On 11 August 2025, HM Treasury published a Policy Statement setting out the Government’s overall approach and targeted reforms of the Appointed Representatives (ARs) legislative regime.

Overview

Following the previous administration’s Call for Evidence on 3 December 2021 as well as experience of the Financial Conduct Authority (FCA) and Financial Ombudsman Service (FOS) in dealing with supervisory challenges and complaints involving ARs, the Government has reviewed the overall scope, benefits and risks associated with the current regulatory approach for ARs.

Key amendments

The Policy Statement outlines two key reforms that the Government intends to make to the AR’s legislative framework consistent with the Government’s policy approach set out in its Regulation Action Plan:

  • FCA permission to act as principal: Rather than the principal firm accepting responsibility for the regulated activities of the AR without further approval, authorised firms would have to seek permission from the FCA similar to that of approving financial promotions. This would require amending section 39 of Financial Services and Markets Act (FSMA 2000) to make clear that an AR is only exempt where the authorised firm has permission to act as a principal, and so the FCA will have discretion to limitations or conditions on those principal firms as it currently does in respect of other permissions granted under of Part 4A FSMA 2000. The Government also mentioned it is working closely with the FCA to ensure it does not disrupt business activity for those firms which already use ARs.
  • Extension of FOS jurisdiction to ARs: The FOS would be able to investigate the AR directly where actions of the AR are outside the scope of the principal firm’s responsibilities, but this is not intended to diminish a principal firm’s oversight of its AR’s activities. The proposal to extend the FOS jurisdiction to ARs is intended to be consistent with the conclusions of the Government’s FOS review published on 17 March 2025, to which legislative reforms aim to ensure greater consumer protection and restore the FOS’s role as an impartial dispute resolution service.

Next steps

The Government will consult on the detail of these reforms in due course.