The general prohibition.

(1)No person may carry on a regulated activity in the United Kingdom, or purport to do so, unless he is—
(a)an authorised person; or
(b)an exempt person.

(2)The prohibition is referred to in this Act as the general prohibition.

Authorised persons acting without permission.

(1) If an authorised person [F1 other than a PRA-authorised person] carries on a regulated activity in the United Kingdom, or purports to do so, otherwise than in accordance with permission—
[F2 (a) given to that person under Part 4A, or]
(b) resulting from any other provision of this Act, he is to be taken to have contravened a requirement imposed on him by the [F3 FCA] under this Act.
[F4 (1A) If a PRA-authorised person carries on a regulated activity in the United Kingdom, or purports to do so, otherwise than in accordance with permission given to the person under Part 4A or resulting from any other provision of this Act, the person is to be taken to have contravened—
(a) a requirement imposed by the FCA, and 
(b) a requirement imposed by the PRA.]
[F5 (2) A contravention within subsection (1) or (1A)—
(a) does not, except as provided by section 23(1A), make a person guilty of an offence,
(b) does not, except as provided by section 26A, make any transaction void or unenforceable, and 
(c) does not, except as provided by subsection
(3), give rise to any right of action for breach of statutory duty.] 
(3) In prescribed cases [F6 a contravention within subsection (1) or (1A)] is actionable at the suit of a person who suffers loss as a result of the contravention, subject to the defences and other incidents applying to actions for breach of statutory duty.
[F7(4) Subsections (1) and (1A) are subject to section 39(1D). 
(5) References in this Act to an authorised person acting in contravention of this section are references to the person acting in a way that results in a contravention within subsection (1) or (1A).]

Restrictions on financial promotion.

(1) A person (“A”) must not, in the course of business, communicate an invitation or inducement to [F1(a)] engage in investment activity [F2, or 
(b) to engage in claims management activity.]
(2) But subsection (1) does not apply if—
(a) A is an authorised person; or
(b) the content of the communication is approved for the purposes of this section by an authorised person. 
[F3 (2A) The content of a communication may be approved for the purposes of this section by an authorised person only if the giving of the approval— 
(a) is permitted under section 55NA (which enables approval to be given with FCA permission), or (b) falls within an exemption conferred by regulations under section 55NB.] 
(3) In the case of a communication originating outside the United Kingdom, subsection (1) applies only if the communication is capable of having an effect in the United Kingdom. 
(4) The Treasury may by order specify circumstances in which a person is to be regarded for the purposes of subsection (1) as— 
(a) acting in the course of business; 
(b) not acting in the course of business. 
(5) The Treasury may by order specify circumstances (which may include compliance with financial promotion rules) in which subsection (1) does not apply. 
(6) An order under subsection (5) may, in particular, provide that subsection (1) does not apply in relation to communications— 
(a) of a specified description; 
(b) originating in a specified country or territory outside the United Kingdom; 
(c) originating in a country or territory which falls within a specified description of country or territory outside the United Kingdom; or 
(d) originating outside the United Kingdom. 
(7) The Treasury may by order repeal subsection (3). 
(8) “Engaging in investment activity” means— 
(a) entering or offering to enter into an agreement the making or performance of which by either party constitutes a controlled activity; or 
(b) exercising any rights conferred by a controlled investment to acquire, dispose of, underwrite or convert a controlled investment. 
(9) An activity is a controlled activity if— 
(a) it is an activity of a specified kind or one which falls within a specified class of activity; and 
(b) it relates to an investment of a specified kind, or to one which falls within a specified class of investment. 
(10) An investment is a controlled investment if it is an investment of a specified kind or one which falls within a specified class of investment. 
[F4 (10A) “Engaging in claims management activity” means entering into or offering to enter into an agreement the making or performance of which by either party constitutes a controlled claims management activity. 
(10B) An activity is a “controlled claims management activity” if— 
(a) it is an activity of a specified kind, 
(b) it is, or relates to, claims management services, and
(c) it is carried on in Great Britain.]
(11) Schedule 2 (except paragraph 26) applies for the purposes of subsections (9) and (10) with references to section 22 being read as references to each of those subsections.
(12) Nothing in Schedule 2, as applied by subsection (11), limits the powers conferred by subsection (9) or (10).
[F5 (12A) Paragraph 25 of Schedule 2 applies for the purposes of subsection (10B) with the references to section 22 in sub-paragraph (3) of that paragraph being read as references to subsection (10B).] 
(13) “Communicate” includes causing a communication to be made. 
(14) “Investment” includes any asset, right or interest [F6 (including where an asset, right or interest is, or comprises or represents, a cryptoasset) (15)“Specified” means specified in an order made by the Treasury.

