Related provisions for COBS 18.1.3
41 - 60 of 118 items.
(1) Prior to the conclusion of any initial life policy and, if necessary, on amendment or renewal, a firm must provide a client with at least the following information:(a) its name and address;(b) the fact that it is registered on the Financial Services Register and its Firm Reference Number3 (or, if it is not on the Financial Services Register, the register in which it has been included and the means for verifying that it has been registered);3(c) whether it has a direct or indirect
When a firm informs a client that it gives advice on the basis of a fair analysis of the market, it must give that advice on the basis of an analysis of a sufficiently large number of life policies available on the market to enable the firm to make a recommendation, in accordance with professional criteria, regarding which life policy would be adequate to meet the client's needs. [Note: article 12(2) of the Insurance Mediation Directive]
(1) Prior to the conclusion of any specific life policy, a firm must at least specify, in particular on the basis of the information provided by the client, the demands and needs of that client. Those demands and needs must be modulated according to the complexity of the relevant policy.(2) This rule does not apply when a firm makes a personal recommendation in relation to a life policy. [Note: article 12(3) of the Insurance Mediation Directive]
All information to be provided to a client in accordance with the rules in this chapter must be communicated:(1) in a durable medium available and accessible to the client;(2) in a clear and accurate manner, comprehensible to the client; and(3) in an official language of the State of the commitment or in any other language agreed by the parties. [Note: article 13(1) of the Insurance Mediation Directive]
In the case of telephone selling, the prior information given to a client must be in accordance with the distance marketing disclosure rules (COBS 5.1). Moreover, information must be provided to the client in accordance with the means of communication to clients rule (COBS 7.2.6 R) immediately after the conclusion of the life policy. [Note: article 13(3) of the Insurance Mediation Directive]
The information referred to in the means of communication to clients rule (COBS 7.2.6 R) may be provided orally where the client requests it, or where immediate cover is necessary. In those cases, the information must be provided to the client in accordance with that rule immediately after the conclusion of the life policy. [Note: article 13(2) of the Insurance Mediation Directive]
(1) 3A firm must not communicate or approve an invitation or inducement to participate in, acquire, or underwrite a non-mainstream pooled investment where that invitation or inducement is addressed to or disseminated in such a way that it is likely to be received by a retail client. (2) The restriction in (1) is subject to COBS 4.12.4 R and does not apply to units in unregulated collective investment schemes, which are subject to a statutory restriction on promotion in section
(1) 3The restriction in COBS 4.12.3 R does not apply if the promotion falls within an exemption in the table in (5) below. (2) A firm may communicate an invitation or inducement to participate in an unregulated collective investment scheme without breaching the restriction on promotion in section 238 of the Act if the promotion falls within an exemption in the table in (5) below.(3) Where the middle column in the table in (5) refers to promotion to a category of person, this means
(1) 3Where a firm communicates any promotion of a non-mainstream pooled investment in the context of advice, it should have regard to and comply with its obligations under COBS 9. Firms should also be mindful of the appropriateness requirements in COBS 10 which apply to a wide range of non-advised services.(2) (a) A firm which wishes to rely on exemptions 2 (certified high net worth investors), 9 (self-certified sophisticated investors) or 12 (non-recognised UCITS), as provided
3A certified high net worth investor is an individual who has signed, within the period of twelve months ending with the day on which the communication is made, a statement in the following terms:“HIGH NET WORTH INVESTOR STATEMENTI make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as
