The European Securities and Markets Authority has published its second thematic note on clear, fair and not misleading sustainability-related claims in relation to environmental, social and governance (ESG) strategies. This note forms part of a broader thematic study to address greenwashing risks in support of sustainable investments and follows ESMA's first note on ESG credentials. The purpose of these notes are to provide market participants with information and build on observed market practices. As with the first note, this second note sets out four principles for making sustainability claims. In summary, claims should be: (i) accurate; (ii) based on accessible information; (iii) substantiated; and (iv) up to date. The note follows a similar format to the first, including practical "do's and don'ts" and examples of good and poor practice. It focuses on ESG integration, exclusions and strategies. While these notes do not create new disclosure requirements, they are intended to guide market participants on ensuring that communications, including non-regulatory oral and written communications, and those aimed at retail investors, are clear, fair and not misleading.

The UK Financial Conduct Authority (FCA) has published an update on its advice guidance boundary review – targeted support policy sprint. The six-week sprint, launched in February 2025, brought together 12 firms, including retail banks, investment platforms and wealth managers, to test the FCA's targeted support proposals. As a reminder, the new regulated activity of targeted support aims to allow authorised firms to provide recommendations for pre-defined consumer segments with common needs or objectives. The regime is outcomes-focussed, with bespoke rules in the FCA handbook and further underpinned by the consumer duty and product governance rules.

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The Council of the EU and the European Parliament (EP) have reached a provisional political agreement on an updated retail investment strategy package to empower and protect consumers and increase competitiveness in the EU's financial markets. The package takes the form of a directive containing targeted amendments to a number of other EU directives in the area of financial services such as the Markets In Financial Instruments Directive (MIFID), the Solvency II Directive, the Directive For Undertakings For Collective Investment In Transferable Securities (UCITS) and the Alternative Investment And Managers Directive (AIFMD), and a regulation amending the Packaged Retail And Insurance-Based Investment Products (PRIIPs Regulation).

The Council of the EU and EP confirm that agreement has been reached in the following areas:

• Value for money – firms must identify and quantify all costs borne by investors related to the investment products they advise. Products failing to offer value for money should not be released onto the market and sold to retail customers, and who should be able to compare investment products' costs, charges, performance and non-financial benefits.
• Inducements – a new test will be introduced to ensure firms act in the clients' best interests, enabling them to distinguish inducements from other fees.

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The Consumer Composite Investments (Designated Activities) (Amendment) Order 2025 has been published, accompanied by an explanatory memorandum. The Order, which enters into force on 6 April 2026, amends the Consumer Composite Investments (CCI) Regulations 2024 to provide temporary exemptions from the financial promotion and the scheme promotion restrictions of the Financial Services and Markets Act 2000. The temporary exemptions apply to the key information documents (KIDs) produced under the previous packaged retail and insurance-based investment products (PRIIPs) regime. This means that under the UK Financial Conduct Authority's (FCA) transitional provisions for the new CCI regime, firms may continue producing KID disclosure documents for the duration of the CCI transitional period. During this time, manufacturers can either continue using KIDs or comply with the new CCI product summary requirements. The CCI transitional period is due to end on 8 June 2027. However, Regulation 8A(3), inserted by the Order, sets a statutory long-stop date of 8 December 2028 for the effect of these exemptions.

The UK Financial Conduct Authority (FCA) and UK Payments Systems Regulator (PSR) have issued a joint letter to HM Treasury (HMT) (dated 11 November) providing an update on their progress against the 2024 recommendations HMT set for payments regulation and outlining focus areas through to 2026.

Key forward-looking priorities include:

• Co-ordination - the regulators set out how they have been working in an increasingly collaborative way to ease congestion in payments regulation.
• Open banking and open finance – the FCA has established a new department incorporating FCA and PSR capabilities, replacing the Joint Regulatory Oversight Committee (JROC) and streamlining decision-making for open banking and open finance. The FCA is working with industry to establish a future entity for open banking ahead of developing the statutory instrument with HMT and subsequently the long-term regulatory framework for open banking. In addition, the FCA has launched the smart data accelerator, with applications currently open for two prioritised open finance use cases in SME lending and mortgages. The FCA will publish a roadmap for this in early 2026, with regulatory foundations in place during 2027. The FCA is also collaborating with the Department for Business and Trade on cross-sector data sharing.

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The UK Financial Conduct Authority (FCA) has published feedback statement FS25/6 setting out its response to feedback received to its June discussion paper on the future of the mortgage market, and action the FCA will take as part of a longer‑term plan to modernise its mortgage rules.

The FCA plans targeted reforms across four key themes:

• Expanding access for first-time buyers and underserved consumers: The FCA will consult (with the UK Prudential Regulation Authority) on loan-to-income (LTI) ratio requirements in Q1 2026. It will also consult on responsible lending rules in 2026.
• Enhancing later-life lending: The FCA will review retirement interest-only requirements to enhance accessibility, explore ways to improve advice to help people confidently plan for later life, and conduct a focused market study to ensure the lifetime mortgage market can meet the changing needs of future customers.
• Enabling innovation: The FCA will continue to support innovation and adoption of new technology through its innovation services, including its Open Finance Tech Sprint, its Supercharged Sandbox and its AI live testing. It also wants to explore changes to disclosure and financial promotion rules to support innovation and smoother digital journeys. It will do this as part of its consumer duty review.

