Who is Covered by the UK FSA Remuneration Code?

In common with other EU jurisdictions, the UK has implemented new rules on remuneration in the financial services sector. These are contained in the Remuneration Code (the "Code") issued and governed by the UK Financial Services Authority (the "FSA").

Importantly, and in contrast to current U.S. rules on remuneration in the financial services sector, the Code applies to a broad range of financial institutions including hedge funds managers and investment managers of UCITS funds, as well as some firms engaged in corporate finance, private equity and venture capital. 

European regulators have been allowed to apply a proportionate approach to firms by reference to their size, internal organisation and the nature, scope and complexity of their activities. The Code has addressed this by dividing firms covered by the Code into four tiers.  The tiers are structured by reference to FSA's approach to the classification of firms under prudential standards.