HMT response to consultation feedback on reforming the SMCR

HM Treasury (HMT) has published the response to its July 2025 consultation on reforming the Senior Managers and Certification Regime (SMCR). The response concerns Phase 2 of the reforms and confirms the government's planned reforms to the Financial Services and Markets Act 2000, including to:

• Remove the Certification Regime from primary legislation, including the annual recertification requirement, and enable the regulators to consider a more proportionate and flexible framework in their rulebooks.
• Reduce the number of senior management functions that require regulator pre-approval. Regulators will be given a new power to specify circumstances where it would be suitable for a firm to notify the regulators of the appointment of a senior manager following the firm's assessment of fitness and propriety.
• Repeal the prescriptive legislative provisions relating to Statements of Responsibilities, enabling regulators to consider appropriate requirements in their rulebooks.
• Streamline conduct rules by repealing the prescriptive legislative requirements on firms to notify regulators of breaches and to conduct mandatory training, while retaining the regulators' power to make conduct rules and set out appropriate requirements in their rulebooks.
• Give regulators the power to specify in rules and guidance the circumstances in which they may accept senior manager applications subject to time-limits or conditions, approval of which would not trigger statutory notice requirements.

HMT also intends to amend the Financial Markets Infrastructure SMCR regime legislated for in FSMA 2023 in relation to central counterparties, central securities depositories and recognised investment exchanges to ensure it is consistent with these wider SMCR changes, as and when it is brought into force.

Return to main website.