Fees

1.1

This Part, unless otherwise stated, applies to every firm and every person required to pay a fee to the PRA.

1.2

In this Part, the following definitions shall apply:

active capacity

means the capacity of the syndicate(s) under management in the fee year in question, including the capacity of syndicates that are not writing new business but have not been closed off in the year in question.

advanced IRB

means the internal ratings based approach for assessing credit risk referred to in Article 151(4) and (9) of the CRR.

advanced measurement approaches or AMA

means advanced measurement approaches to operational risk based on a firm’s own operational risk management systems as referred to in s312(2) CRR.

annual funding requirement or AFR

means, in respect of any fee year, the total ongoing costs of the PRA as determined by the PRA.

annual quantitative reporting template

means a reporting template set out in EU Regulation 2015/2450 or any other relevant Solvency II Regulations.

application

means a request to the PRA, in any format, for the PRA to exercise its functions in relation to the applicant or for approval, waiver or confirmation of any matter relating to the applicant.

best estimate liabilities for fees purposes

means:

1. (1) for UK Solvency II firms in the general insurance fee block (A3), the sum of items entered under row codes R0010, R0370, R0380, R0410 and R0420, column code C0180, of the annual quantitative reporting template S17.01.01, plus the sum of items entered under row codes R0010 and R0030, column codes C0090, C0140 and C0190, of the annual quantitative reporting template S12.01.01, as reported to the PRA;
2. (2) for non-directive firms in the general insurance fee block (A3), a firm’s total gross technical provisions as reported to the PRA under item 19 of form 15, or where this is not reported because the firm is a marine mutual under the Insurance Companies – Reporting Part, item 29 of form M2, or where the firm is a friendly society, the balance sheet entry C3 claims outstanding where this entry is required under the Friendly Societies (Accounts and Related Provisions) Regulations 1994 (SI 1994/1983), and otherwise zero; and
3. (3) for UK Solvency II firms in the life insurance fee block (A4), the sum of items entered under row codes R0010 and R0030, column codes C0150 and C0210, minus the sum of items entered under row codes R0010 and R0030, column codes C0090, C0140 and C0190 of the annual quantitative reporting template S12.01.01, minus corporate pensions business reported under column code C0180 of the annual quantitative reporting template S14.01.01, and minus 0.35 x unit-linked business which is not also corporate pensions business reported under column code C0180 of the annual quantitative reporting template S14.01.01. as reported to the PRA.

collection agent

means the agent, currently the FCA, designated from time to time by the PRA to collect and analyse tariff data from firms and to calculate, invoice and collect fees on its behalf.

consumer credit-related activity (ies)

means:

any of the activities 1 (a) – (m) in Part 2 or 3A; and

advising on regulated credit agreements for the acquisition of land under Article 53DA

of the Regulated Activities Order in the manner specified in Part 3 of the Regulated Activities Order as being relevant to those activities.

core deposit

means core deposits within the meaning of Article 2(2) of the FSMA (Ring-fenced Bodies and Core Activities) Order 2014.

corporate pensions business

means business reported using product ID codes 300-322 for the annual quantitative reporting template S14.01.01.

cross border services

means for Gibraltar-based firms, services provided under an entitlement conferred by the Financial Services and Markets Act 2000 (Gibraltar) Order 2001 in the United Kingdom without using a physical presence there to offer or provide those services.

deposit acceptors fee block

means the fee block for firms whose Part 4A permission includes accepting deposits but does not include either of the following:

1. (1) effecting contracts of insurance; or
2. (2) carrying out contracts of insurance.

designated firms dealing as principal fee block

means firms whose Part 4A permission includes dealing in investments as principal where the PRA has designated ‘dealing in investments as principal’ a PRA regulated activity in respect of that firm.

directive friendly society

means a friendly society that is a UK Solvency II firm.

due date for payment

means the due date for payment of any fee under this Part, payment being required in cleared funds on or before 5pm on that day or, where it is not a business day, the next business day.

fee block

means firms conducting broadly similar regulated activities grouped together for the purposes of calculating and collecting fees as follows:

A0 - the minimum fee block

A1 – the deposit acceptors fee block

A3 – the general insurance fee block

A4 – the life insurance fee block

A5 – the Lloyd’s managing agents fee block

A6 - the Society of Lloyd’s fee block

A10 – the designated firms dealing as principal fee block

fee payer

means any firm or person required to pay a fee in accordance with this Part of the Rulebook.

fee tariff (s) or tariff

means a payment or scale of payments in accordance with the PRA’s fee-charging system.

fee year

means the PRA’s fee year, being twelve months from 1 March in one calendar year to the last day of February in the following calendar year.

first fee year

means the fee year during which a firm becomes authorised or receives an extended Part 4A permission in relation to PRA-regulated activity, but for the purposes of the 2020-21 fee year this does not include firms which are former incoming EEA firms or former incoming Treaty firms and where the same legal entity receives new or extended Part 4A permission in relation to PRA-regulated activity during the course of that fee year.