A certified sophisticated investor is an individual:(1) who has a written certificate signed within the last 36 months by a firm confirming he has been assessed by that firm as sufficiently knowledgeable to understand the risks associated with engaging in investment activity in non-mainstream pooled investments; and(2) who has signed, within the period of twelve months ending with the day on which the communication is made, a statement in the following terms:“SOPHISTICATED INVESTOR
3A self-certified sophisticated investor is an individual who has signed, within the period of twelve months ending with the day on which the communication is made, a statement in the following terms:“SELF-CERTIFIED SOPHISTICATED INVESTOR STATEMENTI declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:(i) I can receive promotional communications made by a person
(1) 3A firm which wishes to rely on any of the certified high net worth investor exemptions (see Part I of the Schedule to the Promotion of Collective Investment Schemes Order, Part I of Schedule 5 to the Financial Promotions Order and COBS 4.12.6 R) should have regard to its duties under the Principles and the client's best interests rule. In particular, the firm should take reasonable steps to ascertain that the retail client does, in fact, meet the income and net assets criteria
(1) 3A firm which is asked to or proposes to assess and certify a retail client as a certified sophisticated investor (see article 23 of the Promotion of Collective Investment Schemes Order, article 50 of the Financial Promotions Order and COBS 4.12.7 R) should have regard to its duties under the Principles and the client's best interests rule. In particular, the firm should carry out that assessment with due skill, care and diligence, having regard to the generally complex nature
(1) 3A firm which wishes to rely on any of the self-certified sophisticated investor exemptions (see Part II of the Schedule to the Promotion of Collective Investment Schemes Order, Part II of Schedule 5 to the Financial Promotions Order and COBS 4.12.8 R) should have regard to its duties under the Principles and the client's best interests rule. In particular, the firm should consider whether the promotion of the non-mainstream pooled investment is in the interests of the client
(1) 3A firm which wishes to rely on one of the one-off promotion exemptions provided by the Promotion of Collective Investment Schemes or the Financial Promotion Order to promote a non-mainstream pooled investment to a retail client should have regard to its duties under the Principles and the client's best interests rule. In particular, the firm should consider whether the promotion of the non-mainstream pooled investment is in the interests of the client and whether it is fair
(1) 3A firm which wishes to rely on the excluded communications exemption in COBS 4.12.4R (5) to promote units in a qualified investor scheme to a retail client should have regard to its duties under the Principles and the client's best interests rule. (2) As explained in COLL 8.1, qualified investor schemes are intended only for professional clients and retail clients who are sophisticated investors. Firms should note that, in the FCA's view, promotion of units in a qualified
(1) Subject to (2) and (3), this section applies to a firm in relation to:(a) the provision of information in relation to its designated investment business; and(b) the communication or approval of a financial promotion;where such information or financial promotion is addressed to, or disseminated in such a way that it is likely to be received by, a retail client.(2) If3 a communication relates to a firm's3MiFID or equivalent third country business, this section does not apply:3(a)
A firm must ensure that information:(1) includes the name of the firm;(2) is accurate and in particular does not emphasise any potential benefits of relevant business or a relevant investment without also giving a fair and prominent indication of any relevant risks;(3) is sufficient for, and presented in a way that is likely to be understood by, the average member of the group to whom it is directed, or by whom it is likely to be received; and(4) does not disguise, diminish or
In deciding whether, and how, to communicate information to a particular target audience, a firm should take into account the nature of the product or business, the risks involved, the client's commitment, the likely information needs of the average recipient, and the role of the information in the sales process.
