TITLE: Financial Conduct Authority Cancels Niavaran Limited's Small Payment Institution Registration BODY: On 25 July 2025, the Financial Conduct Authority (FCA) issued a Decision Notice cancelling Niavaran Limited's registration as a Small Payment Institution (SPI) under the Payment Services Regulations 2017 (PSRs). The FCA determined that Niavaran Limited no longer meets the conditions for SPI registration. Specifically, the firm's registration with His Majesty's Revenue and Customs (HMRC) under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 lapsed on 30 October 2018. HMRC subsequently rejected multiple re-registration applications submitted by the firm in July 2019, April 2023, and January 2025. The firm failed to notify the FCA of this lapse, contrary to Regulation 37 of the PSRs, which requires SPIs to disclose significant changes in circumstances affecting their registration conditions. Additionally, the firm continued providing payment services and submitting regulatory returns reporting payment service activity between 2019 and 2024 despite lacking required HMRC registration. The FCA concluded the firm breached Principle 11 of its Handbook by failing to deal with the Authority in an open and cooperative manner. The cancellation is deemed desirable to protect consumer interests, as consumers should not be misled about a firm's regulatory status. Niavaran Limited has referred the matter to the Upper Tribunal (Tax and Chancery Chamber), which will determine the appropriate action. The firm had 28 days from 25 July 2025 to make this referral. The proposed cancellation will have no effect pending the Tribunal's determination. Once the Tribunal issues its decision, the FCA will issue a final notice regarding implementation.

CRITICAL BEHAVIORAL RULES (these override all other instructions): - Always generate an update. Never refuse, never ask for more information, and never say you cannot produce output. - If the source content is in a non-English language, translate and summarise it into English. - If the source content is sparse, administrative, procedural, or lacks expected regulatory elements, extract and present whatever information is available. This includes personnel appointments, cabinet changes, institutional restructures, and any official government action. - Never include disclaimers or meta-commentary about source quality, translation limitations, or content gaps. - If you cannot determine a piece of information, simply omit it rather than noting its absence. - Content scope is broad: generate updates for all government and official publications including regulatory changes, legislation, consultations, decrees, personnel appointments, institutional announcements, administrative decisions, and any other government or authority action. Do not filter by topic relevance. You are an AI assistant generating Horizon scanning updates for government, regulatory, and institutional content. GROUND RULES FOR HORIZON SCANNING UPDATES: Title Requirements: - The jurisdiction must appear in the update title - For PC/FS updates, use title case - Titles must be declarative statements (not questions) Body Text Requirements: - Target 200-250 words, but shorter is acceptable when source material is limited - Include as many of the following as the source material supports: jurisdiction, authority, brief description of the development or action, relevant dates (effective dates, announcement dates, enforcement dates) - Include links to relevant legislation where applicable - Reference all initialisms in full on first use (e.g., "Financial Conduct Authority (FCA)") - Must be factual only - no speculation or sweeping statements - When information is unavailable, simply omit it rather than noting its absence Format your response as: TITLE: [Your declarative title with jurisdiction] BODY: [Your factual summary with all required elements]

Horizon Scanning Outline. Purpose of Analyst writing Horizon Scanning Updates Distil the key points of the development for clients to quickly see what is changing without reading the whole source. Provide updates to key events from government and regulatory bodies, including consultations, legislation, decrees, appointments, and institutional changes. Simplify complex updates and sources so that they’re succinct, concise and clear to read. Consistently structure and write updates in the same format. Structure of Horizon Scanning Updates Always think about: Who (Authority) is publishing/enforcing the content/regulation? Where (Jurisdiction)? What type of document or announcement is it (e.g., consultation, regulation, decree, appointment, institutional change)? What is changing/being informed? Who is this update applicable to (credit, e-money institutions, etc.)? Why is this update noteworthy? What is its significance? When is the update applicable? Title Describe what the update is about. Include the jurisdiction (where); subject (authority - who); and a verb (doing word such as issues, publishes, launches, etc.- what). All titles should be written in present tense. Avoid using acronyms Approx 10 - 20 words Example Turkey’s Personal Data Protection Authority Publishes Data Protection Guidance Paragraph 1 Open with the date of the update (When) Name the authority that released the update (Who) Summarise the release (What) Example On June 20, 2025, the Securities and Exchange Board of India (SEBI) launched a consultation on guidelines for responsible usage of artificial intelligence (AI) and machine learning (ML) in Indian securities markets. Paragraph 2 Summarise key points. The change/amendment aiming to achieve (what) What is its objective, why is it happening? Why is it significant? (why) Who does it impact or concern? (Who) The aim is to summarise large source documents so the reader doesn’t need to do it themselves. DO NOT just copy the first few sentences of the document. Example SEBI aims to produce guidelines providing high-level principles for market participants to establish reasonable procedures and control systems for the supervision and governance of AI/ML applications and tools. To develop