The Financial Services and Markets Act 2000 (FSMA) meaning

Regulated activities and exclusions Section 19 of the Financial Services and Markets Act 2000 (FSMA 2000) bars any individual or entity from undertaking, or holding themselves out as undertaking, a regulated activity in the UK unless they are authorised or exempt under FSMA 2000 (the General Prohibition). Usefully, most activities specified in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, SI 2001/544 (RAO) are carved out by exclusions. Where you conduct a given activity in a manner that fits an exclusion, you will not contravene the General Prohibition. For additional detail on the General Prohibition, see Practice Notes The general prohibition and implications of its breach and Carrying on unauthorised business and breaching the general prohibition. Most RAO regulated activities are subject to exclusions that can be used where applicable. Exclusions fall into two groupings: exclusions tailored to a specific regulated activity; and exclusions that, in defined situations, span several regulated activities...

This Checklist sets out core topics for firms entering consumer credit, addressing essential management and compliance matters within the Financial Conduct Authority (FCA) framework. It organises themes such as authorisation, threshold conditions, the Senior Managers and Certification Regime (SM&CR), systems and controls, business planning, FCA Principles, the Consumer Duty and continuing regulatory duties, including adherence to the Consumer Credit sourcebook (CONC) and the Consumer Credit Act 1974 (CCA 1974). For fuller guidance, including how the application process works, see Practice Note: FCA authorisation of consumer credit firms. Scope and regulatory status Do the firm’s activities amount to regulated consumer credit activities under section 19 of the Financial Services and Markets Act 2000 (FSMA 2000), and the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, SI 2001/544 (RAO)? See Practice Notes: The general prohibition and implications of its breach and Regulated activities relating to consumer credit Does the firm offer (or plan to offer) buy now pay later (BNPL)/deferred payment credit (DPC) style products?...

Where a scheme of arrangement, restructuring plan, company voluntary arrangement or individual arrangement is put forward in respect of a regulated firm (defined below), the Financial Conduct Authority (FCA) should be engaged at the earliest possible stage. The FCA serves as the conduct regulator for both financial services firms and for the financial markets across the United Kingdom. Under section 1B of the Financial Services and Markets Act 2000 (FSMA 2000), it is tasked with pursuing specified objectives, including one centred on consumer protection in practice. The FCA states its statutory aims as securing an appropriate level of protection for consumers and safeguarding and strengthening the overall integrity of UK financial markets, with the intention of limiting the volume of proposed compromises it deems unsuitable (see FG22/4 para 1.2). On 5 July 2022, the FCA issued guidance on compromises by regulated firms (FCA Guidance FG22/4 July 2022, updated January 2024), prompted by serious concerns that these mechanisms were being advanced and deployed by firms to sidestep redress due to customers...

Background to and scope of this flowchart An individual who conducts a regulated activity in the UK in the course of business, where no relevant exclusion or exemption applies, must be authorised under the Financial Services and Markets Act 2000 (FSMA 2000). For details and context on the consequences of carrying on a regulated activity without authorisation, consult Practice Note: The general prohibition and implications of its breach. For an explanation of what it means to carry on business in the UK, see Practice Notes: What does 'by way of business' mean? and Territorial scope of the general prohibition. For guidance on exemptions and exclusions that may apply in particular circumstances, refer to Practice Notes: Regulated activities—exempt persons and Exclusions and exemptions relating to the general prohibition—an introduction...

Background to and scope of this flowchart On 31 October 2004—often called ‘M Day’—providers and brokers involved in regulated mortgage contracts (RMCs) came within the regulatory perimeter. Any individual or firm undertaking a regulated activity in the UK in the course of business, where no relevant exclusion or exemption applies, is required to hold authorisation under the Financial Services and Markets Act 2000 (FSMA 2000)...