Form ELS

means the eligible liabilities return by which banks and building societies provide information to the Bank of England as required by the Bank of England Act 1998.

foundation IRB

means the internal ratings based approach for assessing credit risk referred to in Article 143(1) of the CRR.

Gibraltar-based firms

has the meaning in the Financial Services and Markets Act (Gibraltar) Order 2001.

general insurance fee block

means firms whose Part 4A permission includes effecting or carrying out contracts of general insurance or contracts of long term insurance other than life policies or firms whose Part 4A permission is insurance risk transformation.

gone into run-off

means that an insurer has acquired the following characteristics:

1. (1) it has ceased to effect new contracts of insurance;
2. (2) its permission for effecting contracts of insurance has been cancelled;
3. (3) its exclusive remaining business is administering its remaining insurance liabilities;
4. and
5. (4) if required to do so, it has submitted a run-off plan to the PRA.

gross written premium for fees purposes

means:

1. (1) for UK Solvency II firms in the general insurance fee block (A3), the total of items entered under row codes R0110, R0120 and R0130, as expressed in column code C0200 where this column is completed for those row codes, of the annual quantitative reporting template S.05.01.01, as reported to the PRA;
2. (2) for non-directive firms in the general insurance fee block (A3), a firm’s gross premium written as reported to the PRA under item 11 of form 11, or where this is not reported because the firm is a Swiss general insurer or holds a relevant waiver, the entry at sheet 1, line 1, column 1, of form 20A, or where the firm is a friendly society, the income and expenditure account entry for gross premium written or contributions as income receivable, as appropriate under the Friendly Societies (Accounts and Related Provisions) Regulation 1994 (SI 1994/1983); and
3. (3) for UK Solvency II firms in the life insurance fee block (A4), the item entered under row code R1410, column code C0300 of the annual quantitative reporting template S05.01.01 minus corporate pensions business reported under column code C0060 of the annual quantitative reporting template S14.01.01, and minus 0.35 x unit-linked business which is not also corporate pensions business reported under column code C0060 of the annual quantitative reporting template S14.01.01, as reported to the PRA.

Group internal model

means the internal models referred to in Articles 230 and 231 of the Solvency II Directive.

insolvency proceedings

means:

1. (1) any proceedings under the Insolvency Act 1986 or Companies Act 2006 to have a firm declared insolvent or to wind up its business including, without limitation, administration, company voluntary arrangement, scheme of arrangement, receivership, administrative receivership, liquidation, sequestration or appointment of a trustee in bankruptcy;
2. (2) any proceedings under the Banking Act 2009 special insolvency regime; or
3. (3) any equivalent process in any jurisdiction outside the United Kingdom.

insurance business transfer scheme

means a scheme to transfer the whole or part of the business of an insurance undertaking or member or former member of the Society which meets the conditions of Part VII FSMA or, where applicable, the Financial Services and Markets Act 2000 (Control of Transfers of Business Done at Lloyd’s) Order 2001(SI 2001/3626).

internal model method or IMM

means the internal approach to counterparty credit risk referred to in Article 283 of the CRR.

Internal models approach or IMA

means the internal models approach referred to in Article 363 of the CRR.

late payment interest

means interest at the rate of 5% per annum above the official bank rate of the Bank of England from time to time in force.

life insurance fee block

means firms whose permission includes effecting or carrying out contracts of insurance which are, or include, life policies or entering into a funeral plan contract as provider.

life policy

means:

1. (1) a contract of long-term insurance other than a pure protection contract;
2. (2) a long-term care insurance contract which is a pure protection contract; and
3. (3) a pension term assurance policy.

Lloyd’s managing agents fee block

means firms whose permission includes managing the underwriting capacity of a syndicate as a managing agent at the Society.

model maintenance fee

means the fee or fees in 3.22.

modified eligible liabilities or MELs

minimum fee block

means the fee block comprising all firms referred to in Table I of the Periodic Fees Schedule.

new authorisations

means any application, or granting of an application, for (1) a Part 4A permission which includes a PRA regulated activity or (2) a top-up permission which includes a PRA regulated activity.

passported activity

means:

1. (1) for former incoming EEA firms and former incoming Treaty firms, an activity carried on under an EEA right or Treaty right, prior to IP completion day, and subsequently under any legislative provision which replaces it;
2. (2) for Gibraltar-based firms, an activity carried out under an entitlement conferred by the Financial Services and Markets Act 2000 (Gibraltar) Order 2001.

pension term assurance policy

means a personal pension policy which is a pure protection contract and in connection with which tax relief is available under Chapter 4 of Part 4 of the Finance Act 2004.

periodic fee(s)

means the fee or fees payable in accordance with Chapter 3.

