Make way for the regulatory gateway

For many years, those giving training on the financial promotion restriction have used the standard triad of "communicated by an authorised person, content approved by an authorised person, or falls within an exemption".

The Financial Services and Markets Act 2023 (FSMA 2023) changes the second of these. The FCA is introducing a regulatory gateway, which authorised firms will need to pass through if they want to approve financial promotions of unauthorised persons.

On 12 September 2023, the FCA published a policy statement and a new webpage setting out how authorised firms may apply to pass through the gateway in order to obtain permission to approve financial promotions of unauthorised firms (approver permission). 

How has the financial promotion restriction changed?

As a result of amendments to the financial promotion restriction in the Financial Services and Markets Act 2000 made by FSMA 2023 and which come into force from 7 February 2024, authorised firms must have FCA permission to approve financial promotions for any unauthorised firms. The three exemptions to this are detailed in the relevant regulations, which state that an authorised person does not need approver permission for:

• their own financial promotions
• financial promotions prepared by any unauthorised person in the same corporate group
• financial promotions prepared by their appointed representatives, where the promotion relates to a regulated activity for which the authorised person has agreed to accept responsibility. 

Applying for approver permission

If an authorised firm is not exempt, the webpage notes that it must apply to the FCA for approver permission during the three-month application window, opening on 6 November 2023 and closing on 6 February 2024. 

The application form will require that authorised firms explain the types of promotion the firm intends to approve, the expertise they have to approve them, policies they have when approving financial promotions, and their historic approvals. 

The application forms will become available on the webpage or via Connect once the application window opens in November.

What if a firm misses the deadline?

Authorised firms which miss this deadline must stop approving financial promotions for unauthorised firms on 7 February 2024. The ability to approve financial promotions for unauthorised persons will be shown on the FS Register from this date as well.

How can we help?

Our Financial Services Regulatory team has significant experience in navigating the financial promotion restriction and can assist you with applying for approver permission.