Commentary Control over authorised persons
321.Part 12 of FSMA is primarily designed to implement European requirements in respect of acquisitions or increases of control over certain types of firm such as credit institutions, investment firms and insurance undertakings. In summary, Part 12 requires a person (the “section 178 notice-giver”) who decides to acquire or increase control over a UK authorised person to give notice to the FSA before making the acquisition (the “section 178 notice”) (section 178(1) (obligation to notify the Authority: acquisitions of control)).
322.“Acquiring control” is defined in section 181 of FSMA and includes cases in which the notice-giver intends to hold 10% or more of the shares of an authorised person or 10% or more of the shares in the parent undertaking of the authorised person. “Increasing control” is defined in section 182 of FSMA as a circumstance in which a person increases the percentage of shares or voting power in the authorised person above certain thresholds (for example, a person who decides to move from a shareholding of 19% to 22 % is required to give a section 178 notice). A notice is also required to be submitted where a person reduces control (as defined in section 183 of FSMA) or ceases to have control (section 191D(1)). Part 12 also confers certain powers to take action where, for example, a person breaches the requirement to give a section 178 notice.