General Considerations

The F&P guidance only applies to the assessment of F&P for controlled functions i.e. individuals/persons performing a key officer, senior officer, management, directorship or ownership role crucial to the licensee that it warrants approval by the regulator. This should not be confused with work titles. For example, a work title such as Vice President (VP) or Assistant Vice President (AVP) should not need an F&P assessment unless the individual/person is performing a controlled function or is a registered officer e.g. VP Compliance is also responsible for the Compliance function or VP Risk is responsible for the Risk function.

The fact that an individual or person may have been considered F&P for a specific role at one licensed entity, does not necessarily mean that individual or person should automatically be considered F&P for another licensed entity or in another role. When considering the F&P of an individual or person, member states should consider the particular function the person/individual is applying to perform, the specific function that the individual is currently performing, and the activities of the licensee or applicant for licensing.

The F&P test applied to shareholders will generally differ to that applied to persons applying to perform a controlled function.

Member states should see the F&P assessment as both an initial test as approval or licensing, but also as an ongoing test/assessment. This is to say approved persons need to be F&P at the outset and on an ongoing basis. Therefore, where a person has been deemed F&P, member states reserve the right to reassess whether such person continues to be F&P for the current and any newly proposed functions/roles.

Licensees and persons applying for approval as a shareholder, or any other controlled function, are expected to provide comprehensive and honest information. Such information may include details of experience, qualifications, and references, membership of professional bodies and evidence of financial soundness, as applicable. Member states’ regulation must mandate this.

Member states’ regulation and laws should provide a range of sanctions where a licensee or person has knowingly, recklessly or willfully supplied misleading or false information to the regulatory body.