FCA wants feedback on proposals for new rules for investment firms

The Financial Conduct Authority (FCA) has published a discussion paper regarding new rules for investment firms.

There are roughly 3,000 investment firms operating in the UK, making it the largest market in Europe.

The EU has introduced a new prudential regime for investment firms. The new Investment Firm Regulation and Directive (IFD/IFR) is planned to take force as of June 2021.

While the UK will not be subject to the new directive as the country is heading out of EU, the government has stated that it wants to establish similar regulations in the UK.

The new discussion paper is the FCA’s first step in helping to establish such a regime. It essentially explains what the rules of IFD/IFR are and now seeks feedback from industry stakeholders to hear how a similar piece of legislation should look like.

“We have long advocated for a bespoke prudential regime for investment firms,” said Christopher Woolard, interim chief executive of the FCA. “A new UK regime would represent a significant improvement in the prudential regulation of investment firms. For the first time, it would deliver a regime that has been designed with investment firms in mind.”

Investment firms and other interested stakeholders will have until 25 September to respond.

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