Protecting vulnerable consumers: The FCA will work with partners to support people affected by financial abuse and help those using a mortgage to manage or consolidate debt.

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The UK Financial Conduct Authority (FCA) has published policy statement PS25/22, setting out near-final rules for a new regulatory framework on targeted support. Under the framework, authorised firms will be permitted to provide tailored investment and pension recommendations to groups of consumers with similar characteristics. This will direct people to products or to take actions with existing products that could put them in a better position in their financial lives. This will be done without the need to conduct individualised suitability assessments, but subject to consumer duty and product governance requirements. The government has confirmed that only authorised firms may provide targeted support. The rules cover design and delivery standards, disclosure obligations, charging and remuneration, application of existing requirements and monitoring outcomes. Following the consultation, the FCA has made the following changes to its rules as set out below.

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HM Treasury has published its consultation response on introducing a new "targeted support" regime following the advice guidance boundary review. The regime will allow authorised firms to provide tailored investment and pension recommendations to groups of consumers with similar characteristics. The government confirmed that targeted support will be established as a distinct regulated activity under the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 subject to bespoke conduct standards and authorisation from the UK Prudential Regulatory Authority and UK Financial Conduct Authority (FCA).

Key changes following feedback to the draft statutory instrument and policy note include: simplified disclosure requirements aligned with FCA rules; clarification of exemptions applicable to targeted support; decision to proceed with secondary legislation enabling workplace pension providers to deliver targeted support communications under the Privacy and Electronic Communications (EC Directive) Regulations 2003 and other technical adjustments. Appointed representatives will initially be excluded from delivering targeted support, with a review planned after reforms to their regime are implemented.

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The Financial Services Regulatory Initiatives Forum has published the ninth edition of the Regulatory Initiatives Grid. This sets out the regulatory pipeline for the next two years, outlining 124 live initiatives which is a 13% reduction since the last grid was published. Key priorities include implementing Basel 3.1 standards, advancing the strong and simple prudential framework and reforms to the prospectus regime and wholesale markets review. Innovation-focused measures cover stablecoin regulation, the national payments vision, and development of a UK captive insurance regime, while consumer-focused reforms include the advice guidance boundary review and regulation of buy now pay later products. The Grid also highlights efforts to streamline regulatory processes, with 45 joint initiatives across sectors, and provides indicative timelines for consultations and implementation through 2027. Separate press releases announcing the Grid have also been published by the UK Financial Conduct Authority and the Bank of England.

The UK Financial Conduct Authority has published two joint statements with regulatory partners addressing areas where firms have sought clarity on delivering targeted support. The first statement, issued with the UK Financial Ombudsman Service, explains its approach to handling consumer complaints related to targeted support. The second, published with the Information Commissioner's Office (ICO), provides guidance on communicating with consumers within the framework of existing direct marketing rules. There are two areas on which firms have asked for clarity in respect of providing targeted support. While the FCA acknowledges calls for legislative reform in this area, it notes that such changes fall within the government's remit. In this context, the FCA has welcomed the announcement by HM Treasury which has confirmed plans to introduce secondary legislation enabling workplace pension providers to send targeted support communications to members who have not opted out of direct marketing.

The UK Financial Conduct Authority (FCA) has published a new webpage clarifying its expectations for firms promoting mainstream investment products and addressing common misconceptions about risk warnings. The FCA states that financial promotions aimed at retail customers must comply with the consumer duty and COBS rules by being fair, clear, and not misleading, and by providing a balanced view of benefits and risks. Regarding common misconceptions, the FCA states that while firms must indicate if capital is at risk, there is no prescribed wording or requirement for risk wording or separate risk warnings. Instead, firms should ensure they include contextualised, prominent risk information that supports consumer understanding without diminishing or obscuring key details within the body of promotion. They must provide a balanced view of the benefits and risks, to give consumers a fair description of the product or service. The FCA has also highlighted that generic or repeated warnings can confuse consumers and encouraged behavioural approaches to improve engagement with risk disclosures.

The UK Financial Conduct Authority (FCA) has sent a letter to the Prime Minister providing an update on its growth strategy. It confirms delivery of most of the 50 pro-growth measures announced in January and outlines plans for 2026. The plans include finalising rules on stablecoins, setting out the delivery plan for open finance, reforming rules for venture capital and alternative investment fund managers and further speeding up IPO applications. The FCA also cites its plans to further overhaul mortgage rules so more people get on the housing ladder and is preparing for its expanded remit as anti-money laundering supervisor and integration of the UK Payments Systems Regulator. The letter highlights active support for firms digitising, with 31 already testing AI use cases, and commits to enabling tokenisation in asset management to drive efficiency and competition. The FCA also urges swift progress on digital ID to streamline know your customer requirements and calls for faster legislation to maintain reform momentum, including modernising the Consumer Credit Act. Finally, the FCA will use its convening power to galvanise system-wide responses to cross-cutting issues such as financial inclusion and mobilising defence investment to protect national and economic security.

