Sipp and Ssas trade body Amps has begun judicial review proceedings of the FCA’s consultation on new capital requirements for Sipp providers.
Amps says while it agrees with the increase in capital requirements, it is unhappy with how the regulator handled the consultation.
The FCA first indicated it would be ramping up capital requirements in November 2012, but watered down its proposals in August of this year after concerns were raised over the impact on small providers.
Amps says: “Amps has consistently supported an increase in the capital requirement for Sipp operators. Our challenge to the FCA is in regard to its apparent disregard for fairness of procedure and adequacy of consultation, which leaves Sipp operators facing an illogical basis of capital requirement which proper consultation might well have seen rejected.”
A statement from Amps says its lawyers advised that the FCA’s decision was “unlawful and ought to be quashed”.
Amps’s lawyers said the regulator did not properly explain its proposals and “has adopted the decision without providing afected persons with a fair opportunity of dissuading it from doing so.”
The decision was unlawful, according to Amps, because it did not make “sufficent enquiries” in making its decisions, made incorrect considerations and “otherwise acted in breach of its statutory duties under the Financial Services and Markets Act 2000”.
Judicial reviews are a challenge to the process by which a public body reaches a decision or action.
The FCA confirmed it has received a letter from Amps’s legal representatives and has responded, but would not comment further. Amps had nothing to add.