Application to Become a Regulated Entity

The Isle of Man Financial Services Authority ('the Authority') is responsible, under the Financial Services Act 2008 (‘FSA08’) and the Insurance Act 2008 (‘IA08’) for the authorisation, regulation and supervision of persons undertaking regulated activities in or from the Isle of Man.

The term “regulated activity” refers to an activity which a person is prohibited from undertaking, or holding out as undertaking in or from the Island unless that person holds a relevant licence, authorisation, registration or permit under the FSA08 or IA08.

If you want to carry on a regulated activity, as a business, in or from the Isle of Man, you will need to have obtained the relevant permission from the Authority before you do so.

The full statutory definition of regulated activity can be found under the FSA08, through the Regulated Activities Order 2011 (“RAO") and the IA08. Regulated Activities includes:

  • deposit taking;
  • investment business;
  • services to collective investment schemes;
  • fiduciary (corporate & trust) services;
  • crowdfunding platforms;
  • money transmission services;
  • issuance of electronic money;
  • the operation of a credit union;
  • insurance business;
  • providing management services for one or more insurers; and
  • acting as an insurance intermediary.

Different provisions apply to those seeking permissions under the Retirement Benefits Schemes Act 2000, and this information can be found here.

The Isle of Man is recognised internationally as a jurisdiction with a robust and effective regulatory environment. A cornerstone of this environment is the knowledge, experience and the fitness and propriety of the individuals working within the financial services sector.

A thorough evaluation process is in place to ensure that applicants meet the Authority’s fitness and propriety criteria.  This evaluation includes assessing:

  • integrity;
  • competence;
  • solvency; and
  • real presence.

It should be noted that the onus is on the applicant and the persons connected with the applicant to satisfy the Authority that they are fit and proper.

For those seeking a licence under the FSA08, this evaluation will be carried out in accordance with the Authority's Licensing Policy for Regulated Activities under the Financial Services Act 2008 (“Licensing Policy”) and for those seeking authorisation under the IA08, this evaluation will be carried out in accordance with the Authority's Insurance Authorisation Guidance.



To a large extent, an applicant’s integrity is a reflection of the persons employed by or associated with the applicant. In assessing the integrity of an applicant and its directors, controllers and key persons, the Authority will consider whether any of their past actions or conduct indicate a lack of integrity. The Authority will consider all relevant circumstances on a case-by-case basis. A list of matters the Authority may have regard to, is set out at Appendix 1 of the Regulatory Guidance – Fitness and Propriety.

An applicant and all connected persons should co-operate in an open and honest manner with the Authority and any other body which regulates them and should promptly inform the regulator(s) of anything relevant to the regulator’s task.  Failure to do so may be relevant to an assessment of a person’s integrity.

This includes the failure to complete a form or supply information required from an applicant in an honest manner, or the omission of any relevant information.



An applicant must be competent to undertake the relevant regulated activities including, where appropriate, having detailed knowledge of the structure, purpose and risks of products and services associated with the activity.

An applicant’s competence is demonstrated by persons in the organisation holding relevant qualifications, having sufficient experience and being appropriately supervised and trained to competently fulfil their functions and regulatory responsibilities.

The Authority’s Training and Competence Framework provides guidance on the specific training and competence requirements and expectations for continuing professional development for particular regulated activities and roles/ functions within regulated entities.

The Authority will use its discretion in assessing competence and may direct that a person should successfully complete a course of study or achieve a relevant qualification within a specified period of time.



Solvency is more than meeting liabilities as they fall due; it includes maintaining sufficient financial resources to survive periods of market weakness and slack trading conditions. Different regulated activities have different capital and liquidity requirements which are based on the prudential risks posed by that business.

Risk management and the proper care for customers' money and assets are also important considerations.

The Authority will require evidence that funds have been provided to meet the share capital requirement and financial resources requirement, for example evidence of funds being lodged to pay up share capital.

The Authority will consider the solvency of the directors, controllers and key persons of an applicant and also of Professional Officer applicants. Please see the Regulatory Guidance – Fitness and Propriety for further details.


Real Presence

All applicants (apart from Professional Officers) must be structured as a company or a branch of a company. The ownership structure of the applicant must be transparent and not unduly complex. The Authority understands that large groups will naturally be more complex, however the Authority must be able to look through the structure and identify the persons who could control the applicant.

All applicants seeking an FSA08 licence, authorisation to be a self-managed authorised insurer, insurance manager or registered as an insurance intermediary, must be managed and controlled in the Island and must have at least 2 Isle of Man resident directors (or 2 resident senior personnel in the case of a branch) at all times.  

