Passporting allows you to offer financial advice to clients that are based in any of the states that make up the European Economic Area (EEA). This is called a cross border services passport. It allows you to give advice overseas without having to get a separate authorisation in that country.
A UK financial adviser providing advice (in accordance with the directives) to a client located in another EEA state must either satisfy the legal requirements of that state through authorisation in that state or through the exercise of a passport.
For example, if you have a client that has retired to live in Spain who you wish to provide investment advice to and you are subject to MiFiD, you should apply for a passport that enables you to give advice in Spain. By doing so you remove the need to seek authorisation from the Spanish authorities, a process that could be complicated and time consuming however, you will still need to comply with the conduct of business requirements in the state which you passport into.
No – passports are not one-size-fits-all, they are both country-specific and specific to the advice you want to offer.
You should check carefully that the passport you apply for permits you to:
a. provide advice in the state you wish to operate
b. provide the advice you would like to offer your clients.
You should also carefully check the conduct of business requirements in the state in which you are passporting into.
In the unlikely circumstances that you have clients in every single one of the EEA states and think that you will provide them with financial advice then – yes – this is a course of action you might like to consider.
In accordance with SUP App 3.3.14 the FCA discourages blanket notifications to all states. Ultimately it is down to you to decide whether it is worth your while applying for a passport.
Information on applying for a passport.
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