Financial Promotion Rules

The UK financial promotion regime is more active and scrutinised than ever before. With the Financial Conduct Authority (FCA) intensifying its focus on financial services and markets, firms that promote or approve any financial promotion must follow clearly defined rules.

AtWhether you are managing investment activity, publishing content on social media platforms, or approving promotions across a corporate group, it's essential to understand the full scope of your responsibilities. Any misstep in approving financial promotions can lead to a criminal offence, trigger FCA investigations, or cause reputational damage.

Let’s take a closer look at the key financial promotions rules every FCA authorised firm must follow under the current regulatory regime.

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Only Authorised Firms Can Approve or Issue Financial Promotions

Under section 21 of the Financial Services and Markets Act 2000, only firms that are authorised or that receive approval from an authorised firm may issue a financial promotion. This rule applies across all industries operating under the regulated activity framework, including those offering financial products, investment platforms, or claims management activity.

If an unauthorised person communicates a promotion approved without authorisation, they could be committing a serious or widespread offence. Since 2024, firms must also meet criteria under the financial promotion regime gateway. To remain eligible, firms must show they have the appropriate competence and can meet all financial promotions requirements set by the FCA.

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Promotions Must Be Clear, Fair and Not Misleading

Any financial promotion relating to financial products or services must follow the FCA rules outlined in the FCA Handbook and enforced by the Advertising Standards Authority. Whether shared through non broadcast advertising, email, or social media platforms, all content must be fair, balanced, and easy for retail customers to understand.

This is especially important when targeting retail investors, ordinary consumers, or those with consumers inexperience. Misleading content, missing risk warnings, or false claims about past performance may result in an investigation and could trigger FCA sanctions.

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Approvals Must Be Made by Competent Individuals

To protect the integrity of the financial promotion process, the FCA requires that every promotion approved is signed off by someone with relevant competence. The authorised firm approves the content only when they are satisfied it meets both FCA and UK code standards.

This rule applies across all types of promotional marketing, including content created for sophisticated investors, investment professionals, and high-net-worth clients. Anyone approving financial promotions must understand the product, the approval process, and the associated regulatory risks. Without this, even approved promotions may later be deemed non-compliant.

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Record Keeping and Audit Trails Are Mandatory

Under the services and markets act, FCA authorised firms must keep accurate records of every financial promotion they approve or distribute. This includes approval dates, content logs, and reviewer details. For example, a promotion targeting sophisticated investors must include evidence of their status such as financial thresholds, net assets, or company turnover required.

Firms must also consider other eligibility criteria such as whether the client is a company director, an unlisted company, or part of a corporate group. Failing to document this information may breach the financial promotion restriction and put your firm at risk.

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Exemptions Exist _ But Come With Conditions

Certain unauthorised firms or individuals may communicate financial promotions under exemptions set out in the UK financial promotion regime. These are often based on eligibility criteria, such as high income or meeting the appropriateness assessment. However, the burden of compliance still sits with the authorised persons involved.

Firms must not use exemptions to avoid their duty to deliver good outcomes or meet their consumer duty obligations. The FCA has also signalled through HM Treasury’s proposals that these exemptions will face tighter scrutiny in the coming years.

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Why It Matters

Failing to follow financial promotions rules can result in regulatory action, fines, or worse, a total loss of consumer trust. The risk is even higher for firms dealing with unsolicited real time communications or aiming to promote financial products across multiple channels.

At Finspector, we help firms authorised under the markets act 2000 stay ahead of these rules. Our platform automates the compliance and approval process, captures a full audit trail, and allows teams to approve content with confidence. Whether you are promoting your own financial promotions or reviewing those of others, we ensure your process meets the highest standard of regulatory compliance.

Book a demo with Finspector today and see how we can support your team in managing approvals, audits, and promotional risk _ all while staying compliant with the UK’s evolving financial promotion regime.

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