Periodic Fees Schedule

means the schedule of periodic fees annexed to Chapter 3, which is replaced annually following the PRA’s fee rates consultation.

personal pension policy

means a pension policy under which contributions (single or regular) are paid to a personal pension scheme.

pure protection contracts

means:

1. (1) a contract of long-term insurance in respect of which the following conditions are met:
1. (a) the benefits under the contract are payable only on death or in respect of incapacity due to injury, sickness or infirmity;
2. (b) the contract has no surrender value, or the consideration consists of a single premium and the surrender value does not exceed that premium; and
3. (c) the contract makes no provision for its conversion or extension in a manner which would result in it ceasing to comply with (a) or (b); or
2. (2) a reinsurance contract covering all or part of a risk to which a person is exposed under a contract of long-term insurance that meets the conditions in (1).

reattribution

means the process under which an insurer seeks to redefine the rights and interests of policy holders.

regulatory transaction fee(s)

means the fee or fees payable in accordance with Chapter 4.

second fee year

means the fee year commencing on 1 March immediately following the end of the firm’s first fee year.

special project fee(s) or SPF (s)

means the fee or fees payable in accordance with Chapter 5.

Society of Lloyd’s fee block

means the fee block of which the Society and its subsidiaries are members.

Solo internal model

means the internal model referred to in Article 112 of the Solvency II Directive.

tariff bands

means broad groupings of business volumes for the purpose of calculating periodic fees.

tariff base

means the PRA’s methodology for calculating volumes of business for the purposes of determining periodic fees.

tariff data

means information about a firm’s business used in the calculation of periodic fees.

tariff rate

means the rate of fee applied to a particular activity for the purpose of calculating periodic fees.

third country branch

means United Kingdom branches of firms which are incorporated elsewhere in the world, excluding Gibraltar.

total assets for fees purposes

means for firms in the designated firms dealing as principal fee block (A10), the sum of the firm's assets as recorded at row 380 of data item template 1.01 of Annex III of the Supervisory Reporting ITS.

total operating income for fees purposes

means for firms in the designated firms dealing as principal fee block (A10), the sum of the firm's net operating income as recorded at row 355 of data item template 2 of Annex III of the Supervisory Reporting ITS.

unit-linked business

means business reported using product ID codes 102, 112, 122, 132, 202, 212, 222, 232, 302, 312, 322, 622, and 722 for the annual quantitative reporting template S14.01.01.

valuation point

means the relevant date or period for assessing a firm’s tariff data and calculating periodic fees under Chapter 3.

2.1

All fees must be paid in full and without deduction on the due date for payment.

2.2

The due date for payment of:

1. (1) periodic fees is as specified in 3.15;
2. (2) regulatory transaction fees is as specified in 4.2;
3. (3) special project fees is as specified in 5.8.

2.3

As permitted by paragraphs 31(7) and 35 of Schedule 1ZB of FSMA, the PRA may take all steps and seek all remedies available to a creditor to recover, as a debt due to the PRA, any fee or other amount, such as interest, which remains unpaid after it falls due.

2.4

The PRA may take regulatory action in relation to non-payment of fees in addition to, or instead of, any steps taken or remedies pursued under 2.3.

2.5

Fee-payers must comply with directions, whether in an invoice, form, notice or otherwise, of the collection agent when acting in that capacity on behalf of the PRA.

2.6

Subject to 2.8, a fee payer who does not pay the full amount of a fee by the due date for payment will incur late payment interest on any unpaid part of the fee, accruing on a daily basis from the due date for payment until payment is made.

2.7

The PRA will not charge interest on late payment interest.

2.8

Late payment interest does not apply to regulatory transaction fees and special project fees.

2.9

If it appears to a firm in relation to any fee that in the exceptional circumstances of a particular case requiring payment or retaining a sum previously paid would be unduly burdensome or would not achieve the purpose for which the fee rule was made, a firm may apply to the PRA under section 138A FSMA for the PRA to:

1. (1) waive the payment;
2. (2) reduce the amount payable; or
3. (3) make a whole or partial refund of sums already paid.

2.10

A claim by a fee payer under section 138A FSMA, in accordance with 2.9 and based on the fee payer’s error must be made within two years of the beginning of the period to which the fee relates.

3.1

Periodic fees are payable in respect of each PRA fee year by any person who is, or becomes, a firm during the fee year.

3.2

The amount payable depends upon the fee block to which the firm has been allocated. Firms falling into more than one fee block pay periodic fees in relation to each, other than firms falling within the A6 Society of Lloyd’s fee block and any other fee block, which pay periodic fees in relation to the A6 fee block only.

