The Financial Conduct Authority has published a discussion paper seeking views on how its retail investments regulatory framework could be reshaped to help consumers take informed investment risks and build confidence to invest, while continuing to mitigate harm from scams and inappropriate exposure to high-risk products. The paper reviews whether current rules keep pace with changes in how consumers invest, including the growth of non-advised platforms and trading apps, digital engagement practices, fractional investments and tokenisation-related ownership models, and the expanding use of model portfolio services. It also raises whether comparable products with similar risk profiles are treated inconsistently, particularly across speculative products such as contracts for difference, leveraged exchange-traded products, margin lending, structured capital-at-risk products and cryptoasset proxies, and asks whether a more risk-and-return-centred approach should replace product-led regulation in this area. Further questions cover the effectiveness and consistency of appropriateness testing under COBS and how financial promotion and distribution rules interact with the Consumer Duty, alongside constraints created by Financial Promotion Order exemptions, including concerns about consumers opting out of FCA protections under unchanged high-net-worth thresholds of GBP 100,000 annual income or GBP 250,000 net assets. Responses are requested by 6 March 2026, after which the FCA will consider feedback and may consult on the issues discussed.
Financial Conduct Authority 2025-12-08
Financial Conduct Authority launches discussion paper on expanding consumer access to investments and rebalancing retail investing rules
The Financial Conduct Authority (FCA) has issued a discussion paper to explore reforms to its retail investments regulatory framework. It aims to boost consumer confidence and informed risk-taking while reducing harm from scams and high-risk products. The paper assesses current rules' adequacy amid evolving practices like non-advised platforms and tokenisation, and questions the consistency in treating speculative products. It also examines appropriateness testing effectiveness and the interaction of financial promotion rules with the Consumer Duty, highlighting concerns about high-net-worth thresholds.