Entire Section
PIB 4.7 PIB 4.7 Simplified Approach
Category 3A Firms
PIB 4.7.1 PIB 4.7.1
(1) ThisRule applies only to anAuthorised Firm inCategory 3A.(2) Subject to (3) and (4), anAuthorised Firm must apply theSimplified Approach as prescribed in PIB section A4.12 in PIB App4.(3) AnAuthorised Firm is not required to apply theSimplified Approach if it obtains prior approval of theDFSA not to do so.(4) After obtaining approval under (3), a firm must not revert to theSimplified Approach without further prior approval from theDFSA .Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]PIB 4.7.1 Guidance
1. In effect, theSimplified Approach reduces undue regulatory burden onCategory 3A firms to reflect more appropriately their risk profile.2. In relation to (3) and (4), theDFSA may consider granting its approval for a change of approach if it is satisfied that there are no regulatory capital arbitrage opportunities. Firms should be able to demonstrate to theDFSA solid and reasonable grounds to be able to move from one approach to the other. For instance, in assessing whether or not to grant approval, theDFSA may consider whether or not there has been a material change in the business of the firm.Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]Category 2 Firms
PIB 4.7.2 PIB 4.7.2
(1) ThisRule applies only to anAuthorised Firm inCategory 2.(2) Subject to (3) and (4), anAuthorised Firm may apply theSimplified Approach , as prescribed in PIB section A4.12 in PIB App4, upon obtaining prior approval to do so from theDFSA .(3) After obtaining approval under (2), a firm must not disapply theSimplified Approach without further prior approval from theDFSA .(4) TheDFSA may revoke its approval under (2) and require a firm to disapply theSimplified Approach , where theDFSA considers that this is warranted by the firm's business model and risk profile.Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]PIB 4.7.2 Guidance
In relation to (3) and (4), the
DFSA may consider granting its approval for a change of approach if it is satisfied that there are no regulatory capital arbitrage opportunities. Firms should be able to demonstrate to theDFSA solid and reasonable grounds to be able to move from one approach to the other. For instance, in assessing whether or not to grant approval, theDFSA may consider whether or not there has been a material change in the business of the firm.Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]