The U.K. Financial Conduct Authority has published its first annual perimeter report, which (i) describes the boundaries of the FCA's regulatory oversight, (ii) considers challenges to the regulatory perimeter and (iii) sets out its aims for the future. The motivations behind the report include recent high profile controversies involving firms on the periphery of the FCA's regulatory perimeter (including London Capital & Finance which issued non-transferable bonds to consumers), innovations in technology that test the boundaries of the perimeter and the post-Brexit future of U.K. financial regulation.
The report describes the FCA's perimeter, which is primarily set out in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001. The FCA also has regulatory powers as the UK's listing authority, responsibility for administering the Payment Services Regulations and Money Laundering Regulations and concurrent competition powers which it shares with the Competition and Markets Authority.
Challenging areas of the regulatory perimeter that are currently on the FCA's radar include:
Looking to the future, the FCA will provide an update in its 2020 annual perimeter report on:
- The extent to which the FCA is able to regulate all financial services activities undertaken by an authorized firm;
- The extent to which the FCA's regulatory perimeter is aligned with the Financial Ombudsman Service and the FSCS; and
- The distinction between what is covered by the FCA's regulatory perimeter and what is not.
View the FCA's 2018-2019 Annual Perimeter Report.
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