PRA has published a consultation paper containing proposals on how it and FCA plan to replace the EU guidelines on the prudential assessment of acquisitions and increases of qualifying holdings in the financial sector (3L3 Guidelines) with a new PRA supervisory statement and new FCA guidance.
The primary objective of the proposals is firm safety, soundness and policyholder protection which would be advanced by setting out the PRA’s expectations in relation to the prudential assessment of acquisitions and increases in control and by updating the non-UK specific elements of the EU 3L3 Guidelines.
All current related guidance on the subject will be brought into one SS, thus making PRA’s expectations clearer. PRA hopes this clarity will also allow for more effective competition, competitiveness and growth, particularly for those persons proposing to acquire or increase control over PRA-authorised firms operating in the UK. FCA will also publish new guidance.
The guidance will largely replicate the existing measures, without making any fundamental changes.
This proposal is relevant to all PRA and FCA authorised firms, all persons to which the Change in Control FSMA part applies and firms seeking to apply for PRA authorisation in identifying who their controllers are.
The consultation closes on 23 February 2024 and the PRA invites feedback until then.