AMI warns FCA fee cut would penalise larger firms

The AMI has requested that FCA considers deferring or reducing the fee costs facing firms during the coronavirus epidemic.

The FCA has indicated that it will consult as part of its normal fees process on assisting smaller firms for July invoicing. However, the 1,100 larger firms under FCA authorisation are required to make their “On Account” payments on the 1st of April. These represent the bulk of the fees due in the year.

In a statement, the AMI says that "discriminating in favour of smaller firms is unfair on our other members".

It added: "These larger firms have the same overheads and costs in proportion as smaller firms. Whilst able to meet these costs, these larger firms need to preserve cash to protect their business and staff in the same way as all in the economy. In making decisions which might include pay reductions, furlough or redundancy, having to make these payments increases the likelihood of having to make decisions which impact on people and their longer term business."

The AMI is urging the FCA to focus on "maintaining the integrity of the market for the recovery".

Robert Sinclair, chief executive of AMI, said: “We have asked for support for all our firms and have received some comfort. Firms are making decisions today to ensure they are here to support the recovery as we come out of lockdown. All firms need the same backing and I call on the FCA to reconsider this decision and not penalise larger firms by taking important cash from their bank at this difficult time.

"These firms are planning cash flow to year end and would really benefit from retaining cash in the business. We believe that Government should be supporting the costs of our regulators at this time.”