REGtape UK | Spring 2025
Published on 1st April 2025
Developments in financial services regulation in the UK
Welcome to the first edition of 2025 reflecting on developments and emerging themes in UK financial services with a focus on the retail banking, investments, wealth and fintech sectors.
The first quarter has proven to be a busy start to the year in financial services regulation following a relatively quiet 2024.
In this edition, we consider the role of regulatory hosts in fund structures, the Financial Conduct Authority (FCA) review of the "advice gap" and the UK's new retail disclosure regime.
We also take a look at two areas of intense focus at the moment: the new UK operational resilience rules (the compliance deadline passed on 31 March) and changes to the regulatory landscape as both the FCA and the government focus on growth.
And, after further delay to rules on non-financial misconduct from the FCA, we consider what firms should do in the meantime.
How is the UK regulatory landscape set to change?
The government published its action plan on 17 March to reform the regulatory landscape and support growth, innovation and private sector investment by ensuring regulations are proportionate, consistent and predictable.
What does the plan detail and what does it mean for the sector?
Further delay to non-financial misconduct final rules
Plans to impose stricter diversity and inclusion rules for financial firms have been axed by the FCA and Prudential Regulatory Authority, with new rules and guidance on non-financial misconduct delayed to the summer this year.
Will the regulator continue to prioritise this area?
How UK firms have prepared for the new operational resilience rules
The FCA introduced new rules and guidance on operational resilience on 31 March 2022 in order to ensure firms are better able to prevent, react to and recover from operational disruptions.
The three-year transition period has come to an end, how have firms needed to prepare in order to ensure full compliance by the 31 March deadline?
Private market valuations come under the FCA's microscope
A recent FCA multi-firm review has found strong practices across the industry but highlighted areas for improvement in private market valuations – and heralds more in-depth regulatory scrutiny.
How will private fund managers need to prepare?
Proposed reforms to UK retail disclosure rules take shape
The UK government and FCA are overhauling the UK's EU-inherited retail disclosure rules.
What are the reasons behind the changes, the proposed timescales and the new legislation on consumer composite investments?
UK 'regulatory hosts' in fund structures offer benefits and raise FCA concerns
The role of a "regulatory host" is pivotal to the launch of many funds but has been under increased FCA scrutiny. The current UK regulatory host model is important for alternative investment fund launches notwithstanding the UK financial regulator's recent criticisms and actions.
How does this model benefit emerging fund managers?
FCA highlights anti-money laundering compliance gaps in UK capital markets
The FCA in its report on money laundering in the UK capital markets has gone into more detail than other recent guidance, with detailed examples and feedback particularly on transaction monitoring and information sharing.
What are the findings and guidance that will be of broad interest to firms across financial services looking to review their compliance?
FCA announces next stage of the Advice Guidance Boundary Review
In the opinion of the FCA, an "advice gap" stems from a combination of lack of consumer confidence and firm reticence – particularly to give personal recommendations due to regulatory requirements and associated risks.
Will the FCA's consultation prompt firms to broaden offerings in this area, increase access to affordable support and cultivate a healthier appetite for investment among UK consumers?
Future of Financial Services podcast
Our monthly podcast series draws upon themes covered in our Future of Financial Services Week in February and explores emerging challenges and solutions in the rapidly changing world of finance.
Recent episodes include discussions on diversity and inclusion, artificial intelligence, sustainability disclosure requirements, and more.
Osborne Clarke's financial services regulatory experts would be happy advise you further on any of the topics covered in this edition. For further information, please contact any of the experts mentioned in the articles or our partners.
