CP26/23 Consumer Duty: scope and proportionality

Read CP26/23 (PDF)[2]

Why we are consulting

We're consulting on a targeted package of changes to our rules and non-Handbook guidance to:  

• Remove business with non-UK customers from the Duty's scope.
• Make it clearer where the Duty applies and where it doesn’t.
• Clarify when and how firms can rely on each other when they work together in distribution chains, and how they can apply the Duty more proportionately.
• Explain the interaction between the Duty and other product governance rules.

These changes are intended to clarify when the Duty applies – and when it doesn’t – to give firms greater confidence in its scope. They also promote a more proportionate approach based on a firm’s role, helping reduce unnecessary cost and complexity while preserving strong protections for retail customers.

Who this is for

This consultation is likely to interest regulated firms subject to the Duty and particularly those that:  

• Have a role early in the distribution chain, including those in the wholesale sector.
• Work with other firms to manufacture a retail product or service.
• Are part of a complex distribution chain.
• Conduct retail business for retail customers outside the UK.

It may also interest: 

• Consumer groups and individual consumers. 
• Industry groups and trade bodies. 
• Industry experts and commentators.
• Policymakers and other regulatory bodies.
• Academics and think tanks.

Next steps

Online response form[3]

We welcome your feedback on these proposals by 18 September 2026.

You can use our online response form, or you can send your comments in writing to:

Consumer Duty Policy Team, Financial Conduct Authority, 12 Endeavour Square, London E20 1JN

Or by emailing: [email protected]

We expect to publish a policy statement summarising responses and to make any new rules in Q1 2027.

Background

The Consumer Duty[4] came into force in 2023. It sets high standards of consumer protection across retail financial services, using an outcomes-based approach that requires firms to deliver good outcomes for retail customers.

Since then, we've seen positive changes in firm conduct and consumer confidence. But we have seen evidence that in some areas the Duty is being applied more widely, and more intensively, than intended – particularly in wholesale markets and complex distribution chains.  

We committed to consult on targeted changes (PDF)[5] in the first half of 2026. These proposals deliver on that commitment. They support the priorities in our strategy 2025 to 2030 (PDF)[6] and the Government's objectives for UK financial services to support economic growth and global competitiveness.