TC 1
Commitments
TC 1.1
Application and purpose
- 01/12/2004
Who?
TC 1.1.1
See Notes
The guidance in
this chapter lists some general, high level, commitments which every firm should make and fulfil,
except that:
(1) for an incoming EEA firm or an incoming Treaty firm, this chapter applies
only in so far as responsibility for any matter it covers is not reserved
by a European Community instrument to the firm'sHome
State regulator; and
(2) this chapter applies to a UCITS qualifier only
in so far as it is relevant to the manner in which a firm communicates or approves a financial promotion.
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Where?
TC 1.1.2
See Notes
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TC 1.1.2A
See Notes
ECO
1.1.6 R has the effect
that this chapter does not apply to an incoming
ECA provider acting as such.
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Why?
TC 1.1.3
See Notes
Principle 3 requires firms to
take reasonable care to organise and control their affairs responsibly and
effectively. This includes making proper arrangements for any employee associated with a regulated
activity carried on by the firm to
achieve, maintain and enhance competence.
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TC 1.1.4
See Notes
Principle 3 is amplified in SYSC. A firm must
take reasonable care to establish and maintain such systems and controls as
are appropriate to its business (SYSC
3.1.1 R). Also, a firm's systems and controls should enable
it to satisfy itself of the suitability of anyone who acts for it (SYSC
3.2.13 G). This would include the competence
of the individual for the role.
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TC 1.1.5
See Notes
Under threshold condition 5 (Suitability), firms are required to
satisfy the FSA that
they are fit and proper persons having
regard to all the circumstances including, amongst other things, the nature
of the regulated activity the firm carries on or is
seeking to carry on and the need to ensure that the firm's affairs are conducted soundly and
prudently. This involves an assessment of the competence of management and
staff as a whole. The suitability of a member of staff who performs a controlled function is
assessed under FIT.
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TC 1.1.6
See Notes
Section 59 of the Act (Approval) requires firms to take reasonable care to ensure that
no person performs
a controlled function without
approval from the FSA.
Before it can grant an application for approval, the FSA must be satisfied that the person is fit and proper.
Under section 61 of the Act (Determination
of applications) the fit and proper test for those requiring such approval
includes assessing qualifications, training and competence.
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TC 1.1.7
See Notes
Where there are no specific training
and competence requirements for a controlled
function, the commitments in TC 1.2 apply.
Where there are specific training and competence requirements for a controlled function (the investment adviser function,
for example), the rules and guidance in TC 2 apply, as well as the commitments. This is because the controlled functions cover
a wider range of activities than the activities specified in TC 2. Also, there are some rules in TC
2 for activities which are not controlled functions (the overseers of administrative
functions, for example).
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TC 1.1.8
See Notes
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TC 1.2
Commitments
- 01/12/2004
TC 1.2.1
See Notes
The firm's commitments
to training and competence should be that:
(1) its employees are
competent;
(2) its employees remain
competent for the work they do;
(3) its employees are
appropriately supervised;
(4) its employees' competence
is regularly reviewed; and
(5) the level of competence is appropriate
to the nature of the business.
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