Author: James Borley, Director of Payment Services, Complyport UK
The regulation of those who own, direct and manage regulated businesses has become a defining feature of modern UK regulatory policy. Whether the objective is protecting consumers in financial services or safeguarding the long-term sustainability of professional football clubs, regulators increasingly focus on the individuals exercising influence and control rather than solely on the organisations themselves.
The Independent Football Regulator’s (IFR) Owners, Directors and Senior Executives (ODSE) regime represents one of the most significant governance developments in English football for decades. Designed to assess the suitability of those seeking to own or lead regulated football clubs, the framework bears a notable resemblance to existing regulatory approaches familiar to financial services firms operating under the Financial Conduct Authority (FCA). The similarities extend beyond the assessment criteria themselves and into broader underlying concepts of accountability, fitness and propriety, governance and ownership transparency.
Indeed, many of the parallels between ODSE and the FCA’s Senior Managers & Certification Regime (SM&CR) are perhaps unsurprising. The Chief Executive of the Independent Football Regulator, Richard Monks was, among other things, closely involved in the development of SM&CR during his time at the FCA. As a result, the ODSE framework reflects many of the same regulatory principles that have become well established within financial services: clear accountability, rigorous suitability assessments and proactive scrutiny of those exercising significant influence over regulated entities.
A Common Regulatory Objective
Although football and financial services may appear very different industries, the core regulatory objectives are remarkably similar.
The FCA introduced SM&CR to strengthen individual accountability and improve governance standards following the financial crisis. The regime seeks to ensure that key decision-makers within authorised firms are identifiable, accountable and suitably qualified to perform their roles. Senior Management Function (SMF) holders must obtain regulatory approval before commencing their position and remain subject to ongoing fitness and propriety assessments.
Similarly, the IFR’s ODSE regime is intended to protect the financial sustainability and resilience of football clubs by ensuring those who own and manage clubs meet appropriate standards of honesty, integrity, competence and financial soundness. The regime forms a key part of the Football Governance Act 2025 and represents a substantial enhancement of previous ownership and directors’ tests operated by football authorities.
Both frameworks are therefore aimed at being preventative rather than reactive. Their purpose is to identify unsuitable individuals before harm occurs, rather than simply intervening after governance failures have already emerged.
Who Falls Within Scope?
The FCA and IFR adopt slightly different approaches when defining the population subject to approval.
Under SM&CR, the FCA focuses primarily on individuals performing designated Senior Management Functions. These include Chief Executives, Executive Directors, Compliance Oversight Officers, Money Laundering Reporting Officers and other individuals holding significant responsibility within authorised firms. Regulatory approval is generally required before the individual commences the role.
The IFR’s ODSE regime extends beyond senior management and incorporates ownership itself into the assessment framework. The regime applies to:
- Owners holding more than 25% of shares, voting rights or equivalent influence;
- Chairpersons;
- Chief Executives;
- Chief Finance Officers;
- Chief Operations Officers;
- Directors, including shadow directors;
- Other key decision-makers capable of exercising significant influence over club operations or strategic direction.
This distinction is important.
Within FCA-regulated firms, senior managers and controllers are generally assessed through separate regulatory mechanisms. The ODSE regime effectively combines these concepts into a single integrated framework covering both ownership and executive leadership.
Application Requirements: Significant Areas of Convergence
Financial services firms will recognise many familiar concepts within the ODSE application process.
An FCA Senior Manager application typically requires:
- Personal and professional background information;
- Employment and regulatory history;
- Criminal record disclosures;
- Regulatory references;
- Evidence of competence and experience;
- A Statement of Responsibilities; and
- Assessment of fitness and propriety.
The FCA’s fitness and propriety assessment is built around three core pillars:
- Honesty, integrity and reputation;
- Competence and capability; and
- Financial soundness.
The ODSE framework adopts a very similar approach.
Applicants seeking approval as owners or senior managers must provide comprehensive information enabling the IFR to assess suitability before an appointment or acquisition is completed. Prescribed application forms must be submitted and approval obtained before the proposed role is assumed or ownership acquired.
The IFR assesses:
- Honesty and integrity;
- Financial soundness;
- Competence and capability;
- Source of wealth;
- Source of funds;
- The ability to contribute to the sustainable operation of the club.
From a compliance perspective, the IFR’s approach will look and feel familiar. In practice, it combines features commonly associated with SM&CR, controller assessments and enhanced Anti-Money Laundering Due Diligence.
The Evolution from Rules-Based Tests to Principles-Based Judgements
One of the most notable features of the ODSE regime is its move away from purely rules-based disqualification criteria.
Historically, football ownership tests focused heavily on specific disqualifying events such as criminal convictions or insolvency-related restrictions. The IFR has instead adopted a more holistic assessment of overall suitability. The regulator has emphasised that decisions will be made on a case-by-case basis, weighing a range of factors rather than relying exclusively on predefined disqualification triggers.
