The post The FCA’s New Crypto Regulatory Era first appeared on Complyport - Your Trusted Partner in Governance, Risk, Compliance & Technology .
]]>The webinar builds on the FCA’s recent consultation papers, confirming the transition from an anti-money laundering (MLR) registration regime to a full, Financial Services and Markets Act 2000 (FSMA) based authorisation model. This will bring cryptoassets under traditional regulatory standards and supervision from the FCA.
Firms operating in, or targeting, the UK cryptoasset market must act now to prepare for this shift. From 25 October 2027, any firm carrying on a regulated cryptoasset activity under FSMA without FCA permission will be acting unlawfully.
The FCA is bringing cryptoasset activities under the same authorisation standards as traditional financial services, reflecting its view that cryptoasset activities pose comparable risks. The FCA has reiterated its long-standing principle of “same risk, same regulatory outcomes”, which will apply fully to cryptoasset firms seeking authorisation.
During the webinar, the FCA was explicit that:
Pass will launch, offering free, non-mandatory engagement with FCA case officers for cryptoasset authorisations.
The FCA will begin accepting new applications and Variations of Permissions (VoPs)
The FCA expects that cryptoasset firms already operating in the UK will apply for authorisation during this period to maximise the chances of authorisation before the commencement date.
Subject to final Parliamentary approval, the new cryptoasset regime will come into force on this date.
During the webinar, the FCA confirmed that the Cryptoasset regime will be significantly broader than the current MLR framework. They emphasised a trade-lifecycle lens, where they aim to capture risks across pre-trade, execution, and post-trade stages.
Firms may be included in this broader regime if they conduct activities including issuance of qualifying stablecoins in the UK, cryptoasset custody, operating or arranging a qualifying cryptoasset trading platform, dealing in qualifying cryptoassets (as principle or agent), arranging deals ins qualifying cryptoassets and cryptoasset staking.
The FCA clearly defined the regime’s perimeter and how different firm types will be impacted:
The FCA framed cryptoasset authorisation around 3 central questions:
The FCA stressed the importance of early and transparent engagement, high-quality and firm-specific applications, and meaningful interaction with FCA case officers. Common causes of rejection include unclear accountability, weak risk understanding, poorly designed controls and “shell” applications lacking substance.
Applicants should also expect iterative engagement, including information requests, workshops and senior management interviews. The FCA also confirmed it will use a “minded to authorise” stage to support firms in achieving operational readiness through limited permissions prior to full authorisation.
In the webinar, the FCA outlined two additional processes to help firms manage the operational disruption of authorisation.
Allows firms that applied during the Application Period (30 September 2026 – 28 February 2027), but have not received decisions on their applications, to continue operating under the old regime until a decision is reached.
Allows firm applying after the Application Period or unsuccessful applicants to serve existing customers for existing services. Under this provision, unsuccessful applicants are expected to run off their UK business.
Outside of these provisions, firms that do not apply for authorisation or have their submission rejected as invalid, must run off their UK business before the regime’s commencement date. If firms fail to do so, they would be conducting unauthorised business and carrying on activities without permission.
The FCA reaffirmed its commitment to supporting firms applying for authorisation or a VoP. It will publish consolidated guidance covering authorisation, supervision, and enforcement expectations, alongside a rolling programme of sector-specific webinars. Application forms are expected to be published in H2 2026.
The FCA strongly encourages firms to engage with PASS ahead of submitting an application.
The FCA urged firms to act soon and not delay preparing for the new cryptoasset regime:
Firms should:
The FCA’s transition to a full FSMA cryptoasset regime will impact firms across areas including regulatory perimeter assessments, authorisation, governance, prudential resilience and ongoing compliance. Complyport supports firms in preparing for and navigating this new regime through the following services:
Contact us today to book a meeting with one of our Subject Matter Experts and ensure your firm is fully prepared for the UK’s crypto regulatory future.
Ask ViCA, your Virtual Compliance Assistant. Claim your complimentary 20 queries today! Register here: https://vica.chat
The post The FCA’s New Crypto Regulatory Era first appeared on Complyport - Your Trusted Partner in Governance, Risk, Compliance & Technology .
]]>The post ‘Final Preparations For End Of The Transition Period’ Letter To CEOs Of Insurance Firms first appeared on Complyport - Your Trusted Partner in Governance, Risk, Compliance & Technology .
]]>The Bank of England together with the FCA have written a letter to CEOs of insurance firms to remind them on the importance of being prepared for the end of the Brexit transitional period, which is set to end on the 31 December 2020, to minimise disruption and ensure market stability.
