As An Investment Manager: How do I become authorised?

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How do I become authorised?

You need to meet the Threshold Conditions, which are the FCA’s minimum standards for becoming, and continuing to be, authorised.

The process of obtaining authorisation requires the proper completion and submission of certain prescribed forms and other documents including a detailed regulatory business plan (which we can assist you with):

A candidate for the Financial Services & Markets Act (FSMA) Part 4A Permission, with the exception in so far as the FCA may direct in individual cases, must apply in writing in the manner shown (in the FCA Connect), and with the information mandated, in the application pack presented by the FCA.

A MiFID investment adviser or investment manager will generally be a “wholesale investment firm” and should follow the FCA application pack procedure for that category. An AIFM under AIFMD will also should follow the FCA’s specific method for AIFMs.

The forms required will include some or all of the following:

  • A core details form: this involves authentic related information about the business structure, controllers, management and personnel. Information on systems and controls, including business continuity is also demanded here.
  • Supplement for investment managers: this deals with the applicant’s regulatory (and not just normal) business plan, its proposed customer types and investment strategy, and the scope of regulatory permissions required. This form also requires specifics on financial resources and cash flow calculations, further detail on personnel and compliance strategies
  • Forms for individuals who will be carrying out “controlled functions” (currently called Approved Persons, but changing in December 2019).
    Owners and influencers appendix.
  • Forms for controllers: individuals who (broadly) maintain or control 10 per cent or more of the applicant firm.
  • IT Controls form: for those firms who are more dependent on IT systems, and.
  • Supporting papers including organisation charts; financial information; compliance and risk procedures, etc

For new applicants looking for authorisation as AIFMs, in addition to the requirements specified above, a firm submitting to be an AIFM also will need to submit the following to the FCA:

The Variation of Permission (VOP) form: which serves as a check list of the AIFMD-specific requirements with further details where necessary. The VOP form includes information linking with: the FCA permission profile for the AIFM; the regulatory business plan; financial resources; conditions for authorisation; approved persons; AIFs and depositary arrangements.

Schedule of AIFs: various details in respect of any AIF for which the firm is to be appointed as AIFM, including its name, constituting instruments (eg Articles of Association) and its investor disclosure document (prospectus).

For applicants which are limited liability partnerships the FCA will need to see a signed LLP agreement before granting authorisation.

Most applicants use Compliance Consultant or their legal adviser to manage the application process for them as this will make the process smoother for a first time applicant.

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