(1) If information compares relevant business, relevant investments, or persons who carry on relevant business, a firm must ensure that:(a) the comparison is meaningful and presented in a fair and balanced way; and(b) in relation to MiFID or equivalent third country business;(i) the sources of the information used for the comparison are specified; and(ii) the key facts and assumptions used to make the comparison are included.(2) In this rule, in relation to MiFID or equivalent
(1) If any information refers to a particular tax treatment, a firm must ensure that it prominently states that the tax treatment depends on the individual circumstances of each client and may be subject to change in future.[Note: article 27(7) of the MiFID implementing Directive](2) This rule applies in relation to MiFID or equivalent third country business or, otherwise, to a financial promotionfinancial promotion. However, it does not apply to a financial promotion to the extent
(1) A firm must ensure that information contained in a financial promotion is consistent with any information the firm provides to a retail client in the course of carrying on designated investment business or, in the case of MiFID or equivalent third country business, ancillary services.[Note: article 29(7) of the MiFID implementing Directive](2) This rule does not apply to a financial promotion to the extent that it relates to:(a) [deleted]22(b) a pure protection contract that
(1) If a firm (F) is aware that a person (C1) with or for whom it is providing services is acting as agent for another person (C2) in relation to those services, C1, and not C2, is the client of F in respect of that business.(2) Paragraph (1) does not apply if:(a) F has agreed with C1 in writing to treat C2 as its client; or(b) C1 is neither a firm nor an overseas financial services institution1 and the main purpose of the arrangements between the parties is the avoidance of duties
(1) This rule applies if a firm (F1), in the course of performing MiFID or equivalent third country business, receives an instruction to perform an investment or ancillary service on behalf of a client (C) through another firm (F2), if F2 is:(a) a MiFID investment firm or a third country investment firm; or(b) an investment firm that is:(i) a firm or authorised in another EEA State; and(ii) subject to equivalent relevant requirements.(2) F1 may rely upon:(a) any information about
(1) If F1 is required to perform a suitability assessment or an appropriateness assessment under COBS 9 or COBS 10, it may rely upon a suitability assessment performed by F2, if F2 was subject to the requirements for assessing suitability in COBS 9 (excluding the basic advicerules) or equivalent requirements in another EEA State in performing that assessment.(2) If F1 is required to perform an appropriateness assessment under COBS 10, it may rely upon an appropriateness assessment
(1) This rule applies if the rule on reliance on other investment firms (COBS 2.4.4 R) does not apply.(2) A firm will be taken to be in compliance with any rule in this sourcebook that requires it to obtain information to the extent it can show it was reasonable for it to rely on information provided to it in writing by another person.
(1) In relying on COBS 2.4.6 R, a firm should take reasonable steps to establish that the other person providing written information is not connected with the firm and is competent to provide the information.(2) Compliance with (1) may be relied upon as tending to establish compliance with COBS 2.4.6 R.(3) Contravention of (1) may be relied upon as tending to establish contravention of COBS 2.4.6 R.
It will generally be reasonable (in accordance with COBS 2.4.6R (2)) for a firm to rely on information provided to it in writing by an unconnected authorised person or a professional firm, unless it is aware or ought reasonably to be aware of any fact that would give reasonable grounds to question the accuracy of that information.
In the case of business that is not MiFID or equivalent third country business, if a rule in COBS or CASS requires information to be sent to a client, a firm need not send that information so long as it takes reasonable steps to establish that it has been or will be supplied by another person.
1An insurer must not contract to provide benefits under linked long-term contracts of insurance that are determined wholly or partly, directly or indirectly, by reference to fluctuations in any index or wholly or partly by reference to the value of, or the income from, or fluctuations in the value of, property other than in accordance with the rules in this section.
To comply with the requirements of COBS 21.2.4A R, a firm should:(1) disclose to policyholders the implications of any credit-risk exposure they may face in relation to the solvency of the reinsurer; and(2) suitably monitor the way the reinsurer manages the business in order to discharge its continuing responsibilities to policyholders.
In considering what action to take in response to written notification of a failure to meet the requirements of this section, the appropriate regulator will have regard to the extent to which the relevant circumstances are exceptional and temporary and to any other reasons for the failure.
(1) When providing a service to which this chapter applies, a firm must ask the client to provide information regarding his knowledge and experience in the investment field relevant to the specific type of product or service offered or demanded so as to enable the firm to assess whether the service or product envisaged is appropriate for the client.(2) When assessing appropriateness, a firm:(a) must determine whether the client has the necessary experience and knowledge in order
The information regarding a client's knowledge and experience in the investment field includes, to the extent appropriate to the nature of the client, the nature and extent of the service to be provided and the type of product or transaction envisaged, including their complexity and the risks involved, information on:(1) the types of service, transaction and designated investment with which the client is familiar;(2) the nature, volume, frequency of the client's transactions in
If, before assessing appropriateness, a firm seeks to increase the client's level of understanding of a service or product by providing information to him, relevant considerations are likely to include the nature and complexity of the information and the client's existing level of understanding.