The UK Financial Conduct Authority (FCA) has published consultation paper CP25/37, as part of the consumer duty requirements review and the workplan announced in the March feedback statement. The FCA sets out targeted amendments to reduce the administrative burden on firms in respect of UK UCITS investment powers, chapters 6 and 7 of the Client Assets Sourcebook, and certain changes to rules relating to insurance products and funeral plans. It also proposes to improve the existing support offering for smaller firms, by piloting a sector-specific directory-style guide which would signpost the relevant parts of the FCA Handbook for smaller firms and set out examples of good and poor practice. The FCA has identified the consumer finance sector as being an appropriate sector for the pilot, focussing initially on credit brokers.

The consultation paper also proposes amendments to the FCA Handbook and non-Handbook materials to remove references to historic guidance on the fair treatment of customers, and to update references to Principles 6 and 7 of the FCA's Principles for Businesses to clarify the scope of the consumer duty in areas where there may still be confusion. The deadline for comments is 27 January 2026.

The UK Financial Conduct Authority (FCA) has published an updated webpage confirming that following the closure of its consultation on capital deductions for redress (CP23/24), it will not proceed with the proposed capital deduction for redress framework. This decision reflects a realignment of regulatory priorities in light of broader changes affecting the advice market. The FCA expects firms to continue addressing redress liabilities under existing rules, including the consumer duty, and warns that it may intervene where firms fail to meet these expectations or pose a risk of harm. Supervisory focus will include provisions for redress liabilities in client book transfers and challenging firms at the gateway, with firms expected to adhere to the FCA's "polluter pays" principle as outlined in its prior communications.

The UK Financial Conduct Authority (FCA) has published consultation paper CP25/38 on enhancing fund liquidity risk management. The FCA sets out in detail the context for this consultation, citing the work carried out both in the UK and internationally in respect of liquidity risk management for collective investment schemes in recent years.

Key proposals the consultation paper seeks feedback on include:

• Requirements for authorised fund managers of undertakings for collective investment in transferable securities (UCITS) funds and non-UCITS retail schemes (NURS) to have anti-dilution tools available.
• Changes in respect of the "listed asset presumption", which is the presumption that a transferable security admitted to or dealt on an eligible market is presumed not to compromise an authorised fund manager's ability to redeem units.
• Removing the derogation from the eligibility tests for holding transferable securities and approved money-market instruments and guidance on eligible markets.
• New conflicts of interest requirement to ensure equitable treatment of unitholders.
• Updating guidelines issued by the European Securities and Markets Authority on liquidity stress testing and including the guidelines in the FCA handbook.
• Proposed guidance on effective liquidity risk management systems.

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The UK Financial Conduct Authority (FCA) has published discussion paper DP25/3 as part of a set of publications forming a "landmark package to boost UK investment culture." The FCA is seeking views on how its regulatory framework can better support informed risk-taking and consumer confidence in retail investments. This work forms part of its wider five-year strategy to help consumers navigate their financial lives. The paper highlights persistent mismatches between consumers' risk appetite and actual investment choices, driven by low financial literacy and fear of scams, and explores interventions to rebalance risk. Key points for discussion are set out below.

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The UK Financial Conduct Authority (FCA) has published consultation paper CP25/36 as part of a set of publications forming a "landmark package to boost UK investment culture." The consultation sets out proposals to enhance client classification, creating a clearer boundary between retail and professional investors, and ensuring firms operating in wholesale markets are regulated proportionately and can operate with confidence when they are dealing with professional clients. Key proposals in relation to client classification are set out below.

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The UK Financial Conduct Authority (FCA) has published a statement on firms working together to manufacture products or services. The statement is targeted at firms seeking clarity on how to apply the consumer duty to co-manufacturing or other collaborative arrangements when manufacturing a product or services. The statement confirms the FCA's intention to develop proposals for consultation following the regulator's letter to the Chancellor in September, setting out its plans to address concerns about the application of the consumer duty, particularly in a wholesale context.

In the statement, the FCA confirms that it has found that firms are applying the consumer duty beyond what the FCA intended, particularly in the areas of decision-making, allocation of responsibility, liability, and outsourcing. Going forward, the FCA will be looking to consider how the scope of the application of the consumer duty could be clearer, including the current exemptions and how firms are able to rely on each other when they work in distribution chains.

For further background on the FCA's work in this area, you may be interested in our webinar on this topic, available to watch here.

The UK Financial Conduct Authority (FCA) has published policy statement PS25/20 as part of a set of publications forming a "landmark package to boost UK investment culture". The policy statement follows the FCA's consultations on the new regime for consumer composite investments (CCIs), which is a new domestic regime to replace the legacy EU regimes for packaged retail and insurance-based investment products and disclosures in respect of undertakings for collective investment in transferable securities, in December 2024 and April this year. The policy statement confirms that the following areas were the subject of substantive feedback and so have been addressed in the final rules.

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The Joint Committee of the European Supervisory Authorities (ESAs) has updated its consolidated Q&A on the EU packaged retail and insurance-based investment products (PRIIPs) key information document. The consolidated document combines responses given by the European Commission in relation to interpretation of Union law with responses given by the ESAs in relation to the application or implementation of the PRIIPs legislation. The updated document includes five new Q&As on performance scenario calculations under section VI.

