DECISION NOTICE

ACTION

1.
For the reasons set out below and pursuant to section 55J of the Act, the Authority has
decided to cancel KCAL’s Part 4A permission.

DEFINITIONS

2.
The definitions below are used in this Decision Notice (and in the Annex):

“the Act” means the Financial Services and Markets Act 2000;

“the Authority” means the Financial Conduct Authority;

“COND” means the Threshold Conditions part of the Handbook;

This Decision Notice has been referred to the Upper
Tribunal. The Tribunal will make a determination
after hearing each party’s case, and remit the
matter to the FCA with such directions as the
Tribunal considers appropriate to give effect to its
determination.

Therefore the findings outlined in this Decision
Notice are provisional and reflect the FCA’s belief as
to what occurred and how it considers the behaviour
of Kingsbridge Capital Advisors Limited should be
characterised. The action outlined in the Decision
Notice will have no effect pending the determination
of the case by the Tribunal. The Tribunal’s decision
will be made public on its website.


2

“EG” means the Enforcement Guide;

“FEES” means the Authority’s FEES Manual, part of the Handbook;

“FSCS” means the Financial Services Compensation Scheme;

“the Handbook” means the Authority’s Handbook of rules and guidance;

“KCAL” means Kingsbridge Capital Advisors Ltd;

“KCAL’s Part 4A permission” means the permission granted by the Authority to KCAL under

the Act;

“the Principles” means the Authority’s Principles for Businesses;

“SFGB Levy” means the Single Financial Guidance Body Levy;

“the suitability Threshold Condition” means the threshold condition set out in paragraph

2E of Schedule 6 to the Act;

“SUP” means the Authority’s Supervision Manual, part of the Handbook;

“the Threshold Conditions” means the threshold conditions set out in Schedule 6 to the

Act;

“the Tribunal” means the Upper Tribunal (Tax and Chancery Chamber); and

“the Warning Notice” means the warning notice given to KCAL dated 10 October 2022.


FACTS AND MATTERS

3. KCAL was authorised by the Authority on 13 March 2003 and is permitted to conduct

designated investment business and MiFiD investment services activities.

4. KCAL has failed to pay regulatory fees and levies totalling £2,691.42 owed to the Authority

consisting of:


a. invoice dated 15 March 2019 for an administrative fee of £250 which had been due

for payment by 14 April 2019 (in respect of the non-submission of regulatory return
due to be submitted by 29 Janaury 2019);


b. invoice dated 15 March 2019 for an administrative fee of £250 which had been due

for payment by 14 April 2019 (in respect of the non-submission of regulatory return
due to be submitted by 12 February 2019);


c. invoice dated 24 June 2019 for an administrative fee of £250 which had been due

for payment by 24 July 2019 (in respect of the non-submission of regulatory return
due to be submitted by 25 April 2019);


d. invoice dated 13 September 2019 for an administrative fee of £250 which had been

due for payment by 13 October 2019 (in respect of the non-submission of regulatory
return due to be submitted by 9 August 2019);

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e. invoice dated 20 November 2019 for regulatory fees and levies of £1,191.42 which

had been due for payment by 20 December 2019;


f.
invoice dated 16 December 2019 for an administrative fee of £250 which had been
due for payment by 15 January 2020 (in respect of non-submission of regulatory
return due to be submitted by 28 October 2019); and


g. invoice dated 13 March 2020 for an administrative fee of £250 which had been due

for payment by 12 April 2020 (in respect of the non- submission of regulatory return
due to be submitted by12 February 2020).


5.
KCAL has also failed to respond adequately to the Authority’s repeated requests that it pay
the fees and levies owed to the Authority.


FAILINGS

6.
The statutory and regulatory provisions relevant to this Decision Notice are set out in the
Annex.

7.
From the facts and matters described above the Authority, having regard to its regulatory
objectives, considers that KCAL:

•
has failed to comply with rules (FEES 4.2.1R, 4.3.1R, 6.7.1R, 6.7.3R, 7A.3.1R and SUP
16.3.14R), which require it to pay fees and levies to the Authority;

•
has failed to respond appropriately to the Authority’s repeated requests that it pay the
fees and levies owed, and is therefore failing to comply with Principle 11 (Relations
with regulators), in that it has not been open and co-operative in all its dealings with
the Authority;


•
has failed to satisfy the Authority that it is ready, willing and organised to comply with
the requirements and standards of the regulatory system, namely the requirement to
pay fees and levies to the Authority by the relevant due date as set out in FEES and
SUP;


•
has therefore failed to satisfy the Authority that its business is being managed in such
a way as to ensure that its affairs will be conducted in a sound and prudent manner or
that it is a fit and proper person having regard to all the circumstances; and


•
is therefore failing to satisfy the suitability Threshold Condition in relation to its
permitted regulated activities.