If a firm is satisfied that the client has the necessary experience and knowledge in order to understand the risks involved in relation to the product or service, there is no duty to communicate this to the client. If the firm does so, it must not do so in a way that amounts to making a personal recommendation unless it complies with the rules in COBS 9 on suitability.
A firm must:(1) on request, provide its PPFM, or the PPFM applicable to specified with-profits funds:(a) free of charge to its with-profits policyholders; or(b) for a reasonable charge to any person who is not its with-profits policyholder; and(2) if the firm publishes its PPFM on its website, prominently signpost its location there.
A firm must send its with-profits policyholders who are affected by any change in its PPFM, written notice, setting out any:(1) proposed changes to the with-profits principles, three months in advance of the effective date; and(2) changes to the with-profits practices, within a reasonable time.
In relation to any with-profits policyholder where the state of the commitment is2 the United Kingdom, an EEA insurer must:2(1) provide the information necessary to enable that policyholder properly to understand the insurer's commitment under the policy;2(2) ensure that the information provided is not narrower in scope or less detailed in content than the information required to be provided in the PPFM produced by a firm subject to COBS 20.3;2 and2(3) send the policyholder who
A firm must produce an annual report to its with-profits policyholders, which must:(1) state whether, throughout the financial year to which the report relates, the firm believes it has complied with its obligations relating to its PPFM and setting out its reasons for that belief;(2) address all significant relevant issues, including the way in which the firm has:(a) exercised, or failed to exercise, any discretion that it has in the conduct of its with-profits business; and(b)
The following documents should be annexed to the annual report in this section:(1) the report to with-profits policyholders made by a with-profits actuary in respect of each financial year (see SUP 4.3.16AR(4)); and(2) any statement or report provided by the person or committee who provides the independent judgement under the firm's governance arrangements for its with-profits business.
(1) An eligible counterparty is a client that is either a per se eligible counterparty or an elective eligible counterparty.(2) A1client can only be an eligible counterparty in relation to eligible counterparty business (PRIN 1 Annex 1 R is an exception to this).1 [Note: article 24(1) of MiFID]
Each of the following is a per se eligible counterparty (including an entity that is not from an EEA state that is equivalent to any of the following) unless and to the extent it is given a different categorisation under this chapter:(1) an investment firm;(2) a credit institution;(3) an insurance company;(4) a collective investment scheme authorised under the UCITS Directive or its management company;(5) a pension fund or its management company;(6) another financial institution
A firm may treat a client as an elective eligible counterparty if:(1) the client is an undertaking and:(a) is a per se professional client (except for a client that is only a per se professional client because it is an institutional investor under COBS 3.5.2 R (5)) and, in relation to business other than MiFID or equivalent third country business:1(i) is a body corporate (including a limited liability partnership) which has (or any of whose holding companies or subsidiaries has)
In the case of MiFID or equivalent third country business, in the event of a transaction where the prospective counterparties are located in different EEA States, the firm shall defer to the status of the other undertaking as determined by the law or measures of the EEA State in which that undertaking is established. [Note: first paragraph of article 24(3) of MiFID]
(1) A firm must take reasonable steps to ensure that a personal recommendation, or a decision to trade, is suitable for its client.(2) When making the personal recommendation or managing his investments, the firm must obtain the necessary information regarding the client's:(a) knowledge and experience in the investment field relevant to the specific type of designated investment or service;(b) financial situation; and(c) investment objectives;so as to enable the firm to make the
(1) A firm must obtain from the client such information as is necessary for the firm to understand the essential facts about him and have a reasonable basis for believing, giving due consideration to the nature and extent of the service provided, that the specific transaction to be recommended, or entered into in the course of managing:(a) meets his investment objectives;(b) is such that he is able financially to bear any related investment risks consistent with his investment