3.3

Periodic fees payable by firms in any fee year will be the sum of the following (so far as applicable to them):

1. (1) a minimum periodic fee at the rate specified in Table IA of the Periodic Fees Schedule;
2. (2) [deleted];
3. (3) periodic fees at the rate specified in Table IIIA, subject to any modifications in Table IV and Table V, of the Periodic Fees Schedule calculated as follows:
1. (a) applying the tariff bases and valuation points set out in 3.4 to the tariff data which they have supplied to the PRA or its collection agent;
2. (b) where applicable, grouping tariff data into the tariff bands shown in Column 3 of Table IIIA of the Periodic Fees Schedule; and
3. (c) applying the appropriate tariff rate as shown in Column 4 of Table IIIA of the Periodic Fees Schedule;
4. the fee being the total of sums payable in respect of all tariff bands;
5. (4) [deleted]
6. (5) [deleted]; and
7. (6) [deleted.]
8. (7) a model maintenance fee calculated in accordance with Table VIII of the Periodic Fees Schedule.

3.4

The tariff bases and valuation points referred to in 3.3 (3)(a) are:

1. (1) for firms in the deposit acceptors fee block (A1):
1. (a) if the firm is a bank and reports monthly, average MELs for October, November and December prior to commencement of the fee year; or
2. (b) if the firm is a bank and reports quarterly, MELs for the December prior to commencement of the fee year; or
3. (c) if the firm is a building society, average MELs for October, November and December prior to commencement of the fee year; or
4. (d) if the firm is a credit union, either its MELs for the December preceding the commencement of the fee year or, in the absence of December MELs its MELs as disclosed by its most recent annual return submitted for regulatory reporting purposes prior to the December preceding commencement of the fee year.
2. (2) for firms in the general insurance fee block (A3) the firm’s gross written premium for fees purposes and its best estimate liabilities for fees purposes for the firm’s financial year which ends in the calendar year to 31 December prior to commencement of the fee year, unless the firm is a UK ISPV, in which case the tariff base is not relevant and a flat fee shown in Table IIIA of the Periodic Fees Schedule is payable, noting that:
1. (a) this tariff base (A3) does not include gross written premium for fees purposes and best estimate liabilities for fees purposes on which a composite firm reports data relevant for the life insurance fee block (A4).
2. (b) where any figure used in the calculation of this tariff base (A3) is a negative number, it shall instead be deemed to be zero.
3. (c) in the calculation of the periodic fee due under 3.3(3) for this fee block (A3), the following weightings shall apply:
   1. (i) 90% of the periodic fee shall be determined from gross written premium for fees purposes; and
   2. (ii) 10% of the periodic fee shall be determined from best estimate liabilities for fees purposes.
3. (3) for firms in the life insurance fee block (A4):
1. (a) for UK Solvency II firms, including composite firms which are also UK Solvency II firms to the extent that they are required to report data used for this tariff base (A4), the firm’s gross written premium for fees purposes and its best estimate liabilities for fees purposes, for the firm’s financial year which ends in the calendar year to 31 December prior to commencement of the fee year;
2. (b) for non-directive firms, including non-directive firms which are also composite firms to the extent that they come within the life insurance fee block, the tariff base is not relevant to the level of fees due and only the minimum fee as specified in Table IA of the Periodic Fees Schedule is payable.
3. (c) Where any figure used in the calculation of this tariff base (A4) is a negative number, it shall instead be deemed to be zero.
4. (d) in the calculation of the periodic fee due under 3.3(3) for this fee block (A4), the following weightings shall apply:
5. 1. (i) 60% of the periodic fee shall be determined from gross written premium for fees purposes; and
   2. (ii) 40% of the periodic fee shall be determined from best estimate liabilities for fees purposes.
4. (4) for firms in the Lloyd’s managing agents fee block (A5), active capacity as reported to the Society for the underwriting year which is in progress at the beginning of the fee year.
5. (5) for firms in the designated firms dealing as principal fee block (A10), total assets for fees purposes as at 31 December preceding commencement of the fee year and the firm’s total operating income for fees purposes for the four quarters ending on or before 31 December preceding commencement of the fee year. In the calculation of the periodic fee due under 3.3(3) for this fee block (A10), the following weightings shall apply:
   1. (a) 50% of the periodic fee shall be determined from total assets for fees purposes; and
   2. (b) 50% of the periodic fee shall be determined from total operating income for fees purposes.
6. (6) For all firms, if the data source specified in the applicable tariff base is not available to the PRA for any reason and the same data is available to the PRA from an alternative source, periodic fees applicable to any firm under 3.3(3) will be calculated using that alternative source.
7. (7) For firms in the designated firms dealing as principal fee block (A10), if, despite a firm having complied with its reporting obligations, fewer than four quarters of data for total operating income for fees purposes have been reported to the PRA, the arithmetic mean of the reported data shall be calculated, and multiplied by 4.

