FCA Reviews Business Contingency Plans

The Financial Conduct Authority ("FCA") is "actively reviewing" firms' business contingency plans in the wake of the COVID-19 outbreak.

According to the FCA, firms must establish and maintain contingency plans to deal with major events. The FCA stated that in conjunction with the Bank of England and HM Treasury, it is reviewing (i) firms' assessments of operational risks, (ii) their ability to continue operations effectively, and (iii) the steps that should be taken to serve and support their customers.

The FCA highlighted several measures that firms should take to meet their regulatory obligations. These include: (i) being able to enter orders and transactions promptly into relevant systems, (ii) using recorded lines when trading, and (iii) providing staff with access to the compliance support as needed. The FCA noted that it will have no objections to staff working from home or using backup sites if firms are able to meet such standards, and undertake the activities as specified.

In a separate communication, the FCA provided firms with temporary relief from the requirement to record telephone calls with clients when traders are working from home. In guidance released on the topic, the FCA added that it "expect[s] firms to consider what steps they could take to mitigate outstanding risks if they are unable to comply with their obligations to record voice communications."