The information regarding a client’s knowledge and experience in the investment field includes, to the extent appropriate to the nature of the client, the nature and extent of the service to be provided and the type of product or transaction envisaged, including their complexity and the risks involved, information on:(1) the types of service, transaction and designated investment with which the client is familiar;(2) the nature, volume, frequency of the client’s transactions in
Although a firm may not be permitted to make a personal recommendation or take a decision to trade because it does not have the necessary information, its client may still ask the firm to provide another service such as, for example, to arrange a deal or to deal as agent for the client. If this happens, the firm should ensure that it receives written confirmation of the instructions. The firm should also bear in mind the client's best interests rule and any obligation it may have
(1) If a firm makes a personal recommendation or manages investments for a professional client in the course of MiFID or equivalent third country business, it is entitled to assume that, in relation to the products, transactions and services for which the professional client is so classified, the client has the necessary level of experience and knowledge for the purposes of COBS 9.2.2R (1)(c).(2) If the service consists of making a personal recommendation to a per se professional
(1) When recommending a small friendly societylife policy, a firm, for the purpose of assessing suitability, need only obtain details of the net income and expenditure of the client and his dependants.(2) A friendly societylife policy is small if the premium:(a) does not exceed £50 a year; or(b) if payable weekly, £1 a week.(3) The firm must keep for five years a record of the reasons why the recommendation is considered suitable.
Under the territorial application rules in COBS 1, the rules in this section apply to:(1) a UK firm's business carried on from an establishment in an EEA State other than the United Kingdom for a retail client in the United Kingdom unless, if the office from which the activity is carried on were a separate person, the activity:(a) would fall within the overseas persons exclusion in article 72 of the Regulated Activities Order; or(b) would not be regarded as carried on in the United
(1) If a firm sells or arranges the sale of a packaged product to a retail client, and subsequently if the retail client requests it, the firm must disclose to the client in cash terms:2(a) any commission receivable by it or any of its associates in connection with the transaction; (b) if the firm is also the product provider, any commission or commission equivalent payable in connection with the transaction; and (c) if the firm or any of its associates is in the same immediate
3An indicative adviser charge is likely to be reasonably representative of the services associated with making the personal recommendation if:(1) the expected long term costs associated with making a personal recommendation and distributing the pure protection contract do not include the costs associated with manufacturing and administering the pure protection contract;(2) the allocation of costs and profit to the indicative adviser charge and product charges is such that any
(1) A firm must make the disclosure required by the rule on disclosure of commission or equivalent (COBS 6.4.3 R) as close as practicable to the time that it sells or arranges the sale of a packaged product.2(2) The firm must make the disclosure:(a) in a durable medium; or(b) when a retail client does not make a written application to enter into a transaction, orally. In these circumstances, the firm must give written confirmation as soon as possible after the date of the transaction,
(1) When determining the value of cash payments, benefits and services under the rule on disclosure of commission equivalent (COBS 6.4.3 R), a firm should follow the provisions of COBS 6 Annex 6.(2) Compliance with this evidential provision may be relied on as tending to establish compliance with COBS 6.4.3 R; and(3) Contravention of this evidential provision may be relied on as tending to establish contravention of COBS 6.4.3 R.
1This sourcebook applies to a firm with respect to the following activities carried on from an establishment maintained by it, or its appointed representative, in the United Kingdom:(1) [deleted]33(2) designated investment business;(3) long-term insurance business in relation to life policies;and activities connected with them.
