On February 5, 2018, the FCA published a consultation setting out proposed changes to its Decision Procedure and Penalties manual and its Enforcement Guide. The amendments to DEPP and EG reflect changes introduced by the EU Benchmarks Regulation, which took effect on January 1, 2018. The Benchmarks Regulation has been implemented in the U.K. by the Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018, which will make the necessary changes to the U.K. statutory framework when they come into force mainly on February 27, 2018.

The FCA proposes to make changes in DEPP to its decision-making procedures for determining applications for: (i) authorization and registration of EU-based benchmark administrators; and (ii) recognition orders or endorsement orders in relation to third country benchmarks. It will also make changes in DEPP to its decision- making procedures for withdrawing, suspending or varying recognition and endorsement orders. Proposed changes in EG relate to how the FCA will apply its penalty policy and decision-making procedure when exercising powers with respect to "miscellaneous BM persons," namely, persons conducting various benchmark-related activities that are not authorized by the FCA. The categories of person that constitute "Miscellaneous BM persons" are defined in the Financial Services and Markets Act 2000 (Benchmarks) Regulations 2018.

The FCA considers that the provisions of Benchmarks Regulation do not require it to make any change to its existing policies on the imposition of penalties, censures, suspensions, restrictions and prohibitions under the Financial Services and Markets Act 2000.

The consultation is open for a short four week period. Comments on the proposals are invited by March 5, 2018 and the FCA intends to publish its Policy Statement and final rules for the changes later in March 2018.

The consultation (FCA CP18/05) is available at: https://www.fca.org.uk/publication/consultation/cp18-05.pdf.

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