Consultation Paper No. 1 2020: Investment Business Fees

Summary

This is a JFSC consultation paper proposing a 16% increase in Investment Business (IB) fee rates for 2020, covering application fees and annual fees, together with a draft Investment Business Fees Notice attached as Appendix B. It applies to all persons registered under the Financial Services (Jersey) Law 1998 to conduct investment business, and to those registered on or after 1 May 2020. The paper explains the rationale (financial crime supervision, reserves restoration, data analytics investment, upcoming MONEYVAL assessment) and invites industry comment before finalising the fees notice.

• Fee increase: Proposed 16% increase in IB fee rates for 2020 (2.5% RPI plus 13.5% additional), rounded to the nearest £5, covering application and annual fees.
• Application fees (draft notice): £2,100 for Class A, B or C; £1,045 for Class D only; £1,045 for Class E only.
• Annual fees (draft notice): Tiered fees based on class of business and number of investment employees or, for Class E, number of funds.
• Reduced fee for late registration: Persons registered after 31 December 2020 pay half the annual fee otherwise payable.
• Annual fee due date: 31 May 2020 for firms already registered on 1 May 2020, otherwise the date the application is granted.
• Late payment fee: 5% of unpaid annual fee principal applied the day after the due date and on the 1st of each subsequent month.
• Late information administration fee: £200 charged if required fee-calculation information is not supplied by the due date, repeating monthly while outstanding.
• Late filing fee: £100 per complete month or part thereof for any document not filed or delivered to the JFSC by its due date, unless the JFSC has agreed in writing to a later date.

The proposals are set out for consultation only at this stage; the JFSC intends to publish feedback and the final fees notice in Q2 2020, with the new fees effective from 1 May 2020 to 30 April 2021. No changes are proposed to other parts of the fees notice this year.

Key obligations

• Registered investment business firms must pay the annual fee by the due date (31 May 2020 if already registered on 1 May 2020, or the date the application is granted for new registrants)
• Firms must supply required information for calculating their annual fee by the due date or face a recurring £200 administration fee
• Firms must file or deliver required documents to the JFSC on or before the due date or face a £100 per month late filing fee
• Firms failing to pay the annual fee by the due date will incur a 5% late payment fee on the unpaid amount, recurring monthly
• Interested parties wishing to comment on the proposed fee changes must submit comments to the JFSC or Jersey Finance Limited by 20 March 2020

Applies to

persons registered to carry on investment business under the Financial Services (Jersey) Law 1998, Class A, B, C, D and E investment business registrants

Deadlines

• 20 March 2020: Deadline for interested parties to submit comments on the consultation to the JFSC or Jersey Finance Limited
• 1 May 2020: New fee rates and draft Investment Business Fees Notice become effective (period 1 May 2020 to 30 April 2021); also the date from which new IB registrants fall under the amended fee regime
• 31 May 2020: Due date for the JFSC to receive the annual fee if the firm is already registered on 1 May 2020
• 31 December 2020: If a person is registered after this date, the annual fee payable on registration is halved
• second quarter of 2020: JFSC plans to publish consultation feedback and the final fees notice