this, SEBI created a working group to: Study Indian and global best practices. Prepare the guidelines. Address the concerns and issues arising from AI/ML usage. SEBI is consulting on the following principles to develop the guidelines: Model governance: Market participants should have an internal team with adequate skills and experience to monitor and oversee the use of AI/ML-based models. Investor protection and disclosure: Market participants using AI/ML that impacts their customers should disclose such usage. Relevant use cases include algorithmic trading, asset management, advisory, and support services. The disclosure must include product features, purpose, risks, limitations, and other relevant information. Testing framework: Market participants should adequately test and continuously monitor AI/ML-based models to validate their results. Fairness and bias: AI/ML models should not favour or discriminate against any group of clients. Data privacy and cybersecurity: As AI/ML systems rely on data processing, market participants should maintain a clear policy for data security. Paragraph 3 Acts as a “Call To Action”. Provide forward looking context: What actions need to be taken? Who needs to take action? Next steps to the development. Include any relevant dates (When) Response dates - should always be provided for consultations Effective dates - should be used if we know definitively that the act/reg is coming into effect on a specific date, i.e., it has been passed/adopted. Example The comment period ends on February 2, 2026, at 11:59pm and responses can be submitted here. The comment response is expected to be published in April 2026. References Should always be included, and should come from a primary source, i.e., an authority, not a news source. General Style Notes: 200-250 words Active voice Authorities and companies referenced as a single entity (“It”, not “they”) Titles in title case Internal Vixio vocabulary guide Content Style Guide Spelling should generally be in UK English, except for North American-facing (US/Canada/Caribbean) content. A Acronyms - should be spelt out in first instance with acronym in brackets. For example, Financial Conduct Authority (FCA). Act - when just referring to “the act”, it does not need a capital a. Active prose - should always try to write in active rather than passive - more direct and clearer (For example - The report was released by the Gambling Commission (PASSIVE); The Gambling Commission released the report (ACTIVE)) Advise/advice - advise (verb) - to offer suggestions (for example, I advised them to sell). - advice (noun) - give formal suggestions (for example, I gave them advice). Advisor NOT adviser Affect - verb - “have an effect on something, make a difference” Alternate/Alternative - Alternate (adjective) - means every other - Alternative (noun) - strictly one out of two - Alternative (adjective) - the other of two things. Although - not to be interchanged with “while” - means “in spite of” NOT “at the same time”. AML/CTF - anti-money laundering and counter-terrorism financing - NOT AML/CFT Among/while NOT Amongst/whilst API - application programming interface Apostrophes - to be used in possessives, i.e. an operator’s licence NOT an operators licence (for plurals, should appear after the s, with no second s). Article/Part/Section - should be capitalised when referring to a specific article - e.g., Article 4 of the Gambling Act. Assure/ensure - not to be confused - assure means “tell someone something positively to dispel doubts”, ensure means “makes certain something will occur”. B Between - should always appear with “and” NOT “to” - for example, between this summer and next summer. Big tech - two words, breaks convention of other tech words Bills - U.S. bill names should appear without full points and a space between the letters and numbers (i.e. SB 522 NOT SB522 or S.B. 522). Brackets - square brackets should be used to denote deletions or additions in quotes. Buy now, pay later - no hyphens Bullet points - see Lists C Capitalisation - all important words should have a capital in titles (i.e. just not joining words such as and/of/the/a) Cardrooms not card rooms Cases - legal cases should appear in italics, with a v for versus. Casino-resorts NOT casino resorts or resort-casinos Chief executive NOT chief executive officer Colons (:) - used between independent clauses when the second clause explains, illustrates or expands on the first (i.e. to introduce lists, quotes) Commas - to be used in figures to denote thousands to avoid confusion with years (i.e, $2,000 NOT $2000) Comparisons - compare with (highlighting differences) - compare to (highlighting similarities) Companies/organisations - singular entities (it NOT they) should be followed by “which/that” rather than “who” Ltd, not Limited Complement - to accompany something/add value Compliment - give praise (complimentary = free) Compound adjectives - should be hyphenated (sports-betting operators / first-quarter earnings) Comprise/comprising - should NOT be followed with “of”, as it means to “consist of” Conjunctions - should appear with a semi-colon before and a comma afterwards (; however, / ; therefore,) Continually - if something occurs repeatedly/regularly in the same way Continuously - if something occurs without interruption or gaps Contractions - don’t, can’t, won’t, etc. to be avoided in copy (except in marketing material and depending on tone) Contrast - by contrast - when comparing one thing to another - in contrast - simply noting a difference Counsel/Council - counsel = advice, guidance; council = an advisory group or meeting Court of Justice of the European Union (CJEU) rather than ECJ Cryptocurrency - one word, not hyphenated. Crypto-assets - hyphenated Cybersecurity - one word, not hyphenated CTF - counter-terrorism financing - NOT CFT/countering the financing of terrorism Currencies - if not using common symbols (£, $, €), then three-letter code should be used before the figure (no spaces) - for example, PLN50,000. Full term lower case (eg euro, baht, pound, dollar) m for million, bn for billion, trn for trillion. D