FSP Editor has been involved in academic Financial Services for the past 15 years.
Did Not Meet FSCA CPD Requirements on 31st May 2019?
For those who did not meet the CPD requirements on the 31st of May 2019, the FSCA released the following exemption:
(Spoiler - You have until 31st July 2019 to comply)
The Exemption from Continuous Professional Development Requirements, 2019 - No 2 of 2019
This exemption allows FSPs, key individuals and representatives until 31 July 2019 to comply with the CPD requirements set out in the Determination of Fit and Proper Requirements for Financial Services Providers, 2017, in respect of the current CPD cycle.
THE FSCA made it clear that:
- The Exemption does change the CPD requirement for the new cycle stating on the 1st of June 2019.
- The Exemption does not change the period of the 2019 CPD cycle. The requirements for the 2019 CPD cycle will still commence on 1 June 2019 and end on 31 May 2020.
- The CPD hours completed for the 2018 CPD cycle in the exemption period, 1 June 2019 until 31 July 2019, cannot be carried over to the 2019 CPD cycle.
- Those who met the CPD requirement on the 31st of May 2018 can continue with activities, courses and programmes and it will be awarded towards the 2019 CPD cycle.
The Financial Sector Conduct Authority (FSCA) published FSCA FAIS Communication 2 of 2019 on its website on 5 June 2019.
The Communication provided general guidance in respect of the requirements relating to CPD, and also addresses frequently asked questions received from Industry. Here is a summary of the most important aspects:
The communication provided guidance to FSPs, key individuals and representatives regarding compliance with the CPD requirements set out in Chapter 4 of the Determination of Fit and Proper Requirements for Financial Services Providers, 2017 (Board Notice 194 of 2017) (“Fit and Proper Requirements”).
- BACKGROUND AND INTRODUCTION
Persons who render financial services must have adequate, appropriate and relevant skills, knowledge and expertise in respect of the financial service, financial products and functions that they perform.
The FSCA introduced CPD requirements in order to ensure that FSPs, key individuals and representatives maintain their competence and that their knowledge, skills and abilities remain up to date in a changing and dynamic environment.
The CPD requirements were introduced long ago in 2008, but only came into effect on 1 June 2018. A CPD cycle runs over a period of 12 months commencing 1 June of every year to 31 May of the following year.
There are also overarching principle-based competence requirements with which FSPs, key individuals and representatives must comply with at all times. FSPs have certain responsibilities in respect of adequate policies, internal systems, control and monitoring mechanisms that must be in place to continuously evaluate and review compliance and the keeping of records to demonstrate compliance.
A FSP must establish, maintain and update a competence register on a regular basis in which all qualifications, successfully completed regulatory examinations, product specific training, class of business training and CPD of the FSP, its key individuals and representatives are recorded.
The FSCA has not yet prescribed the form, manner and intervals in which FSPs must submit the competence register. This means that FSPs must continue to maintain these registers, and will be required to submit the competence register once this information is requested by the FSCA.
It will be extremely difficult to comply with the general competence requirements without having proper policies, procedures, processes, systems and record keeping mechanisms in place. This is fundamental for continuous compliance with the competence requirements.
The FSCA has specific rules relating to the planning and maintenance of CPD activities. Yoy can read more about it here: Embedding CPD