Accountability of regulators Regulator engagement with HM Treasury, external stakeholders, and Parliament Regulators’ relationship with HM Treasury Power of HM Treasury to require a rule review by the regulator
There is currently no formal mechanism for HM Treasury, or anyone else, to require the regulators to conduct reviews of their existing rules. This power is intended to provide for more effective regulation by ensuring there is such a mechanism for the regulator to review its rules where HM Treasury considers it is in the public interest.
	In general, HM Treasury expects that it may be in the public interest to exercise the power to direct the regulator to review its rules where:
significant developments in the relevant markets give rise to the possibility that the current rules may no longer be appropriate; or
substantial evidence gives rise to the possibility that the rules are not achieving their purpose, considering:
in relation to the FCA, its explanation of how the rules were compatible with its strategic objective and advanced one or more of its operational objectives when the rules were made;
in relation to the PRA, its explanation of how the rules advanced one or more of its objectives when the rules were made;
in relation to the PSR, its explanation of how the requirements advanced one or more of its payment systems objectives;
in relation to the Bank as it exercises its FMI functions, its explanation of how the rules advanced its Financial Stability Objective when the rules were made.
	HM Treasury is required to consult the regulator before directing a review under this section. Matters to be consulted on may include:
the regulator’s current plans for review
the quality of the evidence on which a direction is being considered
the timing of a review; and
whether an independent reviewer is necessary.
	There may be situations where it would not be appropriate for the regulator itself to conduct the review. In such a situation, HM Treasury would expect to include in its direction that the regulator should appoint an independent reviewer.