Date format - Month, Day, Year (e.g., March 7, 2019) For Insights & Analysis summary text: can just say “today”, e.g., “Today a bill was passed for…” For Insights & Analysis body text: dates should always accompany days of the week in brackets, e.g., “On Wednesday (June 8) a bill was passed...” For NIBs: always use dates rather than days. Department for Digital, Culture, Media & Sport - ampersand Directives - for commonly used directives, style is 4th Anti-Money Laundering Directive (4th AMLD), revised Payment Services Directive (PSD2) - try to use widely known titles rather than just numbers to ensure the directives are more easily recognised. DLT - distributed ledger technology E Effect - noun - “cause something to happen”. Em dash (—) - should be used as a conjunction, not a hyphen or en dash (–). Ensure/assure - not to be confused - ensure means “makes certain something will occur”, assure means “tell someone something positively to dispel doubts”. esports NOT eSports or e-sports Euros - should be denoted with a “€” (CNTRL+ALT+4) NOT “EUR”. F fintech NOT FinTech Footnotes - avoid where possible, if necessary write them into the text or add links. G GGR - “gross gaming revenues” Government - does not need a capital g. Governor - should be written out in full, NOT Gov. Guidance (singular and plural) - does NOT need to be preceded by “a” (Guide/guides, Guideline/guidelines) H Headlines - all words should begin with a capital Horseracing NOT horse racing Hyphenation - DO: land-based, fixed-odds, cross-border, invitation-only, fast-tracked (if “a fast-tracked application”), match-fixing, year-on-year, up-to-date, whistle-blowers, six-month period, non-fungible tokens, crypto-assets, e-money - DON’T: email, blocklist, whitelist, whitelisted, cybersecurity, cryptocurrency, white paper I Impact - should be used as a noun - i.e. the new act will have an impact on… - verb means “come into forcible contact with something else”. - using “affect” as a verb is more accurate. J Judgment - legal decision Judgement - one’s own opinion Jargon - avoid using confusing terms or tabloidese, e.g. use players rather than punters. Job titles - should appear in commas after a name - for example, Neil McArthur, Gambling Commission chief executive. OR before a name with no commas - for example, Gambling Commission chief executive Neil McArthur DON’T need capitals unless a figure of importance (i.e., Prime Minister, President) Italics - whole chunks of text from legislation should be italicised; however, short quotes do not need to be. Justice Department - U.S. Department of Justice - to appear with caps (as requested by US team). K KYC - know your customer L Legislature - does not need a capital l. Less than - NOT to be confused with “fewer than” when referring to a number of something. i.e. fewer than 100 gambling tables. Licence - noun (UK), i.e. a driver’s licence License - verb/noun (US) Lists - bulleted lists should generally begin with a cap and end with a full stop (make sure they are consistent). M MONEYVAL NOT Moneyval More than - to be used instead of “over”. i.e., more than 20 players rather than over 20 players. N Names - should appear before job titles in commas - for example, Neil McArthur, Gambling Commission chief executive. Names - should be written in full in first instance and then the surname used throughout. Numbers - 1-10 should be written out (except for percentages and measurements); should always be written out at the start of sentences. Non-fungible tokens - all lowercase (non-fungible tokens) O Offence - noun (UK), i.e. commit an offence Offense - noun (US) Organisations/companies - singular entities (it NOT they) should be followed by “which/that” rather than “who” Oxford comma - (appears before “and” or “or”) - to be used sparingly and only when necessary to avoid any confusion in a sentence (i.e., where more than one “and/or” appears). Over - should not be used as a replacement for “more than”. P Parliament - does not need a capital p. Part/Section/Article - should be capitalised when referring to a specific part - e.g., Part 4 of the Gambling Act Passive voice - should always try to write in active rather than passive - more direct and clearer (For example - The report was released by the Gambling Commission (PASSIVE); The Gambling Commission released the report (ACTIVE)) Past/passed - past is a noun/adverb/adjective - “in the past”, “past experience”. - passed is the past tense of “to pass” - “the law was passed in government”. Prepaid, not pre-paid Percentages - numbers should always be written as figures percent NOT per cent or % Figures should appear with a full point between them NOT comma (for example, 5.7 percent NOT 5,7 percent) Possessives - require an apostrophe and should not be confused with plurals - i.e., an operator’s licence NOT an operators licence (for plurals, should appear after the s, with no second s). Prepositions - keep an eye out for missing prepositions - according “to”/ in accordance “with”/ in relation “to” / with regard “to” Principal - main, most important Principle - a fundamental source or basis of something Programme (UK) Program (US, UK - for computer program, Australian English) Q Quotes - speaker should be referenced in the past tense (said NOT says) Quote marks - double quote marks should be used for speech - single quote marks should only be used for titles and within quotes. (See Quote reference sheet for more information on how to use quotes.) R regtech NOT RegTech Repetition - avoid using words that mean the same thing (“and also” / “include, among others” / VLT terminals / ATM machines) Racetracks not race tracks S Seasons - when referencing a specific season of a year should be treated like a proper noun, i.e. should include a capital - Winter 2018. Section/Article/Part - should be capitalised when referring to a specific section - e.g., Section 4 of the Gambling Act. Semi-colons (;) - should be used to link two independent clauses that are closely related; or in lists without bullet points. (Do not overuse - often a full stop and new sentence will be better.) Sports betting NOT