On November 19, the UK’s Financial Conduct Authority (FCA) published a consultation paper proposing an increase to application fees paid by new businesses seeking its authorization and application changes made under the Senior Managers Certification Regime (SMCR) (the Consultation Paper).

In the Consultation Paper, the FCA proposes to increase fees for straightforward applications from £1,500 to £2,500 and for moderately complex ones from £5,000 to £10,000 for newly-authorized firms. The FCA states it would help “redress the balance of cost recovery” away from existing fee-payers and recover further monies towards the total cost of authorizations.

The FCA also proposes to introduce fees for changes in control and applications and charge firms for changes made to its personnel under the SMCR. According to the FCA, these fees would compensate itself for the amount of work undertaken when approving applications.

Furthermore, the FCA is looking to introduce a £2,500 fee for claims management companies (CMCs) that apply for permission to seek out people who want to make a claim. These companies act as lead generators, which puts these “lower risk” CMCs in the same bracket as financial advisers and mortgage brokers. The FCA clarifies that the new fee does not apply to lead generators who seek the higher risk permission of ‘advice, investigation or representation.’

Application fees were last reviewed by the FCA in 2014.

The Consultation Paper is available here.