Recommendation 31

HM Government Not Addressed

The Government continues to keep the legislative framework underpinning the regulation of financial promotions under review. This includes arrangements for financial promotions communicated by authorised firms, as well as the effectiveness of the exemptions that form part of the regime. As part of this the Treasury has already commenced work with the FCA to review exemptions to the financial promotions regime for high net worth individuals, self- certified and certified sophisticated investors. The Committee’s report also noted the Treasury’s ongoing work to create a regulatory gateway for the approval of financial promotions. The Government published the response to its consultation on 22 June 2021. The response sets out the Government’s intention to bring forward legislation to establish the gateway through the imposition of requirements on firms when parliamentary time allows. This change, once in place, is designed to strengthen the regime by ensuring that the firms able to approve financial promotions are limited to those with the relevant expertise to do so, and that the FCA will be able to better identify when a financial promotion has breached the restriction and take action accordingly.