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    CP21/34: Improving the Appointed Representatives regime



    Please find the link to the full consultation paper by the FCA here.

    Who should read this

    • firms who currently have, or intend to have ARs in future, and by the ARs themselves, and
    • consumers and consumer bodies with an interest in the AR regime

    Why we are consulting

    The AR regime was created to allow self-employed representatives to engage in regulated activities without having to be authorised. Over time, it has evolved to include a wider range of business models across sectors and markets.

    Our proposed changes to the AR regime aim to reduce potential harm and ensure that the regime delivers good outcomes for consumers and markets.

    We are seeing a wide range of harm across all the sectors where firms have ARs. This harm often occurs because principals don’t perform enough due diligence before appointing an AR, or from inadequate oversight and control after an AR has been appointed.

    Evidence shows that, on average, principals cause 50 to 400% more supervisory cases than non-principals. It also shows that cases are higher than for non-principals across every sector.

    Our proposals:

    • require principals to provide additional and more timely information on their ARs and how these are overseen, and
    • clarify and strengthen the responsibilities and expectations of principals

    Additionally, we are seeking views, through a discussion chapter, on other potential areas of policy change. We have also collaborated with the Treasury on its Call for Evidence.

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