MCOB 3.4 Purpose

Section 21(1) of the Act (Restriction on financial promotion) imposes a restriction on the communication of financial promotions (qualifying credit promotions in MCOB) by unauthorised persons. A person must not, in the course of business, communicate a qualifying credit promotion unless:

1. (a)

   he is an authorised person; or

2. (b)

   the content of the qualifying credit promotion is approved by an authorised person.

However, the Financial Promotion Order exempts from the restriction created by section 21(1) of the Act certain types of financial promotions (qualifying credit promotions in MCOB).

The purpose of this chapter is to provide rules and guidance for a firm which wishes to communicate or approve a qualifying credit promotion. MCOB 3.5.2 G (Application: what? Exemptions) provides a guide to the topics covered in this chapter.

This chapter amplifies, for activities within its scope:

1. (a)

   Principle 6 (Customers' interests) which requires a firm to pay due regard to the interests of its customers and treat them fairly; and

2. (b)

   Principle 7 (Communications with clients) which requires a firm to pay due regard to the information needs of its clients, and communicate information to them in a way which is clear, fair and not misleading.