PART 9A

Rules and Guidance
CHAPTER 1

Rule-making powers

General rule-making powers of the FCA and the PRA

Rules about recovery plans: duty to consult
137J
1
Before either regulator prepares a draft of any general rules that require
a
relevant person (or
a
relevant person of a specified description) to prepare a recovery plan, the regulator must consult
the Treasury
.
1A
The FCA must also consult the Bank of England.
2
“Relevant person” means—
a
an institution authorised in the
UK
; or
b
a qualifying parent undertaking within the meaning given by section 192B.
3
A “recovery plan” is a document which provides for measures to be taken—
a
by an institution authorised in the
UK
which is not part of a group, following a significant deterioration of the financial position of the institution, in order to restore its financial position; or
b
in relation to a group, to achieve the stabilisation of the group as a whole, or of any institution within the group, where the group or institution is in a situation of financial stress, in order to address or remove the causes of the financial stress and restore the financial position of the group or institution.
4
For the purposes of subsection (3)(a) the definition of “group” in section 421 applies with the omission of subsection (1)(e) and (f) of that section.
6
In this section—
- “
authorised person
”, in relation to the PRA, means PRA-authorised person;
- “
institution
” means—
  1. a credit institution, other than an entity mentioned in Article 2.5 of the capital requirements directive; or
  2. a designated investment firm as defined in Article 4(1)(2AA) of the capital requirements regulation;
- “institution authorised in the
UK
” means
an authorised person who is
—
  1. a bank within the meaning given by section 2 of the Banking Act 2009;
  2. a building society within the meaning given in section 119 of the Building Societies Act 1986; or
  3. an investment firm within the meaning given by section 258A of the Banking Act 2009;
- “
specified
” means specified in the rules.
Pt. 9A applied (1.7.2021) by Regulation (EU) No. 600/2014, Art. 49A(12) (as inserted by Financial Services Act 2021 (c. 22), s. 49(5), Sch. 10 para. 9; S.I. 2021/739, reg. 3(o))
Word in s. 137J(1) substituted (10.1.2015) by The Bank Recovery and Resolution (No. 2) Order 2014 (S.I. 2014/3348), art. 1(2), Sch. 3 para. 2(2)
S. 137J(2)-(4) substituted for s. 137J(2)-(5) (10.1.2015) by The Bank Recovery and Resolution (No. 2) Order 2014 (S.I. 2014/3348), art. 1(2), Sch. 3 para. 2(3)
Words in s. 137J(1) substituted for s. 137J(1)(a)(b) (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 33(2) (with Sch. 3); S.I. 2017/43, reg. 2(g)
Pt. 9A applied (31.12.2020) by The Solvency 2 and Insurance (Amendment, etc.) (EU Exit) Regulations 2019 (S.I. 2019/407), regs. 1(2), 4, Sch. 3 (as amended by S.I. 2020/1301, regs. 1, 3, Sch. para. 27(a) and S.I. 2020/1385, regs. 1(2), 54(2))
Words in s. 137J(6) substituted (1.1.2022) by The Financial Services Act 2021 (Prudential Regulation of Credit Institutions and Investment Firms) (Consequential Amendments and Miscellaneous Provisions) Regulations 2021 (S.I. 2021/1376), regs. 1(3), 4(6)
S. 137J(1A) inserted (1.3.2017) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 2 para. 33(3) (with Sch. 3); S.I. 2017/43, reg. 2(g)
Pt. 9A applied (with modifications) (31.12.2020) by The Over the Counter Derivatives, Central Counterparties and Trade Repositories (Amendment, etc., and Transitional Provision) (EU Exit) Regulations 2019 (S.I. 2019/335), regs. 1(1), 74 (as amended by S.I. 2020/1385, regs. 1(4), 52(7)) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)
Pt. 9A applied (with modifications) (31.12.2020) by The Transparency of Securities Financing Transactions and of Reuse (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/542), regs. 1, 35 (as amended by S.I. 2020/1385, regs. 1(4), 56(7)) (with savings in S.I. 2019/680, reg. 11); 2020 c. 1, Sch. 5 para. 1(1)
Words in s. 137J(6) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 35(b); 2020 c. 1, Sch. 5 para. 1(1)
Pt. 9A substituted for ss. 138-164 (24.1.2013 for specified purposes, 1.4.2013 in so far as not already in force) by Financial Services Act 2012 (c. 21), ss. 24(1), 122(3) (with Sch. 20); S.I. 2013/113, art. 2(1)(c), Sch. Pt. 3; S.I. 2013/423, art. 3, Sch.
Words in s. 137J(6) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 35(a); 2020 c. 1, Sch. 5 para. 1(1)