The FCA has published Guidance Consultation 17/4: Financial Advice Market Review (FAMR): Implementation part 1 (GC17/4). GC17/4 is the first part of the FCA’s consultation on measures to address the recommendations set out in the March 2016 final report of the FAMR. GC17/4 sets out proposed guidance in response to the following FAMR recommendations:

  • streamlined advice (FAMR Recommendation 4) – the review recommends developing a clear framework that gives firms the confidence to provide streamlined advice on simple consumer needs in a proportionate As part of this, the FCA should produce new guidance to support firms offering ‘streamlined advice’ on a limited range of consumer needs. This should include a series of illustrative case studies highlighting the main considerations when developing such models;
  • fact find process (FAMR Recommendation 10) – the FCA should consult on guidance to provide clarity on the standard types of information required as part of the fact find In addition, the guidance should also set out key considerations for verifying a fact find that has been performed by third parties;
  • non-advised services (FAMR Recommendation 3) – the FCA should consult on new guidance to support firms offering services that help consumers make their own investment decisions without a personal recommendation. This should include a series of illustrative case studies highlighting the main considerations firms need to take into account when developing such services and dealing with specific areas of uncertainty identified during the review; and
  • employer and trustee factsheet (Recommendation 11) – the FCA and The Pensions Regulator should develop and promote a new factsheet to set out what help employers and trustees can provide on financial matters without being subject to

In summer 2017, the FCA will publish its second part of the consultation which will set out proposals in the following areas:

  • consequential Handbook changes – the changes to the RAO will necessitate a number of consequential amendments to the FCA Handbook;
  • perimeter and non-advised services – the FCA will propose revised guidance on the amended advice perimeter. The proposals on non-advised services in GC17/4 will be subject to a shortened consultation period, to allow the FCA to take into account feedback when developing this draft guidance;
  • consolidation of non-Handbook guidance – the FCA is currently reviewing the existing non-Handbook material in this area with a view to removing material that is no longer relevant and consolidating the remaining guidance with the proposals on streamlined advice and fact finds in GC17/4. The Part 2 consultation will include details of how the FCA conducts this consolidation process; and
  • guidance informed by the experiences of the FCA’s Advice Unit – the FCA’s Advice Unit was set up in May 2016 to support firms developing automated advice models. The FCA expects to set out further guidance informed by the Advice Unit’s work with firms in this

The deadline for comments on GC17/4 is 23 May 2017 for section :non-advised services and 11 July 2017 for sections 2,3 and 5: streamlined advice, fact find and the factsheet for employers and trustees. The FCA intends to publish  its response to GC17/4 in Autumn 2017. The FCA aim is for the package measures to take effect in January 2018 in line with the Handbook changes implementing MiFID II and the changes to the Regulated Activities Order.

View FCA guidance consultation on implementation of FAMR (Part 1), 11 April 2017