The UK Financial Conduct Authority (FCA) has published a policy statement on changes to handling rules for motor finance complaints. The FCA consulted on proposed changes in Chapter 11 of CP25/27, and this aspect of the consultation closed on 4 November to allow time to finalise any changes and give firms notice before the current extension in the rules for handling motor finance complaints ended on 4 December. The FCA confirms that it is:

• Excluding leasing complaints from any further extension, meaning that firms need to start sending final responses to them from 5 December.
• Further extending the time firms have to send final responses to all other relevant discretionary commission arrangement (DCA) complaints and non‑DCA commission complaints to 31 May 2026 (two months earlier than consulted on). This is so firms will not have to start sending final responses before the FCA has decided whether the redress scheme will go ahead, and which complaints will be covered if it does, without making consumers wait any longer than necessary for a complaint response if they do not fall within any scheme.
• Requiring firms to update their public facing communications to reflect the changes to the time limits, reverting back to the usual six months that consumers will have to refer a complaint to the Financial Ombudsman Service for final responses sent after 29 January 2026.
• Extending record keeping and retention requirements until 11 April 2031.

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The European Securities and Markets Authority (ESMA) has announced that it will launch a Common Supervisory Action (CSA) with national competent authorities in 2026 to review compliance with MiFID II conflicts of interest requirements in the distribution of financial instruments. The press release confirms the CSA will examine how firms identify, prevent and manage conflicts when offering investment products to retail clients. It will focus on: (i) the possible influence of staff remuneration and inducements on what products are offered to investors; (ii) the role of digital platforms in product selection, and whether this serves the investor's best interests; and (iii) the management of conflicts between firm profitability and the needs of retail investors.

The UK Financial Conduct Authority (FCA) has published an update on its forthcoming review of the access to cash regime. The regime, introduced under the Financial Services and Markets Act 2023, seeks to maintain responsible provision of cash access services to consumers and businesses. The FCA expects to begin its review in Q4 2026 and publish findings in Q2 2027. While the exact scope and methodology will be determined closer to the time, the review will assess compliance, costs to firms and the regime's effectiveness in preventing gaps in cash access. It will include quantitative analysis and evaluation of indicators such as consumer sentiment and cash coverage data, alongside stakeholder engagement.

The UK Financial Ombudsman Service (FOS) has launched a consultation on its plans and budget for 2026/27. Key proposals include increasing its case fee to GBP680 and compulsory levy to GBP86 million. The FOS has also announced that it will simplify its billing process for the next financial year by replacing the free case allowance with a monetary value of GBP2,000 for both respondent businesses and professional representatives. It is also introducing quarterly billing in advance for the largest businesses expected to account for the most cases. The FOS anticipates receiving 188,000 cases across a range of financial products, including bank accounts, credit cards and insurance, and resolving 245,000 cases as it works through its existing backlog. Of these, around 60,000 are expected to relate to motor finance commission complaints. The FOS is also preparing for deferred payment credit (buy now, pay later) complaints to fall within its remit from July 2026, meaning it is likely to start receiving these complaints in the second half of 2026/27. The deadline for comments is 21 January 2026.

The UK Financial Conduct Authority (FCA) has published consultation paper CP25/33 outlining its proposed changes to the fees and levies framework ahead of the 2026/27 fee cycle. The consultation paper is structured as follows:

• Chapter 2 sets out proposed changes to the fees manual of the FCA Handbook (FEES). These cover, among other things, introducing the Private Intermittent Securities and Capital Exchange System (PISCES) periodic fee, targeted support fees and levies, cryptoasset firms' application fees and deferred payment credit (often called buy-now, pay-later) fees and levies.
• Chapter 3 sets out proposed changes to FEES 5 (regarding the UK Financial Ombudsman) and FEES 6 (regarding the UK Financial Services Compensation Scheme).
• Chapter 4 sets out joint proposals with the UK Prudential Regulation Authority (PRA) to amend invoice due dates for firms which pay GBP50,000 or more in FCA and/or PRA fees in a year (referred to as "payments on account").
• Chapter 5 provides updates on various areas of fee policy, including section 166 costs for motor finance firms, pro-rating fees for firms which cancel their permissions, and technical changes to the financial penalty scheme. The FCA also confirms that it does not propose to charge fees to incoming Swiss firms for regulated activities they perform under the Berne Financial Services Agreement.

The deadline for responses is 9 January 2026 for targeted support proposals and 16 January 2026 for all other proposals.

The UK Prudential Regulation Authority (PRA) has published policy statement PS24/25 on depositor protection and feedback to responses it received on its March consultation on the topic. The policy statement sets out final rules relating to the limits for deposit protection available from the Financial Services Compensation Scheme (FSCS).

In particular:

• From 1 December, the deposit protection limit increases from GBP85,000 to GBP120,000.
• From 1 December, the limit applicable to certain temporary high balance claims increases from GBP1 million to GBP1.4m.

