Written by Ciara Davies

The FCA and PRA have published an updated statement on the impact of COVID-19 on the Senior Managers and Certification Regime (SM&CR), which set out their expectations for solo-regulated firms.

The regulators state that, as firms have adapted to the impact of the pandemic over the past few months, firms’ application of the SM&CR rules will return to normal.

Some of the provisions that were previously applicable will end on 7 January 2021 and the relevant modifications by consent will end after 30 April 2021.

The statement includes the following:

On 7 January the relaxation on the requirement for firms to submit updated Statements of Responsibilities (SoRs) will end. The FCA now expects firms to apply the notification requirements as normal and submit a Form J when significant changes are made to SoRs. The FCA does not expect firms to submit updated SoRs relating to changes made before 7 January 2021.

The FCA had previously issued a Modification by Consent to the 12-week rule to support firms using temporary arrangements during the pandemic. If temporary arrangements made as a result of the pandemic lasted longer than 12 weeks, firms could notify us that they consented to an extension of the 12-week rule. The modification by consent is still available; however, a firm cannot consent to the modification after 30 April 2021. For example, if a temporary replacement for a senior manager is first appointed on 1 January 2021, the allowance for a temporary replacement runs out on 30 April 2021. It makes no difference to the end date when the firm consents to the modification and whether it does this before or after the date of the statement.

 The regulators have made only minor changes to their previous joint statement in relation to furloughed staff.