3.5

The periodic fees payable by:

1. (1) the Society are as specified in Table IIIA of the Periodic Fees Schedule.
2. (2) [deleted]
3. (3) [deleted]

3.6

The following requirements apply to all firms whose activities give rise to periodic fees, other than firms which pay only a flat rate of fee:

1. (1) [deleted]
2. (2) if the PRA does not, on its own behalf or through its collection agent, obtain sufficient, or sufficiently detailed, information, the PRA may obtain this through its general information-gathering powers;
3. (3) [deleted]
4. (3A) for third country branches and Gibraltar-based firms, the information required for the tariff base is in relation to PRA regulated activities of the firm carried on from offices in the United Kingdom.
5. (4) as periodic fees in respect of any fee year are calculated on the basis of firms’ tariff data for the previous fee year, there may be insufficient tariff data on which the periodic fees may be calculated under 3.4 where a firm becomes authorised for the first time or undertakes a new PRA-regulated activity, resulting in a significant change to its business. In those circumstances, the periodic fees payable will be calculated in accordance with:
1. (a) 3.7 for firms in their first fee year;
2. (b) 3.9 and 3.10 for firms in the deposit acceptors fee block (A1), the general insurance fee block (A3) or the life insurance fee block (A4) in their second fee year or any subsequent fee year;
6. (5) a firm intending to apply any of the methods of calculation in 3.9 must notify the PRA’s collection agent by the date specified in 3.6 (1).
7. (6) Unless 3.7 or 3.9 applies, where a firm has not provided sufficient tariff data for any period by reference to which periodic fees are to be calculated, but a valuation is available for the previous period by reference to which periodic fees are to be calculated, the fee should be calculated using the tariff data applicable to the previous period multiplied by 1.10. An administration fee of £125.00 is payable in this case in addition to the minimum fee.

3.7

A firm in its first fee year pays periodic fees based on its projected valuation for the first twelve months of its new business as follows:

1. (1) The calculation requires the firm to identify, in Table III of the Periodic Fees Schedule, the tariff rates which will be relevant to it as a result of its new or extended permission and apply the formula in 3.7 (2). The resulting figure will be the periodic fee payable by the firm for its first fee year.
2. (2) The formula referred to at 3.7(1) is (A+B) x C, where:
1. A = the amount arrived at by applying the tariff rates in Table III of the Periodic Fees Schedule to the firm’s projected valuation for its first year of new business, as provided to the PRA or its collection agent during the application and data collection process;
2. B = the A.0 minimum fee, unless already paid; and
3. C = the number of calendar months (inclusive) between the calendar month during which the firm received its new or extended permission and the last calendar month of the fee year ÷ 12.

3.8

3.9 applies only to firms in the deposit acceptors fee block (A1), the general insurance fee block (A3) or the life insurance fee block (A4).

3.9

Subject to 3.10, where in:

1. (1) its second fee year; or
2. (2) any subsequent fee year,

a firm has not submitted tariff data to enable the periodic fees calculation to be made in respect of that fee year, periodic fees will be calculated in accordance with Table A below:

3.10

Except in the circumstances to which 3.9 applies, firms in their second fee year or any subsequent fee year after receiving a new or extended permission must calculate their new or additional liability for periodic fees in accordance with 3.4.

3.11

The following modifications to periodic fees will apply:

1. (1) [deleted]
2. (1A) In relation to Gibraltar-based firms, the modifications in 3.7 apply only in relation to the relevant regulated activities of the firm carried on from offices in the United Kingdom.
3. (2) Periodic fees in the A3 general insurance fee block and the A4 life insurance fee block payable by firms outside the scope of the Solvency II Directive are subject to the modifications in Table V of the Periodic Fees Schedule, to be applied to the final figure arrived at under 3.3(3) once all other modifications relevant to this part of the firm’s periodic fees have been taken into account.
4. (3) [Deleted.]

3.12

Where:

1. (1) a firm (A) acquires all or part of the business of another firm (B) in relation to which a periodic fee would have been payable by B; or
2. (2) A becomes authorised as a result of B’s simple change of legal status as defined in 4.5 (4), the following rules apply:
1. (a) if before the date of the acquisition, B had already paid the periodic fees in relation to the business or part of the business acquired by A, A will not pay a further fee; and
2. (b) if the acquisition occurs after the valuation point applicable to the business or part of the business acquired as set out in 3.4, A will pay periodic fees in relation to the period following the acquisition as if the acquisition had occurred immediately before the relevant valuation point.
3. (3) Where the acquisition involves a calculation of periodic fees for the A4 life insurers fee block:
1. (a) [deleted];
2. (b) If any business is transferred to A from B under the procedure set out in Part VII of FSMA and that business would have been included in B’s tariff base in the absence of the transfer, that business should be included in A or B’s tariff base depending on the date of transfer as required by 3.12(2)(b).
3. (c) Best estimate liabilities for fees purposes should include all new business transferred from B.

3.13

If a firm makes an application to cancel or reduce the scope of its Part 4A permission before the start of a fee year, the obligation to pay periodic fees under 3.1 will apply as if the relevant variation or reduction in scope had also taken effect immediately before the start of the fee year.

