional requirements relating to firms in run off

3.2.1

This rule adjusts the calculation of the tariff base for sub-class B1 (General insurance providers) and sub-class C1 (Life and pensions providers) for the purposes of the FSCS's financial year beginning on 1 April 2010 and for subsequent periods. It applies if the firm is in run-off and has been in run-off since 1 November 2008.

3.2.2

The whole of the levy is calculated by reference to relevant net premium income instead of being split 75:25 between relevant net premium income and eligible gross technical liabilities or mathematical reserves.

3.2.3

A firm is in run-off for these purposes if it has ceased to effect new contracts of insurance, its permission for effecting contracts of insurance has been cancelled, its exclusive remaining business is administering its remaining insurance liabilities and, if it is required to supply one, it has supplied a run-off plan under SUP App 2.8.1 R.

3.3

Treatment of pure protection fees in 2010/11

01/04/2013

FEES TP 4

Transitional provisions relating to information requirements following changes to FEES 4 or 5

4.1

Effect of changes to FEES 4 or 5 in relation to the supply of information to the appropriate regulator

4.1.1

This rule applies where any rule, or amendment to a rule, in FEES 4 or FEES 5 ("a FEES rule") has been made but will only come into force in relation to a future financial year of the appropriate regulator or Financial Ombudsman Service ("the future year"), as the case may be.

4.1.2

Unless another rule expressly disapplies this rule, a FEES rule has immediate effect for the supply of information under FEES 4.4 or FEES 5.4 in relation to that future year.

4.1.3

A reference in this rule to an appropriate regulator or Financial Ombudsman Service financial year is a reference to the 12 months ending 31 March.

01/04/2013

FEES TP 5

Transitional Provisions relating to the Special Project Fee for Restructuring

5.1

Special Project Fee for Restructuring applicable to circumstances before 1 July 2010

5.1.1

This rule relates to the changes to FEES 3 Annex 9 (Special Project Fee for restructuring) made by the Fees (Special Project Fee For Restructuring) (Amendment) Instrument 2010. It deals with a trigger event that occurred or started before 1 July 2010 (an "old trigger event") but which was of a type that was only brought into the definition of trigger event by that instrument. A trigger event means a circumstance or event of a type set out in paragraphs (2) or (6) of that Annex (events or circumstances that trigger liability for the Special Project Fee for restructuring).

5.1.2

An old trigger event is still a trigger event and thus triggers liability for the fee. However any regulatory work conducted before 1 July 2010 as a consequence of an old trigger event is not taken into account for the purposes of the calculation of the fee (including the floor in paragraph (8)(a) of FEES 3 Annex 9). Likewise any fees and disbursements invoiced to the appropriate regulator in respect of services performed for the appropriate regulator in relation to assisting the appropriate regulator in performing such regulatory work are not included to the extent that the invoice relates to the period before 1 July 2010.

5.1.3

For example, say that a firm goes into administration before 1 July 2010. Say that the administration did not come within the list of events that triggered liability for the fee before 1 July 2010. The fee is still potentially payable. However the fee will not cover work carried out by the appropriate regulator before 1 July 2010. The same applies even if the administration started before 1 June 2009, when the fee first came into force.

01/04/2013

FEES TP 7

Transitional provisions relating to changes to the FSCS levy arrangements taking effect in 2013/14

7.1

As at 31 March 2013, the FSCS must:

(1)

allocate any surplus or deficit in the balance of an FSA activity group in respect of base costs, to the account of the corresponding FCA activity group as listed in FEES 4 Annex 1A R as at 1 April 2013; and

(2)

take that surplus or deficit (so allocated) into account when calculating the amount to be levied under FEES 6.4.5 R in respect of the financial year commencing on 1 April 2013.