3This sourcebook does not apply to a firm with respect to the activity of accepting deposits carried on from an establishment maintained by it, or its appointed representative, in the United Kingdom, except for COBS 4.6 (Past, simulated past and future performance), COBS 4.7.1 R (Direct offer financial promotions), COBS 4.10 (Systems and controls and approving and communicating financial promotions), COBS 13 (Preparing product information) and COBS 14 (Providing product information
4COBS 4.4.3 R, COBS 5 (Distance communications), COBS 15.2 (The right to cancel), COBS 15.3 (Exercising a right to cancel), COBS 15.4 (Effects of cancellation) and COBS 15 Annex 1 (Exemptions from the right to cancel) apply to a firm with respect to the activity of issuing electronic money as set out in those provisions.
5The following rules in COBS apply to a firm in relation to its carrying on of auction regulation bidding:(1) COBS 5 (Distance communications);(2) (for a firm that has exercised an opt-in to CASS in accordance with CASS 1.4.9 R in relation only to those clients for which it holds client money or safe custody assets in accordance with CASS) COBS 3 (Client categorisation), COBS 6.1.7 R (Information concerning safeguarding of designated investments belonging to clients and client
When a firm is carrying on Lloyd's market activities, any reference in COBS to the term:(1) designated investment is to be taken to include the following specified investments:(a) the underwriting capacity of a Lloyd's syndicate;(b) membership of a Lloyd's syndicate; and (c) rights to or interests in the specified investments in (a) or (b);(2) designated investment business is to be taken to include the following regulated activities:(a) advising on syndicate participation at
When a firm prepares a suitability report it must:(1) (in the case of a personal pension scheme), explain why it considers the personal pension scheme to be at least as suitable as a stakeholder pension scheme; and(2) (in the case of a personal pension scheme, stakeholder pension scheme or2FSAVC) explain why it considers the personal pension scheme, stakeholder pension scheme or2FSAVC to be at least as suitable as any facility to make additional contributions to an occupational
When a firm promotes a personal pension scheme, including a group personal pension scheme, to a group of employees it must:(1) be satisfied on reasonable grounds that the scheme is likely to be at least as suitable for the majority of the employees as a stakeholder pension scheme; and(2) record why it thinks the promotion is justified.
1A firm that communicates a projection for an in-force packaged product which is not a financial instrument:(1) must include a standardised deterministic projection; (2) may also include a stochastic projection2 except that the most prominent projection must be a standardised deterministic projection; and2must follow the projectionrules in COBS 13 Annex 2.
A firm that communicates a projection for a packaged product which is not a financial instrument:2(1) for which a key features illustration2 is not required to be provided; and 2(2) which is not an in-force packaged product;must ensure that such a projection is either a standardised deterministic projection or a stochastic projection2 in accordance with COBS 13 Annex 2. 2
A firm that communicates a projection of benefits for a packaged product which is not a financial instrument, as part of a combined projection where other benefits being projected include those for a financial instrument or structured deposit, is not required to comply with the projection rules in COBS 13.4, COBS 13.5 and COBS 13 Annex 2 to the extent that it complies with the future performance rule (COBS 4.6.7 R).
The general requirement that communications be fair, clear and not misleading will nevertheless mean that a firm that elects to comply with the future performance rule in COBS 4.6.7 R will need to explain how the combined projection differs from other information that has been or could be provided to the client, including a projection provided under the projectionrules in COBS 13.4, COBS 13.5 and COBS 13 Annex 2, and in particular, the firm should identify where a projection in
The provisions of COBS in the table do not apply in relation to any energy market activity or oil market activity carried on by a firm which is MiFID or equivalent third country business: COBSDescription36.1AAdviser charging and remuneration36.1BRetail investment product provider requirements relating to adviser charging and remuneration36.2ADescribing advice services6.3Disclosing information about services, fees and commission - packaged products6.4Disclosure of charges, remuneration
The provisions of COBS in the table are unlikely to be relevant to any energy market activity or oil market activity carried on by a firm which is MiFID or equivalent third country business:COBSDescription5Distance communications7Insurance mediation13Preparing product information14.2Providing product information to clients15Cancellation17Claims handling for long-term care insurance18.1Trustee firms' regime18.3Corporate finance business18.4Stock lending activity19Pensions - supplementary
1The duty to provide best execution does not apply where:(1) the firm has agreed with a professional client that it does not owe a duty of best execution to him; or(2) the firm relies on another person to whom it passes a customer order for execution to provide best execution, but only if it has taken reasonable care to ensure that he will do so.