3.14

If, after the start of the fee year, a firm applies to cancel its Part 4A permission or if a new business activity or event which has given rise to a fee no longer applies to the firm, the firm is still liable to pay and will not be refunded periodic and other fees for that fee year, other than in cases where the PRA exercises its discretion under section 138A FSMA, in accordance with 2.9.

3.15

The due date for payment of periodic fees is as follows:

1. (1) Subject to 3.15 (3), any firm whose total liability for periodic fees in the previous fee year was less than £50,000 must pay the total periodic fee due for the current fee year in full by 1 August.
2. (2) Any firm whose combined total liability for periodic fees payable to the FCA and the PRA in the previous fee year was £50,000.00 or above must pay its periodic fees for the current year in two tranches as follows:
1. (a) an amount equal to 50% of the PRA periodic fee payable in the previous fee year on or before 1 April in the current fee year; and
2. (b) the balance of the periodic fee for the current fee year by 1 September.
3. (3) If a firm cancels its Part 4A permission in the way set out in Permissions and Waivers or the PRA has exercised its own-initiative powers to cancel a firm’s Part 4A permission, the total amount of periodic fees for the fee year, less any amounts already paid, become payable immediately before the cancellation takes effect.

3.16

A fee payer need not pay a periodic fee on the due date for payment under the relevant provision of 3 if that date falls during a period during which circumstances described in General Provisions 2.2 exist and the firm has reasonable grounds to believe that those circumstances impair its ability to pay the fee, in which case the firm must pay on or before the fifth business day after the end of that period.

3.17

Fee-payers must comply with directions from the PRA or its collection agent as to payment of periodic fees arising from any variance between budgeted and actual AFR or any corrections to the AFR once final, audited figures are available in relation to any fee year. As the PRA may determine:

1. (1) a surplus of fee income against AFR may result in a credit to firms or fee blocks; and
2. (2) a shortfall may necessitate a call for additional fees.

3.18

[Deleted.]

3.18A

1. (1) [Deleted.]
2. (2) [Deleted.]
3. (3) [Deleted.]

3.19

[Deleted.]

3.20

[Deleted.]

3.21

[Deleted.]

3.22

3.22 to 3.23 apply to CRR firms and UK Solvency II firms.

3.23

In the fee year commencing on 1 March 2018 and subsequent fee years:

1. (1) The PRA will charge a model maintenance fee to recover in whole or part the annual cost to the PRA, as determined by the PRA, of monitoring, reviewing and policy development for firms’ models for which permission has been granted under the CRR or the Solvency II directive.
2. (2) For firms with one or more models for which permission was granted before 1 March 2018, the model maintenance fee is payable for the fee year commencing on 1 March 2018 and in fee years thereafter.
3. (3) Where a first or additional model permission is granted to a firm on or after 1 March 2018 and during the first six months of any fee year, the model maintenance fee for that model is payable as from the commencement of the first subsequent fee year and in fee years thereafter.
4. (4) Where a first or additional model permission is granted to a firm on or after 1 March 2018 and during in the second six months of any fee year, the model maintenance fee for that model is payable as from the commencement of the second subsequent fee year and in fee years thereafter.
5. (5) The model maintenance fee is calculated in accordance with Table VIII of the Periodic Fees Schedule.
6. (6) For a CRR firm or group, the model maintenance fee shall be the sum of all fees applicable to that firm or group for each permitted model type.
7. (7) For composite firms which are also UK Solvency II firms, the model maintenance fee shall be determined by the fee block for which the firm or group pays the largest periodic fee under 3.3(3).
8. (8) For models incorporating more than one UK firm, the model maintenance fee shall be determined by reference to aggregated figures for all UK firms included within the scope of that model, and shall usually be payable by the firm which pays the largest periodic fee under 3.3(3) or otherwise by such firms and in such proportions as the PRA directs. To facilitate the aggregation calculation where a model incorporates one or more CRD credit institutions and one or more designated investment firms within its scope, for each designated investment firm which is also a UK firm, total assets for fees purposes shall be rounded to the nearest £1million, and each £1million of total assets for fees purposes shall be deemed equivalent to £0.4million in modified eligible liabilities. Total modified eligible liabilities shall then be added together for all UK firms within scope of the model.
9. (9) The Society shall not be required to pay a model maintenance fee.

TABLE IA MINIMUM PERIODIC FEES RATES

TABLE II - TRANSITION COSTS ALLOCATION

[Deleted.]

TABLE IIIA – PERIODIC FEE RATES APPLICABLE TO PRA FEE BLOCKS OTHER THAN THE MINIMUM FEE BLOCK FOR THE FEE YEAR 2022-23

TABLE IV – MODIFICATIONS TO PERIODIC FEES FOR GIBRALTAR-BASED FIRMS

TABLE V – MODIFICATIONS TO PERIODIC FEES FOR NON-DIRECTIVE FIRMS IN THE A1 AND A3 FEE BLOCKS

TABLE VI – EU WITHDRAWAL COSTS ALLOCATION

[Deleted]

[Deleted.]