Although the Authority will not authorise, licence or register a business that is a mere shell without real presence, it may authorise, licence or register an applicant for certain regulated activities where the applicant on its own does not fully meet the real presence test if the applicant’s regulated activity will be managed in the Isle of Man by a Class 7 or Class 3(9) licenceholder, or insurance manager. A managed authorised insurer applicant must have at least one Isle of Man resident director.  Permit holders are exempt from the requirement to have a minimum number of Isle of Man resident directors.

The real presence extends beyond merely appointing resident directors, and applicants must be able to satisfy the Authority that the day to day operations of the business, as well as the undertaking of its regulated activity, will be in the Isle of Man. For the avoidance of doubt, merely having an Isle of Man registered office and appointing officers from a corporate services provider will not satisfy the real presence requirements.

Threshold Criteria for Deposit Takers

The Regulated Activity Order 2011 defines deposit taking into 3 sub-classes:

Class 1 (1) Retail / non-restricted deposit takers;

Class 1 (2) Non-retail / restricted deposit takers; and

Class 1 (3) Representative offices of foreign banks.

The regulated activity of deposit taking requires a high threshold because of the inherent risks to depositors. As such, new start-up Class 1(1) retail deposit taking business, that is not part of an established group of companies with an existing deposit taking business within that group, is not permitted.

However, a start-up Class 1(2) deposit taking business may be permitted, if it is part of a substantial, established group (that is not necessarily a banking group) and subject to the relevant competency and experience of the key persons, with adequate financial resources available to support the establishment of the business.

Full guidance may be found here:


Bank Representative Offices

A foreign deposit taker / bank may consider establishing operations in the Island, but may be unwilling to commit the level of investment required to fully establish those operations before determining the viability of the market.

A financial services licence with Class 1(3) permissions allows a foreign bank to establish a representative office in the Island for marketing and business development. The bank may then wish to develop its business in the Island and later apply for Class 1(1) or Class 1(2) permissions to expand its business.

Guidance for establishing a representative office of a foreign deposit taker / bank can be found below:


Additional Criteria for functionaries to Collective Investment Schemes

The Authority has also published a Supplementary Licensing Policy for Class 3 regulated activity. This policy document is additional to the licensing policy and is directed at licence applicants who wish to provide services to collective investment schemes.

Insurance Intermediaries

There are a number of exemptions within the Insurance Intermediaries (General Business) Regulations 2020 (‘Insurance Intermediaries Regulations’) from the requirement to register as an insurance intermediary and from certain requirements under the Insurance Intermediaries Regulations and the IA08.  Guidance on registration as an insurance intermediary can be found here.

A business that wishes to apply for a licence, authorisation or registration should contact the Authority as soon as possible to open lines of communication and describe its plans. Contact should be made as follows:

What is the Application process?

The application process has several stages:


Stage one

Initial engagement

A prospective applicant should provide an outline of the intended business or a draft business plan which explains:

  • What the prospective applicant plans to undertake in and from the Island;
  • Who will be involved in the business and how they meet the Training & Competence Framework; and
  • If intending to relocate to the Isle of Man from elsewhere, the reasons for this.
We will then arrange a meeting to discuss the plans and provide high level feedback and guidance and outline the application process in more detail.
Stage two

Submission of business plan

At this stage the submission of a draft business plan will provide more detail than the initial discussions. This plan should include financial projections, a clear, more detailed picture of those involved in the application and how the Authority’s expectations in what it looks for in an applicant will be met.

The Authority will review the draft business plan then provide feedback and guidance on areas to develop or how any potential gaps or shortcomings may be addressed if the entity makes a formal application. FSA08 Business Plan Guidance and IA08 Business Plan Guidance for insurers and permit holders is available to assist.

The Authority may ask for an updated business plan before proceeding to the next stage, or if the matters are not significant, it may request the applicant takes the guidance on board and moves to stage three.

Stage three

Application and review

At this stage the applicant will submit an application form, submit the relevant supporting documentation and pay the appropriate application fee.

The Authority’s current service standard for processing an application, from receipt of a complete application to a decision from the Authority is:

  • Deposit taker – 6 months.
  • Life insurer – 6 months.
  • Non-life insurer (apart from class 12) – 3 to 6 months.
  • Investment business, CIS functionary, trust & corporate service provider, payment services business or credit union – 3 to 6 months.
  • Class 12 non-life insurer – 6 weeks to 3 months (the Authority may consider an accelerated timescale of 4 to 6 weeks for completion where the applicant is lower risk as explained in Insurance Authorisation Guidance).

This service standard applies to an application with which there are no major difficulties concerning the applicant or persons connected with the applicant. An application may take considerably longer than the timescales above to process if it is incomplete, or if there are issues in relation to the applicant or connected persons that require further investigation before a recommendation can be made regarding its authorisation, registration or licensing.

To ensure an application is processed as quickly as possible, it is important that all the necessary forms and documentation are completed accurately and submitted in a timely manner.