Financial services firms will immediately recognise this philosophy.
The FCA’s fitness and propriety framework similarly extends beyond criminal convictions or regulatory sanctions. Matters relating to conduct, financial responsibility, disciplinary history or behaviour that may undermine confidence in an individual’s integrity can all become relevant to the assessment. Ongoing evaluation remains a core regulatory expectation.
In both regimes, regulators are ultimately assessing trustworthiness. Technical compliance with minimum requirements is important, but it may not be sufficient where broader concerns regarding judgement, integrity or governance capability exist.
Controllers, Beneficial Owners and Persons of Significant Influence
The strongest parallel between the two systems emerges when comparing ODSE owner assessments with the FCA’s Change in Control regime.
Under the Financial Services and Markets Act, any individual or entity seeking to acquire or increase control in an FCA-authorised firm must notify the regulator and obtain approval before the transaction completes. Failure to obtain approval can constitute a criminal offence.
The FCA requires notification when prescribed control thresholds are crossed. For most regulated firms these thresholds are:
- 10%
- 20%
- 30%
- 50%
of shares or voting rights, together with circumstances where significant influence may be exercised through alternative means.
The FCA’s assessment focuses on:
- Reputation;
- Financial standing;
- Competence;
- Good governance;
- Prudential impact;
- The future management of the regulated firm.
The IFR’s ownership assessment pursues many of the same objectives. The regulator reviews not only the proposed owner’s suitability but also the legitimacy of acquisition funding, the source of wealth supporting the transaction and the ongoing sustainability of the ownership structure itself.
The underlying question is identical: can this individual or organisation be trusted with the stewardship of a regulated institution?
Expectations When Acquiring a Controlling Interest
Prospective acquirers should expect extensive regulatory scrutiny regardless of whether they are purchasing an FCA-regulated business or a football club.
For FCA applications, proposed controllers are generally expected to provide:
- Detailed ownership structures;
- Ultimate beneficial ownership information;
- Funding arrangements;
- Financial resources information;
- Business plans;
- Governance proposals;
- Strategic rationale for the acquisition.
The FCA normally has up to 60 working days to assess a complete change in control notification, although requests for additional information can extend the overall timetable.
Under the IFR framework, prospective owners should similarly anticipate scrutiny of:
- Source of wealth;
- Source of funds;
- Financial resilience;
- Acquisition financing structures;
- Ownership intentions;
- Long-term strategy;
- Ability to support sustainable club operations.
Importantly, regulators in both sectors have moved beyond simply asking whether an acquirer has sufficient funds to complete a transaction. Increasingly, they seek comfort that the ownership model itself is sustainable and will not create future risks for stakeholders.
Practical Lessons for Applicants
A number of practical themes emerge from both regulatory frameworks.
First, transparency remains paramount. Regulators consistently view incomplete/non-disclosure more negatively than historic issues that are openly disclosed and satisfactorily explained.
Second, ownership structures should be documented and understood. Complex arrangements involving multiple holding companies, trusts or overseas entities are not inherently problematic, but they will attract enhanced scrutiny where beneficial ownership is not immediately clear.
Third, applicants should expect regulators to conduct independent verification. Both regimes contemplate engagement with other regulatory authorities, financial institutions and external information sources when assessing suitability.
Finally, prospective owners and senior managers should recognise that approval is not merely an administrative exercise. Increasingly, regulators are making qualitative judgements regarding character, competence and stewardship capability.
Conclusion
The IFR’s ODSE regime demonstrates how regulatory concepts that originated in financial services have influenced governance standards beyond traditional regulated sectors.
The resemblance between ODSE and the FCA’s combined approach under SM&CR and the Change in Control framework is unlikely to be accidental. Both regimes focus on accountability, fitness and propriety, financial soundness, transparent ownership and effective stewardship. The involvement of ex-FCA staff further illustrates the transfer of regulatory thinking between sectors.
Whether applying to become a Senior Manager, seeking approval as a controller of an authorised firm, or acquiring ownership of a football club, regulators increasingly ask the same fundamental question: does the applicant possess the integrity, competence, financial standing and judgement required to be entrusted with a regulated institution? The sector may differ, but the regulatory expectation is becoming increasingly consistent.
How Complyport Can Help
As regulatory expectations around governance and accountability continue to evolve, firms and individuals should ensure they are well prepared for regulatory scrutiny. Complyport provides practical regulatory support across a range of governance and authorisation matters, including:
- SM&CR advisory, including governance reviews and Senior Manager responsibilities.
- Fitness and Propriety assessments for Senior Managers and Certified Persons.
- Change in Control applications and FCA regulatory approvals.
- Regulatory due diligence, including assessments of ownership structures, beneficial ownership and governance arrangements for acquisitions and investments.
Whether you are appointing a Senior Manager, acquiring control of an authorised firm or strengthening your governance framework, contact Complyport today to book a meeting with one of our Subject Matter Experts.
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