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FCA issues remote working guidance and urges firms to show ‘satisfactory planning’

  • 13/10/2021
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FCA issues remote working guidance and urges firms to show ‘satisfactory planning’
The Financial Conduct Authority (FCA) has issued guidance on remote working to firms, who now have to prove remote working will not negatively impact their operations.


The guidance applies to existing firms, firms applying to be regulated and existing firms submitting further applications.

The FCA said that firms considering remote or hybrid working would be evaluated on a “case-by-case basis” and the burden of proof would be on companies to prove remote working will not negatively impact their operations.

Firms will now have to prove that remote working would not impact the firm’s location in the UK or its ability to meet threshold conditions for regulated activities.

The regulator added that firms would have to show remote working would not impact its ability to oversee business functions, cause detriment to consumers, damage integrity of the market, increase risk of financial crime or reduce competition.

The FCA said that a firm would have to show that remote working would not lead to increased reports about the firm to the regulator and it would not reduce the accuracy of the financials services register.

Firms will also have to show “satisfactory planning” for remote working, covering aspects such as sufficient senior management and oversight, adequate systems and controls, consideration of data, cyber and security risks, appropriate record keeping and meeting regulatory requirements,

Companies should consider the effect of remote working on staff, including wellbeing, training and diversity and inclusion. Legal and operational risks will also have to be considered for staff working abroad.

The regulator said: “It’s important any form of remote or hybrid working adopted should not risk or compromise the firm’s ability to follow all rules, regulatory standards and obligations, or lead to a failure to meet them.”

The regulator added that if there were any “material changes” to how firms intend to operate then it needs to be notified.

It continued that companies should make employees aware that the regulator has powers to visit any location work is carried out, which can include supervisory and enforcement visits.

For firms that are applying to be authorised or registered, then applications need to provide details on remote working arrangements.

This includes considerations of legal implications, performance and oversight of key functions, key manager locations, consumer access arrangements, plans for addressing complex consumer needs, customer authentication and vulnerability assessments and business continuity plan.

Other issues such as where and how FCA supervisory visit will be done and how this will be documented, systems and controls for records, physical documents, team communications and plans for compliance reviews should also be included.

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