Prudential Regulation Authority Rulebook

2.1

Each of the functions in 3 –10 is a controlled function and a PRA senior management function.

2.2

PRA senior management function holders must each be approved by the PRA to perform the applicable PRA senior management function.

2.3

1. (1) A firm (other than a third country branch undertaking, a firm that does not have an establishment in the UK or a small run-off firm) must ensure that one or more persons performs each of the following PRA senior management functions on its behalf:
1. (a) the Chief Executive function;
2. (b) the Chief Finance function; and
3. (c) the Chair of the Governing Body function.
2. (2) If a vacancy arises in respect of one or more of the PRA senior management functions set out in (1), a firm must ensure that it appoints a person to fill that vacancy as soon as practicable.

2.4

To the extent that:

1. (1) a firm appoints a person to perform a key function which, but for this rule, would be a PRA senior management function;
2. (2) the appointment is solely to provide cover for a PRA senior management function holder whose absence is:
1. (a) temporary; or
2. (b) reasonably unforeseen; and
3. (3) the appointment is for less than 12 weeks in a consecutive 12-month period,

the description of the applicable PRA senior management function does not relate to those activities of that person.

2.5

1. (1) If, in relation to a firm, a PRA senior management function holder also performs FCA activities, performance of the PRA senior management function will include the performance of those FCA activities, provided the following conditions are met:
1. (a) the PRA’s approval to perform that PRA senior management function has been granted and continues in force;
2. (b) at the time of approval being granted by the PRA, that person was not subject to an FCA approval to perform the particular FCA governing function;
3. (c) the firm made an FCA activities notification; and
4. (d) that person performs and is continuing to perform the FCA activities.
2. (2) If, in relation to a firm, a PRA senior management function holder has been performing FCA activities in the circumstances set out in (1), and that person:
1. (a) ceases to perform the PRA senior management function;
2. (b) within three months of ceasing performance, is approved to perform a new PRA senior management function at the firm; and
3. (c) continues to perform the FCA activities,
3. performance of the new PRA senior management function will include the performance of those FCA activities, provided the conditions in (1) (a) to (d) are met.

2.6

If a PRA senior management function holder to whom 2.5 applies ceases to perform a PRA senior management function but continues to perform the FCA activities, 2.5(1) will continue to apply in respect of the performance of the FCA activities until the earlier of:

1. (1) approval by the FCA in respect of the performance by that person of those FCA activities as an FCA governing function in relation to the firm; or
2. (2) three months from the time that the person ceased to perform that PRA senior management function.

2.6A

If a PRA approved person:

1. (1) (other than in the circumstances set out in 2.5 or 2.6) performs one or more FCA responsibilities;
2. (2) ceases to perform any PRA senior management function; and
3. (3) does not have an FCA approval to perform an FCA controlled function in relation to that firm,
4. the functions in (1) will continue to be part of the PRA senior management function that the person most recently performed for that firm until the earlier of:
1. (a) approval by the FCA in respect of the performance by that person of an FCA controlled function in relation to the firm; or
2. (b) three months from the time that the person ceased to perform that PRA senior management function.

2.7

If a firm that is not significant outsources its internal audit function to an external third party service provider (that is, a service provider outside the firm or the firm’s group), the firm is not required to have any person(s) approved to perform the Head of Internal Audit function.

2.8

1. (1) A firm (other than a UK ISPV) must take all reasonable steps to ensure that before a person begins to perform:
1. (a) a PRA senior management function; or
2. (b) new or revised responsibilities in performance of a PRA senior management function,
2. that person is provided with all of the information and materials that the person may reasonably expect in order to perform that PRA senior management function or those new or revised responsibilities effectively and in accordance with the regulatory system.
3. (2) A firm must:
1. (a) have a written policy to ensure compliance with (1), including in relation to the systems and controls it uses;
2. (b) ensure the policy under (a) is complied with; and
3. (c) maintain adequate records of the steps taken to comply with (1).