PS17/25: FAMR implementation part II and consultation on retiring FG12/15 and FG14/1

Open consultation: CP17/28
01/08/2017
Consultation closes
02/10/2017
Policy Statement
08/12/2017
08/12/2017

This Policy Statement outlines the response to our consultation CP17/28: FAMR Implementation Part II and insistent clients, and announces a consultation on the retirement of guidance FG12/15 and FG14/1.

Show PS17/25 (PDF)

The Financial Advice Market Review (FAMR) was launched jointly by HM Treasury (HMT) and us in August 2015 to explore ways in which government, industry and regulators could take individual and collective steps to stimulate the development of a market that delivers affordable and accessible financial advice and guidance to everyone, particularly those who do not have significant wealth or income.

In its final report in March 2016, FAMR set out a series of recommendations intended to tackle the barriers to consumers accessing advice and guidance.

CP17/28 made proposals developed to implement three of those recommendations, including:

  • Handbook changes arising from recent amendments to the definition of advice on investments in the Regulated Activities Order
  • Guidance on personal recommendations
  • Guidance arising from experiences of the FCA’s Advice Unit

We also proposed new Guidance on insistent clients designed to address concerns raised by firms.

In general, respondents to CP17/28 were supportive of our proposals, and we will be proceeding largely on the basis on which we consulted, with the exception of the PERG material on personal recommendations, which we intend to consider further (see ‘Next steps’ below).

The Policy Statement summarises the feedback we received to the consultation paper and confirms publication of final Handbook rules and Guidance which will take effect from 3 January 2018. 

The Advice Unit guidance has been published as part of FG17/8 Streamlined advice and consolidated guidance.

Additional consultation

We are also using this PS to consult on retiring two pieces of non-Handbook Guidance on inducements and conflicts of interest (FG14/1), and on independent and restricted advice (FG12/15). We are asking for any views on our proposed approach by 19 January 2018.

Who this applies to

Our proposals will most directly impact on:

  • firms providing advice on or distributing retail investment products and financial instruments to retail clients
  • trade associations and consumer groups involved in retail investment markets

Next steps

Stakeholders responded positively to the draft Perimeter Guidance (PERG) on personal recommendations in CP17/28 and have asked for more help on further areas where they feel there is still uncertainty. We want to ensure that the new Guidance assists firms in developing services that help consumers make their own investment decisions and we have decided to consider further how we can best address stakeholders’ concerns.  This Guidance will be published early in 2018.