In response to feedback, the PRA has made additional amendments to the depositor protection part of the PRA Rulebook (DPP rules). These include amending the requirement for firms to display the FSCS compensation sticker and poster to exclude branches where a firm does not deal with depositors in person, clarifying the scope of "third-party premises" to tighten the requirement and more closely reflect models such as banking hubs, and updates to the information sheet to address points raised about accessibility. Firms are required to update their single customer view systems to reflect the new limit from December 1. Deposit takers will then have up to six months to make changes to disclosure materials, which will need to be completed no later than 11.59pm on 31 May 2026.

The UK Financial Conduct Authority (FCA) has published its findings from its multi-firm review of contracts for difference (CFD) providers, assessing compliance with the consumer duty's "price and value" outcome. The review found examples of good practice but highlighted significant concerns and areas needing improvement. While some firms simplified charging structures and restricted high-risk retail clients, many failed to make meaningful changes following implementation of the duty, with board reports often restating requirements rather than analysing compliance. Fair value assessments (FVAs) were frequently inadequate, focusing narrowly on spreads and execution speed while overlooking material costs such as overnight funding charges and ancillary fees. The FCA highlighted poor transparency on fee structures and unjustified overnight funding charges, including on matched positions, which can create substantial costs with little benefit.

Few firms pay interest on client margin deposits despite high market rates, raising further concerns about fair value. Weaknesses also persisted in monitoring vulnerable clients, appropriateness testing and not adequately considering consumer complaints in FVAs. CFDs remain complex and risky products, and the FCA warns that foreseeable harm could arise from practices such as charging for hedged positions without offsetting costs. The regulator will engage directly with firms showing poor compliance and consider further action, stressing that CFD providers must deliver good outcomes, communicate clearly and ensure fair value under the consumer duty. The FCA encourages CFD manufacturers and distributors to consider these findings and address these identified gaps.

The UK Financial Conduct Authority (FCA) has published a statement with findings from its review of certain credit builder products, which claim to improve consumers' credit scores by reporting regular payments to credit reference agencies (CRAs). The FCA found little evidence that these products significantly enhance credit scores for most consumers and highlighted potential risks, including misrepresentation of a customer's financial circumstances and facilitating access to unaffordable credit. Many of these products are unregulated, and firms often fail to clearly disclose their limitations. Following FCA engagement, five firms have ceased offering such products, while others have amended their models and marketing practices. The FCA continues to work with firms and CRAs to improve data reporting standards while considering whether it should take further action.

The UK Financial Conduct Authority (FCA) has published a progress statement on its proposed motor finance consumer redress scheme consultation, following the UK Supreme Court ruling on 1 August. In the statement, the FCA confirms that the consultation deadline has been extended from 18 November to 12 December. The FCA also confirms that it has been actively engaging with stakeholders and has received feedback on key issues, including on the methodology for calculating redress, the time period for the scheme, the rate of compensatory interest, how independent mechanisms will ensure confidence, including the role of the Financial Ombudsman Service and ideas for alternative approaches, and fraud prevention. It urges respondents to provide detailed evidence and alternative suggestions where they disagree with proposals, all of which will be considered before final decisions are made.

Final rules are still expected in early 2026 but the FCA confirms this will now be February or March. While some complaints have been paused since January 2024 and the FCA has consulted on extending this pause beyond 4 December 2025, the consultation is now closed and the FCA is considering responses. However, the FCA stresses that complaints cannot remain paused indefinitely and lenders are therefore encouraged to maintain momentum to deliver certainty for customers and the wider market.

HM Treasury (HMT) has released its financial inclusion strategy, outlining a comprehensive national plan to remove barriers to financial participation and to build financial resilience. The strategy focuses on six main areas: (i) improving digital inclusion and access to banking through the roll-out of 350 in-person banking hubs and the launch of a pilot scheme enabling the opening of a bank account without standard ID; (ii) supporting savings by delivering regulatory clarity to enable employers to offer workplace savings schemes with confidence and driving uptake of the government's Help to Save scheme; (iii) ensuring the insurance market is supporting the financial wellbeing of households and vulnerable customers; (iv) increasing access to affordable credit; (v) strengthening debt advice provision; and (vi) introducing compulsory financial education in primary schools. HMT will review the strategy's implementation progress two years after publication and provide an update thereafter.

The Financial Services and Markets Act 2000 (Regulated Activities etc.) (Amendment) (No. 2) Order 2025 has been laid before Parliament, accompanied by an explanatory memorandum. A draft was laid before Parliament in June. The Order amends the Financial Services and Markets Act 2000 (Regulated Activities etc.) (Amendment) Order 2025 (the 2025 Order) which provides for certain buy-now-pay-later (BNPL) agreements to become "regulated deferred payment credit agreements" with effect from 15 July 2026. Under article 3(2) of the 2025 Order, nearly all merchants brokering BNPL products are exempt from the regulatory requirements concerning credit broking by virtue of a new provision (article 36FB) in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (RAO). Generally, merchants who introduce customers to regulated credit products are undertaking the regulated activity of credit broking under article 36A of the RAO and must have regulatory approval, unless an exemption applies.