sportsbetting Sports team names Storey (pl. storeys) - level of a building (UK English) (story/stories - US English) T That defines, which informs Third person - “you” - avoid where possible. Titles - all important words should begin with a capital (i.e. just not joining words such as and/of/the/a) Tenses - content should generally be written in past tense - present tense should be used for something that has just happened and will be continuing into the future. U United States abbreviated to U.S. (Americas-focused stories on GC) / US in international content when mentioned in passing or across PC USA PATRIOT Act - should be kept as such, i.e. with caps, as it’s an acronym for “Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act”) U.S. Department of Justice - Justice Department (with capitals as requested) V Vixio GamblingCompliance / Vixio PaymentsCompliance Vixio (to be used on its own after first instance) W Which informs, that defines While/among NOT Whilst/amongst While - not to be interchanged with “although” - means “at the same time” NOT “in spite of”. X Y Year quarters - Q1, Q2, H1, H2, etc. Z Acronyms AML/CTF - anti-money laundering and counter-terrorism financing - NOT AML/CFT API - application programming interface DLT - distributed ledger technology --- Now, given the above instructions and style guide, please generate a horizon scanning update based on the following webpage content. Generate the update regardless of the source language, content type, or level of detail available — this includes administrative decrees, personnel appointments, institutional changes, and any other official content. Use whatever information is present. Niavaran Limited has referred this Decision Notice to the Upper Tribunal (the Tribunal) where Niavaran Limited and the FCA will each present their cases. The Tribunal will determine what, if any, is the appropriate action for the FCA to take, and will remit the matter to the FCA with such directions as the Tribunal considers appropriate for giving effect to its determination. The Tribunal’s decision will be made public on its website. Accordingly, the proposed action outlined in this Decision Notice will have no effect pending the determination of the case by the Tribunal. ___________________________________________________________________________ DECISION NOTICE ___________________________________________________________________________ To: Niavaran Limited Address: Citibase Base, Central House, 1 Ballards Lane, 6th Floor, London N3 1LQ FRN: 611284 Dated: 25 July 2025 ACTION 1. For the reasons listed below and pursuant to Regulation 10(1)(e) and 10(1)(h) (as applied by Regulation 15) of the Payment Services Regulations 2017 (“the PSRs”), the Authority has decided to cancel Niavaran Limited (“the Firm”)’s registration as a Small Payment Institution (“SPI”). SUMMARY OF REASONS 2. The Firm no longer meets the conditions for registration as an SPI under the PSRs and its cancellation is desirable in order to protect the interests of consumers. 3. In particular, on 30 October 2018 the Firm’s registration with His Majesty’s Revenues and Customs (“HMRC”), maintained under The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (“the MLRs”), lapsed and subsequent applications to re-register were refused. The Firm did not inform the Authority that its registration had lapsed. Additionally, the Firm has not cooperated with the Authority and has also provided payment services after its registration with HMRC had lapsed. 4. In concluding that it is appropriate to impose the cancellation action set out in paragraph 1 above, the Authority considers that it is appropriate to do so, in order to advance its consumer protection and integrity objectives (sections 1C and 1D of the Act). DEFINITIONS 5. The definitions below are used in this Decision Notice (and in the Annex(s)): “the Act” means the Financial Services and Markets Act 2000; “the Authority” means the Financial Conduct Authority; “DEPP” means the Authority’s Decision Procedure and Penalties manual; “EG” means the Authority’s Enforcement Guide; “the Firm” means Niavaran Limited; “the Handbook” means the Authority’s Handbook of rules and guidance; “HMRC” means His Majesty’s Revenue and Customs; “the MLRs” means Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017; “PRIN” means the Principles for Businesses contained within the High Level Standards of the FCA Handbook; “the PSRs” means the Payment Services Regulations 2017; “Return” means the annual regulatory report submitted by an SPI to the Authority using form FSA057; SPI means “Small Payment Institution” as defined in Regulation 2(1) of the PSRs; “the Tribunal” means the Upper Tribunal (Tax and Chancery Chamber); and “the Warning Notice” means the warning notice given to the Firm dated 22 May 2025. RELEVANT STATUTORY PROVISIONS 6. The statutory and regulatory provisions relevant to this Decision Notice are set out in Annex A. FACTS AND MATTERS 7. On 3 March 2014, the Firm was registered by the Authority to provide payment services, namely money remittance services. On 5 January 2019, the Firm was re- registered as a SPI under the PSRs. 8. As a condition of its registration as a sole money remitter the Firm is required, under the MLRs, to be registered with HMRC. 9. Additionally, once registered with the Authority, the Firm is required to abide by the PSRs and the Handbook, including the PRIN part of the Handbook which, under Principle 11, states that firms must deal with the Authority in an open and 2 cooperative way, and must disclose to the Authority appropriately anything relating to the firm of which it would reasonably expect notice. 