The UK authorities have put in place a series of temporary measures to ensure financial stability for UK households and businesses that could arise from disruption to the provision of cross-border financial services if the UK and EU do not agree on a post-Brexit agreement covering the financials services sector. Such measures include the Temporary Permissions Regime (TPR) and the use of temporary transitional powers, that will allow businesses to continue accessing services from EU financial institutions even after the end of the Brexit transitional period.
Nonetheless, it is expected that Brexit might cause significant market volatility, specifically to EU-based clients and, therefore, the letter aims to remind firms of the key areas requiring final preparations, including: contingency planning and continuity of cross-border business in respect of EU liabilities; Part VII saving provision; data; EEA bank account closures; EEA passporting firms; and TPR firms’ Part 4A submission timeline.
Insurance firms planning to run-off their remaining liabilities relying on EU run-off regimes, where these are available, or seeking to transfer their EU liabilities to an EU-authorised insurer, should ensure that they finalise preparations and implement suitable and realistic contingency plans prior to the end of the transitional period. The letter also reminds firms and intermediaries of their duty to inform customers about the possible impact of the withdrawal of the UK from the EU on insurance contracts.
More information about the FCA’s expectations can be found here.
The Part VII ‘saving provision’ under the Financial Services and Markets Act 2000 (FSMA) has been a key aspect of the Brexit restructuring toolkit for UK insurers, enabling transfers of European insurance to EU-domiciled affiliates or subsidiaries through a court-sanctioned legal transfer process.
It will apply where that insurance business transfer scheme is already underway at the end of the transition period (under the current Part VII regime) and has met two conditions: payment of the regulatory fee and approval of an independent expert. Part VII provision will only take effect on exit day if the UK does not enter into the withdrawal agreement with the EU.
The use of standard contractual clauses (SCCs) in relevant contracts is one way that EEA firms can comply with the EU’s cross-border personal data transfer laws after the end of the transition period in the absence of a decision by the European Commission on UK data protection adequacy.
UK insurance firms are advised to make sure whether their contracts that involve the transfer of personal data need to be updated in line with the EU requirements or to consider other appropriate measures for personal data transfers from the EEA into the UK. This could include reviewing the position for EU vendors or third parties on which the services of UK insurance firms rely on.
Insurance firms with customers residing in the EU, whose UK bank accounts may be closed, are expected to communicate with their customers and review whether making or receiving payments could still be achieved to and from overseas accounts. Firms are also expected to explore alternative arrangements so that impacted customers can continue to benefits from their insurance products. The FCA also expects firms to communicate with their customers in a timely and supportive manner.
EEA passporting insurance firms will need to obtain a temporary Part 4A permission to operate in the UK pending permanent authorisation as Third Country Branches with a Part 4A permission. While in TPR, firms will be subject to the same regulatory obligations and supervisory framework as if they were a Part 4A authorised firm.
The PRA sets its expectations in the Prudential Regulation Authority’s approach to branch authorisation and supervision. Furthermore, the FCA and PRA have set out information for firms on using TPR through the FCA’s website.
The PRA has sent information requests to firms that had notified entering the TPR but had not provided a Part 4A application yet. The PRA requested this information in order to allocate enough resources to review the large volume of the expected Part 4A applications.
TPR firms are expected to submit their Part 4A application during the quarter previously notified to the PRA (for example, Q3 2021).
If a TPR firm anticipates that it will be unable to submit during the quarter previously notified, it should contact the PRA at the earliest opportunity: PRA.TPR@bankofengland.co.uk
https://www.bankofengland.co.uk/prudential-regulation/letter/2020/final-preparations-for-the-end-of-the-transition-period-insurance-firms?sf130864283=1 ; https://www.fca.org.uk/news/statements/fca-writes-joint-letter-brexit-bank-ceos-insurance-firms-updates-website-all-firms
https://www.bankofengland.co.uk/financial-policy-summary-andrecord/2020/october-2020.
Mike Dalmiras joined Complyport in March 2020. Prior to joining Complyport, Mike completed a Schuman Traineeship at the European Parliament. Mike holds an LL.B Law degree from the University of Essex and an MSc in Project and Enterprise Management from University College London (UCL).
The post ‘Final Preparations For End Of The Transition Period’ Letter To CEOs Of Insurance Firms first appeared on Complyport - Your Trusted Partner in Governance, Risk, Compliance & Technology .
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