1To provide best execution, a firm must:(1) take reasonable care to ascertain the price which is the best available for the customer order in the relevant market at the time for transactions of the kind and size concerned; and (2) execute the customer order at a price which is no less advantageous to the customer, unless the firm has taken reasonable steps to ensure that it would be in the customer's best interests not to do so.
(1) 1In order to take reasonable care to ascertain the price which is the best available, a firm:(a) should disregard any charges and commission made by it or its agents that are disclosed to the customer under COBS 6.1.9 R (Information about costs and associated charges);(b) need not have access to competing exchanges, or to all, or a minimum number of, available price sources; but if a firm can access prices displayed by different exchanges and trading platforms and make a direct
Unless a client expressly instructs otherwise, a firm must, in the case of a clientlimit order in respect of shares admitted to trading on a regulated market which is not immediately executed under prevailing market conditions, take measures to facilitate the earliest possible execution of that order by making public immediately that clientlimit order in a manner which is easily accessible to other market participants. [Note: article 22(2) of MiFID]
An investment firm shall be considered to disclose clientlimit orders that are not immediately executable if it transmits the order to a regulated market or MTF that operates an order book trading system, or ensures that the order is made public and can be easily executed as soon as market conditions allow. [Note: article 31 of MiFID Regulation]
A key features document must:(1) include enough information about the nature and complexity of the product, how it works, any limitations or minimum standards that apply and the material benefits and risks of buying or investing for a retail client to be able to make an informed decision about whether to proceed; and(2) explain:(a) the arrangements for handling complaints about the product;(b) that compensation might be available from the FSCS if the firm cannot meet its liabilities
TableA key features document for a packaged product must:(1)Include the title: ‘key features of the [name of product]’;(2)describe the product in the order of the following headings, and by giving the following information under those headings:HeadingInformation to be given‘Its aims’A brief description of the product’s aims‘Your commitment’ or ‘Your investment’What a retail client is committing to or investing in and any consequences of failing to maintain the commitment or investment‘Risks’The
3A key features document for a short-term money market fund, a money market fund or a qualifying money market fund must include a statement identifying it as such a fund and a statement that the authorised fund's investment objectives and policies will meet the conditions of the definition of short-term money market fund, money market fund or qualifying money market fund, as appropriate.
4A key features document for a feeder NURS must include:(1) a statement identifying it as such a scheme;(2) information specific to the feeder NURS and its qualifying master scheme which enables investors to understand the qualifying master scheme's key particulars; and(3) a description and explanation of any material differences between the risk profile of the feeder NURS and that of the qualifying master scheme.