The Authority is not responsible for delays arising from the submission of incomplete, inaccurate or changing applications. During the processing of any application, two-way communication with the Authority is essential. This dialogue will allow the processing team to gain a better understanding of the business, which may also speed up the application process.

Stage four


Applications are considered by senior Authority staff (for this purpose, referred to as the “Decision Making Group”). The applicant will be notified of the recommendation on its application by letter, and will also receive a copy of the paper supplied by staff to the decision making group. Where a recommendation is for a licence, authorisation or registration to be granted, the applicant will not be invited to attend or make written representations. However, where a recommendation is for a licence, authorisation or registration to be refused, the applicant will be invited to make any representations it wishes in writing to the Decision Making Group (oral representations are only as permitted by the Decision Making Group).

The staff recommendation is purely that. The decision to issue a licence, authorisation or registration is made by the Decision Making Group, which may accept, or reject, the recommendation of the processing staff.

When making the decision, the Decision Making Group will consider the paper put forward by the processing staff in support of the recommendation, and where the recommendation is for a licence, authorisation or registration to be refused, the Decision Making Group will also consider any representations that may be made by the applicant.

The decision will be notified to the applicant subsequently in writing. Reasons will be provided for a negative decision and for the imposition of any conditions on a licence, authorisation or registration.

For Class 12 insurers and foreign insurers, a similar process is followed. However, where a recommendation is for an authorisation to be granted, the applicant may not always be notified of the recommendation or receive a copy of the paper in advance.  Where a recommendation is for an authorisation to be refused, the applicant will still be invited to make any representations it wishes to the Decision Making Group.

Stage five

'Subject to' matters

The Authority may agree to issue a licence, authorisation or registration subject to a number of matters which will need to be met before the licence, authorisation or registration is issued.

Common ‘subject to’ matters include obtaining appropriate insurance and the finalisation and adoption of procedures and risk management frameworks.

It may also include other matters considered appropriate such as the appointment of key personnel who are still in roles with other businesses or are preparing to re-locate to the Island to take up roles within the applicant.

The Authority expects the ‘subject to’ matters to be completed in a timely manner. If satisfying of ‘subject to’ matters is not completed within 3 months, the Authority may suspend its decision and require the applicant to submit a refreshed application and business plan.

Stage six

Licensed, authorised or registered

The applicant is now licensed, authorised or registered and its services may now be made available to its target customers.

If an applicant is aggrieved by a decision of the Authority not to authorise, register or issue a licence or to attach conditions to an authorisation registration or licence, it may appeal to the Financial Services Tribunal.

The Financial Services Tribunal Rules 2015 (‘the Tribunal Rules’) can be found here, and they set out the procedure and grounds for an appeal. The grounds for appeal are set out in rule 6A of the Tribunal Rules, and they are that-

(a) the disputed decision is based on an error of fact;

(b) the disputed decision is wrong in law; or

(c) the regulatory authority’s exercise of its discretion in relation to the disputed decision was so unreasonable that no reasonable regulatory authority would have exercised its discretion in such a manner.

When applying for a licence, authorisation or registration, prospective controlled function holders (such as directors and Head of Compliance) do not want to leave their existing role to move to a business which does not yet have the appropriate licence, authorisation or registration. What can we do?

The Authority recognises that prospective controlled function holders may be unwilling to leave a secure role, for a firm which is not yet licensed, authorised or registered. As such the Authority will consider a proposed appointee making its assessments as though that proposed person is a part of the applicant. If licence, authorisation or registration is agreed, that agreement will be subject to the proposed appointee’s formal appointment.


How long will an application take?

The Authority’s current service standard for processing an application, from receipt of a complete application to a decision from the Authority is:

  • Deposit taker – 6 months.
  • Life insurer – 6 months.
  • Non-life insurer (apart from class 12) – 3 to 6 months.
  • Investment business, CIS functionary, trust & corporate service provider, payment services business or credit union – 3 to 6 months.
  • Class 12 non-life insurer – 6 weeks to 3 months (the Authority may consider an accelerated timescale of 4 to 6 weeks for completion where the applicant is lower risk as explained in Insurance Authorisation Guidance).
I am a regulated business in another jurisdiction. Can I sell my products and services to customers in the Island?

The FSA08 and IA08 require a person to be licensed, registered or authorised if they are undertaking regulated activity in or from the Isle of Man.

Merely having Isle of Man resident customers is not, operating in or from the Island.

For example, a company issuing credit cards from the UK would not require a financial services licence merely by issuing credit cards to Isle of Man residents from its UK base. Conversely, a company issuing credit cards from the Isle of Man, but does not cater to Isle of Man customers would still require a licence to do so.

It is important to highlight that there are restrictions on investment business and insurance intermediaries when soliciting Isle of Man customers, even if they are not undertaking the activity in or from the Island.