FSMA Part 4A authorisation application gateway

Statutory route for applying to the FCA (and PRA where dual-regulated) for permission to carry on regulated activities under Part 4A of the Financial Services and Markets Act 2000, including required materials and the s.55V determination clock.

An application for permission to carry on one or more regulated activities is made under Part 4A of the Financial Services and Markets Act 2000 (FSMA), specifically sections 55A to 55F. Applications are submitted to the FCA through the Connect portal. Where the activity is PRA-regulated (for example deposit-taking or insurance), a parallel application is made to the PRA and the two regulators determine the application jointly.

Statutory route: Part 4A FSMA 2000 (ss.55A–55F)
Submission portal: FCA Connect
Required scope detail: Each regulated activity sought, plus any limitations or requirements
Required accompanying materials: Regulatory business plan, governance map, three-year financial projections, SMF approval applications (Form A) under Part 5 FSMA and SM&CR
Senior management approvals: Form A applications for each Senior Management Function under Part 5 FSMA (ss.59–71)
Determination period — complete application: 6 months from receipt (FSMA s.55V(1))
Determination period — incomplete application: 12 months from receipt (FSMA s.55V(2))
When the clock starts: On receipt of the application, not on completeness
Dual-regulation trigger: PRA-regulated activities require a parallel PRA application

Watch the s.55V clock. The 6-month determination period applies only where the application is complete on receipt. An incomplete application starts a 12-month clock from the day the FCA receives it — not from the day the gaps are filled. Applicants who submit through Connect before the regulatory business plan, governance map, financial projections and SMF (Form A) applications are fully prepared therefore lose the benefit of the shorter statutory window.

Scope of permission. The application must identify each regulated activity sought and any limitations or requirements the applicant accepts on the face of the permission. The FCA may grant the permission with limitations, requirements, or on a narrower scope than requested under ss.55E–55F FSMA.

FSMA Threshold Conditions overview

The minimum statutory conditions a firm must satisfy at FCA/PRA authorisation and continuously thereafter, set out in Schedule 6 FSMA 2000 and supplemented by the Financial Services and Markets Act 2000 (Threshold Conditions) Order 2013.

The Threshold Conditions are the minimum standards a firm must meet to be authorised by the FCA or PRA, and must continue to satisfy for as long as it holds Part 4A permission under FSMA 2000. They are set out in Schedule 6 to FSMA (substituted by the Financial Services Act 2012) and supplemented in detail by the Financial Services and Markets Act 2000 (Threshold Conditions) Order 2013 (SI 2013/555).

Primary statutory source: Schedule 6 FSMA 2000 (substituted by Financial Services Act 2012)
Supplementing instrument: Threshold Conditions Order 2013 (SI 2013/555)
FCA-set conditions (Part 1B Sched 6): Location of offices; effective supervision; appropriate non-financial resources; suitability; business model
PRA-set conditions (Parts 1C/1D Sched 6): Legal status; appropriate financial resources (deposit-takers and insurers)
Continuous obligation: Conditions must be satisfied at authorisation and on an ongoing basis
Consequence of breach: FCA/PRA may vary or cancel Part 4A permission under s.55J FSMA

Dual responsibility: For dual-regulated firms (banks, insurers, designated investment firms), the FCA and PRA each apply their own threshold conditions. The PRA's conditions focus on safety and soundness; the FCA's on conduct and consumer outcomes. A firm must satisfy both regulators' conditions on a continuing basis to retain its permission.

Business plan

1

Is the regulatory business plan complete?

Document covers products, target customers, distribution channels, key risks, controls and how the firm will meet its regulated obligations from day one.
2

Are 3-year financial projections present?

Profit and loss, balance sheet and cash flow forecasts for years 1-3, with stated assumptions, capital adequacy position and stress scenarios.

Governance

1

Does the governance map identify every Senior Management Function?

Organisation chart names each SMF holder, reporting lines, committee structure and delegation flows. No SMF role is unallocated.
2

Are all controllers (10% or more) identified?

