On 16 April 2025, the Financial Conduct Authority (FCA) published a consultation paper, CP25/9, on further proposals on product information for consumer composite investments (CCIs).
Background
The FCA consulted in CP24/30 on a new product information regime for CCIs, which is intended to be a simpler and more flexible system tailored to the UK to replace current rules that were introduced across the EU when the UK was a member state. The responses to CP24/30 are currently being analysed and the FCA notes that CP25/9 is not intended to respond to the feedback it received to that previous consultation.
Proposals
In CP25/9, the FCA is consulting on some remaining issues to support the CCI regime, including proposals for:
- Removing the requirement for firms to calculate and disclose implicit transaction costs – the FCA explains that this would remove a significant compliance burden for firms while ensuring that consumers are still provided with the most relevant information about the transaction costs of their chosen product.
- Simplifying current cost disclosure rules reflecting assimilated requirements of the Markets in Financial Instruments Directive Organisation Regulation (MiFID Org Reg) and bringing them into line with the proposals for CCIs.
- Transitional provisions to allow firms flexibility to move across to the new regime as soon as they are ready.
- Consequential amendments to other parts of the FCA Handbook that result from the new CCI rules.
Next steps
The consultation closes on 28 May 2025.
The FCA plans to issue a policy statement with final rules in late 2025, and will include its response to any feedback to CP24/30 and CP25/9 together in that policy statement. It also intends to continue its detailed engagement with a range of stakeholders on the issues discussed in both CCI consultations, with the aim of creating a regime that works for consumers and the wider market.
For more information on the CCI regime, please listen to our podcast mini-series, the first episode of which is available here.