Feedback on Consultation Paper No. 11 2019 – Proceeds of Civil Financial Penalties

Summary

This is the JFSC's feedback paper following Consultation Paper No. 11 2019, which sought views on how the JFSC should disburse money it collects as proceeds of Civil Financial Penalties imposed under the Financial Services Commission (Jersey) Law 1998. All four respondents supported the JFSC's proposals, and the JFSC confirms it will proceed to implement them as consulted on.

• Retention as income: Proceeds of Civil Financial Penalties will be retained by the JFSC as income, as originally proposed.
• Class of business approach: Proceeds will be allocated according to the defined classes of business set out in the consultation, with scope for a more granular approach where a contravention relates to a specific activity within a class.
• Multi-class penalties: Where a Penalty relates to more than one class of business, Proceeds will be allocated to future fees based on the relative proportion of fee income from each affected class.
• Fee reductions mechanism: Proceeds will be applied to future fees via a specific line item on firms' JFSC fee invoices labelled discount in respect of Civil Financial Penalties; the exact discount amount cannot be determined until fees for that period are levied.
• 2020 fee cycles affected: During 2020, the Trust Company Business and Fund Services Business annual fee cycles will each receive an allocation of Proceeds, reflected in firms' annual fee invoices for those sectors.

The paper is primarily a record of consultation outcomes and confirms the JFSC's operational approach going forward; it does not itself impose new compliance duties on regulated firms beyond receiving fee adjustments reflecting any allocated Proceeds.

Applies to

registered persons under the Regulatory Laws, Trust Company Business firms, Fund Services Business firms

Deadlines

• during 2020: Trust Company Business and Fund Services Business annual fee cycles will receive an allocation of Proceeds, reflected in the annual fee invoice raised for each firm in those sectors.