Every person or entity holding 10% or more of shares or voting rights is named, with controller forms (Form A controllers) prepared for each.

Threshold conditions

FSMA Threshold Condition - appropriate non-financial resources

The FCA-set appropriate non-financial resources threshold condition under paragraph 2D of Schedule 6 FSMA 2000 and article 3(1)(d) of the Threshold Conditions Order 2013, covering systems, controls, governance, staff competence and operational resilience.

The appropriate non-financial resources threshold condition requires FCA-solo regulated firms to have non-financial resources that are appropriate in relation to the regulated activities they carry on or seek to carry on. PRA-authorised firms (deposit-takers and insurers) are subject to a parallel "appropriate financial resources" threshold condition under Parts 1C and 1D of Schedule 6.

Statutory source (FCA-solo): Paragraph 2D of Schedule 6 FSMA 2000
Supplementing provision: Article 3(1)(d), Threshold Conditions Order 2013 (SI 2013/555)
Scope of "non-financial resources": Systems and controls, staff competence, governance arrangements, operational and cyber resilience
Parallel PRA condition: Appropriate financial resources (Parts 1C and 1D, Schedule 6 FSMA)
Continuous test: Resources must remain appropriate throughout the life of the permission
Proportionality: Adequacy is judged relative to the nature, scale and complexity of the firm's regulated activities

What "appropriate" covers: the FCA expects firms to evidence proportionate governance arrangements, fit-and-proper senior managers under SM&CR, sufficient and competent staff, robust IT and operational resilience, effective risk management and compliance functions, and credible business continuity and outsourcing arrangements. Failures in operational resilience or systems and controls have repeatedly been cited by the FCA as breaches of this condition.

FSMA Threshold Condition - suitability

The FCA-set suitability threshold condition under paragraph 2F of Schedule 6 FSMA 2000 and article 3(1)(f) of the Threshold Conditions Order 2013 - the firm and its controllers must be fit and proper.

The suitability threshold condition requires that a firm, its senior managers, and its controllers are fit and proper to carry on the regulated activities for which permission is sought or held. The FCA assesses integrity, competence and capability, and financial soundness across the firm itself, persons who effectively run it, and qualifying shareholders (controllers holding 10% or more).

Statutory source: Paragraph 2F of Schedule 6 FSMA 2000
Supplementing provision: Article 3(1)(f), Threshold Conditions Order 2013 (SI 2013/555)
Assessed against: The firm; senior managers; controllers (10% or more shareholders)
Three core dimensions: Integrity (honesty and reputation); competence and capability; financial soundness
Interaction with SM&CR: Operates alongside the Senior Managers and Certification Regime approval gateway under Part 5 FSMA
Controller approval: Acquisitions of 10% or more require regulator approval under Part 12 FSMA

How it works in practice: the FCA may refuse, vary or cancel a permission where it is not satisfied that the firm and its controllers are fit and proper. Suitability is reassessed on a continuous basis, including on changes of control, regulatory references for senior managers, and through the firm's own annual fit-and-proper assessments under SM&CR.

FSMA Threshold Condition - business model

The FCA-set business model threshold condition under paragraph 2E of Schedule 6 FSMA 2000 and article 3(1)(e) of the Threshold Conditions Order 2013 - firms' business models must be suitable for their regulated activities.

The business model threshold condition requires that a firm's business model - the nature and scale of its commercial activities and how those activities generate revenue - is suitable for the regulated activities it carries on or proposes to carry on. The FCA assesses suitability having regard to the interests of consumers and the integrity of the UK financial system.

Statutory source: Paragraph 2E of Schedule 6 FSMA 2000
Supplementing provision: Article 3(1)(e), Threshold Conditions Order 2013 (SI 2013/555)
Test: Business model must be suitable for the regulated activities carried on or proposed
Reference factors: Interests of consumers; integrity of the UK financial system
Distinct from suitability: Bites on commercial design and revenue model, not on fitness of individuals
Applies to: All FCA-authorised firms (FCA-solo and FCA-side of dual-regulated firms)

What the FCA looks at: revenue model and pricing structure; reliance on a single product, channel or counterparty; dependency on regulated permissions for viability; whether the model relies on consumer harm (for example, churn, complexity, or low engagement) to be profitable; and whether forecast assumptions are realistic. A firm whose business model only works if customers behave against their own interests will struggle to satisfy this condition.

