The FCA has published examples of good and poor practice on how asset managers can improve applications for authorisation. It has higlighted several areas which tend to hold up applications.
- where firms cannot show they will be taking decisions on the firm’s business in the UK on a day to day basis, with effective supervision from the UK of all activities and senior managers being able to visit and work in the UK as necessary;
- firms underestimating what they need to do to supervised outsourced service providers;
- not properly assessing the risks their business model could pose to clients, including not having fully appreciated the impact of the Consumer Duty on the business;
- failing to identify how conflicts could arise, and how to prevent and manage them;
- not understanding who the clients are and therefore not being able to show how they will comply with the correct rules;
- failing to assess and explain how the redress and compensation schemes apply (or not);
- not clearly articulating how they will use new permissions, if applying for a VOP; and
- not providing the required draft fund documentation with their application.