FCA Handbook - REC 3.14 Products, services and normal hours of operation

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REC 3.14 Products, services and normal hours of operation

Purpose

The purpose of REC 3.14 is to ensure that the FCA is informed of planned changes to the services a UK recognised body intends to provide and of the normal hours of operation of those services. Unplanned suspensions of those services, unplanned changes in hours of operation and events causing a UK recognised body to be unable to provide those services should be notified to the FCA under the rules in REC 3.15.

Products and services

Where a UK RIE proposes to admit to trading (or to cease to admit to trading) by means of its facilities:

(1)
a specified investment (other than a security or an option in relation to a security); or
(2)
a type of security or a type of option in relation to a security;

it must give the FCA notice of that event, and the information specified for the purposes of this rule in REC 3.14.6 R to the FCA, at the same time as that proposal is first formally communicated to its members or shareholders (or any group or class of them).

When a UK RIE removes a financial instrument from trading on a trading venue, it must immediately give the FCA notice of that event and relevant information including particulars of that financial instrument, any derivative that is also removed from trading that relates or is referenced to that financial instrument, and the reasons for the action taken.

[Note: articles 32(2) and 52(2), paragraph 1 of MiFID. REC 2.6.6UK(4) requires that the FCA be notified when a trading suspension for a financial instrument is lifted or a financial instrument is re-admitted to trading. MiFID ITS 2 specifies a format for communication by the operator to the FCA.]

Where a UK recognised body proposes to provide (or to cease to provide) clearing facilitation services in respect of:

(1)
a specified investment (other than a security or an option in relation to a security); or
(2)
a type of security or a type of option in relation to a security;

it must give the FCA notice of that event and the information specified for the purposes of this rule in REC 3.14.6 R, at the same time as that proposal is first formally communicated to its members or shareholders (or any group or class of them).

Securities falling within the same article in Part III of the Regulated Activities Order which may be given the same generic description (for example, shares admitted to the UK official list) will normally be regarded as being of the same type. Options in relation to the same type of security will normally be regarded as being options of the same type.

The following information is specified for the purposes of REC 3.14.2 R and REC 3.14.3 R:

(1)
a description of the specified investment to which the proposal relates;
(2)
where that specified investment is a derivative, the proposed terms of that derivative; and
(3)
in the case of a UK RIE which is admitting that specified investment to trading, the name of any RCH which will provide clearing services in respect of that specified investment under an agreement with that UK RIE.

Where:

(1)
a UK RIE proposes to amend the standard terms of any derivative admitted to trading by means of its facilities; or
(2)
a UK RIE proposes to amend the standard terms relating to any derivative in respect of which it provides clearing facilitation services;

it must give the FCA notice of that event, and written particulars of those proposed amendments, at the same time as that proposal is first formally communicated to its members or shareholders (or any group or class of them).

Where a UK recognised body proposes to make (or to cease to make) arrangements for the safeguarding and administration of assets belonging to any other person (other than an undertaking in the same group), that recognised body must give the FCA notice of that event, and the information specified for the purposes of this rule in REC 3.14.9 R, at the same time as that proposal is first formally communicated to its members or shareholders (or any group or class of them).

The following information is specified for the purposes of REC 3.14.8 R:

(1)
a description of the assets (or types of assets) to which the proposal relates; and
(2)
the date or dates on which arrangements referred to in REC 3.14.8 R will be made (or cease to be made).

The FCA does not need to be notified of proposals to offer (or to withdraw offers of) safeguarding and administration services for individual assets of the same type. Specified investments (other than securities) falling within the same article in Part III of the Regulated Activities Order will normally be regarded as being of the same type. Securities falling within the same article in Part III of the Regulated Activities Order which may be given the same generic description (for example, shares admitted to the UK official list) will also normally be regarded as being of the same type.

Hours of operation

Where a UK recognised body proposes to change its normal hours of operation or (for RAPs) the timing, frequency or duration of its bidding windows, it must give the FCA notice of that proposal, and particulars of, and the reasons for, the actions proposed, at the same time as the proposal is first formally communicated to its members or shareholders, or any group or class of them.