UK Regulators Finalize Policy on Prudential Assessment of Acquisitions and Increases in Control

The U.K. Financial Conduct Authority and Prudential Regulation Authority have finalized their policy on the prudential assessment of acquisitions and increases of control. The regulators have published a joint policy statement, a PRA supervisory statement, and FCA non-handbook guidance. The documents cover: (i) how the regulators expect firms, acquirers, and increasing controllers to identify controllers for the purposes of the Financial Services and Markets Act 2000; (ii) the regulators' expectations for submitting the change in control notification; (iii) the assessment criteria; and (iv) how the regulators will use their respective statutory powers to impose conditions on an approval.

The policy documents replace the EU guidelines on the prudential assessment of acquisitions and increases of qualifying holdings, and the PRA has updated its statement of policy on the interpretation of EU guidelines and recommendations to remove reference to those guidelines. No material policy changes have been made since the original consultation, but further clarification and guidance has been added in relation to limited partnership structures, what constitutes a significant influence, and the regulators' assessment processes. The policy took effect upon its publication on November 1, 2024.

We discuss the new guidance on limited partnership structures in our bulletin, "New UK guidance for private equity firms on acquisitions and increases in control in PRA and FCA authorised firms". 

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