FCA Handbook - REC 3.15 Suspension of services and inability to operate facilities

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REC 3.15 Suspension of services and inability to operate facilities

Purpose

(1)
The purpose of REC 3.15.2 R to REC 3.15.5 G is to enable the FCA to obtain information where a UK recognised body decides to suspend the provision of its services in relation to particular investments or (for a RAP) decides to cancel an auction. Planned changes to the provision of services should be notified to the FCA under REC 3.14.
(2)
REC 3.15.6 R to REC 3.15.7 R provide for notification to the FCA where a UK recognised body is unable to operate or provide its facilities for reasons outside its control or where it decides to extend its hours of operation in an emergency.
(3)
REC 3.15.8R provides for notification to the FCA where a RAP has to cancel an auction in specified circumstances.

[Note: REC 2.5.1(8) also requires a UK RIE to report its parameters for halting trading to the FCA]

Suspension of services

Where, for any reason, an RIE halts trading in a financial instrument on a trading venue which is material in terms of liquidity in that financial instrument,

it must immediately give the FCA notice of that event, particulars of that financial instrument, and the reasons for the action taken.

[Note: article 48(5) of MiFID and MiFID RTS 12]

When a UK RIE suspends trading on a trading venue in any financial instrument, it must immediately give the FCA notice of that event and relevant information including particulars of 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 suspends providing clearing facilitation services generally in respect of any derivative (other than an option in relation to a security), type of security or type of option in relation to a security, it must immediately give the FCA notice of that event, particulars of that derivative, type of security or type of option in relation to a security, as the case may be, and the reasons for the action taken.

Where a UK recognised body suspends any arrangements it makes for the safeguarding and administration of any type of asset belonging to any other person (other than an undertaking in the same group), that UK recognised body must immediately give the FCA notice of that event, particulars of that type of asset and the reasons for the action taken.

Specified investments (other than securities or options in relation to securities) falling within the same article in Part III of the Regulated Activities Order will normally be regarded as being assets 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 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.

Inability to operate facilities

Where, because of the occurrence of any event or circumstances, a UK recognised body is unable to operate any of its facilities within its normal hours of operation, it must immediately give the FCA notice of that inability and inform the FCA:

(1)
which facility it is unable to operate;
(2)
what event or circumstance has caused it to become unable to operate that facility within those hours; and
(3)
what action, if any, it is taking or proposes to take to enable it to recommence operating that facility.

Extension of hours of operation

Where, because of the occurrence of any event or circumstances, a UK recognised body extends its hours of operation, it must immediately give the FCA notice of that event, and inform the FCA:

(1)
what event or circumstance has caused it to do so;
(2)
the new hours of operation; and
(3)
the date on which it expects to revert to its normal hours of operation.

Recognised auction platforms - cancellation of auctions

Where a RAP has to cancel an auction in the circumstances set out in regulation 11 of the UK auctioning regulations, it must immediately give the FCA notice of that cancellation.