Q&A: Understanding the new Remuneration Rules under the UK’s Investment Firms Prudential Regime

The UK’s Investment Firms Prudential Regime (“IFPR”) comes into force on 1 January 2022, applicable to all FCA-authorised investment firms providing MiFID services. 

One of the more challenging aspects of IFPR is a more prescriptive approach to remuneration. Firms will want to understand the new rules as soon as possible, identify the potential problem areas and make the necessary adjustment to their remuneration policies and processes.

We’ve pulled together an essential Q&A to help you better understand your remuneration rule requirements under the IFPR, which includes the following topics:

• When do the new rules kick in?
• Does the principal of proportionality still apply to remuneration?
• Which categories of staff are caught by the requirements, and to which forms of remuneration do they apply?
• What are the basic requirements for a Remuneration Policy (applying to all firms, including SNI and non-SNI)?
• What about carried interest and co-investment arrangements (for all firms)?

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Related sources

In addition, we have also prepared a checklist providing top tips to address your obligations, ahead of the 1 January 2022 deadline, access here.

Questions

Our experienced prudential team are on hand with a wide range of solutions designed to help make your IFPR and regulatory reporting obligations as simplified and seamless as possible. We can help you understand the new rules, implement the changes, and support your ongoing regulatory reporting challenges.

Complete this form or call +44 (0) 20 7042 0500 to connect with us.

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How we help

Our team can help you:

• Understand the new rules: The FCA has already published one Discussion Paper and two Consultation Papers on IFPR, to be followed shortly by a third Consultation Paper and a final Policy Statement. Rooted in a firm grasp of the detail and underlying objectives of the new regime, our IFPR Implementation Planner and other briefing documents boil these requirements down to the essential details.
• Implement the changes: We will take you step-by-step through embedding the changes into your financial control and compliance frameworks. This will include documentation such as the new ICARA and regulatory reporting formats, revised remuneration policies, plus supporting compliance and monitoring collateral. Our aim is to support you through the changes whilst causing minimal disruption to your business.
• Regulatory reporting: We offer a comprehensive reporting solution that addresses all your FCA obligations on an on-going basis.

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