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Status: You are viewing the version of the handbook as on 2009-03-31.

PRIN 3.4 General

Clients and the Principles

PRIN 3.4.1RRP

Although Principle 7 refers to clients, the only requirement of Principle 7 relating to eligible counterparties3 is that a firm must communicate information to eligible counterparties3 in a way that is not misleading.

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PRIN 3.4.2RRP

For the purposes of PRIN, a firm intending to carry on, or carrying on, activities that do not involve designated investment business, may treat a client as an eligible counterparty in accordance with PRIN 1 Annex 1 R.2

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PRIN 3.4.3GRP
1
  1. (1)

    COBS 3 (Client categorisation)2 applies to a firm intending to conduct, or conducting, designated investment business 2(other than giving basic advice)2 and ancillary activities relating to designated investment business. Any client categorisation2established in relation to such business will be applicable for the purposes of Principles 6, 7, 8 and 9.1

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  2. (2)

    The person to whom a firm gives basic advice2 will be a retail client3 for all purposes including the purposes of Principles 6, 7, 8 and 9.1

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Actions for damages

PRIN 3.4.4RRP

A contravention of the rules in PRIN does not give rise to a right of action by a private person under section 150 of the Act (and each of those rules is specified under section 150(2) of the Act as a provision giving rise to no such right of action).

Reference to "regulators" in Principle 11

PRIN 3.4.5RRP

Where Principle 11 refers to regulators, this means, in addition to the FSA, other regulators with recognised jurisdiction in relation to regulated activities, whether in the United Kingdom or abroad.