Also see: LNB News 17/09/2025 16. Instead of ring‑fencing crypto as a carve‑out dealt with via financial promotions and anti‑money laundering duties, the FCA intends to fold cryptoasset firms into the full Financial Services and Markets Act 2000 (FSM 2000) framework. In practice, the FCA would normalise crypto by delivering like‑for‑like treatment for comparable risks, regardless of the technology. The article is set around four pillars: governance and accountability; market access and distribution; operational resilience and financial crime; and product and disclosure strategy. For businesses that have only sat within the Money Laundering Regulations (MLRs) boundary and the financial promotions regime, this shift brings a clear step‑up in oversight, responsibility and cost. Fundamentally, the consultation maps the FCA’s existing regulatory blueprint onto cryptoasset activities. That spans high‑level standards such as operational resilience and the Senior Managers and Certification Regime (SM&CR); business standards including environmental, social and governance; and supervision. The FCA is also considering if and how to apply its consumer duty and possible access...

In this issue: Prudential requirements Financial crime and sanctions Complaints, compensation and claims management Investigations, enforcement and discipline Regulation of capital markets Sustainable finance and ESG Banks and mutuals Investment funds and asset management UK MiFID II Consumer credit, mortgage and home finance Regulation of insurance FSMA regulated pensions activity Payment services and systems Financial Services Enforcement Database Daily and weekly news alerts Intraday news alerts New and updated content Dates for your diary Prudential requirements COREPER asked to endorse agreement on CCP concentration risk treatment After the European Parliament adopted, in April 2024, a proposal for a directive of the Parliament and the Council to amend Directive 2009/65/EC (UCITS), Directive 2013/36/EU (CRD IV) and the Investment Firms Directive (EU) 2019/2034 (IFD), the Council of the EU’s General Secretariat released an ‘I/A’ Item Note inviting the Council’s Permanent Representatives Committee (COREPER) to confirm its agreement...

The legislation broadly matched industry expectations, with some welcome adjustments, notably decentralised finance (DeFi) being largely excluded from the scope and an exemption for overseas stablecoin issuers (see: Financial Services and Markets Act 2000 (Regulated Activities and Miscellaneous Provisions) (Cryptoassets) Order 2025, LNB News 30/04/2025 6, and News Analysis: Legislation to bring UK crypto activity within regulatory perimeter published). Finance minister Rachel Reeves also disclosed talks with US counterparts on deeper cooperation over digital assets, potentially easing anxiety among UK businesses about the United States moving ahead under crypto-friendly president Donald Trump. The Treasury said ‘clear new rules’ will boost investor confidence and protect consumers, though the 29 April 2025 announcements (a draft statutory instrument, a policy statement and a press release) sketch only the bare outline of the government’s plan. Businesses ‘should not expect this draft legislation to provide all the answers’, noted Hannah Meakin, a partner at Norton Rose Fulbright. She added that it sets out the framework that now requires detailed development; nevertheless, it represents the vital...

Consumer protection legislation applies to businesses generally and to the regulated financial services sector This Practice Note explores the obligations on firms authorised by the Financial Conduct Authority (FCA) under the Financial Services and Markets Act 2000 (FSMA 2000) (herein referred to as ‘firms’) to comply with a central element of consumer protection law, the Consumer Rights Act 2015 (CRA 2015), together with its predecessor, the Unfair Terms in Consumer Contracts Regulations 1999, SI 1999/2083 (UTCCRs). In addition to these statutory duties, firms must follow the FCA’s regulatory rules and take account of guidance relevant to unfair contract terms. Under the CRA 2015, the FCA may challenge firms regarding the fairness and/or transparency of contractual terms and notices in financial services consumer contracts (whether in standard form or individually negotiated) entered into from 1 October 2015. Under the UTCCRs, the FCA may challenge firms regarding the fairness or transparency of contractual terms in standard form financial services contracts entered into before 1 October 2015. ...

This Practice Note addresses the regulated activity of managing investments... Definition Managing investments is a regulated activity under article 37 of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, SI 2001/544 (RAO). It entails exercising discretion over assets that beneficially belong to another person, where those assets consist of, or include, any investment categorised as a ‘security’, a ‘structured deposit’ or a ‘contractually-based investment’. For further detail on what constitutes a ‘security’, a ‘structured deposit’ or a ‘contractually-based investment’, see Securities, structured deposits or contractually-based investments below)... The exercise of discretion This regulated activity only arises where the investment manager exercises discretion. Where portfolio management is non-discretionary—for example, the manager purchases shares strictly on client instructions, or simply receives and forwards client orders—the work is more likely to fall within another regulated activity, such as ‘dealing in investments, either as principal or agent’ (RAO SI 2001/544, arts 14 and 21) or ‘arranging deals in investments’ (RAO SI 2001/544, art 25)...