4When producing the key features document, the authorised fund manager of the feeder NURS should have due regard to the provisions in COLL 4.6.8 R (Contents of the simplified prospectus) in terms of additional information appropriate to a feeder NURS and its qualifying master scheme. In particular, the appropriate charges information required by COBS 13.4.1 R and COBS 13 Annex 3 (Charges) should represent the aggregate of the charges of the feeder NURS and its qualifying master
(1) This rule applies in relation to a distance contract that is not a life policy, personal pension scheme, cash deposit ISA or CTF.(2) When the consumer exercises his right to cancel he may be required to pay, without any undue delay, for the service actually provided by the firm in accordance with the contract. The performance of the contract may only begin after the consumer has given his approval. The amount payable must not:(a) exceed an amount which is in proportion to
(1) The firm may require the consumer to pay for any loss under a contract caused by market movements that the firm would reasonably incur in cancelling it. The period for calculating the loss shall end on the day on which the firm receives the notification of cancellation.(2) This rule:(a) does not apply for a distance contract or for a contract established on a regular or recurring premium or payment basis; and(b) only applies if the firm has complied with its obligations to
The firm must, without any undue delay and no later than within 30 calendar days, return to the consumer any sums it has received from him in accordance with the contract2, except for any amount that the consumer may be required to pay under this section. This period shall begin from the day on which the firm receives the notification of cancellation.2 [Note: article 7(4) of the Distance Marketing Directive]
The firm is entitled to receive from the consumer any sums and/or property he has received from the firm without any undue delay and no later than within 30 calendar days. This period shall begin from the day on which the consumer dispatches the notification of cancellation. [Note: article 7(5) of the Distance Marketing Directive]
(1) 1This chapter applies to a firm in relation to designated investment business carried on for:(a) a retail client; and(b) in relation to MiFID or equivalent third country business, a professional client.(2) If expressly provided, this chapter also applies to a firm in relation to other ancillary services carried on for a client, but only in relation to its MiFID or equivalent third country business.(3) But this chapter does not apply to a firm to the extent that it is effecting
If a firm carries on designated investment business, other than advising on investments or advising on conversion or transfer of pension benefits, 2with or for a new retail client, the firm must enter into a written basic agreement, on paper or other durable medium, with the client setting out the essential rights and obligations of the firm and the client.[Note: article 39 of the MiFID implementing Directive]
(1) A firm must, in good time before a retail client is bound by any agreement relating to designated investment business or ancillary services or before the provision of those services, whichever is the earlier, provide that client with:(a) the terms of any such agreement; and(b) the information about the firm and its services relating to that agreement or to those services required by COBS 6.1.4 R, including information on communications, conflicts of interest and authorised
(1) A firm must establish a record that includes the document or documents agreed between it and a client which set out the rights and obligations of the parties, and the other terms on which it will provide services to the client.(2) The record must be maintained for at least whichever is the longer of:(a) 5 years; or(b) the duration of the relationship with the client; or(c) in the case of a record relating to a pension transfer, pension conversion, 2pension opt-out or FSAVC, indefinitely.
When considering its approach to client agreements, a firm should be aware of other obligations in the Handbook which may be relevant. These include the fair, clear and not misleading rule and the rules on disclosure of information to a client before providing services and the rules on distance communications (principally in COBS 2.2, 5, 6 and 13).
(1) A firm must ensure that a communication or a financial promotion is fair, clear and not misleading.(2) This rule applies in relation to:(a) a communication by the firm to a client in relation to designated investment business other than a third party prospectus;(b) a financial promotioncommunicated by the firm that is not:(i) an excluded communication;(ii) a non-retail communication;(iii) a third party prospectus; and(c) a financial promotion approved by the firm.[Note: article
(1) 1The fair, clear and not misleading rule applies in a way that is appropriate and proportionate taking into account the means of communication and the information the communication is intended to convey. So a communication addressed to a professional client may not need to include the same information, or be presented in the same way, as a communication addressed to a retail client.(2) COBS 4.2.1R(2)(b)1 does not limit the application of the fair, clear and not misleading
A firm should ensure that a financial promotion:(1) for a product or service that places a client's capital at risk makes this clear;(2) that quotes a yield figure gives a balanced impression of both the short and long term prospects for the investment;(3) that promotes an investment or service whose charging structure is complex, or in relation to which the firm will receive more than one element of remuneration, includes the information necessary to ensure that it is fair, clear
2A communication or a financial promotion should not describe a feature of a product or service as “guaranteed”, “protected” or “secure”, or use a similar term unless:24(1) that term is capable of being a fair, clear and not misleading description of it; and(2) the firm communicates all of the information necessary, and presents that information with sufficient clarity and prominence, to make the use of that term fair, clear and not misleading.45