TABLE VIII – MODEL MAINTENANCE FEES

TABLE IX – RING-FENCING FEE

[Deleted.]

4.1

This chapter does not apply to Gibraltar-based firms exercising entitlements under the Financial Services and Markets Act 2000 (Gibraltar) Order 2001.

4.2

Unless otherwise indicated in 4, the due date for payment of regulatory transaction fees is on or before the application is made.

4.3

Regulatory transaction fees incurred by a firm remain payable even if an application is withdrawn. Regulatory transaction fees once received by the PRA, or by the collection agent on its behalf, are non-refundable.

4.4

Chapter 4 shows regulatory transaction fees payable to the PRA. As all PRA firms are dual regulated, fees may also be payable to the FCA.

4.5

Regulatory transaction fees for applications for new authorisations are payable in accordance with Table B:

1. (1) [Deleted.]

1. (2) [Deleted.]
2. (3) Where an application is categorised as either straightforward or moderately complex and involves a simple change of legal status as defined in 4.5 (4), the fee payable for a new authorisation is discounted by 50%.
3. (4) An application involves only a simple change of legal status under 4.5(3) if it is from an applicant which:
1. (a) is a new legal entity intending to carry on the business, using the same business plan, of an existing firm where the latter has no outstanding regulatory obligations and is cancelling its Part 4A permission; and
2. (b) will:
1. (i) have the same or a narrower Part 4A permission and the same branches as the firm;
2. (ii) assume all of the rights and obligations in connection with any of the PRA regulated activities carried on by the firm;
3. (iii) continue the same compliance arrangements in relation to client assets and client money as the firm except for any changes required only as a result of the change of legal status; and
4. (iv) continue with a risk profile and arrangements for controlling and monitoring risk which will not be materially different from those of the firm.
4. (5) [Deleted.]
5. (6) Where a new authorisation under 4.5 or an exercise of entitlements by a Gibraltar-based firm in line with 4.6A relates to more than one PRA regulated activity, a single fee, being the highest applicable regulatory transaction fee, is payable.
6. (7) An application for a new authorisation is not deemed complete until the regulatory transaction fee is paid.

4.5A

A parent financial holding company or parent mixed financial holding company (both within the meaning of s192O of FSMA) shall pay a regulatory transaction fee of £2,500 in respect of an application for approval or exemption made under s192Q of FSMA (and such a fee shall be in addition to any other regulatory transaction fee payable).

4.6

[Deleted.]

4.7

1. (1) [Deleted.]
2. (2) [Deleted.]
3. (3) Subject to paragraph (4), where a fee-payer or FCA authorised firm seeks to vary its existing Part 4A permission to:
4. 1. (a) include a PRA regulated activity, or
   2. (b) include, in relation to a PRA regulated activity, the activity of providing services to retail clients,
5. the fee payable shall be £25,000.00.
6. (4) In a case where the fee-payer or FCA authorised firm seeks to vary its existing Part 4A permission to include a PRA regulated activity described in:
1. (a) fee block A1 in respect of a credit union or fee block A4 in respect of a friendly society, it shall be £1,500.00;
2. (b) fee block A3 in respect of an ISPV or friendly society or fee block A5 in respect of a Lloyd's managing agent, it shall be £5,000.00.

4.8

The transferor seeking regulatory consent for an insurance business transfer scheme under Part VII of FSMA pays a regulatory transaction fees of £20,000.00, the due date for payment being on or before the date of any application to the PRA for the appointment of an independent expert.

4.9

For the purposes of 4.8 an insurance business transfer scheme involving more than one transferor or transferee may, at the PRA’s discretion, be treated as a single scheme to which only one fee will be applied. Where there is more than one transferor they will be jointly and severally liable for the fee.

4.10

A transferor in an insurance business transfer scheme may be liable to pay a regulatory transaction fee under 4.8 and a special project fee under 5 in relation to the same subject matter.

4.11

[Deleted.]

4.12

[Deleted.]

4.12A

4.12A to 4.15A apply to CRR firms and UK Solvency II firms.

4.13

[Deleted.]

4.13A

Regulatory transaction fees are payable:

1. (1) as set out in 4.14A where a CRR firm seeks permission from the PRA in its capacity as United Kingdom regulator or consolidating supervisor to use one of the model types referred to in 4.14A which require consent under Part Three of the CRR;
2. (2) as set out in 4.14B where any of the following applications are made which require consent under Title I or Title III of the Solvency II Directive:
1. (a) a UK Solvency II firm seeks permission from the PRA in its capacity as United Kingdom regulator for permission to use a solo internal model;
2. (b) a UK Solvency II firm seeks permission from the PRA in its capacity as Solvency II group supervisor for permission to use a group internal model; or
3. (c) a Solvency II undertaking seeks permission from its group supervisor to use a group internal model which includes within the model’s scope one or more UK Solvency II firms.

