FCA Appointed Representatives for Investment Managers & Advisers
What is an Appointed Representative (AR)?
An Appointed Representative (AR) is a person or entity which is able to arrange deals in investments and advise on investments by being authorised under the umbrella of a directly authorised FCA firm (often referred to as the 'Principle Firm').
In order to be an Appointed Representative, the AR must meet certain requirements, namely:
- a) it must not be an authorised person;
- b) it must have entered into a contract with its FCA Principal and comply with the requirements in the specific Appointed Representative regulations; and
- c) the FCA Principal must have accepted responsibility in writing for the authorised activities of the Appointed Representative for the business specified in the contract.
Upon these conditions being satisfied, the Appointed Representative will become an ‘Exempt Person’ for the purposes of the Financial Services and Markets Act 2000 and may then arrange deals in investments and/or advise on investments.
All active and client facing individuals will need to be approved to perform the customer function pursuant to the FCA’s approved person regime.
Once Approved by the FCA as an Appointed Representative, what are AR's permitted to do?
The activities that an AR may conduct are also set out in SUP 12.2.7 of the FCA Handbook.
These can be summarised as:
- Advising on Investments;
- Arranging Deals in Investments
The AR cannot conduct any activity which the FCA Principle does not the appropriate permissions. The AR is not permitted to hold client money.
How to set up as an FCA Appointed Representative?
To set up as an FCA Appointed Representative (AR) (also known as FCA Umbrella Hosting) you would need to demonstrate a sound business model and track record in the financial services that you would like to arrange or advise on.
Whether you are currently an Appointed Representative looking to move to a new FCA Principal or simply thinking about making your move into the AR umbrella space, we can help with a complete 'turnkey' solution, ranging from company formation, registered office and infrastructure support. The Appointed Representative is a highly cost effective solution for financial service firms, with the process typically taking just a few weeks.
The formal legal status of an Appointed Representative can be found on the FCA website by clicking here. We always recommend that those interested in the AR umbrella model read and understand the legal obligations.
We’re Here to Help if you…
- Want to get to market quicker as a regulated financial services firm;
- Need assistance in compliance and oversight, whilst having direct control and
- Want to focus on the growth of your business;
- Are not happy with your current FCA Principle and want to work with someone more supportive towards your strategic direction;
- Are looking for a Principle with a wide range of FCA permissions to conduct your business in UK & Europe
- Want to launch your own investment products or investment solutions giving you access to European investors.
Our Objectives in Helping You…
- Help you grow and develop your firm with like-minded partners and service providers;
- Developing a corporate government framework, ensure all regulatory requirements are met;
- Reduce your regulatory and infrastructure costs so you can focus on your core business;
- Ensure your financial stability by offering flexible working agreements;
- Enable you to work with your new and existing clients and partners with reassurance and confidence.
- Help you grow as a financial services firm.
Appointed Representative Vs Direct FCA Authorisation?
- No FCA returns or annual fees;
- No Capital Adequacy or Auditing Requirements;
- Access to Vantage Ventures' compliance resources;
- Ongoing compliance training;
- No SMF16 or SMF17 requirements;
- We are your back office and compliance team, promoting industry best practice.
- Appointed Representative status in as little as 4 weeks.
Direct Authorisation – Things to Consider:
We help you become directly authorised by the FCA, as we consider this to be the natural progression for your entity as it matures. Here are some regulatory, compliance and financial considerations to think about when becoming directly authorised:
- Application process can take up to 12-18 months;
- Annually audited accounts by an independent auditor are required;
- Management & Forecast accounts will be required;
- A sound Compliance Framework is necessary;
- AML and Compliance Monitoring Programmes are required;
- Regulatory Capital must be posted;
- Dedicated personnel for compliance, anti-money laundering and regulatory functions are required;
- FSCS annual fees may be payable (depending on the firm's activities);
- Annual FCA fees may be payable;
- FCA GABRIEL reporting is required twice annually.