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The House of Lords Financial Services Regulation Committee (the Committee) has issued a formal response to HM Treasury's (HMT) reply to its report "Growing Pains: Clarity and Culture Change Required" which evaluated the progress made by the UK Financial Conduct Authority (FCA) and UK Prudential Regulation Authority (PRA) in supporting growth and competitiveness in the financial services sector and the wider UK economy. The Financial Services and Markets Act 2023 introduced a secondary objective for the UK regulators focused on international competitiveness and growth. While welcoming initial steps taken by the UK government, the Committee notes that HMT did not engage with several key findings, critical to the success of the secondary objective and broader UK economic growth. The Committee uses this opportunity to restate some of its recommendations and raise further questions on the following themes as set out below.

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The UK Financial Conduct Authority (FCA) has issued a warning to investors regarding contracts for difference (CFDs), a type of derivative that allows speculation on the price movement of shares or assets without owning the underlying asset. The FCA expresses concern that some firms are using high-pressure tactics to encourage investors to self-certify as professional clients, which thereby removes key retail consumer protections, potentially exposing individuals to losses beyond their financial capacity.

The regulator also raises concerns about the role of social media influencers in promoting offshore firms and unrealistic returns, often without disclosing that such firms are unregulated. The FCA reminds firms that they must not push elective professional or redirection promotions onto their retail clients, otherwise it will take action against firms who breach its rules. The FCA also reiterates its commitment to targeting "finfluencers" who unlawfully promote financial products and services. Firms are also reminded of their obligations under the consumer duty and investors are encouraged to use the FCA's InvestSmart tools to support informed decision-making with their investments.

The UK Financial Conduct Authority (FCA) has updated its webpage on the proposed motor finance consumer redress scheme consultation to announce the launch of a data room. The facility is intended to support stakeholder engagement during the consultation period, which closes on 4 November. The data room provides controlled access to underlying datasets relevant to the FCA's analysis of consumer loss, particularly in relation to the APR adjustment remedy and high commission arrangements. Access is restricted to individuals with demonstrable expertise in handling large datasets and financial modelling and is granted solely for the purpose of responding meaningfully to the consultation. Entry is conditional upon signing a confidentiality agreement. The FCA clarifies that the data room is not designed to enable firms to calculate their own redress liabilities, as they would need to calculate this from their own data.

The UK Financial Conduct Authority (FCA) has published its findings from a multi-firm review assessing how UK payment service providers (PSPs) (including banks and other businesses offering payment accounts) detect and respond to romance fraud, a growing financial crime where victims are deceived into sending money to fraudsters who engineer false romantic relationships or friendships. The review covered 60 cases across six firms and the conclusions highlight examples of good practice and areas for improvement. Whilst some firms are leading the way with proactive engagement and compassionate support reflecting best practice, these examples were not consistent across the industry and it is clear that staff play a critical role in interventions. Equally, the review also examined the effectiveness of firms' systems and controls in detecting romance fraud, to avoid missed opportunities to detect suspicious activity, including transactions to overseas jurisdictions, multiple payments over a short period and sudden increases in the value of funds being sent.

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The Joint Committee of the European Supervisory Authorities (comprising the European Banking Authority, European Insurance and Occupational Pensions Authority and European Securities and Markets Authority) (ESAs) have published their 2026 work programme, setting out key priorities for cross-sectoral collaboration for 2026.

The programme focuses on joint efforts in relation to:

• Digital Operational Resilience Act (DORA) – the ESAs will concentrate on the effective operation of the new oversight framework and work related to supervisory convergence of DORA. The ESAs will designate third-party providers critical (CTPPs) to the EU financial sector by the end of 2025 and will conduct risk assessments to outline individual annual oversight plans for each CTPP, complemented by a strategic multi-annual oversight plan.
• Consumer protection and financial innovation – in 2026, the ESAs expect to work on drafting regulatory technical standards based on the empowerments in the proposed amendments to the PRIIPs Regulation in the European Commission's (EC's) Retail Investment Strategy. Work on consumer confidence and protection will consider the EC's strategy to develop a Savings and Investment Union.

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The UK Financial Conduct Authority (FCA) has updated its webpage on its consultation on the motor finance consumer redress scheme to include a Frequently Asked Questions (FAQs) section. The FCA's responses reflect queries raised during initial stakeholder engagement and aim to clarify operational and legal aspects of the scheme. Notably, the FCA addresses the role of the UK Financial Ombudsman Service, firms' communication obligations to consumers and to professional representatives, firms' liabilities in relation to 0% APR agreements and the treatment of deceased consumers. The FCA confirms that these FAQs do not represent any new approach to policy. The FCA intends to update these FAQs regularly as its engagement with stakeholders continues.

The European Banking Authority (EBA) has published a report on white labelling, accompanied by a fact sheet. In the report, the EBA considers the use of white labelling as a business model by the firms that are under its mandate, including credit institutions, e-money institutions, payment institutions, non-bank issuers of asset-referenced tokens and non-bank lenders. The report defines white labelling as a business model in which a financial institution (the provider) enters into an agreement with another entity (the partner, who may or may not be a financial institution) to distribute and offer one or more financial products and services under the partner's own brand only. The EBA finds that white labelling is being widely used, with 35% of surveyed banks employing the model to distribute a broad range of financial products and services, both domestically and cross-border, including account and payment services, credit provisioning and open banking services.