1

Is the location of offices documented?

Head office and (if a UK body corporate) registered office are in the United Kingdom. Address and function of each office stated.
2

Is effective supervision evidenced?

Group structure, close links and ownership chain documented. No legal, regulatory or jurisdictional barriers prevent the FCA from supervising the firm.
3

Are appropriate non-financial resources demonstrated?

Systems and controls, IT capability, premises, outsourcing arrangements, and staff numbers and competence are sufficient for the regulated activities sought.
4

Is suitability evidenced for the firm and every SMF and controller?

Fitness and propriety records, criminal record checks, regulatory references and credit checks complete for the firm, each SMF candidate and each controller.
5

Is the business model rationale documented?

Business model is coherent, viable and consistent with the interests of consumers and market integrity. Revenue sources, conflicts of interest and customer outcomes explained.

People

1

Are SMF Form A submissions ready?

Form A prepared for every individual seeking approval for a Senior Management Function, with supporting CV, references and disclosures attached.
2

Are fitness-and-propriety enquiries documented?

Honesty, integrity and reputation, competence and capability, and financial soundness assessed for each SMF candidate. Evidence retained on file.

Dual regulation

1

Has the PRA been notified if SI 2013/556 applies?

If the firm will accept deposits, effect or carry out contracts of insurance, or otherwise carry on a PRA-regulated activity under the Financial Services and Markets Act 2000 (PRA-regulated Activities) Order 2013, the PRA is the lead regulator and a joint application has been arranged.

Fees

1

Has the application fee category been determined?

Firm has classified the application as Straightforward, Moderately complex or Complex per FCA FEES 3 Annex 1R, calculated the correct fee and is ready to pay on Connect submission.

Official FCA guidance

Applying for authorisation (opens in a new tab)
FCA overview of the Part 4A authorisation process and Connect.
FCA Handbook: COND (Threshold Conditions) (opens in a new tab)
Authoritative source for the threshold conditions firms must meet.
FCA Handbook: FEES 3 Annex 1R (opens in a new tab)
Application fee categories and amounts.

FCA authorisation application readiness checklist

FCA threshold conditions reference

Apply for FCA authorisation under Part 4A FSMA

Cyber security for financial services firms

Which insurance and pension funding rules apply to your business

Insurer authorisation and prudential rules

Business plan

Is the regulatory business plan complete?

Are 3-year financial projections present?

Governance

Does the governance map identify every Senior Management Function?

Are all controllers (10% or more) identified?

Threshold conditions

Is the location of offices documented?

Is effective supervision evidenced?

Are appropriate non-financial resources demonstrated?

Is suitability evidenced for the firm and every SMF and controller?

Is the business model rationale documented?

People

Are SMF Form A submissions ready?

Are fitness-and-propriety enquiries documented?

Dual regulation

Has the PRA been notified if SI 2013/556 applies?

Fees

Has the application fee category been determined?

Official FCA guidance

Related guides in Financial Regulation Overview

Business plan

Is the regulatory business plan complete?

Are 3-year financial projections present?

Governance

Does the governance map identify every Senior Management Function?

Are all controllers (10% or more) identified?

Threshold conditions

Is the location of offices documented?

Is effective supervision evidenced?

Are appropriate non-financial resources demonstrated?

Is suitability evidenced for the firm and every SMF and controller?

Is the business model rationale documented?

People

Are SMF Form A submissions ready?

Are fitness-and-propriety enquiries documented?

Dual regulation

Has the PRA been notified if SI 2013/556 applies?

Fees

Has the application fee category been determined?

Official FCA guidance