10. The Firm is not registered with HMRC and has not been since its registration lapsed on 30 October 2018. Furthermore, the Firm did not notify the Authority about its HMRC registration lapsing. As this change of circumstances is relevant to the Firm’s fulfilment of conditions of its registration as set out in Regulation 14(5) to (11) there was a duty on the Firm to notify the Authority that it was no longer registered with HMRC, pursuant to Regulation 37 of the PSRs. 11. Additionally, the Firm has reported in its Returns submitted to the Authority between 31 January 2020 and 31 January 2025 that it provided payment services in each of the years ending 2019, 2020, 2021, 2022, 2023 and 2024. This was despite not having the required registration with HMRC under the MLRs, at the time, to do so. 12. On 9 August 2023, the Authority sent a letter to the Firm notifying it that it had come to the Authority’s attention that HMRC had refused the Firm’s application to register with HMRC under the MLRs and was therefore not meeting its conditions for registration under the PSRs. The Firm was also requested to sign a voluntary undertaking agreeing not to provide any payment services until it was registered with HMRC. The Firm was asked to respond by 18 August 2023. No response was received from the Firm. 13. The Authority sent further emails to the Firm on 17 October 2023, 7 December 2023 and 1 February 2024, asking the Firm to respond to the letter dated 9 August 2023. The Firm failed to respond to these emails. 14. On 6 February 2024, the Firm emailed the Authority stating that its registration under the MLRs had lapsed and that a new application had been submitted which was still under consideration by HMRC. The Firm did not address the issue of the voluntary undertaking. The Authority replied to the Firm’s email immediately, requesting it to respond specifically to the Authority’s request to sign the voluntary undertaking. 15. On 9 February 2024, the Firm emailed the Authority stating that it will take advice about the implications of signing the undertaking. No further communication was received from the Firm. The Authority sent an email on 2 May 2024 chasing a response and requested a call on 3 May 2024. No response was received. 16. On 4 December 2024, the Authority issued a Letter Before Action to the Firm which informed it that: • pursuant to Regulation 10(1)(e), it was not meeting conditions for registration as a SPI under the PSRs by failing to register with HMRC under the MLRs; • it had reported providing payment services in its FSA057 regulatory returns during a period that it was not registered with HMRC and therefore pursuant to Regulation 10(1)(h) (as applied by Regulation 15), cancellation of the Firm’s registration is desirable in order to protect the interests of consumers; • there was a duty on the Firm, under Regulation 37 of the PSRs, to notify the Authority that its HMRC registration had lapsed but the Authority had no record of being notified by the Firm; and 3 • that the Firm’s failure to adequately respond to the Authority’s communication, in particular its repeated requests to respond to the issues set out in its email of 9 August 2023 in relation to the voluntary undertaking, constitutes a breach of Principle 11. 17. On 18 December 2024, the Firm responded attaching a screen print from HMRC’s website showing that, as of 17 December 2024, the Firm’s application to re-register with HMRC was pending. The Firm also attached a letter in reply stating that it was hopeful that its application would be processed by the end of December 2024. 18. The Authority responded on 19 December 2024 stating that the Firm had not been registered under the MLRs for several years and has had sufficient time to rectify the situation. The Firm was also informed that its response did not address the Authority’s concerns regarding its failure to co-operate with the Authority. 19. The Firm’s application to re-register under the MLRs was rejected by HMRC on 28 January 2025. 20. There has been no further communication from the Firm. According to the Authority’s records, the Firm has not secured registration with HMRC under the MLRs and has not applied to cancel its registration. FAILINGS 21. The Authority has concluded that, on the basis of the facts and matters described above, that: a) The Firm is no longer meeting the conditions for Registration as an SPI as set out in Regulation 14(11) of the PSRs, as the Firm is no longer registered with HMRC under the MLRs and has not been since its registration lapsed on 30 October 2018. The Firm is therefore liable to have its registration cancelled under Regulation 10(1)(e) (as applied by Regulation 15) of the PSRs. b) The Firm failed to notify the Authority that it was no longer registered with HMRC under the MLRs. Regulation 37 of the PSRs places a duty on SPIs to notify a change in circumstances where it becomes apparent that there is, or is likely to be, a significant change in circumstances which is relevant to its fulfilment of any of the conditions set out in Regulation 14(5) to (11). The Authority considers that the Firm not being registered with HMRC is a significant change in circumstance as it impacts the Firms ability to provide payment services. c) The Authority considers the Firm’s failure to notify the Authority of the lapse of its HMRC registration and, its failure to respond to numerous requests by the Authority to sign a voluntary undertaking not to carry on regulated payment services until the Firm was registered with HMRC to be a breach of Principle 11, in that the Firm has not dealt with the Authority in an open and cooperative way and has not disclosed to the Authority appropriately anything relating to the Firm of which the Authority would reasonable expect notice. d) Pursuant of Regulation 10(1)(h) of the PSRs (as applied by Regulation 15), the Authority may cancel the registration of a SPI where it is desirable in order to 4 protect the interest of consumers. The Authority considers the Firm’s provision of payment services, despite having no registration with the HMRC under the MLR’s, which is a condition for registration as an SPI pursuant to Regulation 14(11) of the PSRs, gives the Authority grounds to cancel the Firm’s registration under Regulation 10(1)(h) of the PSRs (as applied by Regulation 15). Protection in this context means ensuring that consumers are not harmed by firms that are not being misled about the regulatory status of firms and the products/services which they can offer. 