[F1 Regulated activities]

(1) An activity is a regulated activity for the purposes of this Act if it is an activity of a specified kind which is carried on by way of business and— 
(a) relates to an investment of a specified kind; or 
(b) in the case of an activity of a kind which is also specified for the purposes of this paragraph, is carried on in relation to property of any kind. 
[F2 (1A) An activity is also a regulated activity for the purposes of this Act if it is an activity of a specified kind which is carried on by way of business and relates to— 
(a) information about a person’s financial standing, F3… [F4 or ] 
F5(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 
[F6 (c) administering a benchmark.]] 
[F7 (1B) An activity is also a regulated activity for the purposes of this Act if it is an activity of a specified kind which— 
(a) is carried on by way of business in Great Britain, and 
(b) is, or relates to, claims management services.] 
(2) Schedule 2 makes provision supplementing this section. 
(3) Nothing in Schedule 2 limits the powers conferred by [F8 subsection (1) [F9 or (1A)]] [F8 subsections (1) to (1B)]. 
(4) “Investment” includes any asset, right or interest [F10 (including where an asset, right or interest is, or comprises or represents, a cryptoasset)]. 
(5) “Specified” means specified in an order made by the Treasury.
F11 (6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 
[F12 (6A) For the purposes of subsection (1A)(c), “benchmark” has the meaning given by Article 3 of the EU Benchmarks Regulation 2016, and “administering” a benchmark means acting as an administrator of that benchmark within the meaning of that Article.]

Designation of activities requiring prudential regulation by PRA

(1) The Treasury may by order specify the regulated activities that are “PRA-regulated activities” for the purposes of this Act. 
(2) An order under subsection (1) may
(a) provide for exceptions
(b) confer powers on the Treasury or either regulator;
(c) authorise the making of rules or other instruments by either regulator for purposes of, or connected with, any relevant provision;
(d) make provision in respect of any information or document which in the opinion of the Treasury or either regulator is relevant for purposes of, or connected with, any relevant provision;
(e) make such consequential, transitional, or supplemental provision as the Treasury consider appropriate for purposes of, or connected with, any relevant provision
(3) Provision made as a result of subsection (2)(e) may amend any primary or subordinate legislation, including any provision of, or made under, this Act
(4) “Relevant provision” means this section or any provision made under this section.]

Contravention of the general prohibition [F1or section 20(1) or (1A)].

(1) A person who contravenes the general prohibition is guilty of an offence and liable—
(a) on summary conviction, to imprisonment for a term not exceeding six months or a fine not exceeding the statutory maximum, or both;
(b) on conviction on indictment, to imprisonment for a term not exceeding two years or a fine, or both.
[F2 (1A) An authorised person (“A”) is guilty of an offence if A carries on a credit-related regulated activity in the United Kingdom, or purports to do so, otherwise than in accordance with permission—
(a) given to that person under Part 4A, or
(b) resulting from any other provision of this Act
(1B) In this Act “credit-related regulated activity” means a regulated activity of a kind designated by the Treasury by order.
(1C) The Treasury may designate a regulated activity under subsection (1B) only if the activity involves a person
(a) entering into or administering an agreement under which the person provides another person with credit
(b) exercising or being able to exercise the rights of the lender under an agreement under which another person provides a third pa
(c) taking steps to procure payment of debts due under an agreement under which another person is provided with credit
(1D) But a regulated activity may not be designated under subsection (1B) if the agreement in question is one under which the obligation of the borrower is secured on land
(1E) “Credit” includes any cash loan or other financial accommodation.
(1F) A person guilty of an offence under subsection (1A) is liable—
(a) on summary conviction, to imprisonment for a term not exceeding the applicable maximum term or a fine not exceeding the statutory maximum, or both;
(b) on conviction on indictment, to imprisonment for a term not exceeding two years, or a fine, or both.
(1G) The “applicable maximum term” is—
(a) in England and Wales, [F3the general limit in a magistrates’ court] (or 6 months, if the offence was committed before the commencement of [F42 May 2022]);
(b) in Scotland, 12 months;
(c) in Northern Ireland, 6 months.]
(2) In this Act “an authorisation offence” means an offence under this section.
(3) In proceedings for an authorisation offence it is a defence for the accused to show that he took all reasonable precautions and exercised all due diligence to avoid committing the offence.
[F5 (4) Subsection (1A) is subject to section 39(1D)
(5) No proceedings may be brought against a person in respect of an offence under subsection (1A) in a case where either regulator has taken action under section 205, 206 or 206A in relation to the alleged contravention within section 20(1) or (1A).]

