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In an effort to ease the regulatory burden on financial firms, the U.K.’s Financial Conduct Authority (FCA) is launching a review of its rules and guidance, following the introduction of its consumer duty. The review set new conduct standards for firms dealing with retail clients.

In a consultation paper published Tuesday, the FCA detailed its plans for slimming down regulation and easing the industry’s compliance burden, citing the introduction of new conduct rules. It also examined its expanded mandate to foster growth and the financial industry’s global competitiveness that were both adopted in mid-2023. 

“The proposals are part of our work to streamline our rules, reduce burdens on businesses, and improve outcomes for consumers following the introduction of the consumer duty,” the paper said.

The FCA said that new duty, which sets a high standard of care for retail clients, presents an opportunity to curb prescriptive requirements that may be duplicative or redundant. It also allows it to facilitate competition and innovation. 

Among other things, the plans outlined in the paper include scrapping outdated (pre-2022) guidance and supervisory publications that apply to investment, consumer finance and mortgage firms. 

It’s also seeking to reform disclosure rules to provide firms with more flexibility to tailor their communications in certain circumstances, such as online and digital transactions. Furthermore, it’s considering tailored compliance guidance for small firms. 

The FCA plans to review the cross-border application of its rules and whether transactions with foreign clients should have to comply with the U.K.’s rules.

“Given the global and interconnected nature of the U.K. market, we intend to seek further views on whether to make changes to this approach — starting with a review within the insurance sector,” the paper said. “This will examine whether conduct rules… should apply to firms serving customers outside the U.K. while adhering to international obligations.”

The effort to slim its rulebook follows a consultation that the FCA undertook in July of last year to consider ways to simplify its requirements since it adopted a new consumer duty. 

That review revealed that, while there’s little appetite for a sweeping overhaul of its rules, there is demand for targeted changes that aim to address longstanding industry concerns about the “length and complexity” of the FCA’s rules.

“We will use an accelerated consultation process to act immediately on the measures in this paper where there is a clear case for change and where there is stakeholder appetite to go quickly,” it said. 

For more contentious areas, the FCA will seek more feedback, it said. It also plans to hold a summit in the summer with industry firms, trade groups and consumer/investor advocates to identify areas where compliance can be made simpler and easier.

“Now the consumer duty is in full force, we’re making changes quickly where stakeholders want us to, to cut unnecessary costs, support growth, and ultimately help consumers get better outcomes,” said Sarah Pritchard, executive director of supervision, policy, competition and international at the FCA, in a release.

“These proposals are part of our long-term efforts to future-proof our rules, reduce burdens for financial firms and will help the ambitious government targets to cut the cost of regulation,” she added.

The regulator said that it will publish a progress report on these efforts and its updated plans for further work, in September.