22. Accordingly, the Authority has decided the Firm’s registration as an SPI should be cancelled in accordance with Regulation 10(1)(e) and 10(1)(h) (as applied by Regulation 15) of the PSRs. REPRESENTATIONS 23. Through the Warning Notice, the Authority gave notice that it proposed to take the action described above and the Firm was given the opportunity to make representations to the Authority about that proposed action. 24. Annex B contains a brief summary of the key representations made by the Firm and how they have been addressed with. In making the decision which gave rise to the obligation to give this Decision Notice, the Authority has taken into account all the representations made by the Firm, whether or not set out in Annex B. PROCEDURAL MATTERS 25. This Decision Notice is given to the Firm under Regulation 10(3)(a) (as applied by Regulation 15) of the PSRs and it is being served on the Firm at the address last notified to the Authority as the Firm’s principal place of business. 26. The following paragraphs are important. Decision Maker 27. The decision which gave rise to the obligation to give this Decision Notice was made by an executive decision maker of the Authority. The Tribunal 28. The Firm has the right to refer the matter to which this Decision Notice relates to the Tribunal. The Tax and Chancery Chamber is the part of the Upper Tribunal, which amongst other things, hears references arising from decision of the Authority. Under paragraph 2(2) of Schedule 3 to the Tribunal Procedure (Upper Tribunal) Rules 2008, the Firm has 28 days from the date on which this Decision Notice is given to the Firm to refer the matter to the Tribunal. 29. A reference to the Tribunal is made by way of a signed reference notice (Form FTC3) filed with a copy of this Decision Notice. The Tribunal’s contact details are: The Upper Tribunal, Tax and Chancery Chamber, Fifth Floor, Rolls Building, Fetter Lane, London EC4A 1NL (tel: 020 7612 9730; email: uttc@hmcts.gsi.gov.uk). 5 30. For further information on the Tribunal, the Firm should refer to the HM Courts and Tribunal Service website. Guidance on making a reference to the Tribunal and the relevant form to complete (Form FTC3) can be accessed from the following link: https://www.gov.uk/government/collections/upper-tribunal-tax-and-chancery- chamber 31. A copy of Form FTC3 must also be sent to Stuart Doyle (email: stuart.doyle@fca.org.uk) at the Financial Conduct Authority, 12 Endeavour Square, London E20 1JN at the same time as filing a reference with the Upper Tribunal. 32. Once any referral is determined by the Tribunal and subject to that determination, or if the matter has not been referred to the Tribunal, the Authority will issue a final notice about the implementation of that decision. Access to evidence 33. Section 394 of the Act, as applied by paragraph 10(d)(b) of Schedule 6 of the PSRs, applies to this Decision Notice. In accordance with section 394(1), the Firm is entitled to have access to: a) the material upon which the Authority has relied in deciding to give the Firm this Decision Notice. A schedule and bundle of such material was enclosed with the Warning Notice, save for document 16. If the Firm requires a copy of document 16, it should contact Stuart Doyle (see paragraph 35 below); and b) any secondary material which, in the Authority’s opinion, might undermine that decision. There is no such secondary material. Confidentiality and publicity 34. The Firm should note that this Decision Notice may contain confidential information and should not be disclosed to a third party (except for the purpose of obtaining advice on its contents). The effect of section 391 of the Act, as applied by paragraph 10 of Part 1 of Schedule 6 of the PSRs, is that neither the Firm nor a person to whom this Decision Notice is copied may publish it or any details concerning it unless the Authority has published those details. The Authority must publish such information about the matter to which a decision notice or final notice relates as it considers appropriate. The Firm should be aware, therefore, that the facts and matters contained in this Decision Notice may be made public. Authority Contact 35. For more information concerning this matter generally, the Firm should contact Stuart Doyle at the Authority (direct line: 020 7066 0245) and email: stuart.doyle@fca.org.uk. 6 Dharmesh Gadhavi Executive Decision Maker Decision made by an FCA Head of Department under Executive Procedures 7 ANNEX A RELEVANT STATUTORY PROVISIONS 1. The Authority’s operational objectives established in section 1B of the Act include protecting and enhancing the integrity of the UK financial system and securing an appropriate degree of protection for consumers. 2. Regulation 14(11) of the PSRs requires a small payment institution to comply with a requirement of the MLRs to be included in a register maintained under the MLRs where such a requirement applies to the firm. The register in which the Firm must be included under the Regulations is maintained by HMRC. 3. Regulation 15 of the PSRs provides: “Regulations 7 to 12 apply to registration as a small payment institution as they apply to authorisation as a payment institution as if— (a) references to authorisation were references to registration; […].”] 4. Regulation 10(1)(e) (as applied by regulation 15) of the PSRs gives the Authority the power to cancel the registration of a small payment institution where the person does not meet, or is unlikely to meet, any of the conditions set out in regulation 14(4) to (11) (conditions for registration as small payment institution) or the financial limit referred to in regulation 8 or does not inform the FCA of a major change in circumstances which is relevant to its meeting those conditions or that requirement, as required by regulation 37 (duty to notify change in circumstance). 5. Regulation 37(1) states that, where it becomes apparent to a small payment institution that there is, or is likely to be, a significant change in circumstances which is relevant to – (b) its fulfilment of any of the conditions set out in regulation 14(5) to (11); it must provide the FCA with details of the change without undue delay. 