The Financial Conduct Authority (FCA) has released important information on new rules for the promotion of marketing high-risk investments. The FCA is seeking to address concerns about the ease and speed with which people can make high-risk investments by proposing a significant strengthening of its rules on how these products are promoted and sold to investors.
These rules primarily impact businesses that are:
- Interacting with consumers and retail investors;
- Marketing opportunities to High-Net-Worth Investors, Sophisticated Investors and other investors that are not categorised as professional investors.
Rules related to risk warnings for financial promotions of high-risk investments will have effect from 1 December 2022. All other rules will have effect from 1 February 2023.
To understand the intricacies of these new rules, MJ Hudson’s Regulatory solutions team have created a helpful Q&A.
This Q&A contains important information on the new rules made by the FCA to its principles and on the promotion of high-risk investments. The document also reminds firms of the proposed rules and guidelines made by the HM Treasury (“HMT”) to the financial promotion exemptions.
This memorandum covers the following publications:
- FCA Policy Statement 22/10: Strengthening our financial promotion rules for high-risk investments.
- HMT Financial Promotion Exemptions for High-Net-Worth Individuals and Sophisticated Investors.