Professional & Financial Services UK-wide

Investment firm and trading venue rules

If you deal in investments as agent, hold client money or assets, or operate a trading venue, your rules sit on top of the duties every regulated firm shares: the dealing permission, best execution when executing client orders, the CASS client money and custody rules, the IFPR prudential regime with its remuneration code, and — for venues — MTF and OTF authorisation or recognised investment exchange status and transaction reporting.

Guide summary

Get the right FCA permission before you deal in investments for clients. Keep client money and assets separate from your own. Follow the IFPR rules on how much money your firm must hold. If you run a trading venue, get authorisation or recognition from the FCA.

  • Get Part 4A permission from the FCA to deal or arrange deals in investments
  • Hold client money in separate bank accounts and reconcile regularly
  • Keep accurate records of client assets and money at all times
  • Follow the IFPR prudential rules on own funds and liquidity
  • Apply the MIFIDPRU remuneration code for staff who take risks
  • Get FCA authorisation for a multilateral or organised trading facility
  • Get recognised investment exchange status to operate an exchange
  • Submit MiFIR transaction reports to the FCA for reportable instruments
  • Take all sufficient steps to get the best result for clients on orders
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This guide covers securities dealing and market infrastructure, on top of the shared duties in run a regulated financial services firm. Everything here applies UK-wide.

Dealing in investments as agent

Executing client orders in investments is a regulated activity needing its own permission, with the conduct-of-business rules that follow it.

Protect client money and assets

Holding client money or custody assets brings the CASS rules: segregation, reconciliation, records and the client money distribution regime.

Meet the IFPR prudential regime

FCA investment firms follow the Investment Firms Prudential Regime — own funds and liquidity requirements scaled to your activities, the internal capital adequacy and risk assessment process, and the MIFIDPRU remuneration code. (UK AIFMs and UCITS managers follow their own prudential and remuneration rules — see fund and asset management rules.)

Operate a trading venue lawfully

Running a multilateral or organised trading facility needs venue authorisation; operating as an exchange needs recognised investment exchange status. Dealers executing client orders owe best execution; venue operators and dealers alike carry transaction reporting obligations.

Next steps

Make sure the shared duties in run a regulated financial services firm are in place, then confirm everything with the financial intermediary compliance checklist.