False claims to be authorised or exempt.

(1) A person who is neither an authorised person nor, in relation to the regulated activity in question, an exempt person is guilty of an offence if he
(a) describes himself (in whatever terms) as an authorised person
(b) describes himself (in whatever terms) as an exempt person in relation to the regulated activity; or
(c) behaves, or otherwise holds himself out, in a manner which indicates (or which is reasonably likely to be understood as indicating) that he is—
(i) an authorised person; or
(ii) an exempt person in relation to the regulated activity.
(2) In proceedings for an offence under this section it is a defence for the accused to show that he took all reasonable precautions and exercised all due diligence to avoid committing the offence.
(3) A person guilty of an offence under this section is liable on summary conviction to imprisonment for a term not exceeding six months or a fine not exceeding level 5 on the standard scale, or both.
(4) [F1 But where the conduct constituting the offence involved or included the public display of any material, the maximum fine for the offence is level 5 on the standard scale multiplied by the number of days for which the display continued.]

[F1Local authorities

72G.—(1) There is excluded from article 5 any activity which is carried on by a local authority.
(2) There is excluded from articles 21, 25(1) and (2), 39A and 53 any activity carried on by a local authority which relates to a contract of insurance which is not a qualifying contract of insurance.
(3) There is excluded from articles [F225A(1)(b), 25A(2)], 25B, 25C, 25E, 36A, 39D, 39E, 39F, 39G, F3… 53B, 53C, 53D, 60N, F3… 63B, 63F, 63J or 89A any activity which is carried on by a local authority.
[F4 (3A) There is excluded from article 25A(1)(b) and (2) any activity which is carried on by a company which is a wholly-owned subsidiary of a local authority.
(3B) F5 There is excluded from articles 25A(1)(a) and (2A), 53A, 53DA and 61 any activity which is carried on by a local authority, or a company which is a wholly-owned subsidiary of a local authority, in so far as the contract …—
[F6 (a)was entered into before 21st March 2016; or
(b)is entered into on or after 21st March 2016 and—
[F7 (i) is an agreement to which section 423A(3) of the Act applies;]
(ii) is a bridging loan; or
(iii) is a restricted public loan in relation to which the requirements of paragraph (6) are met.]
[F8 (3C) There is excluded from article 59(1) and (1A) any activity which is carried on by a local authority.
[F9(4) There is excluded from article 60B
[F10(a) any activity which is carried on by a local authority—
(i) in relation to a credit agreement which was entered into before 21st March 2016, or which is entered into on or after that date for a purpose other than acquiring or retaining property rights in land or in an existing or projected building; and
(ii) in so far as the activity is carried on in relation to a credit agreement [F11falling within paragraph (6A) or within section 423A(2)(a) or (b) or (3)(b), (d), (e) or (f) of the Act;]]
(b) any activity which is carried on by a local authority [F12in relation to a credit agreement entered into on or after 21st March 2016], the purpose of which is to acquire or retain property rights in land or in an existing or projected building, in so far as the credit agreement meets one of the following conditions—
[F13 (i) it is an agreement to which section 423A(3) of the Act applies;]
(ii) it is a bridging loan; or
(iii) it is a restricted public loan in relation to which the requirements of paragraph (6) are met.
[F14(4A) A reference in paragraph (4) to any land or building—
(a) in relation to an agreement entered into before IP completion day, is a reference to any land or building in the United Kingdom or within the territory of an EEA State;
(b) in relation to an agreement entered into on or after IP completion day, is a reference to any land or building in the United Kingdom.]
(5) There is excluded from article 64 any agreement made by a local authority to carry on an activity of the kind excluded by 1.paragraphs (2) to (4)
[F15(6) The requirements of this paragraph are that
(a)the borrower receives timely information on the main features, risks and costs of the loan at the pre-contractual stage; and
