United Kingdom: Treasury Confirms Reforms to FSMA Statutory Deadlines

In brief

On 12 May 2026, HM Treasury confirmed a package of reforms to the UK regulatory framework, including shorter statutory deadlines for key FCA and PRA determinations such as new firm authorisations, variations of permission (VoPs) and senior manager approvals. Introduced in the Financial Services and Markets Bill 2026-27, the changes are intended to speed up regulatory decision-making, support firms seeking to establish or expand in the UK, and form part of a broader effort to enhance the competitiveness of the financial services sector.

In more detail

New statutory deadlines

The Treasury’s July 2025 consultation proposed a number of new, shortened statutory deadlines for the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) to determine applications for new firm authorisations, VoPs and senior manager applications. The proposed changes were intended to promote faster determinations of applications for firms seeking to set up or grow in the UK, with the Treasury taking the view that slow authorisation timelines presented a less attractive prospect to international firms and stakeholder feedback indicating that processing times in the UK are too long compared to other jurisdictions.

In its response, the Treasury confirms that it will amend the Financial Services and Markets Act 2000 (FSMA) to implement new deadline changes. The deadlines confirmed are:

These new deadlines will sit alongside non-statutory stretching targets agreed with the FCA and PRA in July 2025 at the time of the Treasury’s consultation. These include:

• SMCR: 35 day median target for FCA SMCR approved person applications, 45 day median for PRA SMCR approved person applications
• VoPs: 3 months from complete application, 6 months from incomplete application (where permission is aligned to business model)
• Payments and e-money firm authorisations/registrations: 3 months from complete application, 10 months from incomplete application
• New insurance firm authorisations: 3 months from complete application from insurance firms that qualify for the wholesale insurance accelerated authorisation pathway
• Insurance special purpose vehicles (ISPVs) authorisations: 6 weeks from complete application, 10 working days from complete application from ISPVs that qualify for an accelerated pathway as set out in the PRA’s November 2024 consultation paper on proposed changes to the UK ISPV regulatory framework (CP15/24)

The FCA and PRA have already begun to report against both the stretching targets and forthcoming shortened statutory deadlines in their operating metrics.

Other reforms

Alongside the shortened statutory deadlines, the Treasury confirms that it will make a number of other changes to the regulatory environment aimed at supporting the growth and competitiveness of the financial services sector. These reforms include:

• Requiring the FCA and PRA to produce new long-term strategies at least once every five years. The regulators will be required to set out their strategic priorities in these documents, including with respect to their objectives and supervision. The FCA published a long-term strategy in 2025, covering the period up to 2030, and the Treasury will work with the FCA to meet the new legislative requirements without needing to issue a new strategy.
• Removing the requirement for the regulators to consider the section 3B FSMA regulatory principles (known as “have regards”) each time they exercise their policy and rulemaking powers. Instead, the FCA and PRA must have regard to the regulatory principles, as well as remit letters from the Treasury, when producing the new long-term strategies. This reduces the administrative burden on the regulators and allows them to focus on aggregate impact rather than granular detail.
• Removing a range of prescriptive reporting and other procedural requirements imposed on the regulators, including among others obligations to include certain information in their annual reports and to consult on guidance and minor rule changes. The full list of these amended requirements is set out in Annex A to the Treasury’s response.
    

Next steps

The changes have been introduced in the Financial Services and Markets Bill 2026-27, which is currently going through the legislative process. Until the changes are finalised, firms should continue to plan on the basis of the current statutory deadlines, while monitoring the legislative timetable and the FCA’s and PRA’s published operating metrics for signs of how the shorter deadlines are beginning to be reflected in practice.

Firms planning new authorisations, VoPs, senior manager applications or financial promotion approval applications may wish to consider whether the proposed shorter timelines affect transaction planning, market entry timetables, governance changes or product launch sequencing. At the same time, firms should continue to focus on application quality and completeness, as the distinction between complete and incomplete applications will remain important to the overall timetable.