8.
The Authority has therefore decided to cancel KCAL’s Part 4A permission for the reasons
described above.


REPRESENTATIONS

9.
Through the Warning Notice, the Authority gave notice that it proposed to take the action
described above and KCAL was given the opportunity to make representations to the
Authority about that proposed action.


10.
Following receipt of the Warning Notice, KCAL contacted the Authority on 21 October 2022
and requested an extension of time until 18 November 2022 to pay the outstanding
regulatory fees and levies as KCAL are attempting to close an investment agreement which
would enable them to pay these fees. They state this investment agreement had been
signed in 2019 but has not been funded yet, several reasons for this delay were given.
KCAL propose they are not a regulatory risk other than failing to pay the regulatory fees
as they are not holding any assets and have no clients.

11.
The Authority has refused this extension on the grounds that KCAL have previously been
given extensions which they have failed to comply with and in these representations have
failed to provide any evidence that they will be in a position to pay the outstanding fees
on 18 November 2022.


12.
The Authority has therefore decided to cancel KCAL’s Part 4A permission for the reasons
described above.

PROCEDURAL MATTERS

13.
This Decision Notice is given to KCAL under section 55Z and in accordance with section
388 of the Act.


14.
The following paragraphs are important.

Decision Maker

15.
The decision which gave rise to the obligation to give this Decision Notice was made by an
executive decision maker of the Authority.

The Tribunal

16.
KCAL has the right to refer the matter to which this Decision Notice relates to the Tribunal.
Under paragraph 2(2) of Schedule 3 to the Tribunal Procedure (Upper Tribunal) Rules 2008,
KCAL has 28 days from the date on which this Decision Notice is given to KCAL to refer the
matter to the Tribunal.

17.
A reference to the Tribunal is made by way of a signed reference notice (Form FTC3) filed
with a copy of this Decision Notice. The Tribunal’s contact details are: The Upper Tribunal,
Tax and Chancery Chamber, Fifth Floor, Rolls Building, Fetter Lane, London EC4A 1NL (tel:
020 7612 9730; email: uttc@hmcts.gsi.gov.uk).


18.
For further information on the Tribunal, KCAL should refer to the HM Courts and Tribunal
Service website. Guidance on making a reference to the Tribunal and the relevant form to
complete (Form FTC3) can be accessed from the following link:

19.
A copy of Form FTC3 must also be sent to Funmi Ojo at the Financial Conduct Authority,
12 Endeavour Square, London E20 1JN at the same time as filing a reference with the
Upper Tribunal.

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20.
Once any referral is determined by the Tribunal and subject to that determination, or if the
matter has not been referred to the Tribunal, the Authority will issue a final notice about
the implementation of that decision.

Access to evidence

21.
Section 394 of the Act applies to this Decision Notice. In accordance with section 394(1),
KCAL is entitled to have access to:

(a)
the material upon which the Authority has relied in deciding to give KCAL this Decision
Notice – a schedule of such material was given with the Warning Notice; and

(b)
any secondary material which, in the Authority’s opinion, might undermine that
decision. There is no such secondary material.

Confidentiality and publicity

22.
KCAL should note that this Decision Notice may contain confidential information and should
not be disclosed to a third party (except for the purpose of obtaining advice on its
contents). The effect of section 391 of the Act is that neither KCAL nor a person to whom
this Decision Notice is copied may publish it or any details concerning it unless the Authority
has published those details. The Authority must publish such information about the matter
to which a decision notice or final notice relates as it considers appropriate. KCAL should
be aware, therefore, that the facts and matters contained in this Decision Notice may be
made public.

25.
For more information concerning this matter generally, KCAL should contact Funmi Ojo
(direct line: 020 7066 1354).

Lauren Rafter
Executive Decision Maker











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ANNEX

RELEVANT STATUTORY PROVISIONS

The Authority’s operational objectives established in section 1B of the Act include protecting and
enhancing the integrity of the UK financial system and securing an appropriate degree of
protection for consumers.

1.
The Authority is authorised by section 55J of the Act to cancel an authorised person’s Part
4A permission, where it appears to the Authority that it is failing to satisfy the Threshold
Conditions.


2.
Paragraph 2E of Schedule 6 to the Act provides, in relation to a person (“A”) carrying on
or seeking to carry on regulated activities which do not consist of or include a PRA-
regulated activity, that:


“A must be a fit and proper person having regard to all the circumstances,
including –

(f) whether A’s business is being … managed in such a way as to ensure that its
affairs will be conducted in a sound and prudent manner.”


