Check the types of investment and activities that are ‘investment business’ and how your firm needs to be authorised or licensed to conduct investment business.
Three pieces of regulation:
- the Financial Services and Markets Act 2000;
- the Regulated Activities Order (Statutory Instrument 2001, No. 544) as amended; and
- the Non-Exempt Activities Order (Statutory Instrument 2001, No. 1227) as amended.
determine whether - for the purpose of each investment activity undertaken - a firm needs to be authorised by:
- the Financial Conduct Authority (FCA), previously the Financial Services Authority (FSA);
- a designated professional body (DPB);
- or whether no authorisation or licence is necessary.
In order to conduct 'mainstream' investment business - for example, if your firm recommends the purchase of specific investments (eg, pensions, listed company shares) or approves financial promotions - the firm needs to be authorised by the FCA, previously the FSA.
In order to conduct 'non-mainstream' investment business - for example, if your firm advises on private company shares, interprets advice given to a client by an authorised person or takes part in discussions with a client and an authorised person - the firm needs to be licensed by ICAEW.
If a firm has no authorisation or licence, the firm may not undertake any regulated investment business.
Investment business also includes advice on mortgages and general insurance. For further information on the types of investment and types of activity that are regulated, see the DPB resources web page.
ICAEW submits an annual report to the FCA on its activities as a designated professional body.