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    FCA look to strengthen financial promotions rules

    By David Petty   | 31/01/2023


    The FCA has proposed new measures for the section 21 sign off process.

    Under current rules, any FCA authorised firm is allowed to approve financial promotions on behalf of other firms who are not authorised by the regulator. The changes being introduced will require authorised firms to undergo a new screening process before they are allowed to approve financial promotions. Firms will also be required to regularly report back to the FCA on financial promotions they have approved.

    In their consultation paper, CP22/27- Introducing a gateway for firms who approve financial promotions, the FCA outlines new measures that will require firms to demonstrate they have the right expertise for the promotions they wish to approve.

    The consultation focuses on the following aspects of the proposed gateway:

    When the new regime comes into force, a firm that wants to be able to approve financial promotions will need (subject to some exceptions) to apply to the FCA for permission to do so.

    The proposed reforms aim to ensure that the FCA can act quickly to put a stop to harmful financial promotions communicated by unauthorised firms, including in areas such as high-risk investments and Buy Now Pay Later. It’s imperative that firms ensure the firm which is signing off any financial promotions under the section 21 process has the relevant experience and knowledge.

    Talk to us today to discuss how we may be able to support your financial promotion sign offs.

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