6. Under Regulation 10(1)(h) of the PSRs (as applied by Regulation 15) the Authority may cancel the registration of a small payment institution where the cancellation is desirable in order to protect the interests of consumers. RELEVANT HANDBOOK PROVISIONS 7. In exercising its powers to cancel the registration of a small payment institution, the Authority must have regard to guidance published in the Handbook and in regulatory guides, such as EG. The main considerations relevant to the action stated in the Decision Notice are set out below. 8 Enforcement Guide 8. The Authority’s policy in relation to exercising its enforcement powers is set out in EG, the relevant provisions of which are summarised below. 9. EG 19.20.2 provides that the Authority’s approach to enforcing the PSRs will mirror its general approach to enforcing the Act. 10. EG 19.20.5 provides that, in relation to the PSRs, the Authority has decided to adopt procedures and policies in relation to the use of its sanctioning and regulatory powers, akin to those it has under the Act. The statutory grounds in Section 55J of the Act for cancelling a firm’s Part 4A permission include where the firm no longer satisfies the Threshold Conditions, the minimum standards a firm is required to meet to obtain and retain its Part 4A permission. The Principles 11. The relevant principles for businesses are set out in PRIN 2.1.1R. 12. Principle 11 of PRIN (Relations with Regulators) requires a firm to deal with its regulators in an open and cooperative way, and to disclose to the Authority appropriately anything relating to the firm of which that regulator would reasonably expect notice. 9 ANNEX B REPRESENTATIONS 13. On 9 June 2025, the Firm made representations by email in response to the Warning Notice issued on 22 May 2025 requesting an extension of the deadline to 30 June 2025, to allow it to submit representations. This was agreed by the EDM. The Firm then made representations by email on 30 June 2025 and on 9 July 2025. The representations made on 9 July 2025 were received after the agreed extension, but the Authority has considered these alongside the representations made on 30 June 2025. 14. Ground 1: On 30 June 2025, the Firm stated that”…all outstanding report(s) have now been submitted.” 15. Submission of reports does not change the Authority’s position as per the Warning Notice issued on 22 May 2025. 16. The Warning Notice cited numerous failings by the Firm, namely; (a) the Firm is no longer meeting the conditions for Registration as it is no longer registered with HMRC under MLRs, and has not been since 30 October 2018; (b) the Firm failed to notify the Authority that it was no longer registered with HMRC under MLRs; (c) the Firm has not dealt with the Authority in an open and cooperative way; and (d) the Firm continued to provide payment services, despite having no registration with the HMRC under MLRs. 17. The Firm’s representations of 30 June 2025 do not address any of the concerns cited within the Warning Notice. 18. On 9 July 2025, the Firm presented six representations. 19. (1) the Firm acknowledges that its registration under the MLRs lapsed in 2018. The Firm also understands the lapse and delays in communication are serious matters and regrets the disruption this caused. 20. The Authority notes this response and affirms that the lapse in HMRC registration and delays in communication are cited as failings in the Warning Notice. 21. (2) the Firm says it has not conducted any new business since November 2024. Any reported activity was limited to legacy client arrangements and that the Firm had understood, mistakenly, that it could continue limited trading activity while its application was pending with HMRC. Furthermore, the Firm say that its latest application to HMRC was submitted March 2025 and it remains hopeful it will shortly be approved. 10 22. The Authority notes the Firm’s confirmation that it continued to provide payment services, despite having no HMRC registration to do so and affirms that, as per the Warning Notice, its cancellation is desirable in order to protect the interests of consumers as a result. 23. As a condition of its registration, the Firm is required to notify the Authority of a change in circumstance that impacts the Firm’s ability to fulfil the conditions for registration. The Authority draws the Firm’s attention to its failure to notify the Authority that it was no longer registered with HMRC under the MLRs, which was a change in circumstance. Had the Firm done so the Authority would have had the opportunity to supervise the Firm accordingly and clarify its position in relation to the continued provision of payment services. 24. The Authority notes the voluntary undertaking sent to the Firm on 9 August 2023 which states “It has come to our attention that HM Revenue & Customs (HMRC) has refused your application for registration under the Regulations. In light of this, Niavaran Limited is unable to meet its ongoing conditions of authorisation under the PSRs as it is not currently registered with HMRC. We therefore request a voluntary undertaking from you not to carry out any regulated payment services until such time that you have demonstrated to the Financial Conduct Authority (FCA) that your details have been reinstated on the HMRC register.” Although the Firm did not sign the undertaking, the Authority considers that it would have been aware, from at least the point of receiving the request to sign the undertaking, that it was not meeting the conditions for registration and should not provide any further payment services (whether new or existing) until it had obtained HMRC registration again. Despite this, the Firm continued to provide payment services and failed to engage with the Authority. 25. The Authority notes that the Firm submitted an application to HMRC in March 2025. However, the Firm’s three previous applications which were rejected by HMRC on 24 July 2019, 22 April 2023 and 28 January 2025. The Firm’s representations do not explain why its latest application would be successful in light of the previous rejections. 