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The Financial Services and Markets Act 2023 (Commencement No.11 and Saving Provisions) Regulations 2025 were made and have been published. These Regulations are the eleventh commencement regulations made under the Financial Services and Markets Act 2023 (FSMA 2023). The Regulations continue the process of revoking certain pieces of retained EU law relating to financial services and restating them into UK domestic law, including through regulator-made rules. You may like to read our article "A boost for UK Financial Services" for further information.

In particular, these Regulations revoke the following:

• The UK MiFID Organisational Regulation (UK Commission Delegated Regulation (EU) 2017/565, otherwise known as the UK MiFID Org Regulation), on 23 October.
• The UK Prospectus Regulation ((EU) 2017/1129), on 19 January 2026.
• The UK PRIIPs Regulation (1286/2014), on 6 April 2026.

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The UK Financial Conduct Authority (FCA) has published a Dear CEO Letter addressed to claims management companies (CMCs), in particular those that may fall within scope of the proposed industry-wide motor finance redress scheme. This follows the FCA's separate letter of 31 July highlighting concerns around financial promotions that may breach the requirements of the Claims Management: Conduct of Business sourcebook (CMCOB) and the consumer duty.

The FCA's latest letter to CMCs sets out the key issues it is monitoring and its expectations from firms participating in the proposed redress scheme on behalf of consumers once it comes into effect. Key issues include: (i) pre-contract disclosure of customers' ability to pursue claims independently, with firms expected to review past cases to ensure customers were adequately informed and, where they were not, to remedy the situation; (ii) multiple representation, where firms should cease acting if they discover a customer has multiple representatives; (iii) contract termination, with CMCs expected to avoid excessive termination fees for customers who choose to exit contracts to participate directly in the redress scheme; and (iv) representing customers participating in the redress scheme, where CMCs should not request excessive or unnecessary information from respondent firms or place undue burden on them, with mutual cooperation between CMCs and respondent firms expected. The FCA warns that failure to act in accordance with the expectations of the Dear CEO letter may result in enforcement.

The UK Financial Conduct Authority (FCA) published a Dear CEO letter addressed to all firms involved in motor finance lending and broking since 2007, outlining its expectations ahead of the introduction of the proposed industry-wide redress scheme. Although the redress scheme is under consultation, firms are urged to act now to meet existing complaints and prepare for potential implementation of the redress scheme. The FCA warns that failure to prepare adequately may result in enforcement action. For existing leasing complaints, firms must be ready to deliver accurate and fair complaint outcomes from 5 December. For commission-related complaints subject to the proposed extension of 31 July 2026, firms should continue gathering evidence, investigating diligently and progressing complaints, including issues that potentially fall outside the scope of the scheme which relate to lending and broking.

The FCA also expects lenders to begin taking the following actions in preparation: (i) accurately identifying impacted customers; (ii) gathering appropriate information to assess cases; (iii) strengthening case-handling systems and controls where necessary, including the use of AI-technologies; (iv) maintaining adequate financial and non-financial resources; and (v) taking responsibility at the senior manager level for ensuring there is no undue delay in the resolution of complaints, including by ensuring there is appropriate oversight of the firm's approach to the potential scheme. Lenders and brokers are expected to engage proactively with the FCA and notify it promptly of any material developments affecting their ability to meet obligations, via a SUP 15 notification. The FCA reaffirms its commitment to securing fair outcomes and expects full cooperation from all parties throughout the process.

The UK Financial Conduct Authority (FCA) has published consultation paper CP25/27 (alongside a press release and an accompanying statement) incorporating its proposed market-wide consumer redress scheme under section 404 of the Financial Services and Markets Act 2000. The consultation follows the UK Supreme Court ruling on 1 August. The consultation on the redress scheme proposals closes on 18 November. The FCA anticipates the final rules will be set out in early 2026 followed by a staged implementation.

The proposed scheme covers claims in relation to arrangements which involve discretionary commissions, commissions said to be too high, and where there are commercial ties between the lender and the dealer, in each case that were not adequately disclosed, so giving rise to "unfair relationships" under the Consumer Credit Act 1974. For further information on the proposed scheme, you may like to read our article "FCA consultation on motor finance redress scheme".

In addition to the redress scheme, the FCA is consulting on an extension to the deadline for motor finance firms to send final responses to motor finance complaints until 31 July 2026, allowing time for the scheme rules to be finalised and for firms to act upon them. This 2026 deadline is a further extension to the 4 December 2025 deadline the FCA previously introduced for relevant complaints. The extended 2026 deadline would not apply to complaints regarding leasing agreements. Comments on these proposals should be submitted by 4 November, with FCA confirmation expected by 4 December.

The UK Financial Conduct Authority (FCA) has published a letter to HM Treasury (HMT), addressing concerns about the consumer duty's application to wholesale firms. While the consumer duty aims to enhance retail consumer outcomes, the FCA clarifies that wholesale activities with minimal retail impact generally fall outside its scope. Following extensive industry engagement, the FCA acknowledges confusion and disproportionate compliance burdens. In response, it outlines a four-point action plan and suggests legislative updates for HMT to consider.

