Michael LewisThe FCA is consulting on plans to simplify its rules on the amount of capital investment firms need. It is not planning to change the fundamental requirement, but things it can reduce the volume of legal text that sets out the requirements by 70%.
The FCA’s view is that large parts of the current rules aren’t relevant to most investment firms because they are based on rules designed for banks, so it is planning on cutting out the irrelevant ones and simplifying the others.
The FCA proposes to:
- remove all references to the UK CRR from the definition of regulatory capital that applies to firms within MIFIDPRU3;
- in doing so, it will consolidate all requirements into MIFIDPRU3, remove irrelevant provisions and make requirements clearer and more accessible.
Consultation closes on 12 June and the FCA would like to bring the new framework into effect on 1 January 2026.