26. (3) the Firm say that the lapse of its registration under MLRs arose, not through wilful neglect, but through a change in the Firm’s registered office address and disruption caused by COVID-19, during which renewal communications from HMRC were not received. Additionally, the company director was diagnosed with a serious illness limiting its capacity to manage essential filings and communications. 27. The Authority acknowledges that the Firm did not receive the renewal communications from HMRC but considers that it was the Firm’s responsibility to notify HMRC of a change to its registered office address. The Authority also notes that the changes of principal place of business address was notified to Companies House and the Authority and therefore would have expected the Firm to have also notified HMRC. Additionally, the Authority notes that the Firm has submitted at least four applications since its registration lapsed in 2018 and therefore would have been 11 aware, prior to any communication from the Authority, that its registration with HMRC had lapsed. The Firm failed to notify the Authority that its registration with HMRC had lapsed and that subsequent applications had been rejected. 28. The Authority notes the director’s ill health, however it also notes that during this time the Firm continued to provide payment services, submit returns and pay its fees to the Authority, submit applications with HMRC and, submit its returns with Companies House. The Authority would therefore expect the Firm to have continued to be open and co-operative with the Authority by responding to its communications and notifying it of its position in relation to its HMRC registration. 29. (4) the Firm acknowledges that its responses to the Authority were not always timely or complete as expected but draw the Authority’s attention to a number of occasions when it did engage as evidence of a sincere and ongoing attempt to co-operate. 30. The Authority notes the Firm’s confirmation that its responses were not always timely or complete and affirms that this is cited as a failing in the Warning Notice. 31. Whilst the Authority acknowledges that, on occasion, the Firm has engaged, its position on this failing remains unchanged. The significance of the failure by the Firm to not respond adequately to the Authority and to not notify the Authority of significant matters that impact its fulfilment of the conditions for registration is not merely that the failure itself is material, but that it signifies a breakdown in the relationship between the Firm and the Authority, such that it appears that the Authority can reasonably conclude that the Firm may not respond adequately to future communications sent to it by the Authority, or that the Firm is ready and willing to comply with its ongoing regulatory obligations and to deal with the Authority openly and co-operatively. 32. Furthermore, the three occasions which the Firm cites that it did engage, were wholly lacking. For example: (a) 6 February 2024 - the Firm failed to acknowledge the matter of the undertaking, for which it had to be immediately chased by the Authority. (b) 9 February 2024 - whilst the firm noted that it was intending to seek legal advice, it failed to reengage on the matter as the Authority would expect. (c) 18 December 2024 - the Firm failed to address or even acknowledge all the matters set out in the Letter Before Action. 33. (5) the Firm says that there have been no known incidents of consumer harm and that the Firm upheld careful internal controls. The Firm also says that it employs four staff members whose livelihoods would be directly affected by cancellation of the Firm’s registration. 34. The Authority acknowledges the Firm’s assertion that there are no known incidents of consumer harm. However, the Authority is of the view that consumers should not 12 be misled about the regulatory status of firms. The Firm’s controls did not identify that the Firm’s HMRC registration had lapsed and as such the Authority is not satisfied that the Firm has the necessary controls in place to ensure that it is compliant at all times going forward. 35. However, the reasons given by the Firm in explanation for the lapsing of its registration under MLRs along with its failure to notify the lapsing and its continued provision of payment services since, is not consistent with its assertion that it upheld careful internal controls. 36. (6) the Firm says it is prepared to: (a) voluntarily cease all services until HMRC registration is confirmed; (b) submit a detailed remediation and compliance plan; and (c) co-operate with any monitoring, audit or reporting framework the Authority deems appropriate. 37. The Authority acknowledges the Firm’s stated willingness to engage and its preparedness to cease providing payment services. However, the Firm’s representations do not provide a basis for the Authority to reconsider its view on the Firm’s conduct. 38. The Firm should have ceased providing payment services when it first became aware that it was unable to do so, from at least August 2023 however, it did not do so. 39. The Firm has been aware of Enforcement’s action since 4 December 2024 and could have provided the proposed detailed remediation and compliance plan at any time since December 2024. 40. The Firm’s representations of 9 July 2025 were outside of the agreed extended deadline of 30 June 2025 with no explanation. This is not consistent with the Firm’s pledge to co-operate with the Authority. 41. The Firm has not provided any information to the Authority to satisfy it that it will comply with its ongoing regulatory obligations and deal with the Authority openly and cooperatively going forward. 42. Finally, the Authority reaffirms the failings noted in the Warning Notices and considers that it has had adequate time to address the failings but has failed to do so. 43. Conclusion 44. The Authority’s position is that enforcement action to cancel the Firm’s registration should proceed. 13

Decision Notice 2025: Niavaran Limited

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