4.14

[Deleted.]

4.14A

1. (1) Where a CRR firm seeks permission to apply any model type the fee payable is as set out in Table D below.

Table D - Model types under CRR

4.14B

1. (1) Where a UK Solvency II firm or a Solvency II undertaking seeks permission for an internal model, the fee payable is as set out in Table E below, subject to 4.14B(2) and 4.14B(3).
2. (2) Where a firm or a group falls within both the general insurance fee block and the life insurance fee block, the fee payable is the greater of the fees due under each fee block.
3. (3) Where a Solvency II undertaking seeks permission for a group internal model which includes one or more UK Solvency II firms within its scope, the fee is calculated using aggregated tariff data for all in-scope UK Solvency II firms, and is payable by such of those firms and in such proportions as the PRA directs.

Table E – Internal model application fees

4.15

[Deleted.]

4.15A

The due date for payment under 4.12A to 4.14B is as follows:

1. (1) where the application is made directly to the PRA, on or before the application is made;
2. (2) within 30 days after the PRA notifies a CRR firm that its EEA parent’s consolidating supervisor has requested assistance; or
3. (3) within 30 days after the PRA notifies a UK Solvency II firm that it has received a copy of a group internal model application from the Solvency II group supervisor which includes the UK Solvency II firm within its scope.

4.16

Where the PRA has given notice to a fee payer of its intention to itself appoint a skilled person to:

1. (1) provide it with a report pursuant to s166(3)(b) of FSMA; or
2. (2) collect or update information pursuant to Section 166A(2)(b) of FSMA;

the fee will be the amount invoiced by the skilled person.

4.17

The due date for payment by the firm is 30 days from the date of each invoice from the PRA to the firm.

5.1

In the circumstances described in this Chapter, a firm may be required to pay a special project fee for restructuring in addition to the other fees that it pays.

5.1A

In this Chapter “firm” includes an FCA authorised firm seeking to vary its Part 4A permission to include a PRA regulated activity.

5.2

An SPF for restructuring becomes payable by a firm if it engages, or prepares to engage, in activity which involves it undertaking or making arrangements with a view to any of the following:

1. (1) raising additional capital; or
2. (2) a significant restructuring of the firm or the group to which it belongs, including without limitation:
1. (a) mergers or acquisitions;
2. (b) reorganising the firm’s group structure;
3. (c) reattribution;
4. (d) a significant change to the firm’s business model; and
5. (e) a significant internal change programme.

5.3

No SPF for restructuring is payable if the transaction only involves the firm seeking to raise capital within the group to which it belongs.

5.4

An SPF for restructuring may also be payable by a firm if:

1. (1) the firm becomes subject to insolvency proceedings or steps are taken by someone entitled to do so to commence insolvency proceedings against the firm; or
2. (2) either the Bank of England or HM Treasury has exercised a stabilisation power in respect of the firm under the Banking Act 2009.

5.5

The PRA and the FCA will levy separate SPFs for restructuring and may do so in relation to the same event or circumstance.

5.6

SPFs for restructuring, once paid, are non-refundable.

5.7

The SPF for restructuring is calculated as follows:

1. (1) Determine the number of hours, or part of an hour, taken by the PRA in relation to regulatory work conducted as a consequence of the activities referred to in 5.2 or 5.4. The number of hours or part hours is as recorded on the PRA’s systems in relation to the work.
2. (2) Next, multiply the applicable rate in the table of SPF hourly rates below by the number of hours or part hours arrived at under 5.7(1):

3. SPF hourly rates
   Pay grade of persons employed by the PRA	Hourly rate
   Administrator	£60.00
   Associate	£130.00
   Technical specialist	£190.00
   Manager	£250.00
   Any other persons employed by the PRA	£350.00

4. (3) Then add any fees and disbursements invoiced to the PRA by any third party provider in respect of services performed for the PRA in relation to assisting the PRA in performing the regulatory work referred to in 5.2 and 5.4.
5. (4) The resulting figure is the fee.
6. (5) Where an SPF for restructuring is charged and the restructuring directly affects more than one firm, the PRA may combine the total fees calculated under 5.7(4) in relation to that restructuring and reapportion those fees among all firms directly affected by the restructuring, using metrics which, in the opinion of the PRA, reflect the firms’ relative nature, scale and complexity.

5.8

The due date for payment of an SPF for restructuring is 30 days from the date of each invoice from the PRA to the firm.

5.9

The obligation to pay an SPF for restructuring is ongoing. There is no limit to the number of times that the PRA may invoice a firm for the SPF for restructuring in relation to the same events or circumstances.

5.10

The SPF for restructuring is a single fee which may be payable under both 5.2 and 5.4.