Regulated Individuals  

The Regulated Individuals (RIs) Regime requires certain functions within a firm to be approved prior to being appointed by the GFSC, these are known as regulated individuals.  These also include sector specific functions as well as positions within a firm that exercise significant influence over the running of the firm.  

Schedule 14 and 15 of the Bill set out a list of RIs.

A Significant Influence Function (as per the letter of amendment) is a person (“P”) that exercises significant influence over a regulated firm if, despite not formally having that role:

• P performs a regulated function; 

• P instructs or purports to instruct the person that formally has that role as to how that person should perform a regulated function; or 

• the person that formally has that role habitually or to a material extent performs the regulated function in accordance with P’s wishes or instructions.  

Regulated individuals can be appointed on a temporary basis under specific circumstances, e.g. where it would be unreasonable to expect the firm to find a replacement immediately.  

A person is only permitted to perform a regulated function, including on a temporary basis, if the individual has been approved by the GFSC.  

Next steps

Firms should be familiar with Part 8 of the Bill that sets out the Regulated Individuals Regime and Schedule 14 and 15 that provides a list of the notifiable functions within a firm. 

The GFSC is currently carrying out an information gathering exercise to complete our understanding of what individuals are carrying out regulated individual functions at the firm.  This is a one-off exercise and designed to provide the GFSC with the information needed to align current information with requirements under the LRP. 

For existing firms, we understand that several functions will already have been notified to us, however, the new Act sets out specific functions per industry sector that in addition to the core functions, a firm needs to have in place.   

Once we have processed information provided, we may advise firms to provide further information.  This will only be requested in cases where firms name an individual as providing a RI function that has not previously been notified/approved by the GFSC.