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(1) A firm may apply to the FSA to cancel its Part IV permission before it has ceased carrying on all regulated activities. However, where a firm makes a formal application for cancellation of its permission when it has not yet ceased carrying on regulated activities, the FSA will expect the firm:

(a) to cease those regulated activities within the short term (normally no more than six months from the date of application for cancellation); and

(b) to have formal plans to cease its regulated activities in an orderly manner.

(2) Firms should note, however, that the FSA will not grant an application for cancellation of Part IV permission until the firm can demonstrate that it has ceased carrying on all regulated activities (SUP 6.4.19 G).

(3) The FSA may apply additional procedures or require additional information, as if the firm had entered into a long term wind down of business (see SUP 6 Annex 4), if it considers it appropriate to the circumstances of the firm.

The application for cancellation of permission

(1) 3, 4A firm other than a credit union wishing to cancel its Part IV permission, must apply online at www.fsa.gov.uk using the form specified on the FSA's ONA system.4

(2) 4A credit union wishing to cancel its Part IV permission must apply using the form in SUP 6 Annex 6D and submit its application in the way set out in SUP 15.7.4 R to SUP 15.7.9 G (Form and method of notification). The application must be addressed for the attention of the Cancellations Team at the FSA.4

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(4) Until the application has been determined, a firm which submits an application for cancellation of Part IV permission must inform the FSA of any significant change to the information given in the application immediately it becomes aware of the change.

(5) Where a firm is obliged to submit any form, notice or application online under (1), if the FSA's information technology systems fail and online submission is unavailable for 24 hours or more, until such time as facilities for online submission are restored a firm must submit any form, notice or application by using the form in SUP 6 Annex 6D and submitting it in the way set out in SUP 15.7.4 R to SUP 15.7.9 G (Form and method of notification).4

(1) 4If the FSA's information technology systems fail and online submission is unavailable for 24 hours or more, the FSA will endeavour to publish a notice on its website confirming that online submission is unavailable and that the alternative methods of submission set out in SUP 6.4.5 D (5) and SUP 15.7.4 R to SUP 15.7.9 G (Form and method of notification) should be used.

(2) 4Where SUP 6.4.5 D (5) applies to a firm, GEN 1.3.2 R (Emergency) does not apply.

(1) 5In addition to applying for cancellation of Part IV permission in accordance with SUP 6.4.5 D, a firm may discuss prospective cancellations with its usual supervisory contact at the FSA.5 Alternatively a firm can contact the Firms Contact Centre on 0845 606 9966.

(2) To contact the 5Cancellations5 Team:

(a) write to: Cancellations Team, The Financial Services Authority, 25 The North Colonnade, Canary Wharf, London, E14 5HS; or

(b) email cancellation.team@fsa.gov.uk

(3) If a firm which has applied for cancellation decides to remain authorised it should inform the FSA immediately using one of the methods in SUP 6.4.6 G (2).

Information to be supplied to the FSA as part of the application for cancellation of permission

(1) If a firm is subject to the complaints rules in DISP, the FSA may request confirmation from the firm that there are no unresolved, unsatisfied or undischarged complaints against the firm from a customer of the firm.

(2) If there are unresolved or undischarged complaints against a firm from a customer of the firm, the FSA may request confirmation, as appropriate, of the steps (if any) which have been taken under the firm's complaints procedures and the amount of compensation claimed. The FSA may also request an explanation of the arrangements made for the future consideration of such complaints.

Confirmations and resolutions

(1) ceased carrying on all regulated activities;

(2) properly disbursed funds in its client bank accounts and closed those accounts;

(3) discharged all insurance or deposit liabilities; and

(4) properly transferred all investments, title documents and other property that it held on behalf of clients.

Reports from professionals

Approved persons

When will the FSA grant an application for cancellation of permission?

(1) ceased carrying on regulated activities or fully run off or transferred all insurance liabilities;

(2) repaid all client money and client deposits;

(3) discharged custody assets and any other property belonging to clients; and

(4) discharged, satisfied or resolved complaints against the firm.

(1) as part of the application for cancellation of permission, if the firm has ceased carrying on all regulated activities under its Part IV permission at the time of application (see SUP 6.4.9 G); or

(2) after the application but before its determination, if the firm has not ceased carrying on regulated activities under its Part IV permission at the time of application.

(1) there are unresolved, unsatisfied or undischarged complaints against the firm from any of its customers;

(2) the firm has complied with CASS 4.3.99 R7,7 CASS 5.5.80 R and CASS 7.2.15 R 7(Client money: discharge of fiduciary duty) andCASS 4.3.104 R and CASS 7.2.19 R 7(Client money: allocated but unclaimed client money) if it has ceased to hold client money; these rules apply to both repayment and transfer to a third party;8

(3) the firm has ceased to hold or control custody assets in accordance with instructions received from clients (including instructions set out in an agreement entered into in accordance with CASS 2.3.2 R (Custody: client agreement)) and COBS 6.1.7 R6,  (Information concerning safeguarding of designated investments belonging to clients and client money)7;

(4) the firm has repaid all client deposits, if it is ceasing to carry on regulated activities including accepting deposits;

(5) the FSA or another regulator has commenced an investigation against the firm or continuing enforcement action against the firm;

(6) there are any matters affecting the firm which should be investigated before a decision on whether the firm should have its Part IV permission cancelled by the FSA or be disciplined;

(7) the firm has unsettled or unexpired liabilities to consumers, for example, outstanding contracts (such as deposits or insurance liabilities);

(8) the firm has settled all its debts to the FSA; and

(9) the factors set out in SUP 6.4.19 G apply.

The FSA's enforcement and investigation powers against a former authorised person

(1) information gathering and investigation powers in Part XI of the Act (Investigation gathering and investigations) (see9EG 3 (Use of information gathering and investigation powers)9);

(2) powers to apply to court for injunctions and restitution orders in Part XXV of the Act (Injunctions and restitution) (see9EG 109 (Injunctions) and9 EG 119 (Restitution and redress));

(3) powers in Part XXIV of the Act (Insolvency) to petition for administration orders or winding up orders against companies or insolvent partnerships, or bankruptcy orders (or in Scotland sequestration awards) against individuals (see9 EG 13 (Insolvency)9);

(4) powers in Part XXVII of the Act (Offences) to prosecute offences under the Act and other specified provisions (see9 EG 129 (Prosecution of criminal offences)).

(1) powers to take disciplinary action against firms by publishing statements of misconduct under section 205 of the Act (Public censure) or imposing financial penalties under section 206(1) of the Act (Financial penalties); and

(2) the power to require firms to make restitution under section 384 of the Act (Power of the FSA to require restitution).

(1) it proposes to exercise any of the powers described in SUP 6.4.24 G; or

(2) it has already begun disciplinary and restitution proceedings against the firm by exercising either or both of these powers against the firm.

How long will an application take?

(1) Under section 52(1) of the Act (Determination of applications), the FSA has six months to consider a completed application.

(2) If the FSA receives an application which is incomplete, that is, where information or a document required as part of the application is not provided, section 52(2) of the Act requires the FSA to determine the incomplete application within 12 months of the initial receipt of the application.

(3) Within these time limits, however, the length of the process will relate directly to the complexity of variation requested and whether the firm has fully wound down (run off) its activities at the time it applies. The FSA publishes standard response times on its website setting out how long the application process is expected to take in practice. From time to time, the FSA also publishes its performance against these times.

How will FSA make the decision?