RELEVANT HANDBOOK PROVISIONS

3.
In exercising its power to cancel a Part 4A permission, the Authority must have regard to
the regulatory requirements and guidance published in the Handbook and in regulatory
guides, such as EG. The main considerations relevant to the action stated in this Decision
Notice are set out below.

Relevant Principle

4.
Principle 11 requires that a firm must deal with its regulators in an open and co-operative
way and must disclose to the Authority appropriately anything relating to the firm of
which the Authority would reasonably expect notice.

Relevant Rules

5.
FEES 4.2.1R requires that:


“A person shown in column (1) of the table in FEES 4.2.11 R as the relevant fee
payer must pay each periodic fee applicable to it, calculated in accordance with
the provisions referred to in column (2) of the applicable table, as adjusted by any
relevant provision in this chapter:

(1)
in full and without deduction (permitted or required by a provision in
FEES); ands

on or before the date given in column (3) of that table, unless FEES 4.2.10
R applies.”

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6.
FEES 4.3.1R states that:


“The periodic fee payable by a firm (except an AIFM qualifier, ICVC or a UCITS
qualifier) is:

(1)
each periodic fee applicable to it calculated in accordance with FEES 4.3.3
R, using information obtained in accordance with FEES 4.4; plus

(1A)
any periodic fee applicable to it calculated in accordance with FEES 4.3.3A
R using information relating to its UK business obtained in accordance with
FEES 4.4 (or by other means in the case of the Bank of England); less

(2)
any deductions from the periodic fee specified in Part 2 of FEES 4 Annex
2AR or Part 7 of FEES 4 Annex 11R.”


7.
FEES 6.7.1R requires that:

“A participant firm that is not within FEES 6.7.-1R, must pay its share of any levy
made by the FSCS in one payment”.

8.
FEES 6.7.3R states that:


“A participant firm's share of a levy to which FEES 6.7.1R applies is due on, and
payable within 30 days of, the date when the invoice is issued.”

9.
FEES 7A.3.1R requires that:


“A firm must pay the SFGB money advice levy or SFGB debt advice levy applicable

to it:

(1)
in full and without deduction (unless permitted or required by a provision
in FEES); and

(2)
by 1 August or, if later, within 30 days of the date of the invoice in the fee
year to which that sum relates

10.
SUP 16.3.14R states that:


“If a firm does not submit a complete report by the date on which it is due in
accordance with the rules in, or referred to in, this chapter or the provisions of
relevant legislation and any prescribed submission procedures, the firm must pay
an administrative fee of £250.”

Guidance concerning the suitability Threshold Condition

11.
Guidance on the Threshold Conditions is set out in COND.

COND 2.5 – Suitability: Paragraph 2E of Schedule 6 to the Act

12.
COND 2.5.1AUK reproduces the relevant statutory provision that a person concerned
must be a fit and proper person having regard to all the circumstances, including,

amongst other things, whether its business is being managed in such a way as to ensure
that its affairs will be conducted in a sound and prudent manner.


13.
COND 2.5.1BG confirms that Paragraph 2E of Schedule 6 to the Act sets out the suitability
Threshold Condition for firms carrying on, or seeking to carry on, regulated activities
which do not consist of or include a PRA-regulated activity.

14.
COND 2.5.2G states that the Authority will take into consideration anything that could
influence a firm’s continuing ability to satisfy the Threshold Conditions.

15.
COND 2.5.6G gives examples of the kind of particular considerations to which the
Authority may have regard when assessing whether a firm will satisfy, and continue to
satisfy, the suitability Threshold Condition including, but not limited to, whether:


•
the firm has been open and co-operative in all its dealings with the Authority and
is ready, willing and organised to comply with the requirements and standards
under the regulatory system (COND 2.5.6G(1)); and

•
the firm has contravened, amongst other things, any provisions of the regulatory
system, which includes the Principles and other rules (COND 2.5.6G(4)).

Cancelling a firm’s Part 4A permission on the Authority’s own initiative

16.
The Authority’s policy in relation to exercising its enforcement powers is set out in EG,
certain provisions of which are summarised below.

17.
EG 8.1.1(1) provides that the Authority may use its own initiative power to vary or cancel
the permission of an authorised person under section 55J of the Act, where the person is
failing or is likely to fail to satisfy the Threshold Conditions.

18.
EG 8.5.1(1) states that the Authority will consider cancelling a firm’s Part 4A permission
using its own initiative powers contained in section 55J of the Act in circumstances where
the Authority has very serious concerns about the firm, or the way its business is or has
been conducted.


19.
EG 8.5.2 provides examples of the circumstances in which the Authority will consider
cancelling a Part 4A permission, and EG 8.5.2(5) specifies that non-payment of fees is
one such circumstance.