The rules also clarify FSA expectations regarding standards of behaviour for all approved persons.
Reflecting the FSA’s increased focus on competence, the proposals introduce a 30 month deadline for individuals to complete all modules of a qualification required for their role. The rule will be introduced from January 1 2011.
Qualifications that meet FSA regulatory requirements will now be listed in the FSA Handbook so that firms and individuals will have an easily accessible and comprehensive source of approved qualifications.
The FSA will also own and oversee the production and changes to examination standards in future ensuring that standards are reviewed every three years.
Further changes clarify how individuals operating under the Significant Influence Function should be responsible for ensuring the competence of employees in their designated area of the business.
Peter Smith, head of investments policy at the FSA, says: “Competence and approved persons requirements are key elements of our regulatory regime and over the last few years we have increased our scrutiny of individuals working in the financial services industry.
“Today’s new rules strengthen and clarify our overall competence requirements and ensure firms and individuals are maintaining standards of competence and behaviour at an appropriate level.”