BoE Policy Statement On Fundamental Rules For FMIs

On 18 July 2025, the Bank of England published a policy statement on Fundamental Rules for Financial Market Infrastructures (FMIs). These rules, effective from 18 July 2026, outline the high-level outcomes FMIs must achieve in areas such as financial resources, operational resilience, and risk management. The policy is relevant for recognised UK Central Counterparties, recognised UK Central Securities Depositories, UK Recognised Payment System Operators and UK Specified Service Providers.

On 18 July 2025, the Bank of England published a policy statement on Fundamental Rules for Financial Market Infrastructures (FMIs). These rules, effective from 18 July 2026, outline the high-level outcomes FMIs must achieve in areas such as financial resources, operational resilience, and risk management. The policy aims to improve transparency and the effectiveness of the Bank's supervision, ensuring FMIs manage risks without compromising their own resilience. The rules mark the first use of the Bank's new general rule-making powers under the amended Financial Services and Markets Act 2000.

The policy statement incorporates feedback from a consultation conducted between November 2024 and February 2025. Respondents largely supported the proposals, and the Bank has made minor adjustments. Key changes to the rules include clarifying that FMIs are not expected to take actions that harm their own resilience when managing risks to financial system stability and emphasising the importance of transparency between FMIs and their participants to support better risk management. The Bank has also refined the application of rules to group activities, limiting the scope to information that materially affects an FMI's regulatory obligations. Additionally, the implementation period for the rules has been extended from six to twelve months, allowing FMIs more time to make necessary adjustments. Minor amendments for clarity and accuracy were also made to the accompanying guidance. These changes aim to ensure the rules are practical, proportionate, and effective in achieving their objectives.

While the rules are currently limited to UK FMIs, the Bank may expand their application to non-UK entities in the future. The policy aligns with statutory obligations and government recommendations to support financial stability, innovation, and proportionate regulation, ensuring the UK remains a global leader in financial services.

Also on 18 July 2025, the Bank published a document setting out its supervisory approach to onboarding new FMIs. This aims to enhance transparency and support innovation by outlining the process for becoming a Bank-regulated FMI, tailored to different FMI types such as central counterparties (CCPs), central securities depositories (CSDs), and payment systems. The approach is proportionate, risk-based, and forward-looking, encouraging market entry and innovation while managing risks to financial stability.

The onboarding process is divided into four stages: risk assessment, authorisation or recognition, mobilisation, and scaling. Mobilisation and scaling are discretionary stages designed to help new FMIs safely establish and grow their operations under proportionate regulatory oversight. This publication serves as a standing reference and may be updated to reflect legislative or policy changes, ensuring it remains relevant to evolving market conditions.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.