(b)any advertising of the loan is fair, clear and not misleading.
[F16(6A) The following credit agreements fall within this paragraph-
(a) an agreement involving a total amount of credit of less than 200 euro;
(b) an agreement that involves a total amount of credit of more than 75,000 euro, other than an unsecured credit agreement the purpose of which is the renovation of a residential immovable property;
(c) a hiring or leasing agreement under which an obligation to purchase the object of the agreement is not laid down either by the agreement itself or by any separate agreement;
(d) an agreement under which the credit is granted free of interest and without any other charges;
(e) an agreement under which the credit has to be repaid within three months and only insignificant charges are payable;
(f) an agreement concluded with an investment firm or a credit institution for the purposes of allowing an investor to carry out a transaction relating to one or more of the instruments listed in Part 1 of Schedule 2, where the investment firm or credit institution granting the credit is involved in that transaction;
(g) an agreement under which the consumer’s liability is strictly limited to an item that the consumer is requested to deposit, upon the conclusion of the agreement, as security in the creditor’s safe-keeping;
(h) an agreement that relates to a restricted public loan.
(6B) For the purposes of subsection (6A)(c), an obligation to purchase the object of the agreement is deemed to exist if the creditor decides that it does.]
(7) In this article—
“bridging loan” has the meaning given by [F17article 60G(9)];
“borrower” means a person receiving credit;
[F18“consumer” means an individual who is acting for purposes outside those of any trade, business or profession carried on by the individual;]
F19…
“credit” includes a cash loan and any other form of financial accommodation;
“restricted public loan” means credit that is—
(a) offered to a particular class of borrower and not offered to the public generally;
(b) offered under an enactment with a general interest purpose; and
(c) provided on terms which are more favourable to the borrower than those prevailing on the market, because the credit meets one of the following conditions—
(i) it is interest free;
(ii) the rate of interest is lower than that prevailing on the market; or
(iii) the rate of interest is no higher than that prevailing on the market but the other terms on which the credit is provided are more favourable to the borrower; and “wholly-owned subsidiary” has the same meaning as in section 1159 (meaning of “subsidiary” etc.) of the Companies Act 2006 and, for the purposes of this definition, a local authority is to be treated as a body corporate.]]

https://www.legislation.gov.uk/ukpga/2023/29/contents

1. Introductory Text

2. Expand +

   PART 1 Regulatory framework

3. Expand +

   PART 2 Access to cash

4. Expand +

   PART 3 Performance of functions relating to financial market infrastructure

5. Expand +

   PART 4 Central counterparties in financial difficulties

6. Expand +

   PART 5 Insurers in financial difficulties

7. Expand +

   PART 6 Miscellaneous

8. Expand +

   PART 7 General

9. SCHEDULES

   1. Expand +

      SCHEDULE 1

      Revocation of retained EU law relating to financial services

   2. Expand +

      SCHEDULE 2

      Transitional amendments

   3. Expand +

      SCHEDULE 3

      New Schedule 6B to FSMA 2000

   4. Expand +

      SCHEDULE 4

      FMI Sandboxes

   5. Expand +

      SCHEDULE 5

      Financial promotion: related amendments

   6. Expand +

      SCHEDULE 6

      Digital settlement assets

   7. Expand +

      SCHEDULE 7

      Accountability of the Payment Systems Regulator

   8. Expand +

      SCHEDULE 8

      Cash access services

   9. Expand +

      SCHEDULE 9

      Wholesale cash distribution

   10. Expand +

       SCHEDULE 10

       Performance of functions relating to financial market infrastructure

   11. Expand +

       SCHEDULE 11

       Central counterparties

   12. Expand +

       SCHEDULE 12

       Write-down orders

   13. Expand +

       SCHEDULE 13

       Insurers in financial difficulties: enforcement of contracts

   14. Expand +

       SCHEDULE 14

       Credit unions