01/04/2013

FEES TP 8

Transitional provisions relating to FEES 3 Annex 9R and FEES 4.3.6R taking effect in 2013/14

(1)

(2) Material to which the transitional provision applies

(3)

(4) Transitional provision

(5) Transitional provision: dates in force

(6) Handbook provision: coming into force

8.1

Special project fee transitional provisions

8.1.1

FEES 3 Annex 9R

This rule relates to a special project fee or part of a special project fee which has the following characteristics:
(1) one or more of the events described in FEES 3 Annex 9R (2) or (6) had occurred before 1 April 2013; and
(2) FSA employees conducted regulatory work which had been recorded on the FSA's systems and/or the FSA was invoiced fees and disbursements as a consequence of the applicable event or events referred to in FEES 3 Annex 9R (2) or (6) before 1 April 2013.
(3) Hours or part hours worked by FSA staff and any fees or disbursements invoiced to the FSA of the kind described in FEES 3 Annex 9R (9) which were not accounted for in an invoice issued by the FSA prior to 31 March 2013 shall be named "pre-LCO accrued costs" in FEES TP 8.1.

From 1 April 2013 indefinitely

1 April 2013

8.1.2

FEES 3 Annex 9R

In relation to the kind of special project fee specified in FEES TP 8.1.1R,
(a) where one of the events referred to in FEES 3 Annex 9R (6)(a) had occurred, any pre-LCO accrued costs shall be included in the calculation of any amount payable to the FCA under FEES 3 Annex 9R (9);
(b) a special project fee is payable to the FCA regardless of whether the amount calculated according to FEES 3 Annex 9R for the FCA is less than £50,000; and
(c) no special project fee is payable if the sum total of adding together (i) the amount calculated in accordance with FEES 3 Annex 9R (9) in respect of the FCA and (ii) the total costs invoiced by the FSA before 1 April 2013 results in a total amount of less than £50,000.

From 1 April 2013 indefinitely

1 April 2013

8.1.3

FEES 3 Annex 9R

In relation to the kind of special project fee specified in FEES TP 8.1.1R, where one of the events referred to in FEES 3 Annex 9R (2) or (9)(b) had occurred:
(a) 50% of the pre-LCO accrued costs shall be included in the calculation of any amount payable to the FCA under FEES 3 Annex 9R(9);
(b) 50% of the pre-LCO accrued costs shall be included in the calculation of any amount payable to the PRA under FEES 3 Annex 9R(9);
(c) a special project fee is payable to the appropriate regulator regardless of whether the amount calculated according to FEES 3 Annex 9R for the appropriate regulator is less than £50,000; and
(d) no special project fee is payable if the sum total of adding together (i) the amount calculated in accordance with FEES 3 Annex 9R(9) in respect of the FCA, (ii) the amount calculated in accordance with FEES 3 Annex 9R(9) in respect of the PRA and (iii) the total costs invoiced by the FSA before 1 April 2013 results in a total amount of less than £50,000.

From 1 April 2013 indefinitely

1 April 2013

8.1.4

FEES 3 Annex 9

As a result of FEES FEES TP 8.1.3R, pre-LCO accrued costs may give rise to two separate fee payment obligations following 1 April 2013, one in respect of the FCA and one in respect of the PRA if the threshold in FEES TP 8.1.3(d) is breached.

From 1 April 2013 indefinitely

1 April 2013

8.1.5

FEES 3 Annex 9

(1) This guidance gives examples of how FEES TP 8.1 is intended to operate.
(2) If an event specified in FEES 3 Annex 9 (2) occurred on 1 April 2012, the £50,000 threshold was breached on 1 November and the FSA invoiced for the full amount outstanding as at 1 December 2012 but issued no further invoices, any accrued hours or part hours and fees or disbursements invoiced to the FSA between 1 December 2012 and 1 April 2013 will be divided equally between the FCA and the PRA and an amount would be payable to the FCA and the PRA as separate fees regardless of whether the separate thresholds contained in FEES 3 Annex 9 (8) are met as long as the combined FSA, FCA and PRA costs incurred exceeded £50,000.
(3) If an event specified in FEES 3 Annex 9 (6)(a) occurred on 1 February 2013, the FSA had begun the relevant regulatory work but had yet issued any invoices or breached the 50,000 floor before 1 April 2013, the accrued hours and disbursements will be allocated towards the FCA's fee calculation.

From 1 April 2013 indefinitely

1 April 2013

8.2

On account fee transitional provisions

8.2.1

FEES 4.3.6 R (1) and FEES 4.3.6 R (1A)

For the 2013/2014 fee year, "previous fee year" is replaced by "FSA financial year for 2012/2013" and "periodic fee" is replaced by "periodic fee payable to the FSA".