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The UK Financial Conduct Authority (FCA) has published consultation paper CP25/26 proposing consequential updates to the FCA Handbook following its June consultation (now closed) on a new regulated activity of "targeted support". This new form of support seeks to help consumers navigate their financial lives by enabling firms to offer investment product suggestions to groups of consumers with shared characteristics. The FCA is now consulting on additional Handbook changes to ensure that the targeted support proposals work effectively with existing requirements. Specifically, the FCA seeks to refine earlier proposals, including rules on commissions, charging structures and disclosure obligations, and ensure that the new regulated activity aligns with the wider regulatory framework, such as reporting requirements. The changes impact the glossary of definitions and several sourcebooks. The deadline for comments is 17 October, with a final policy statement incorporating feedback from this and the June consultation, expected in December.

The UK Financial Conduct Authority (FCA) has issued a statement highlighting the growing concern over high-risk investment schemes promoted by unregulated firms. The FCA notes that these schemes, which often involve unlisted loan notes or mini-bonds used to fund property developments, may be marketed to investors through enticing websites, marketing campaigns and social media influencer promotions. Many of these firms operate outside the FCA's regulatory remit due to legal exemptions, meaning investors may not have access to the UK Financial Ombudsman Service or the Financial Services Compensation Scheme if things go wrong. The FCA emphasises that such investments are generally suitable only for experienced or self-certified "sophisticated investors" under strict criteria and urges individuals to verify a firm's regulatory status using its register, before investing. The statement also includes a section of "top tips to investors" which includes, among others, advising caution around promised high returns, encouraging diversification of investments and recommending limited exposure to high-risk investments to no more than 10% of an investment portfolio.

The UK Financial Conduct Authority (FCA) has published consultation paper CP25/25 (CP), alongside a press release, setting out its proposed regulatory framework for cryptoasset activities under the Financial Services and Markets Act 2000 (FSMA). This follows HM Treasury's (HMT) draft statutory instrument (SI) to bring qualifying cryptoasset activities within the scope of the Regulated Activities Order 2001 (RAO) and under the FCA's remit. Qualifying cryptoasset activities will include issuing qualifying stablecoins, safeguarding qualifying cryptoassets and specified investment cryptoassets, operating a qualifying cryptoasset trading platform (CATP), intermediation and staking. Firms and individuals undertaking these activities will require FCA authorisation before operating by way of business in the UK.

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The UK Financial Conduct Authority (FCA) has announced a GBP1 million public awareness campaign regarding its proposed motor finance compensation scheme. The campaign aims to inform consumers that they do not need to engage claims management companies (CMCs) or law firms to access redress, potentially saving them up to 30% of any compensation awarded. The FCA has taken regulatory action against misleading promotions, requiring CMCs to amend or remove 396 advertisements since January 2024. A formal consultation on the scheme is expected in early October, with potential compensation payments commencing in 2026.

HM Treasury (HMT) has published a formal response letter dated 2 September to the House of Lords Financial Services Regulation Committee's June report on the UK Financial Conduct Authority (FCA) and UK Prudential Regulation Authority's (PRA) secondary international competitiveness and growth objectives. The letter welcomes the Committee's recommendations and notes their alignment with the UK government's Financial Services Growth and Competitiveness Strategy, announced in July, reaffirming its commitment to regulatory reform. HMT's response outlines ongoing efforts that directly address the Committee's recommendations, including reforms to the UK Financial Ombudsman Service (FOS) to restore its original role as a swift and impartial dispute resolution body, a review of the consumer duty's application to wholesale firms, with the FCA due to report back to the Chancellor by the end of September, and the prioritisation of the Advice Guidance Boundary Review to tackle the advice gap. Appendix A of the letter provides further detail on the government's response to each of the Committee's recommendations, including ongoing work and future priorities.

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The UK Financial Conduct Authority (FCA) has issued a statement alongside a press release aimed at clarifying the rules surrounding workplace savings schemes. These schemes, which allow employees to save directly from their salary via payroll, are seen as a tool to enhance financial resilience and support economic growth. Despite their potential, uptake remains low with only 7% of UK employers currently offering such schemes, largely due to perceived regulatory barriers. The statement is intended to provide reassurance that workplace savings schemes can be successfully set up and implemented to comply with existing rules and legislation.

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The UK Competition and Markets Authority (CMA) has published its provisional decision that the remaining provisions of the SME Banking (Behavioural) Undertakings 2002 (the 'Limitation on Bundling Provisions') are no longer appropriate and should be released. The Limitation on Bundling Provisions prevent the banks that gave the undertakings from requiring, as a condition of granting a business loan or approving the opening of a business deposit account, that a small or medium-sized enterprise (SME) customer should open or maintain a business current account with the bank. The proposed release is due to changes in the competitive landscape in the SME banking markets and changes in customer behaviour, and the decision follows the CMA's review of the undertakings earlier this year. The CMA is now consulting on this provisional decision before it makes its final decision. The deadline for comments is 5pm on 3 September.