The general prohibition Under section 19 of the Financial Services and Markets Act 2000 (FSMA 2000), no person may undertake regulated activities in the UK unless they are authorised or fall within an exemption. This is referred to as the general prohibition. For guidance on the territorial reach of this restriction, see Practice Note: Territorial scope of the prohibition. Under FSMA 2000, s 31, an authorised person is one who: has been granted permission by the Financial Conduct Authority (FCA) or the Prudential Regulation Authority (PRA) under FSMA 2000, Pt 4A to carry on specified regulated activities; or is a Gibraltar-based person with a Schedule 2A permission to carry on one or more regulated activities. Please note that this latter provision, inserted by section 22(1), (2) of the Financial Services Act 2021, is not yet in force...

This [ insert document name ] has not been sanctioned by an authorised person in line with section 21(2)(b) of the Financial Services and Markets Act 2000...

Important—this provisional allotment letter (pal) is of value and is negotiable. Your prompt attention is required. This invitation lapses at [ insert time ] on [ insert date ]. The full pal must be produced at the time of payment. Should you be uncertain about any part of this pal, or unsure what steps to take, you should seek your own financial advice without delay from your stockbroker, bank manager, solicitor, accountant, or another suitably qualified independent financial adviser duly authorised under the Financial Services and Markets Act 2000 (fsma), or, if you are located outside the United Kingdom, from an appropriate qualified independent financial adviser duly authorised within your jurisdiction. If you dispose of, transfer, or have already disposed of or otherwise transferred all of your ordinary shares (other than ex-rights) held in certificated form before [ Insert time ] on [ Insert date ], please send this pal together with form x (form of renunciation) on page [ Insert page number ], completed immediately, to the buyer...

Warning: This promotional material has not been signed off or otherwise approved by an authorised person as defined under the Financial Services and Markets Act 2000. If you rely on this promotion when undertaking any investment activity, you could potentially face a particularly substantial financial risk of losing the entirety of the capital or other assets you commit. This document is issued by [ insert the name of the person making the financial promotion, or on whose behalf the financial promotion is made ]. Anyone receiving this document who requires additional details, or wishes to raise any other enquiry concerning the subjects to which this communication pertains, should send a request to [ insert the postal or electronic address to which a recipient should send such requests. Also, if applicable, insert the country or territory in which the person making the financial promotion, or on whose behalf the financial promotion is made, is incorporated. Also, provide the registered address of the person making the financial promotion, or on whose...

The regulation of consumer credit Under section 19 of the Financial Services and Markets Act 2000 (FSMA 2000), no one may perform a regulated activity, or even hold themselves out as doing so, within the UK unless they are an authorised person—authorised by the Prudential Regulation Authority and/or the Financial Conduct Authority (FCA)—or an exempt person, for example as an appointed representative. For a high-level outline of the UK regulated activities regime, see Practice Note: What are regulated activities? An activity is regulated where it is of a ‘specified kind’—that is, specified in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (RAO), SI 2001/544—and is carried on by way of business...

What is the regulatory regime under the Financial Services and Markets Act 2000 (FSMA 2000) Under section 19 of the Financial Services and Markets Act 2000, the general prohibition applies: a person must not carry on a regulated activity in the UK, or even purport to do so, unless they are within one of the permitted categories below. An authorised person (that is, authorised by the Prudential Regulation Authority and/or the Financial Conduct Authority) An exempt person (for example, an appointed representative) For an outline of the UK regime governing regulated activities, see Practice Note: What are regulated activities? An activity is regulated if it is of a ‘specified kind’—as listed in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (RAO 2001), SI 2001/544—and it is carried on by way of business. For further detail on what amounts to carrying on a regulated activity ‘by way of business’ in the UK, refer to Practice Notes: What does ‘by...